Exhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is effective as of June 18,
2007, by and between Furniture Brands International, Inc., a Delaware
corporation (“Company”) and Ralph Scozzafava (“Executive”).

 

WHEREAS, Executive desires to serve as the Vice Chairman, a member of the Board,
and Chief Executive Officer Designate of the Company and later as Chairman and
Chief Executive Officer of the Company, and in exchange for the protection and
other consideration set forth in this Agreement, is willing to give the Company,
under certain circumstances, his covenant not to compete, and the Company
desires to so employ Executive.

 

NOW, THEREFORE, in consideration of the promises and the mutual agreements
contained herein, the Company and Executive hereby agree as follows:

 

ARTICLE I

Definitions

 

1.1

Definitions. As used herein, the following terms shall have the following
meanings.

 

(a)

“Board” means the Board of Directors of the Company.

 

(b)

“Cause” means (i) engaging by Executive in willful misconduct which is
materially injurious to Company; (ii) conviction of Executive by a court of
competent jurisdiction of, or entry of a plea of nolo contendere with respect to
a felony; (iii) engaging by Executive in fraud, material dishonesty or gross
misconduct in connection with the business of Company; (iv) engaging by
Executive in any act of moral turpitude reasonably likely to materially and
adversely affect Company or its business; or (v) Executive’s current chronic
abuse of or dependency on alcohol or drugs (illicit or otherwise). No act or
omission of Executive shall be “willful” if conducted in good faith or with a
reasonable belief that such conduct was in the best interests of the Company. No
termination shall be for “Cause” unless approved by a resolution of a majority
of the members of the Board after reasonable prior notice to Executive and an
opportunity to appear (with the assistance of counsel) before the Board.

 

(c)

“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended.

 

(d)

“Confidential Information” as used in Section 2.5, shall mean all technical and
business information of the Company, or which is learned or acquired by the
Company from others with whom the Company has a business relationship in which,
and as a result of which, similar information is revealed to the Company,
whether patentable or not, which is of a confidential, trade secret and/or
proprietary character and which is either developed by Executive (alone or with
others) or to which Executive shall have had access during his employment.
Confidential Information shall include (among other things) all confidential
data, designs, plans, notes, memoranda, work sheets, formulas, processes, and
Customer and supplier lists, but shall not include Executive’s rolodex (or other
tangible or electronic address book).

(e)

“Constructive Termination” shall mean Executive’s voluntary termination of
employment with the Company as a result of:

 

 

(i)

a material diminution in Executive’s title, authority, duties, or
responsibilities, or a change in Executive’s supervisory reporting relationship
within the Company (which, for the avoidance of doubt, includes: (A) any removal
of Executive from,

 

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or failure to elect or reelect Executive to, the Board at any time, and (B)
following a Change of Control, a status and reporting relationship in which
Executive is not the senior-most officer, reporting to the board of directors,
of the top-most parent company of which the Company may be the parent,
subsidiary or a division thereof following such Change of Control);

 

(ii)

a change, caused by the Company, in geographic location of greater than 50 miles
of the location at which Executive primarily performs services for the Company
on the Commencement Date;

 

(iii)

a material reduction in Executive’s base pay, incentive compensation, or
benefits;

 

(iv)

failure of the Company to promote Executive to Chief Executive Officer by
January 1, 2008 and to Chairman by May 1, 2008.

No voluntary termination by Executive shall constitute a “Constructive
Termination” unless he shall have given (x) notice of the proposed termination
due to Constructive Termination, with particulars, to the Company not later than
90 days following the initial occurrence of the condition above forming the
basis for such termination and (y) the Company an opportunity for 30 days after
such notice within which to remedy such condition, in which such condition is
not remedied.

(f)

“Customer” means any Person or entity to whom the Company has sold any products
(i) in the case of on-going employment, during the twenty-four (24) calendar
months immediately preceding any dispute under Section 2.6 of this Agreement,
and, (ii) in the case of the employment having ended, the twenty-four (24)
calendar months preceding Executive’s termination of employment.

(g)

“Person” means an individual, a partnership, a corporation, an association, a
joint stock company, a limited liability company, a trust, a joint venture, an
unincorporated organization, or a governmental entity or any department, agency
or political subdivision thereof.

(h)

“Severance Payment” shall mean the aggregate gross amount of severance payments
determined under Section 2.4 (c).

(i)

“Termination Date” shall mean the date on which Executive incurs a termination
of employment with the Company.

 

ARTICLE II

Employment

 

2.1

Employment. Company agrees to employ Executive and Executive hereby accepts such
employment with the Company, upon the terms and conditions set forth in this
Agreement, for the period beginning on June 18, 2007 (“Commencement Date”) and
ending as provided in Section 2.4 of this Agreement (the “Employment Period”).

 

2.2

Position and Duties.

(a)

Commencing on the Commencement Date, Executive shall serve as Vice Chairman and
Chief Executive Officer Designate of the Company, and no later than January 1,
2008, as Vice Chairman and Chief Executive Officer of the Company, and no later
than May 1, 2008, as Chairman and Chief Executive Officer of the Company. On the
Commencement Date, Executive shall be appointed as a member of the Board.
Executive, subject to the control of the Board, shall have general supervision
and control over the business, property and affairs of the Company and perform
such duties as may be assigned to him by the Board.

 

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(b)

Executive shall devote his best efforts and his full business time and attention
(except for permitted vacation periods and reasonable periods of illness or
other incapacity) to the business and affairs of the Company. Executive shall
perform his duties and responsibilities to the best of his abilities in a
diligent, trustworthy, businesslike and efficient manner. In the performance of
his duties hereunder, Executive shall at all times report and be subject to the
lawful direction of the Board and perform his duties hereunder subject to and in
accordance with the resolutions or any other determinations of the Board and the
certificate of incorporation and by-laws of the Company and applicable law.
During the Employment Period, Executive shall not become an employee of any
Person or entity other than the Company. This section shall not be construed to
prohibit Executive from serving on the Board of Directors of one or more other
entities (with the consent of the Board in the case of a for-profit entity) or
from investing in a business to the extent consistent with the provisions of
Section 2.6.

 

2.3

Compensation. Executive shall be entitled to the following compensation.

 

(a)

Annual Salary:

Executive shall receive a base salary at the annual rate of $700,000 payable in
bi-weekly installments. The Base Salary level shall be reviewed as Executive
moves into the position of Chairman and Chief Executive Officer of the Company,
and annually thereafter, and increased (but not decreased) in the discretion of
the Board (any such original or increased amount being Executive’s “Base Salary”
thereafter).

 

(b)

Annual Incentive:

Executive shall eligible for an annual target incentive of 100% of Executive’s
Base Salary. For 2007, Executive’s incentive will be guaranteed at 100% of
Executive’s Base Salary, prorated for the full months served during 2007. For
2008 and thereafter, Executive’s incentive will be based on the provisions of
the Company’s Short-Term Incentive Plan.

 

(c)

Long-Term
Compensation:

Executive shall be eligible for an annual long-term compensation target award of
200% of Executive’s Base Salary, which may be payable in a combination of cash
and stock options.

 

(d)

Long-Term Cash
Plan:

The Company’s Special Long-Term Performance Cash Plan covers the performance
period 2007-2008. Executive shall be eligible, under this Plan for a long-term
incentive target for the 2007 performance period of $700,000, prorated for the
full months served during 2007. For the full performance period 2007-08,
Executive’s long-term incentive target shall be prorated for the full months
served during 2007-2008. The actual payout for each performance period may be
higher or lower depending on business results, with a payout limit of 200% of
the target.

 

(e)

Annual Stock Option
Grants:

For the years 2007 and 2008 Executive shall receive a stock option grant with a
Black-Scholes value of $700,000. Both grants will provide for vesting in four
equal annual increments of 25% on the anniversary dates of the grant, with a
10-year expiration term and are forfeitable on termination of employment if
unvested. The 2007 grant shall take place on Executive’s first

 

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day of employment, at the closing price of the Company’s shares of common stock
(“Shares”) on that day. The 2008 grant will take place at the January meeting of
the Human Resources Committee at the closing price of the Shares on that day.

 

(f)

Sign-On Equity
Grants:

On Executive’s first day of employment, Executive shall receive two special
equity grants:

 

Stock Options – Non-qualified options for 100,000 Shares granted under the
Company’s 1999 Long-Term Incentive Plan (“Plan”) that vest in four equal annual
increments of 25% on the anniversary dates of the grant, with a 10-year
expiration term and are forfeitable on termination of employment if unvested.
This grant will be at the closing price of the Shares on that day.

 

Restricted Shares – 20,000 restricted Shares granted under the Plan that vest in
three annual increments of 33-1/3% on the anniversary dates of the grant and are
forfeitable at termination if unvested.

 

(g)

Relocation:

Executive shall be eligible for the Company’s standard relocation benefits;
provided, all relocation expenses paid or reimbursed by the Company shall be
grossed up for all taxes to the extent taxable to Executive. If Executive
voluntarily resigns, other than due to Constructive Termination, or is
terminated with Cause prior to the second anniversary of the Commencement Date,
Executive must repay 100% of all relocation expenses previously reimbursed or
paid by the Company if such termination occurs during the first year and all
such relocation expenses on a prorated basis during the second year (the
prorated amount payable by Executive to be based on one (1) minus the fraction
the numerator of which is the number of days employed and the denominator of
which is 730).

 

(h)

Vacation:

Executive shall receive 4 weeks of vacation annually.

 

(i)

Benefits:

Executive shall be eligible for employee benefits and other insurance plans
which are described in the benefit highlights document given to employees
generally. Executive is also eligible to participate in the Company’s Executive
Deferred Compensation Program. and other benefits and perquisites provided to
senior executives (other than benefits not available to new hires on the date
hereof [or benefits available to the current Chief Executive Officer while
Executive is not the Chief Executive Officer]).

 

2.4

Term.

 

(a)

General Term. This Agreement shall commence on June 18, 2007, and terminate on
June 30, 2010, unless extended prior to that date (the “Term”). The Term shall
automatically be extended for successive additional one-year periods unless
either party to this Agreement provides the other party with notice of
termination of this Agreement at least one hundred and eighty (180) days prior
to the expiration of the original three-year period or any one-year period
thereafter.

 

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(b)

Termination for Cause or Voluntary Termination Other than Constructive
Termination. If Executive is terminated by the Company for Cause or if Executive
voluntarily terminates his employment in any manner, except for a Constructive
Termination or as provided in Section 2.4(g), prior to the end of the Employment
Period, Executive shall be entitled only to his Base Salary and accrued unused
vacation through the date of termination, but shall not be entitled to any
further Base Salary or any applicable bonus or Benefits under Section 2.3(i) for
that year or any future year, except for (“Accrued Benefits”): (i) any prior
year earned unpaid bonus, (ii) any unreimbursed business expenses incurred on or
prior to the Date of Termination and (iii) amounts as may be provided in an
applicable benefit plan or program, or to any severance compensation of any
kind, nature or amount.

 

Termination Without Cause. If Executive is terminated without Cause or if there
is a Constructive Termination, Executive shall be entitled to the benefits
described in this subsection.

 

 

(i)

A Severance Payment equal to two, multiplied by, the sum of (a) Executive’s
annual Base Salary as of Executive’s Termination Date; and (b) the average
annual bonus paid to Executive under the Company’s Short-Term Incentive Plan
over the three year period (or such shorter period of time as Executive was
eligible for a bonus under such Short-Term Incentive Plan) immediately preceding
the year of Executive’s Termination Date;

 

(ii)

A cash payment in an amount equal to the premiums that Executive would pay in
order to secure COBRA continuation coverage for health, dental and vision
benefits under the Company’s medical plan for two years following termination of
employment (irrespective of whether COBRA otherwise would terminate prior to
expiration of such two-year period) (“COBRA Payment”); and the additional
federal, state, and local income and other taxes (other than taxes under Section
409A of the Internal Revenue Code of 1986, as amended (“Code”)) that will result
from the COBRA Payment (the “COBRA Tax Gross-up”).

Method of Payment. The Severance Payment, the COBRA Payment and the COBRA Tax
Gross-up shall be paid in a single lump-sum cash payment, less all applicable
withholding taxes, within fifteen days following Executive’s termination of
employment to the extent they are not subject to Section 409A of the Code, or if
they are subject to Section 409A, on the first day of the seventh month
following Executive’s termination of employment or, if earlier, the date
Executive dies following such termination of employment.

 

(iii)

Section 2.3(f) to the contrary notwithstanding, Executive shall immediately
fully vest in the unvested portion of his Sign-On Equity Grants provided under
Section 2.3(f) hereof. Executive shall vest in any and all other non-qualified
stock options, incentive stock options, stock appreciation rights, restricted
stock, performance shares, performance units, and restricted stock units
(collectively “Equity Awards”) previously granted to Executive by the Company
which are outstanding on Executive’s Termination Date in accordance with the
terms of the plan(s) under which such Equity Awards were granted.

 

(iv)

Executive shall be entitled to receive a Bonus Payment equal to the pro-rata
portion (determined as of the Termination Date) of Executive’s incentive bonus
otherwise payable under the terms of the Company’s Long-Term Incentive Plan.
Such Bonus Payment will be paid at the same time that the bonus would have been
paid under the Company’s Long-Term Incentive Plan had Executive

 

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continued employment through end of the performance period during which the
Termination Date occurred.

 

(v)

The Company (at its expense) shall, for a period of twelve months following
Executive’s Termination Date:

Reimburse Executive for the reasonable costs of outplacement services,
reasonable job hunting expenses, travel costs, and financial counseling costs
associated with employment transition not to exceed $40,000. All reimbursements
shall be made as soon as practicable after submission of appropriate expense
reports but in no event later than the end of Executive’s third taxable year
following the year in which Executive terminates employment with the Company;
and

Allow Executive to participate in the welfare plans the Company generally makes
available to its key employees on substantially the same terms as an actively
employed key employee, except that (A) for a period of six months following the
Date of Termination, Executive shall pay to the Company the premium cost of
participation in such plans to the extent required to comply with Section
409A(2)(B)(i) of the Code and Regulation Section 1.409A-1(b)(9)(v) thereunder,
and on the first day of the seventh month following the Date of Termination the
Company shall pay Executive a lump sum amount equal to such amounts so paid by
him, and (B) Executive may not continue to participate in the Company’s
Short-Term Disability and Long-Term Disability Plans.

(c)

No Mitigation. To the extent that Executive shall receive compensation for
personal services from employment other than with the Company subsequent to a
termination of Executive’s employment with the Company, the amounts so earned
shall not be offset against the amounts (if any) due under this Agreement
following Executive’s termination of employment.

 

(d)

Cap on Certain Payments by the Company. In the event that (i) any payment or
benefit of any type by the Company to or for the benefit of Executive, whether
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, would equal or exceed the product of 3 and Executive’s
Base Amount (as defined in Section 280G of the Code), thereby making such
payment or benefit subject to the excise tax imposed by Section 4999 of the of
the Code, (ii) or any interest or penalties are incurred by Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the “Excise Tax”), then
unless Section 2.4(e) applies, Executive shall receive, subject to the
conditions of this Agreement and in full satisfaction of any and all rights
under this Agreement, only such payments and benefits which do not, in the
aggregate, equal or exceed the product of 3 and Executive’s “Base Amount.”

(e)

Certain Additional Payments by the Company. Notwithstanding anything in this
Agreement to the contrary, in the event that any payment or benefits of any type
by the Company to or for the benefit of Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, exceeds the product of 3 and Executive’s “Base Amount” by an amount
greater than ten (10) percent of such product, then the cap on payment imposed
under Section 2.4(d) shall not apply and Executive shall be entitled to receive
an additional payment (a “Gross Up Payment”) in an amount such that after
payment by Executive of the Excise taxes and any income taxes (and any interest
and penalties imposed with respect thereto) imposed upon the Gross Up Payment,
Executive retains an amount of the Gross Up Payment equal to the Excise Tax
imposed upon the payments.

 

All determinations required to be made under this Section 2.4(e), including
whether and when a Gross Up Payment is required and the amount of such Gross Up
Payment and

 

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the assumptions to be utilized in arriving at such determination, shall be made
by such certified public accounting firm in the business of performing such
calculations as may be designated by the Company (the “Consulting Firm”), which
shall provide detailed supporting calculations both to the Company and
Executive. All fees and expenses of the Consulting Firm shall be borne solely by
the Company.

 

(f)

Severance Forfeiture. Executive agrees that Executive shall be entitled to the
payments set forth in this Section 2.4 only if Executive has not materially
breached, as of the Termination Date, any provisions of this Agreement and does
not materially breach such provisions at any time during the period for which
such payments are to be made. The Company’s obligation to make such payments
will terminate upon the occurrence of any such material breach during the
severance period.

 

(g)

No Additional Severance. Executive hereby agrees that no severance compensation
of any kind, nature or amount shall be payable to Executive, except as expressly
set forth in this Section 2.4, and Executive hereby irrevocably waives any claim
for any other severance compensation.

 

(h)

Death or Disability. The Company’s obligation under this Agreement terminates on
the last day of the month in which Executive’s death occurs or on the date as of
which Executive first becomes entitled to receive disability benefits under the
Company’s long-term disability plan. The Company shall pay to Executive or
Executive’s estate all previously earned and accrued but unpaid Base Salary and
accrued unused vacation up to such date. Thereafter, Executive or his estate
shall not be entitled to any further Base Salary, bonus, or Benefits for that
year or any subsequent year, except for his Accrued Benefits as provided in
Section 2.4(b).

 

2.5

Confidential Information. Executive expressly recognizes and acknowledges that
during his employment with the Company, he will become entrusted with, have
access to, and gain possession of confidential and proprietary information,
data, documents, records, materials, and other trade secrets and/or other
proprietary business information of the Company that is not readily available to
competitors, outside third parties and/or the public, including without
limitation, information about (i) current or prospective customers and/or
suppliers, (ii) employees, research, goodwill, production, and prices,
(iii) business methods, processes, practices or procedures; (iv) computer
software and technology development, and (v) business strategy, including
acquisition, merger and/or divestiture strategies, (collectively or with respect
to any of the foregoing, the “Confidential Information”). Executive agrees, by
acceptance of the benefits under this Agreement, to protect all Confidential
Information concerning the business activities of the Company which were
acquired in connection with or as a result of the performance of service for the
Company.

 

2.6

Competitive Activity. For a period of 12 months following termination of
Executive’s employment hereunder, he shall not engage, or attempt to engage, on
his own behalf or on behalf of a third party in any “Competitive Activity”. The
term “Competitive Activity” shall mean participation by Executive, without
written consent of the Board, in the management of any business operation of any
enterprise if such operation engages in the design, manufacture, marketing, or
retail of residential furniture in any geographic are where the Company or its
subsidiaries conducts business.

 

2.7

Stock Ownership. The Board has approved stock ownership requirements for the
senior officers of the Company. The ownership requirement for the Chief
Executive Officer is 200,000 Shares. Executive will have five years from
Executive’s appointment as Chairman and Chief Executive Officer to attain this
level of ownership.

 

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                ARTICLE III

                Miscellaneous

 

3.1

Executive's Representations. Executive hereby represents and warrants to the
Company that (i) Executive’s execution, delivery and performance of this
Agreement do not and shall not conflict with, breach, violate or cause a default
under any contract, agreement, instrument, order, judgment or decree to which
Executive is a party or by which he is bound, (ii) Executive is not a party to
or bound by any employment agreement, noncompete agreement or confidentiality
agreement with any other person or entity and (iii) upon the execution and
delivery of this Agreement by the Company, this Agreement shall be the valid and
binding obligation of Executive, enforceable in accordance with its terms.
Executive hereby acknowledges and represents that he fully understands the terms
and conditions contained herein.

 

3.2

Survival. Sections 2.4, 2.5 and 2.6 shall survive and continue in full force in
accordance with their terms notwithstanding any termination of the Employment
Period.

 

3.3

Notices. All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this Agreement will be in writing and
will be deemed to have been given when delivered personally, mailed by certified
or registered mail, return receipt requested and postage prepaid, or sent via a
nationally recognized overnight courier, or sent via facsimile (provided
recipient provides a facsimile acknowledgement of receipt within 24 hours
thereafter in reply), to the recipient. Such notices, demands and other
communications will be sent to the address indicated below:

 

 

To the Company:

 

 

Furniture Brands International, Inc.

 

Human Resources Committee

 

101 South Hanley Road

 

19th Floor

 

St. Louis, Missouri 63105

 

 

To Executive:

 

 

Ralph Scozzafava

 

 

At the last known residence address on the payroll records of the Company

 

Or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.

 

3.4

Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law. If
any provision of this Agreement is held to be invalid, illegal or unenforceable
in any respect under any applicable law or rule in any jurisdiction, (a) the
parties agree that such provision(s) will be enforced to the maximum extent
permissible under the applicable law, and (b) any invalidity, illegality or
unenforceability of a particular provision will not affect any other provision
of this Agreement.

 

3.5

Successors and Assigns. Except as otherwise provided herein, all covenants and
agreements contained in this Agreement shall bind and inure to the benefit of
and be enforceable by the Company, and their respective successors and assigns.
This Agreement is personal to Executive and except as otherwise specifically
provided herein,

 

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this Agreement, including the obligations and benefits hereunder, may not be
assigned to any party by Executive. If Executive dies prior to receipt of all
amounts and benefits due him under this Agreement, including, without
limitation, under Section 2.4, such amounts will be paid to Executive’s estate.

 

3.6

Descriptive Headings. The descriptive headings of this Agreement are inserted
for

 

convenience only and do not constitute a part of this Agreement.

 

3.7

Counterparts. This Agreement may be executed in one or more identical
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.

 

3.8

Waiver. Neither any course of dealing nor any failure or neglect of either party
hereto in any instance to exercise any right, power or privilege hereunder or
under law shall constitute a waiver of such right, power or privilege or of any
other right, power or privilege or of the same right, power or privilege in any
other instance. Without limiting the generality of the foregoing, Executive’s
continued employment without objection shall not constitute Executive’s consent
to, or a waiver of Executive’s rights with respect to, any circumstances
constituting Constructive Termination (subject to Section 1.1(e)). All waivers
by either party hereto must be contained in a written instrument signed by the
party to be charged therewith, and, in the case of Company, by its duly
authorized officer.

 

3.9

Entire Agreement. This instrument constitutes the entire agreement of the
parties in this matter and shall supersede any other agreement between the
parties, oral or written, concerning the same subject matter.

 

3.10

Amendment. This Agreement may be amended only by a writing which makes express
reference to this Agreement as the subject of such amendment and which is signed
by Executive and by a duly authorized officer of the Company.

 

3.11

Governing Law. This Agreement shall be signed by the parties in St. Louis,
Missouri. All questions concerning the construction, validity and interpretation
of this Agreement will be governed by and construed in accordance with the
domestic law of the State of Missouri, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of Missouri or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Missouri. Any litigation relating to or
arising out of this Agreement shall be filed and litigated exclusively in the
St. Louis County Circuit Court or the United States District Court for the
Eastern District of Missouri.

 

3.12

Remedies. Each of the parties to this Agreement will be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs
(including reasonable attorneys' fees) caused by any breach of any provision of
this Agreement and to exercise all other rights existing in its favor. The
parties hereto agree and acknowledge that money damages may not be an adequate
remedy for any breach of the provisions of this Agreement, including, without
limitation, Sections 2.5, 2.6 and 2.7 hereof, and that any party may in its sole
discretion apply to any court of law or equity of competent jurisdiction
(without posting any bond or deposit) for specific performance and/or other
injunctive relief in order to enforce or prevent any violations of the
provisions of this Agreement.

3.13

Exit Interview. To ensure a clear understanding of this Agreement, Executive
agrees, at the time of termination of Employee's employment, to engage in an
exit interview with the Company at a time and place designated by the Company
and at the Company's expense. Executive understands and agrees that during said
exit interview, Executive may be required to confirm that he will comply with
his on-going obligations under this

 

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Agreement. The Company may elect, at its option, to conduct the exit interview
by telephone.

 

3.14

Future Employment. Executive shall disclose the existence of this Agreement to
any new employer or potential new employer which offers products or services
that compete with the Company’s Business if such new employment commences within
two years following Executive’s termination of employment with the Company.
Executive consents to the Company informing any subsequent employer of
Executive, or any entity which the Company in good faith believes is, or is
likely to be, considering employing Executive, of the existence and terms of
this Agreement if such subsequent employment commences (or is expected to
commence) within two years following Executive’s termination of employment with
the Company.

 

3.15

Indemnification. he Company shall indemnify Executive and hold Executive
harmless from and against any claim, loss or cause of action arising from or out
of Executive's performance as an officer, director or employee of the Company or
any of its subsidiaries or in any other capacity, including any fiduciary
capacity, in which Executive serves at the request of the Company to the maximum
extent permitted under applicable law. The Company shall cause Executive to be a
covered person, during and after termination of his employment and membership on
the Board respecting his acts and omissions occurring during such employment and
membership, under any directors and officers liability insurance policy (or
similar policy) that it may have in effect from time to time, and shall afford
Executive all of the rights and privileges available to covered persons in
accordance with the terms of any such policy.

 

3.16

Inconsistency. In the event of any inconsistency between this Agreement and any
other agreement (including but not limited to any option, long-term incentive or
other equity award agreement), plan, program, policy or practice (collectively,
“Other Provision”) of the Company the terms of this Agreement shall control over
such Other Provision. No provision in any policy, code, plan or program related
to a violation thereof being grounds for termination, or similar language, shall
result in a “cause” termination unless such violation is also Cause under this
Agreement and the provisions hereof are complied with, and the foregoing shall
apply even if Executive signs an acknowledgement or otherwise agrees to the
provisions of such policy, code, plan or program.

 

10

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
this 14th day of June, 2007, and effective as of the date first written above.

 

 

 

Furniture Brands International, Inc.

 

 

 

 

By:

/s/ Mary Elizabeth Sweetman

 

 

 

 

Name:

Mary Elizabeth Sweetman, Ph.D.

 

 

 

 

Title:

Senior Vice President, Human Resources

 

 

 

 

 

 

 

EXECUTIVE

 

 

 

 

By:

/s/ Ralph Scozzafava

 

 

 

 

Name:

Ralph Scozzafava

 

 

 

 

11