Daniel K. Frierson
DIXIE GROUPAbout Daniel K. Frierson
Daniel K. Frierson, age 83, is Chairman of the Board (since 1987), Chief Executive Officer (since 1980), and a Director (since 1973) of The Dixie Group, Inc. . He also serves as a Director of Printpack, Inc. and chairs its Compensation Committee . Pay-versus-performance disclosures show Company TSR on an initial $100 investment of $12 in 2024 (vs $29 in 2023 and $30 in 2022), alongside net losses of $13.0 million in 2024, $2.7 million in 2023, and $35.1 million in 2022, contextualizing performance during his recent tenure .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Dixie Group, Inc. | Chief Executive Officer | Since 1980 | Led long-term strategy; oversaw transition to residential focus and execution of profit improvement and restructuring plans |
| The Dixie Group, Inc. | Chairman of the Board | Since 1987 | Board leadership and Executive Committee chair; set agenda and oversight between meetings |
| The Dixie Group, Inc. | Director | Since 1973 | Continuity and industry relationships cited by Board as key qualifications |
| The Dixie Group, Inc. | Strategic transactions (company-level) | 2019–2021 | Executed profit improvement plan; sold AtlasMasland commercial business to focus on residential, use proceeds to reduce debt (~$20m) and improve liquidity |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Printpack, Inc. | Director; Chair, Compensation Committee | Not disclosed | External compensation governance experience; industry network |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | 625,000 | 625,000 |
| Bonus ($) | 505,502 (accrued under 2023 plan) | — (no cash incentives under 2024 plan) |
| Stock Awards ($, grant-date fair value) | — | 77,314 |
| Option Awards ($, grant-date fair value) | 25,192 | — |
| All Other Compensation ($) | 5,050 | 5,300 |
| Total ($) | 1,160,744 | 707,614 |
All Other Compensation detail (2023 vs 2024):
- Registrant contributions to defined contribution plans: $3,050 (2023), $3,300 (2024)
- Insurance premiums: $2,000 (2023), $2,000 (2024)
Performance Compensation
Annual and Long-Term Incentive Framework
| Element | Metric | Weighting/Range | Vesting | Notes |
|---|---|---|---|---|
| 2025 Cash Incentive (CEO) | Operating income from continuing ops (adjusted) | 100% metric; payout range 45%–105% of base salary | N/A | Committee retains discretion; paid March 2026 if earned |
| 2025 Primary LTI Share Award (restricted stock) | Goals incl. financial and individual | Value up to 45% of base salary + cash incentive | Vests ratably over 3 years | $5 minimum price used to determine shares |
| 2025 Career Shares (restricted stock) | Tenure/retention | Value at 20% of base salary (CEO not excluded) | Age ≥61: 2-year ratable; Age ≤60: 5-year ratable after reaching age 61 | Immediate vesting on death, disability, or change in control; partial vesting on termination without cause |
| 2024 Incentive Outcomes | Company/individual goals | N/A | N/A | No cash incentives or share awards granted to NEOs under 2024 plan |
Actual Awards (Most Recent Disclosed Year)
| Year | Cash Incentive Paid ($) | Primary LTI Shares (count) | Career Shares (count) | Option Grants (count, strike, vest/condition) |
|---|---|---|---|---|
| 2023 (awarded under 2023 plan) | 505,502 | 101,745 | 25,000 | 60,000 options; $1.00 strike; vest after two years and only if average high/low stock price ≥$3.00 for five consecutive trading days; exp 5/25/2028 |
Pay Versus Performance (Context)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| PEO SCT Total ($) | 976,093 | 1,160,744 | 707,614 |
| PEO Compensation Actually Paid ($) | 271,437 | 1,149,340 | 699,836 |
| Company TSR (Value of $100) ($) | 30 | 29 | 12 |
| Company Net Income (Loss) ($000) | (35,079) | (2,718) | (13,000) |
Equity Ownership & Alignment
| Category | Detail |
|---|---|
| Beneficial Ownership (Common) | 1,412,565 shares; 9.2% of Common |
| Beneficial Ownership (Class B) | 1,249,302 shares; 100% of Class B |
| Voting Power Structure | Each Class B share carries 20 votes; aggregate votes outstanding 38,983,486; Common 13,997,446 votes; Class B 24,986,040 votes |
| Group Voting Control | Directors and executive officers as a group hold 27,176,276 votes or 69.7% of total vote |
| Ownership Breakdown | Outright Common: 41,886; IRA: 3,567; 401(k): 796; spouse/children/family: 32,715 Common, 570,636 Class B; unvested restricted: 84,299 Common, 76,796 Class B; family Unitrust: 5,486 Class B |
| Outstanding Equity Awards (12/28/2024) | Unexercisable options: 60,000 at $1.00; expiration 5/25/2028; unvested restricted stock: 161,095 shares (market value $104,873 at $0.651/share) |
| Hedging/Pledging Policy | Hedging or hypothecation of restricted stock awards prior to vesting is expressly prohibited |
| Ownership Agreements | Historical shareholder agreement among family parties covering 585,136 Class B shares expired in 2023; parties filed a joint Schedule 13D due to unity of interests and intention to vote as a group |
Note: At 2024 year-end, options had a $1.00 strike vs $0.651 stock price, implying they were out-of-the-money at that date .
Employment Terms
- Change-in-control and termination vesting: All share awards vest immediately on death, disability, or change in control; termination without cause vests all Career Shares and the expensed portion of Long-Term Incentive Shares; unvested awards are forfeited on voluntary termination prior to retirement or termination for cause .
- Retirement treatment: At retirement age, restricted stock vests to the extent expensed and is paid out by March 15 of the subsequent year; if Mr. Frierson had retired at year-end 2024, 65,878 shares would have vested with a value of $42,887 at $0.651/share .
- Deferred compensation: Executives may defer up to 90% of total compensation; Company contributed 2% to the qualified plan in 2024 (no non-qualified contributions) and 1% in 2023 .
- Severance multiples, non-compete (employment), and clawback: No severance multiples, employment non-compete clauses, or clawback provisions are disclosed in the proxy; the company-level non-compete applies to the 2021 commercial business sale (5 years) . There were no related party transactions in 2024 .
Board Governance
- Roles and structure: CEO and Chairman roles are combined; Executive Sessions of independent directors occur quarterly, chaired by the Lead Independent Director, William F. Blue, Jr. . Board met five times in 2024; no director attended fewer than 75% of meetings .
- Committees: Executive Committee (Frierson, Chair; Blue, Jr.) with full Board authority between meetings ; Audit Committee (Owens, Chair; Blue, Jr.; Brock; Murray) all independent; Owens designated audit committee financial expert ; Compensation/Nominations and Corporate Governance Committee (Blue, Jr., Chair; Brock; Murray) administers executive compensation and governance .
- Independence: Independent directors are Blue, Jr.; Brock; Murray; Owens; Executive Sessions exclude management .
- Director compensation (policy): Non-employee directors receive $40,000 cash retainer; $10,000 chair premium; $40,000 restricted stock with $5 minimum pricing; equity vests five business days after the succeeding annual meeting .
Performance & Track Record
- Strategic actions: Sold AtlasMasland commercial business in 2021 to focus on residential, receiving $20.5 million cash at closing and retaining ~$7 million of assets; proceeds used to reduce debt by approximately $20 million and increase borrowing availability; expected favorable pro forma impact on profitability .
- Restructuring and balance sheet actions: 2019 profit improvement plan expanded to $17.1 million cost reductions; facility sale and leaseback transactions reduced total debt by $55 million through late 2019 and increased equity by over 50%, with subsequent borrowing availability of $22 million after closing .
- Operating context: Pay-versus-performance table indicates persistent net losses over 2022–2024 and declining TSR, framing execution risk in recent periods .
Say-on-Pay & Shareholder Feedback
- Say-on-pay approval: In 2024, over 93% of votes were cast “For” executive compensation; similar approval in 2023; the Committee considers these results in compensation reviews .
Compensation Committee Analysis
- Composition and process: Independent committee members review and set executive compensation; the Committee may engage compensation consultants and evaluates CEO performance annually against established goals .
Investment Implications
- Alignment and control: Significant family and Class B ownership confers outsized voting control (69.7% as a group), with single-trigger vesting upon change in control—raising governance and takeover defense considerations despite quarterly independent director executive sessions .
- Incentive structure and selling pressure: 2025 incentives are tightly tied to operating income, with substantial at-risk cash (up to 105% of salary) and equity awards; however, no 2024 incentives were granted, and options remain subject to a stringent $3.00 stock price condition—limiting near-term forced selling from option exercises and implying retention through performance-based vesting .
- Execution risk: Multi-year TSR and net loss patterns highlight ongoing operational challenges; while strategic actions (commercial exit, debt reduction) improved liquidity and focus, the turnaround remains dependent on delivering profitable growth in residential operations .
- Board oversight: Combined CEO/Chair role is partially mitigated by a Lead Independent Director, independent committees, and quarterly executive sessions; lack of disclosed clawback and the presence of single-trigger vesting are watch items for pay-for-performance alignment .