SHAW DIVERSIFIED SERVICES, INC. BILL WOYSHNER

SHAW DIVERSIFIED SERVICES, INC.BILL WOYSHNER

TUFTEX DIVISION• 2 Carpet ManufacturingSites in Santa Fe Springs,CA• 2 Distribution Centers (LaMirada & Cypress, CA)• Yarn Mill in Yuma, AZ• More than 1,000employees

Water UsageINDUSTRIALRECLAIMEDYear Total Flow Total Flow• 2007-2008 170 MGY 78 MGY• 2008-2009 98 MGY 37 MGY• 2009-2010 87 MGY 31 MGY• 2010-2011 91 MGY 28 MGY

Individual ValueMoving RangeWater UsageProgram Title:Environmental Objective:Environmental Target:Environmental Aspect(s):Program Champion:PLANT WG --WATER USAGE BY WEEKDate: 3/4/2011REDUCTION OF WATER USAGE PER POUND PROCESSED (GALLONS USAGED/LB)X = 2.355 GALLONS/LB; REDUCTION BY 10 PERCENTAGE (2.1195 GAL/LB)WATER USAGE AND WASTEWATER REDUCTIONSSCOTT PRICEI-MR Chart of Water (Gal/lb) by Water-CodeCurrent (omitted 21 22)3.52009baseline 2010-2 2010-312011 End of Project 4/9/20113.02.52.01/10/20092 22224/4/2009 6/27/20099/19/2009112/12/2009223/20/2010Date6/12/201019/4/201011111/27/2010111 1 11 1122 222/26/2011111 15/21/2011_ UCL=2.502X=2.355LCL=2.2082011 Goal = 2.1195 gal/lb2009baseline 2010-2 2010-311.51.0111 10.50.0221111__ UCL=0.181MR=0.055 LCL=01/10/20094/4/20096/27/20099/19/200912/12/20093/20/2010Date6/12/20109/4/201011/27/20102/26/20115/21/2011

Technical & Operation-TPM (Total Productive Maintenance) System• Schedules and tracks all Work Orders and PM'sIncludes all Wastewater cleaning task and Storm Water BMPsSource testing and tuning of all equipment required by AQMD.-Boiler Area• Boiler EconomizersPreheats feed water to DA tank• RO Water SystemReduces Chemical usageMinimizes boiler blow-downsUsed in Dye house to reduce chemical additivesRO waste product used in process as wash water• Heat Recovery UnitGenerates hot water for Boiler feed waterPreheats process wash waterReduces effluent water temperature going back to city

Technical & Operation-Effluent Wastewater• pH controlled by redundant meters• Temperature controlled• Flow rates controlled by redundant meters• Hourly sampling• Approx 100,000 gallons per day of this water is re-used for processoperations-Dye Make-up Reuse• Excess dye from the process is reused back in the dying process(500,000 gallons per year)-Data Analysis• Extension data analysis system to control process conditions (Pressure,Temperature, flow rate, etc)

Effluent pH MetersEffluent Control

Lint TrapRO Water System

Heat RecoveryUnitBoilerEconomizers

Total $WasteIndividual ValueMoving RangeInventoryClaimsProductivitySafety*1000 PoundsOff QualityTurnover*RawMaterialsEnergyShortFirstsPercentLean Manufacturing / 6 Sigma2010 WG / WW EntitlementTotal Value: $21,395,118Tuftex (Carpet) Waste in Pounds$7,000,000$6,000,0004000300010080$5,000,000$4,000,000$3,000,000$2,000,00020001000604020$1,000,000$-0.0240.0211Waste Type0SelvedgeChangeover - CDRSeamGreige WasteYarn on TubesBeam WasteI-MR Chart 1000 of % Pounds Production 1108 769 571 437 392 215 147 107 180Points Categories 8 and 12 removedPercent 28.2 19.6 14.6 11.1 10.0 5.5 3.7 2.7 4.6Cum % 28.2 47.8 62.4 73.5 83.5 89.0 92.7 95.4 100.0WG WWLintProject: Pounds Pareto (Define).MPJ; Worksheet: Worksheet 1; 9/21/2007 2:24:54 PMEOLUCL=0.02097Other00.018_X=0.016870.015LCL=0.0127701/07/0701/28/0702/18/0703/11/0704/01/0704/22/07 05/13/07Date06/03/0706/24/0707/15/0708/05/0708/26/070.0061UCL=0.0050370.0040.002__MR=0.0015420.000LCL=001/07/0701/28/0702/18/0703/11/0704/01/0704/22/07 05/13/07Date06/03/0706/24/0707/15/0708/05/0708/26/07Project: CDR Softwaste Baseline.MPJ; Worksheet: Worksheet 1; 9/17/2007 12:28:04 PM

Lean Manufacturing / 6 Sigma

Lean Manufacturing / 6 SigmaShaw SUMM ScorecardMETRICSFacility / OrganizationPlant WG/WW - TuftexCorporate Objectives1: The safety and health of our employees2: Growing our business and exceeding customer3: Being the Employer of Choice for a talented and4: World-Class performance in our keep business5: Innovation leadership6: Sustainability and environmental leadership7: Exceeding Berkshire Hathaway's expectation foFocusCorporate ObjectivesMetrics Operational Definition andMeasurement Tool2009 Baseline2010 Goal1 2 3 4 5 6 7PMaintain or Achieve system certifications -SQS, SAFE, (or SMS if applicable)SQS, SafeCertifiedSMSCertificationOperationalExcellenceX P % Entitlement per Year7% 25%X P Engergy Intensity - (btu/lb for 09) 2921 2848X X P X Water Intensity - (gallons/lb from 09')1.337 1.304Corporate Waste Intensity 20094.07% 3.66%

Barriers and Issues•Incoming and RECLAIMWater sometimes causesQuality issues in dyeingprocess.•Need consistency in thewater quality for adjusting dyechemistry•RECLAIM water seems to bemore consistent than regularincoming Industrial Water.

•Zero Waste to the Landfill sinceNovember of 2009Highlights & Awards•2010 Facility of the Year - CWEA•2009-2010 LA County Sanitation DistrictCertificate of Recognition•Environmental O&Ts tied to Six SigmaProjects (Water & Energy)•Community Involvement -‣Yearly "Earth Day" Events‣"Green/Lean Pays Seminar" forthe City of Santa Fe Spring‣Beach Cleanup•Visionary Stewardship Award – LACounty Water District•Shaw System Certification (ISO 9001 &14001)