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[LETTERHEAD OF MOHAWK]
NEWS RELEASE
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For Release: Immediately
Contact: John D. Swift, Chief Financial Officer
MOHAWK INDUSTRIES, INC. ANNOUNCES SETTLEMENT IN LAWSUITS
Calhoun, Georgia, August 11, 2000 - Mohawk Industries, Inc. (NYSE:MHK) has
reached an agreement in principle to settle two antitrust class actions filed
against Mohawk and other carpet manufacturers in the United States District
Court in Rome, Georgia. Under the terms of the settlement agreement, Mohawk
will contribute $13,500,000 to a settlement fund to resolve price fixing claims
brought by a class of purchasers of polypropylene carpet and a proposed
settlement class of purchasers of nylon carpet. The settlement is subject to
preliminary approval of the court, notice to members of the two settlement
classes, certification of the proposed settlement classes and final approval by
the court after a hearing. The settlement will be paid in one cash installment
after the final approval and the class members are properly notified of their
rights in the settlement. After taking into account the impact of reserves
established in preceeding periods for potential liabilities, a pre-tax charge of
$7,000,000 will be recorded to operating earnings in the third quarter of 2000
in connection with this settlement. The Company denies all wrongdoing and has
agreed to settle the case to avoid additional costs to defend the lawsuits.
Mohawk is a leading producer of woven and tufted broadloom carpet and rugs for
residential and commercial applications. The Company designs, manufactures and
markets carpet in a broad range of colors, textures and patterns and is widely
recognized through its premier brand names, some of which include "Mohawk,"
"Aladdin," "Bigelow," "Custom Weave," "Durkan," "Galaxy," "Harbinger," "Helios,"
"Horizon," "Image," "Karastan," "Mohawk Commercial," "World," and "Wunda Weve."
Mohawk offers a broad line of area and washable rugs branded by Karastan,
Aladdin, Newmark & James and American Rug Craftsmen and decorative throw
blankets, placemats, pillows and chairpads branded by American Weavers. Mohawk
also offers a complete laminate product line and distributes carpet padding and
ceramic tile. The Company markets its products primarily through retailers and
dealers.
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