Exhibit 10.7

March 2, 1999

Mr. Bernard C. Wampler
Pulaski, Virginia 24301

Dear Bernard:

         This will confirm the agreement  pursuant to which you will retire as a
member of the Board of Directors of Pulaski Furniture Corporation, and remain as
a consultant to the Company for the three-year period beginning today.

1.   Pulaski  agrees to repurchase  the 68,641 shares of common stock of Pulaski
     Furniture  Corporation owned by you (including 9,200 shares issuable to you
     under the Stock Incentive  Plan) for a price of $21.70 a share,  this being
     the average  closing  market price for PFC stock for the  four-week  period
     ended Friday,  February 19, 1999. Pulaski Furniture  Corporation's check in
     the amount of $1,489,510 will be delivered to you by Spencer Rygas on March
     15, 1999, at a time and place upon which you and he agree.

2.   Pulaski  agrees to pay you a  consulting  fee in the amount of  $325,855 in
     twelve equal quarterly  installments with the first such payment being paid
     on March 15,  1999,  in the amount of  $27,154.58.  In the event you are to
     pass away during the consulting period, the remaining payments will be paid
     on the same schedule to the Bernard C. Wampler Family Limited Partnership.

3.   The SERP and the Deferred  Compensation  Agreement of December 2, 1997 will
     continue in effect in accordance  with their terms.  For example,  when the
     deferred  compensation  payments  terminate in  approximately 20 years, the
     SERP payments will be calculated  based on the SERP plan without the offset
     previously required when deferred compensation payments were also received.

4.   Pulaski  Furniture  Corporation will maintain your current level of medical
     insurance benefits using Medicare and a supplement.

5.   The Company will continue to pay the premiums on the life insurance  policy
     on your life issued by Ohio National  Insurance  Company,  in the principal
     amount of $250,000  between ages 65 and 70; $200,000 between 70 and 75; and
     $100,000 after age 75.

6.   You will vacate your office at Pulaski Furniture  Corporation  headquarters
     by March 31, 1999, and you will take with you the three bachelor  chests on
     the wall that are full of your materials, as well as the pine bookcase. The
     other furniture will remain.

7.   You  will  change  your  mailing  address,  but it is  understood  that you
     probably  will  continue to receive mail at Pulaski  Furniture  Corporation
     headquarters  for some time.  Janice Cheverton will see that mail addressed
     to you is put in the blue  pouch with your name and that this is put in the
     mail slot so that you can pick it up at your convenience.

8.   We have agreed that there should be an internal  statement  regarding  your
     retirement and this will be reviewed with you as soon as possible.

9.   As stated above,  the shares being  purchased  from you by the  Corporation
     include  9,200 shares  issuable  under the Stock  Incentive  Plan.  Pulaski
     agrees  that  it is to pay 25% of the  issue  value  of  these  shares,  as
     provided under the Plan,  which is intended to pay all or part of the state
     and federal withholding taxes on these 9,200 shares.

10.  We have discussed  having a retirement  dinner and that matter is left with
     the Board of Directors for resolution.

11.  You  agree  that  you will  consult  with the  President  and the  Board of
     Directors of the Corporation from time to time over the next three years on
     a basis that is not  burdensome to you, and at times that are reasonable in
     accordance  with your  schedule.  Pulaski will, of course,  pay  reasonable
     out-of-pocket  expenses in connection with any such consultation.  You also
     agree  that  you  will  not  compete  with  the  Corporation,  directly  or
     indirectly, during the term of this agreement and within a reasonable range
     of any of the Corporation's operations, you will preserve in confidence all
     nonpublic information about the Corporation that you have or may acquire in
     the  future,  and  you  agree  not to make  adverse  statements  about  the
     Corporation  or its officers or  employees;  and you will protect the trade
     secrets of the Corporation.

         I have signed this letter  agreement in the space  provided below after
approval by the Board of Directors, and if this letter agreement is agreeable to
you, please sign and return one of the duplicate originals to me.


                                           Sincerely,


                                           /s/ John G. Wampler
                                           -------------------------------------
                                           John G. Wampler
                                           President and Chief Executive Officer

/s/ Bernard C. Wampler
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Bernard C. Wampler