Document:

ex10_58fourthamendcredit

Exhibit 10.58

[Execution]
FOURTH AMENDMENT TO CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of July 1, 2013, is entered into by and among THE DIXIE GROUP, INC., a Tennessee corporation (“Dixie”), CANDLEWICK YARNS, LLC, an Alabama limited liability company (“Candlewick”), FABRICA INTERNATIONAL, INC., a California corporation (“Fabrica”), MASLAND CARPETS, LLC, a Georgia limited liability company (“Masland”; together with Dixie, Candlewick and Fabrica, are referred to hereinafter each individually as a “Borrower”, and individually and collectively, jointly and severally, as the “Borrowers”), THE PERSONS IDENTIFIED AS THE LENDERS ON THE SIGNATURE PAGES HERETO (the “Lenders”), and WELLS FARGO CAPITAL FINANCE, LLC, a Delaware limited liability company, as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, “Agent”).
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, dated as of September 13, 2011, as amended by the First Amendment to Credit Agreement, dated as of November 2, 2012, the Second Amendment to Credit Agreement, dated as of April 1, 2013, and the Third Amendment to Credit Agreement, dated as of May 22, 2013 (as amended hereby and as the same may be further amended, modified, supplemented, renewed, restated or replaced, the “Credit Agreement”), among Agent, the Lenders and the Borrowers, the Lenders have made loans and advances and provided other financial accommodations to the Borrowers; and
WHEREAS, the Borrowers have requested that Agent and Lenders enter into this Amendment to make certain changes to the Credit Agreement effective on (and subject to the occurrence of) the Fourth Amendment Effective Date; and
WHEREAS, Agent and the Lenders are willing to amend the Credit Agreement as set forth herein.
NOW, THEREFORE, in consideration of the agreements herein contained and other good and valuable consideration, the parties hereby agree as follows:
		
	I.
	  DEFINITIONS

1.1    Additional Definitions.  As used herein, the following terms shall have the meanings given to them below, and the Credit Agreement is hereby amended to include, in addition and not in limitation, the following:

“Fourth Amendment” means the Fourth Amendment to Credit Agreement, dated as of July 1, 2013, by and among Borrowers, Lenders and Agent, as acknowledged and agreed to by the Guarantors.
“Fourth Amendment Effective Date” means the date on which the conditions precedent to the effectiveness of the Fourth Amendment shall have been satisfied or waived by Agent.
“RFP” means Rothman Family Partnership, LLC, a Georgia limited liability company, and its successors and assigns.
“Robertex” means Robertex Associates, Inc., a Georgia corporation.

“Robertex Acquisition” means: (a) the acquisition by Masland of all of the Stock of Robertex on the Fourth Amendment Effective Date in accordance with the Robertex Acquisition Documents in consideration for cash in the amount of approximately $2,262,150 and the issuance of the Rothman Note, (b) the merger of Robertex with and into Masland (with Masland as the surviving limited liability company) on the Fourth Amendment Effective Date, (c) the lease by Masland from Rothman and RFP of the real property located at 207 Boling Industrial Boulevard, Calhoun, Georgia pursuant to the Rothman Lease, and (d) all of the other transactions contemplated by the Robertex Acquisition Documents or related thereto.
“Robertex Acquisition Documents” means, collectively, the following (as the same may be amended, modified, supplemented, renewed, restated or replaced): (a) the Securities Purchase Agreement, dated as of June 30, 2013, between Masland, as buyer, and Rothman, as seller, (b) the Plan of Merger, dated as of the Fourth Amendment Effective Date, between Robertex and Masland, (c) the Articles of Merger of Robertex Associates, Inc. with and into Masland Carpets, LLC (the “Robertex Articles of Merger”) to be filed with the Secretary of State of the State of Georgia on or promptly following the Fourth Amendment Effective Date, (d) the Commercial Lease/Purchase Agreement, dated as of the Fourth Amendment Effective Date, between Masland, as tenant, and Rothman and RFP, as owner (the “Rothman Lease”), and (e) all of the other agreements, documents and instruments executed and delivered in connection with the foregoing or related thereto.
“Robertex Assets” means all of the assets of Robertex which were acquired by Masland in connection with the Robertex Acquisition.
“Rothman” means Robert P. Rothman, an individual residing in the State of Georgia, and his successors and assigns.
“Rothman Indebtedness” means the Indebtedness incurred by Masland to Rothman in connection with the Robertex Acquisition evidenced by the Rothman Note and secured by the Specified Robertex Assets; provided, that, the aggregate principal amount of such Indebtedness shall not exceed $4,000,000 at any time.
“Rothman Intercreditor Agreement” means the Intercreditor Agreement, dated as of the Fourth Amendment Effective Date, by and among Agent, Rothman and RFP, as acknowledged and agreed to by the Loan Parties, as the same may be amended, modified, supplemented, renewed, restated or replaced.
“Rothman Loan Documents” means, collectively, the following (as the same may be amended, modified, supplemented, renewed, restated or replaced): (a) the Purchase Money Promissory Note, dated as of June 30, 2013, by Masland in favor of Rothman in the original principal amount of $4,000,000 (the “Rothman Note”), (b) the Security Agreement, dated as of June 30, 2013, between Masland, as debtor, and Rothman, as secured party (the “Rothman Security Agreement”), (c) the Guaranty Agreement, dated as of June 30, 2013, by Dixie in favor of Rothman (the “Rothman Guaranty”), (d) the UCC financing statement naming Rothman, as secured party, and Masland, as debtor, to be filed with the Clerk of the Superior Court of Gordon County, Georgia with respect to the Specified Robertex Assets, and (e) all of the other agreements, documents and instruments executed and delivered in connection with the foregoing or related thereto.

“Specified Robertex Assets” means the Robertex Assets described on Schedule A to the Fourth Amendment and the products and proceeds thereof.
1.2    Amendments to Definitions.

(a)Eligible M&E.  Schedule 1.1 of the Credit Agreement is hereby amended by deleting clause (c) of the definition of “Eligible M&E” in its entirety and replacing it with the following:

“(c)  it is (i) located at the ColorMaster dye house in Calhoun, Georgia or is subject to a Lien in favor of Lineage PCR, Inc. (it being understood that this clause (i) shall no longer apply after the payment and satisfaction of the ColorMaster Indebtedness and the release of all Liens granted to Lineage PCR, Inc. securing such Indebtedness), (ii) located at the premises leased by Masland from Rothman and RFP in Calhoun, Georgia or is subject to a Lien in favor of Rothman (it being understood that this clause (ii) shall no longer apply after the payment and satisfaction of the Rothman Indebtedness and the release of all Liens granted to Rothman securing such Indebtedness), or (iii) not located at one of the locations in the continental United States set forth on Schedule 4.30;”.
(b)Permitted Indebtedness.  Schedule 1.1 of the Credit Agreement is hereby amended by deleting clause (e)(iii) from the definition of “Permitted Indebtedness” in its entirety and replacing it with the following:

“(iii)  the unsecured guaranty of the ColorMaster Indebtedness by Dixie pursuant to a certain guaranty dated as of the First Amendment Effective Date, the unsecured guaranty of the Rothman Indebtedness by Dixie pursuant to the Rothman Guaranty, and other unsecured guarantees with respect to Indebtedness of a Borrower or one of its Subsidiaries, to the extent that the Person that is obligated under such guaranty could have incurred such underlying Indebtedness”.
(c)Permitted Investments.  Schedule 1.1 of the Credit Agreement is hereby amended by deleting clause (m) from the definition of “Permitted Investments” in its entirety and replacing it with the following:

“(m)  (i) so long as no Event of Default has occurred and is continuing or would result therefrom, the ColorMaster Purchase, (ii) so long as no Event of Default has occurred and is continuing or would result therefrom, the Robertex Acquisition, and (iii) so long as no Event of Default has occurred and is continuing or would result therefrom, and the Payment Conditions have been satisfied, any other Investments (including Acquisitions).”
(d)Permitted Purchase Money Indebtedness.  Schedule 1.1 of the Credit Agreement is hereby amended by deleting the definition of “Permitted Purchase Money Indebtedness” in its entirety and replacing it with the following:

“Permitted Purchase Money Indebtedness” means, as of any date of determination, (a) the ColorMaster Indebtedness, (b) the Rothman Indebtedness, and (c) other Purchase Money Indebtedness incurred after the Closing Date in an aggregate principal amount outstanding at any one time not in excess of $20,000,000.

1.3    Interpretation.  Unless otherwise defined herein or the context otherwise requires, terms used in this Amendment, including its preamble and recitals, have the meanings provided in the Credit Agreement.

		
	II.
	  EVENTS OF DEFAULT

3.1    Events of Default.  Section 8.7 of the Credit Agreement is amended by deleting such Section in its entirety and replacing it with the following:

“8.7  If there is a default in one or more agreements to which a Loan Party or any of its Subsidiaries is a party with one or more third Persons relative to either (a) the ColorMaster Indebtedness, (b) the Rothman Indebtedness, or (c) Indebtedness of a Loan Party or any of its Subsidiaries involving an aggregate amount of $3,000,000 or more, and, in each case, such default (i) occurs at the final maturity of the obligations thereunder, or (ii) results in a right by such third Person, irrespective of whether exercised, to accelerate the maturity of such Loan Party’s or its Subsidiary’s obligations thereunder;”.
		
	III.
	  CONDITIONS PRECEDENT

3.1    Subject to Section 3.2 below, this Amendment shall be and become effective as of the date hereof (the “Fourth Amendment Effective Date”), subject to the conditions set forth in this Section III having been satisfied (it being understood and agreed that this Amendment may be executed and delivered in escrow pending release upon satisfaction of such conditions):

(a)Execution of Amendment.  Agent shall have received fully executed counterparts of this Amendment.

(b)Rothman Intercreditor Agreement.  Agent shall have received, in form and substance satisfactory to Agent, the Rothman Intercreditor Agreement, duly authorized, executed and delivered by Rothman and RFP and acknowledged by each Loan Party.

(c)Robertex Acquisition.  Agent shall have received, in form and substance satisfactory to Agent, true, correct and complete copies of the Robertex Acquisition Documents and the Rothman Loan Documents, in each case duly authorized, executed and delivered by the parties thereto, and Masland shall consummate the Robertex Acquisition simultaneously with the effectiveness of this Amendment.

(d)Amendment Fee.  Agent shall have received an amendment fee in the amount of $25,000 to be apportioned on a pro-rata basis among the Lenders according to each Lender’s Commitment, and Borrowers hereby authorize Agent to charge the Loan Account for such amendment fee.

(e)Accuracy of Representations and Warranties.  Each of the representations and warranties of the Loan Parties set forth in Section 4 of the Credit Agreement shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof).

(f)Other Documents.  Agent shall have received such other agreements, documents, instruments and information executed and/or delivered by the Loan Parties as Agent may reasonably request.

3.2    Notwithstanding anything to the contrary set forth in Section 3.1 hereof, prior to the inclusion of any Accounts or Inventory acquired in connection with the Robertex Acquisition as Eligible Accounts or Eligible Inventory, Agent shall have received a certified copy of the Robertex Articles of Merger, as filed with the Secretary of State of the State of Georgia.

IV.  MISCELLANEOUS

4.1    Acknowledgments Regarding Rothman Indebtedness and Rothman Intercreditor Agreement.  In connection with the Robertex Acquisition, (a) each Lender acknowledges that Agent is entering into the Rothman Intercreditor Agreement in substantially the form presented by Agent to Lenders prior to the date hereof, (b) each Lender consents to the terms of the Rothman Intercreditor Agreement, including, without limitation, Agent’s agreement contained therein that it shall not have a first priority Lien on any of the Specified Robertex Assets until the payment and satisfaction of the Rothman Indebtedness, (c) Agent and each Lender agrees that, notwithstanding any contrary terms set forth in the Credit Agreement or any other Loan Document, the Specified Robertex Assets shall not be subject to a first priority Lien in favor of Agent until the payment and satisfaction of the Rothman Indebtedness, (d) each Borrower agrees that it shall notify Agent in writing of the payment and satisfaction of the Rothman Indebtedness within 5 Business Days after the payment and satisfaction thereof, (e) each Borrower agrees that the Specified Robertex Assets shall automatically become subject to a first priority Lien in favor of Agent upon the payment and satisfaction of the Rothman Indebtedness, regardless of whether any Borrower has provided Agent notice of such payment and satisfaction, and (f) each Borrower agrees that, following the payment and satisfaction of the Rothman Indebtedness, it shall comply with all of the provisions of Section 5.12 of the Credit Agreement with respect to the Specified Robertex Assets within 10 days after Agent’s request therefor.

4.2    No Additional Obligations.  The Borrowers acknowledge and agree that the execution, delivery and performance of this Amendment shall not create (nor shall the Borrowers rely upon the existence of or claim or assert that there exists) any obligation of any of Agent or Lenders to consider or agree to any other amendment of or waiver or consent with respect to the Credit Agreement or any other instrument or agreement to which Agent or any Lender is a party (collectively, an “Additional Amendment” or “Consent”), and in the event that Agent and the Lenders subsequently agree to consider any requested Additional Amendment or Consent, neither the existence of this Amendment nor any other conduct of Agent or the Lenders related hereto, shall be of any force or effect on the Lenders’ consideration or decision with respect to any such requested Additional Amendment or Consent, and the Lenders shall not have any obligation whatsoever to consider or agree to any such Additional Amendment or Consent.

4.3    Acknowledgments and Stipulations.  In order to induce Agent and Lenders to enter into this Amendment, each Borrower acknowledges, stipulates and agrees that (a) the Loan Documents executed by each Borrower are legal, valid and binding obligations of such Borrower enforceable against such Borrower in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally; (b) the Liens granted by each Borrower to Agent in the Collateral are valid and duly perfected, first priority Liens, subject only to Permitted Liens; (c) each of the recitals contained at the beginning of this Amendment is true and correct; and (d) prior to executing this Amendment, each Borrower consulted with and had the benefit of advice of legal counsel of its own selection and has relied 

upon the advice of such counsel, and in no part upon the representation of Agent, any Lender or any counsel to Agent or any Lender concerning the legal effects of this Amendment or any provision hereof.

4.4    Additional Representations and Warranties of the Borrowers.  Each Borrower hereby represents and warrants that on the Fourth Amendment Effective Date and after giving effect to the amendments and waivers contained herein:  (a) the representations and warranties contained in Section 4 of the Credit Agreement shall be correct in all material respects on and as of such date as though made on and as of such date, (b) no Default or Event of Default exists under the Credit Agreement on and as of such date.  Without limitation of the preceding sentence, each Borrower hereby expressly re-affirms the validity, effectiveness and enforceability of each Loan Document to which it is a party (in each case, as the same may be modified by the terms of this Amendment).  

4.5    Effect of this Agreement.  Except as expressly amended pursuant hereto, no other changes or modifications to the Loan Agreement or any of the other Loan Documents are intended or implied, and in all other respects, the Loan Agreement and each of the other Loan Documents is hereby specifically ratified, restated and confirmed by all parties hereto as of the date hereof.  To the extent that any provision of the Loan Agreement or any of the other Loan Documents are inconsistent with the provisions of this Amendment, the provisions of this Amendment shall control.  All references in the Loan Agreement (including without limitation the Schedules thereto) to the “Agreement” and all references in the other Loan Documents to the “Loan Agreement” shall be deemed to refer to the Loan Agreement, as amended hereby.

4.6    Further Assurances.  The Loan Parties shall execute and deliver such additional documents and take such additional action as may be reasonably requested by Agent to effectuate the provisions and purposes hereof.

4.7    Governing Law.  THE VALIDITY OF THIS AMENDMENT, THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF, THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO, AND ANY CLAIMS, CONTROVERSIES OR DISPUTES ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.

4.8    Binding Effect.  This Amendment shall bind and inure to the benefit of the respective successors and permitted assigns of each of the parties hereto.

4.9    Counterparts; Electronic Execution.  This Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same agreement.  Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Amendment.  Any party delivering an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Amendment but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

4.10    Successors and Assigns.  This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
[Signatures on Next Page]

Each of the parties hereto has caused a counterpart of this Amendment to be duly executed and delivered as of the date first above written.
	
		
	BORROWERS:
	THE DIXIE GROUP, INC.

By:  /s/ Jon A. Faulkner
Name:   Jon A. Faulkner
Title:    VP / CFO

	 
	CANDLEWICK YARNS, LLC

By:  /s/ Jon A.Faulkner
Name:    Jon A. Faulkner
Title:     President

	 
	FABRICA INTERNATIONAL, INC.

By:   /s/ Jon A. FaulknerName:    Jon A. Faulkner
Title:     President

	 
	MASLAND CARPETS, LLC

By:  /s/ Jon A. FaulknerName:    Jon A. Faulkner
Title:     President

	
		
	AGENT AND LENDERS:
	WELLS FARGO CAPITAL FINANCE, LLC, 
as Agent and as a Lender

By:  /s/ Matt Mouledous
Name:     Matt Mouledous
Title:     VP

	 
	BANK OF AMERICA, N.A.,
as a Lender

By:    /s/ Robert B. H. Moore
Name:     Robert B. H. Moore
Title:     Senior Vice President

GUARANTOR’S ACKNOWLEDGEMENT
The undersigned, a guarantor of the “Obligations” of THE DIXIE GROUP, INC., a Tennessee corporation (“Dixie”), CANDLEWICK YARNS, LLC, an Alabama limited liability company (“Candlewick”), FABRICA INTERNATIONAL, INC., a California corporation (“Fabrica”), MASLAND CARPETS, LLC, a Georgia limited liability company (“Masland”; together with Dixie, Candlewick and Fabrica, are referred to hereinafter each individually as a “Borrower”, and individually and collectively, jointly and severally, as the “Borrowers”), under and as defined in that certain Credit Agreement, dated as of September 13, 201, as amended by the First Amendment to Credit Agreement, dated as of November 2, 2012, the Second Amendment to Credit Agreement, dated as of April 1, 2013, the Third Amendment to Credit Agreement, dated as of May 22, 2013, and the Fourth Amendment to Credit Agreement (the “Fourth Amendment”), dated as of the date hereof (as amended, restated, supplemented, or otherwise modified prior to the date hereof, the “Credit Agreement”) among the Borrowers, the lenders party thereto (the “Lenders”), WELLS FARGO CAPITAL FINANCE, LLC, a Delaware limited liability company, as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, the “Agent”), hereby (a) acknowledges receipt of the foregoing Fourth Amendment; (b) consents to the terms thereof and the execution thereof by the Borrowers; (c) reaffirms its obligations pursuant to the terms of the Guaranty Agreement, dated as of September 13, 2011, by the undersigned in favor of Agent and Lenders (the “Guaranty”); and (d) acknowledges that Agent and the Lenders may amend, restate, extend, renew or otherwise modify the Credit Agreement and any indebtedness or agreement of the Borrowers, or enter into any agreement or extend additional or other credit accommodations to the Borrowers, without notifying or obtaining the consent of the undersigned and without impairing the liability of the undersigned under the Guaranty for the Borrowers’ present and future Obligations.  Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement.
	
		
	 
	C-KNIT APPAREL, INC.

By:  /s/  Jon A. Faulkner
Name:    Jon A. Faulkner
Title:     Presidentex10_62incentivecomp2014

Exhibit 10.62
Summary Description of 
the Annual Incentive Compensation Plan/Range 
of Incentives as effective on March 5, 2014

The following is a description of the Company's Annual Incentive Compensation Plan (“Plan”) for its executive officers for fiscal 2014.

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 Career Shares.   In order to receive any incentive award under the Plan, an executive officer must be actively 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 executive officers whose responsibilities are primarily related to corporate-level administration, the Cash Incentive Award component provides the opportunity to earn a cash incentive ranging from 15% to a maximum of 75% of such participant's base salary as of January 1, 2014 (from 45% to 105% for the Chief Executive Officer and Chief Operating Officer, and from 30% to 90% for the Chief Financial Officer).  For all executive officers in this category, 50% of the amount of the Cash Incentive Award is determined based on the achievement of specified levels of the Company's annual consolidated Operating Income, as adjusted for unusual items, 30% of the amount is determined based on achievement of specified levels of the annual Operating Income of the Company's Residential Business Unit, as adjusted for unusual items, and 20% of the amount is determined based on achievement of specified levels of the Company's annual Contract Operating Income, 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 level of achievement of individual performance goals as set and determined 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 the opportunity to earn a cash incentive ranging from 15% to 75% of such participant's base salary.  For executive officers in this category, 55% of the amount of the Cash Incentive Award is determined based on the achievement of specified levels of their annual business unit Operating Income, as adjusted for unusual items, 30% of the amount is determined based on the achievement of specified levels of the Company's annual consolidated Operating Income, as adjusted for unusual items, and 15% of the amount is determined based on the achievement of specified levels of the annual Operating Income 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 level of achievement of individual performance goals as set and determined by the Compensation Committee.

Cash Incentive Awards, if and to the extent earned under the Plan, will be based on the participant's base salary as of January 1, 2014, and it is anticipated that such awards will be paid to participants in cash on or prior to March 14, 2015.

1

Primary Long-Term Incentive Awards and Career Shares
A Primary Long-Term Incentive Award may 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 shall be awarded to each executive officer as an award of restricted stock valued at 20% of such officer's base salary (provided, however, that for 2014 the Chief Operating Officer shall receive an award valued at 35% of base pay and the Chief Financial Officer shall receive an award of 30% of base pay).  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, in determining the number of shares to be granted, 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 ratably over 3 years from the award date, and for all Participants other than the Company’s Chief Operating Officer and Chief Financial Officer Career Shares will vest when the participant becomes (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.  Career Share awards for the Chief Operating Officer and Chief Financial Officer will vest ratably over five years beginning on such officer’s 61st birthday.  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 the 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 Awards will only be made if the Company achieves a minimum Operating Income performance level, as adjusted for unusual items; Career Share Awards will only be made if the Company's operating income for fiscal 2014 is positive.  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 awards 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 described forth above, any award to a participant for 2014 may be reduced, but not increased, by the Compensation Committee in its sole discretion based on individual performance criteria.

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00227-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00227-of-00352.parquet"}]]