27  Notes to Consolidated Financial Statements (dollars in thousands, except per share data) - continued -  The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted – average assumptions: (1)  There were no options granted during 2001. The following pro forma summary presents the Company’s net income (loss) and earnings (loss) per share which would have been reported had the Company determined stock compensation cost using the alternative fair value method of accounting set forth under Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation". The pro forma impact on net income (loss) shown below may not be representative of future effects. In August 1996, the Company’s Board of Directors adopted a stock ownership plan applicable to the senior management of the Company for the purpose of encouraging each participant to make a significant investment in the Company’s Common Stock. Pursuant to the plan, at December 29, 2001, 802,557 shares were subscribed at a weighted-average price of $6.76 per share, at December 30, 2000, 791,786 shares were subscribed at a weighted-average price of $6.74 per share, and at December 25, 1999, 620,516 shares were subscribed at a weighted-average price of $8.79 per share. The Company also has a stock purchase plan which authorizes 108,000 shares of Common Stock for purchase by supervisory associates at the market price prevailing at the time of purchase. At December 29, 2001, 27,480 shares remained available for issue. Shares sold under this plan are held in escrow until paid for and are subject to repurchase agreements which give the Company the right of first refusal at the prevailing market price at the time of sale. The number of shares sold under the plan was 9,100 in 1999. The Company had commitments for purchases of machinery and equipment, building construction and information systems of approximately $6,829 at December 29, 2001. NOTE L – COMMITMENTS THE DIXIE GROUP  / 2001 ANNUAL REPORT 2001 GRANTS (1) 2000 GRANTS 1999 GRANTS Expected life – 5 years 5 years Expected volatility – 49.50% 50.10% Risk-free interest rate – 6.37% 5.60% Dividend yield – 0.00% 0.00% 2001 2000 1999  Pro forma: Net income (loss) $ (144) $ (10,213) $ 16,271 Earnings (loss) per share: Basic (0.01) (0.89) 1.43 Diluted (0.01) (0.89) 1.39