Dixie Group Signs Letter of Intent to Buy Fabrica

<%=company1%> announced that it has signed a letter of intent to acquire privately held, high-end carpet and rug maker Fabrica International and its interest in Chroma Systems Partners dyeing and finishing operations.

The terms of the transaction were not disclosed and is subject to regulatory approval, due diligence review and execution of a definitive purchase agreement.

Fabrica, headquartered in Santa Ana, California, with estimated 2000 sales of in excess of $50 million, manufactures and sells high-end luxury carpet and rugs to carpet retailers, interior designers, luxury yachts, furniture stores and other markets.

Dixie Group Chairman Daniel K. Frierson commented, "We are delighted that Fabrica will become part of The Dixie Group. Our Masland high-end residential carpet and rug business is growing at a steady pace, and we see market demand continuing to increase. Their excellent management team will remain in place and continue to operate the company as a stand-alone business. Fabrica's strong track record in sales and profitability growth will contribute to The Dixie Group's strategic and financial goals."

Frierson indicated that Fabrica's 25-plus years of experience in developing, manufacturing and marketing highly styled residential products will strengthen Dixie Group's market position.

The Company anticipates closing the transaction before the end of June 2000.