EXHIBIT 10.2

SEPARATION AGREEMENT AND FULL AND FINAL RELEASE

This agreement is made, by and between Sekar Sundararajan (“You” or “Executive”)
and Hooker Furniture Corporation (“Employer”) (each a “Party” and collectively,
the “Parties”) (the “Agreement”).

Reasons for Agreement

1.  
Executive’s employment has been terminated without cause by Employer effective
November 30, 2009, thereby discontinuing any employer/employee relationship
between the Employer and Executive.

2.  
This Agreement is designed to provide Executive with additional benefits above
and beyond the benefits he is already entitled to receive prior to and upon his
termination in exchange for the consideration from Executive, as specified
below.

Terms of the Agreement

1.  
Termination Date.  Your termination date will be November 30, 2009 (“Termination
Date”).  For purpose of the Consolidated Omnibus Budget Reconciliation Act
(“COBRA”), 29 U.S.C. § 1161 et seq., your Termination Date shall serve as the
“qualifying event” for the purpose of any rights you might have under COBRA.

2.  
Special Severance Benefits.  Employer agrees to provide you with the following
benefits following your termination of employment:

a.  
Employer will continue to pay you your normal salary, as of your Termination
Date, less required and authorized withholdings and deductions, for a period of
two months ($ 41,666.66).  The salary continuation payments will be made to you
no later than January 15, 2010.  The salary continuation payments described in
this sub-paragraph are compensation to which you would not otherwise be entitled
except under the terms of this Agreement with Employer.

b.  
In addition to the two-month salary continuation payments described above,
Employer will waive the service vesting requirements under your Deferred Bonus
Agreement though January 31, 2010, thereby entitling you to receive a payment of
$50,000 on January 31, 2010 and a payment of $33,334 on January 30, 2011.  The
$33,334 payment on January 30, 2011 shall be expressly conditioned on your
compliance with the requirements of Paragraph 8 of this Agreement.  Failure to
comply with the requirements of that paragraph will cause you to forfeit your
right to that payment.

 
 
c.  
You are entitled (in accordance with the provisions of the plan) to your
interest in the Company’s 401(k) Plan; please contact Fidelity Investments at
800-835-5097 for instructions on distribution or rollover options.

3.  
Employee’s Release.  In consideration for the Special Severance Benefits set
forth above in Paragraph 2, and other consideration set forth in this Agreement,
you agree, on behalf of yourself, heirs, descendants, executors, administrators,
assigns and successors, to waive, release, covenant not to sue, and forever
discharge Employer, its parents, subsidiaries, affiliates, owners, trustees,
officers, directors, attorneys, agents, employees, shareholders, and each of
them individually or collectively (“Released Parties”), from any and all claims,
known or unknown, liquidated or unliquidated, that you may have relating to or
arising out of your employment with Employer and termination thereof as of the
effective date of this Agreement (the “Release”).

This Release includes, but is not limited to, any claims of wrongful discharge,
breach of express or implied contract, claims for wages, commissions or
expenses, fraud, misrepresentation, defamation, slander and libel, liability in
tort, claims of any kind that may be brought in any court or administrative
agency, any claims under Title VII of the Civil Rights Acts of 1964 and 1991, as
amended, the Americans with Disabilities Act, the Age Discrimination in
Employment Act, the Family Medical Leave Act, the Equal Pay Act, the Employee
Retirement Income Security Act of 1974, the Consolidated Omnibus Budget
Reconciliation Act of 1985, Sections 1981 and 1983 of Title 42 of the United
States Code, the National Labor Relations Act, as amended, the Immigration
Reform and Control Act, as amended, the Workers Adjustment and Retraining
Notification Act, as amended, the Occupational Safety and Health Act, as
amended, or any other federal, state or local law relating to your employment,
employee benefits or the termination of your employment.

Except to the extent such agreement is prohibited by applicable law or
regulation, Executive agrees that if he attempts to avoid or set aside the terms
of the Agreement or if any Released Party successfully asserts the Agreement as
a defense or bar to any suit or claim asserted by Executive, Executive shall be
liable for reimbursing the Released Party for its reasonable costs and
attorneys’ fees in defending against such claims or asserting such
defense.  Should any third party bring any action or claim against a Released
Party on Executive’s behalf, Executive acknowledges and agrees that the
Agreement provides him with full relief and he will not accept any additional
relief.  If the release of any one claim described herein is found invalid,
Executive acknowledges and agrees that such invalidity has no affect on the
validity of any other release of claim.
 
 
 

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4.  
Special Release Notification.  Paragraph 3 includes a release of all claims
under the Age Discrimination in Employment Act (“ADEA”) and, therefore, pursuant
to the requirements of the ADEA, you acknowledge and understand the following:
(a) you have been advised that this release includes, but is not limited to, all
claims under the ADEA arising up to and including the date of execution of this
release; (b) that you have been advised to consult with an attorney and/or other
advisor of your choosing concerning your rights and obligations under this
release; (c) that you have been advised to consider fully this release before
executing it; (d) that you have been offered ample time and opportunity, in
excess of twenty-one days, to do so; and (e) that this release shall become
effective and enforceable seven days following your execution of this Agreement
(the “Effective Date”), during which seven day period you may revoke your
acceptance of this Agreement by delivering written notice to Anne Jacobsen, Vice
President of Human Resources, at Hooker Furniture Corporation, P.O. Box 4708,
Martinsville, Virginia 24115.

5.  
No Other Payments.  Executive understands and agrees that Employer and the other
Released Parties shall neither make nor cause to be made any other payments him,
his beneficiaries or dependents, or otherwise on his behalf, except as
specifically referenced herein.  Executive represents and warrants that he has
not assigned to any person any of the claims released herein.

6.  
Taxes.  To the extent any taxes may be due on the payments provided in this
Agreement beyond any withheld (including, without limitation, any taxes due
under Code Section 409A), Executive agrees to pay such taxes and to indemnify
and hold Employer and its agents and affiliates harmless for any tax payments
owed, interest, penalties, levies or assessments resulting from the payments
provided hereunder or from any failure by you to pay such taxes, interest,
penalties, levies or assessments.

7.  
Company Property.  Executive acknowledges that you have returned or will return
on or before the Termination Date to Employer all property of the Employer.  For
purposes of this paragraph, “property of the Employer” includes, but is not
limited to, keys, corporate credit cards, equipment, books, supplies, computer
programs, originals and copies of all corporate documents, including financial
records and information, and any other materials, whether prepared by you or by
others, but excludes anything owned by you individually.

8.  
Non-Disparagement.  The Parties agree that they will not in any way disparage,
make statements or take action that could discredit each other or in any way
damage their respective reputations or ability to do business.  Executive
understands and agrees that Employer is unable to guarantee compliance with this
provision by all employees of Employer, but Employer will take reasonable steps
to ensure that all upper management of Hooker Furniture Corporation and its
subsidiaries have been informed of and will comply with this non-disparagement
provision.  A violation of this provision constitutes a material breach of the
terms of this Agreement and voids any compensation or benefits provided under
the terms of this Agreement.

Additionally, you agree not to interfere with Employer’s property or employees
in any manner.  A breach of the terms of this paragraph also would constitute a
material breach of this Agreement, and would void any compensation or benefits
provided under the terms of this Agreement.

9.  
No admission.  You understand and agree that Employer has admitted no liability
or obligation to provide any of the consideration contemplated herein.

10.  
Severability and Consequences of Invalid Terms.  Should any portion or provision
of this Agreement be found void or unenforceable for any reason by a Court of
competent jurisdiction, the Court should enforce all portions and provisions of
this Agreement to the maximum extent which would have been enforceable in the
original Agreement.  If such portion or provision cannot be so modified to be
enforceable, the unenforceable portion shall be deemed severed from the
remaining portions and provisions of this Agreement, which shall otherwise
remain in full force and effect.  If any portion or provision of this Agreement
is so found to be void or unenforceable for any reason in regard of any one or
more persons, entities, or subject matters, such portion or provision shall
remain in full force and effect with respect to all other persons, entities, and
subject matters.

11.  
Complete Agreement.  This Agreement represents the complete agreement between
Executive and Employer regarding Executive’s employment and separation of
employment and supersedes any prior existent agreements, whether oral or
written.  Notwithstanding the foregoing, this Agreement is not intended to void
any common law duties including, but not limited to, duties or obligations to
maintain confidentiality or refrain from adverse use of any of Employer’s trade
secrets or other confidential information that you may have acquired in the
course of your employment.

12.  
Governing Law and Interpretation.  This Agreement shall in all respects be
interpreted, enforced, and governed by the laws of the Commonwealth of
Virginia.  The language of this Agreement shall be construed as a whole,
according to its fair meaning, and shall not be construed strictly for or
against either of the parties.

 
 
 

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13.  
Understanding and Authority.  The Parties understand and agree that all terms of
this Agreement are contractual and are not a mere recital, and represent and
warrant that they are competent to covenant and agree as herein provided.  You
understand, agree and represent that the covenants made herein and the releases
herein executed may affect rights and liabilities of substantial extent and
agrees that the covenants and releases provided herein are in your best
interest.  You represent and warrant that in negotiating and executing this
Agreement, you have had an opportunity to consult with competent legal counsel
of your choosing concerning the meaning and effect of each term and provision
hereof, and that there are no representations, promises, or agreements between
Employer and you other than those referenced or expressly set forth in writing
herein.  The Parties have carefully read this Agreement in its entirety, fully
understand and agree to its terms and provisions, and intend and agree that it
be final and binding.

14.  
Counterparts; Headings.  This Agreement may be executed in a number of identical
counterparts, each of which shall be deemed an original for all purposes.  The
paragraph headings in this Agreement are for reference and convenience only, and
shall not modify or effect its substantive terms.

 

DELIVERED TO EXECUTIVE ON OCTOBER 28, 2009.

EXECUTIVE

/s/ Sekar
Sundararajan­­                                                                                                           Date:
11-09-09
Sekar Sundararajan

HOOKER FURNITURE COPORATION

By:  /s/ E. Larry
Ryder                                                                                                           Date:  11-10-09

Title:  Executive V.P.