Exhibit 10.cc.

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (the "Agreement "), dated as of November
1, 1996, between Troy A. Peery, Jr. (the "Executive") and Heilig-Meyers
Company, a Virginia corporation (the "Company"), recites and provides as
follows:

         WHEREAS,  the Board of Directors of the Company (the  "Board")  expects
that the Executive will continue to make substantial contributions to the growth
and prospects of the Company; and

         WHEREAS,  the Board desires that the Company retain the services of the
Executive,  and the  Executive  desires  to  continue  his  employment  with the
Company, all on the terms and subject to the conditions set forth herein.

         NOW,  THEREFORE,  in  consideration  of the foregoing  premises and the
mutual  covenants  herein  contained,  the  Company and the  Executive  agree as
follows:

     1. Employment  Period.  The Company hereby agrees to continue the Executive
in its employ,  and the  Executive  hereby agrees to remain in the employ of the
Company, in accordance with the terms and provisions of this Agreement,  for the
period  commencing  on the date of this  Agreement  (the  "Effective  Date") and
ending on the third anniversary of such date (the "Employment Period").  Subject
to the provisions of Section 3 hereof, the Employment Period shall be a constant
rolling period of three (3) years,  commencing on the Effective  Date,  with the
result  that,  for each day after the  Effective  Date the  Executive's  term of
employment  shall be  extended  for an  additional  day so that at all times the
remaining period of the Executive's term of employment shall be three (3) years.

     2.            Terms of Employment.

          (a) Position and Duties.

               (i) During the Employment  Period,  (A) the Executive's  position
(including  status,  offices,  titles and  reporting  requirements),  authority,
duties  and  responsibilities  shall be at least  commensurate  in all  material
respects with the most significant of those held,  exercised and assigned at any
time during the 90-day period  immediately  preceding the Effective Date and (B)
the Executive's  services shall be performed at the location where the Executive
was employed  immediately  preceding the  Effective  Date or any office which is
less than 35 miles from such location.

(page 106)
               (ii) The Board agrees that during the Employment  Period it shall
nominate  the  Executive  for  election to the Board at each  annual  meeting of
shareholders  and use its best efforts to cause the Executive to be duly elected
to the Board at each such meeting.

               (iii) During the Employment  Period, and excluding any periods of
vacation and leave to which the Executive is entitled,  the Executive  agrees to
devote  reasonable  attention  and  time  during  normal  business  hours to the
business  and affairs of the Company  and, to the extent  necessary to discharge
the responsibilities assigned to the Executive hereunder, to use the Executive's
reasonable   best   efforts  to  perform   faithfully   and   efficiently   such
responsibilities.  During the  Employment  Period it shall not be a violation of
this Agreement for the executive to (A) serve on corporate,  civic,  charitable,
furniture industry association or professional  association boards or committees
(provided  the  Executive  obtains  prior  approval of the  Board),  (B) deliver
lectures,  fulfill speaking engagements or teach at educational institutions and
(C) manage personal investments, so long as such activities do not significantly
interfere  with  the  performance  of  the  Executive's  responsibilities  as an
employee of the  Company in  accordance  with this  Agreement.  It is  expressly
understood  and agreed  that to the extent  that any such  activities  have been
conducted by the Executive prior to the Effective Date, the continued conduct of
such  activities  (or the  conduct  of  activities  similar  in nature and scope
thereto)  subsequent  to the  Effective  Date shall not  thereafter be deemed to
interfere  with  the  performance  of the  Executive's  responsibilities  to the
Company.

          (b) Compensation.

               (i) Base Salary.  During the  Employment  Period,  the  Executive
shall receive an annual base salary ("Annual Base Salary"),  which shall be paid
in equal  installments  on a monthly  basis,  at least equal to twelve times the
highest  monthly base salary paid or payable to the Executive by the Company and
its  affiliated  companies  in respect of the  twelve-month  period  immediately
preceding the month in which the Effective  Date occurs.  During the  Employment
Period,  the Annual Base Salary shall be reviewed at least annually and shall be
increased at any time and from time to time as shall be substantially consistent
with  increases  in base  salary  generally  awarded in the  ordinary  course of
business to other peer  executives of the Company and its affiliated  companies.
Any  increase in Annual Base Salary shall not serve to limit or reduce any other
obligation to the Executive under this  Agreement.  Annual Base Salary shall not
be reduced  after any such  increase and the term Annual Base Salary as utilized
in this Agreement shall refer to Annual Base Salary as so increased.  As used in
this  Agreement,  the term  "affiliated  companies"  shall  include  any company
controlled by, controlling or under common control with the Company.

(page 107)
               (ii)  Annual  Bonus.  In  addition  to Annual  Base  Salary,  the
Executive  shall be awarded,  for each fiscal year ending during the  Employment
Period,  in cash an annual bonus (the "Annual Bonus") under the Company's Annual
Performance-Based  Bonus Plan or, if more favorable to the Executive,  under any
plans,  practices,  programs and policies of the Company and its  affiliates  in
effect generally at any time after the Effective Date with respect to other peer
executives of the Company and its affiliated companies.

               (iii)  Incentive,   Savings  and  Retirement  Plans.  During  the
Employment  Period,  the  Executive  shall be  entitled  to  participate  in all
incentive  (including,   without  limitation,  stock  incentive),   savings  and
retirement plans, practices, policies and programs applicable generally to other
peer  executives of the Company and its  affiliated  companies,  but in no event
shall such plans,  practices,  policies and programs  provide the Executive with
incentive  opportunities  (measured  with  respect to both  regular  and special
incentive  opportunities,  to the  extent,  if any,  that  such  distinction  is
applicable), savings opportunities and retirement benefit opportunities, in each
case,  less  favorable,  in the  aggregate,  than  the most  favorable  of those
provided by the Company and its  affiliated  companies for the  Executive  under
such plans, practices, policies and programs as in effect at any time during the
90-day period  immediately  preceding the Effective Date or if more favorable to
the Executive,  those provided generally at any time after the Effective Date to
other peer executives of the Company and its affiliated companies.

               (iv) Welfare  Benefit Plans.  During the Employment  Period,  the
Executive and/or the Executive's  family,  as the case may be, shall be eligible
for participation in and shall receive all benefits under welfare benefit plans,
practices,  policies  and  programs  provided by the Company and its  affiliated
companies  (including,   without  limitation,   medial,  prescription,   dental,
disability, salary continuance,  employee life, group life, accidental death and
travel accident insurance plans and programs) to the extent applicable generally
to other peer executives of the Company and its affiliated companies,  but in no
event shall such plans,  practices,  policies and programs provide the Executive
with  benefits  which  are  less  favorable,  in the  aggregate,  than  the most
favorable  of such plans,  practices,  policies  and  programs in effect for the
Executive  at any time  during  the  90-day  period  immediately  preceding  the
Effective Date or, if more favorable to the Executive,  those provided generally
at any time after the Effective Date to other peer executives of the Company and
its affiliated companies.

               (v) Expenses.  During the Employment  Period, the Executive shall
be  entitled  to receive  prompt  reimbursement  for all  reasonable  employment
expenses  incurred  by the  Executive  in  accordance  with the  most  favorable
policies,  practices and procedures of the Company and its affiliated  companies
in effect for the  Executive  at any time during the 90-day  period  immediately
preceding  the  Effective  Date or, if more  favorable to the  Executive,  as in
effect generally at any time thereafter

(page 108)
with respect to other peer executives of the Company and its affiliated
companies.

               (vi) Fringe Benefits. During the Employment Period, the Executive
shall be  entitled  to fringe  benefits in  accordance  with the most  favorable
plans,  practices,  programs  and  policies of the  Company  and its  affiliated
companies  in effect for the  executive  at any time  during  the 90-day  period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in  effect  generally  at any time  thereafter  with  respect  to other  peer
executives of the Company and its affiliated companies.

               (vii) Office and Support Staff. During the Employment Period, the
Executive  shall  be  entitled  to an  office  or  offices  of a size  and  with
furnishings and other  appointments,  and to exclusive personal  secretarial and
other assistance, at least equal to the most favorable of the foregoing provided
to the Executive by the Company and its affiliated  companies at any time during
the 90-day period immediately preceding the Effective Date or, if more favorable
to the Executive,  as provided  generally at any time thereafter with respect to
other peer executives of the Company and its affiliated companies.

               (viii)  Vacation.  During the  Employment  Period,  the Executive
shall be entitled to paid vacation in accordance with the most favorable  plans,
policies,  programs and practices of the Company and its affiliated companies as
in effect for the  Executive  at any time during the 90-day  period  immediately
preceding  the  Effective  Date or, if more  favorable to the  Executive,  as in
effect generally at any time thereafter with respect to other peer executives of
the Company and its affiliated companies.

     3.            Termination of Employment.

          (a) Death or Disability.  The Executive's  employment  shall terminate
automatically  upon the Executive's  death during the Employment  Period. If the
Company  determines  in good  faith that the  Disability  of the  Executive  has
occurred during the Employment  Period (pursuant to the definition of Disability
set forth below), it may give to the Executive written notice in accordance with
Section 11(b) of its intention to terminate the Executive's employment.  In such
event, the Executive's  employment with the Company shall terminate effective on
the 30th day after  receipt of such  notice by the  Executive  (the  "Disability
Effective  Date"),  provided  that,  within the 30 days after such receipt,  the
Executive  shall not have returned to full-time  performance of the  Executive's
duties.  For purposes of this Agreement,  "Disability" shall mean the absence of
the Executive from the Executive's  duties with the Company on a full-time basis
for 180  consecutive  business days as a result of  incapacity  due to mental or
physical  illness  which is  determined to be total and permanent by a physician
selected by the

(page 109)
Company or its insurers and acceptable to the Executive or the Executive's legal
representative   (such  agreement  as  to  acceptability   not  to  be  withheld
unreasonably).

          (b) Cause. The Company may terminate the Executive's employment during
the Employment  Period for Cause. For purposes of this Agreement,  "Cause" shall
mean (i) a material breach by the Executive of the Executive's obligations under
Section  2(a)  (other than as a result of  incapacity  due to physical or mental
illness) which is demonstrably  willful and deliberate on the Executive's  part,
which is committed in bad faith or without reasonable belief that such breach is
in the best interests of the Company and which is not remediated in a reasonable
period of time after receipt of written notice from the Company  specifying such
breach or (ii) the  conviction  of the  Executive  of a felony  involving  moral
turpitude.

          (c) Notice of  Termination.  Any termination by the Company for Cause,
or by the Executive, shall be communicated by Notice of Termination to the other
party  hereto  given in  accordance  with  Section  11(b).  For purposes of this
Agreement,  a "Notice of Termination" means a written notice which (i) indicates
the specific  termination  provision in this Agreement  relied upon, (ii) to the
extent  applicable,  sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's  employment  under
the  provision so  indicated  and (iii) if the Date of  Termination  (as defined
below)  is  other  than  the  date of  receipt  of such  notice,  specifies  the
termination  date (which date shall be not more than 15 days after the giving of
such  notice).  The failure by the  Executive or the Company to set forth in the
Notice of Termination any fact or circumstance  shall not waive any right of the
Executive or the Company hereunder or preclude the Executive or the Company from
asserting  such  fact  or  circumstance  in  enforcing  the  Executive's  or the
Company's rights hereunder.

          (d)  Date of  Termination.  "Date  of  Termination"  means  (i) if the
Executive's  employment  is  terminated  by the  Company  for  Cause,  or by the
Executive,  the date of receipt of the Notice of  Termination  or any later date
specified  therein,  as the case may be, (ii) if the  Executive's  employment is
terminated  by the  Company  other  than for  Cause or  Disability,  the Date of
Termination  shall be the date on which the Company  notifies  the  Executive of
such termination and (iii) if the Executive's employment is terminated by reason
of death or Disability,  the Date of  Termination  shall be the date of death of
the Executive or the Disability Effective Date, as the case may be.

     4.            Obligations of the Company upon Termination.

          (a) Other than for Cause or Death.  The Company may terminate
the Executive's employment during the Employment Period for other than
Cause or Death.  If, during the Employment Period, the Company shall

(page 110)
terminate  the  Executive's  employment  other  than  for  Cause or death or the
Executive shall terminate employment:

               (i) The Company  shall pay to the Executive in a lump sum in cash
within 30 days  after  the Date of  Termination  the sum of (1) the  Executive's
Annual Base Salary through the Date of Termination to the extent not theretofore
paid; (2) to the extent not theretofore  paid, the product of (A) the greater of
(x) the Annual Bonus paid or payable,  including by reason of any  deferral,  to
the Executive (and annualized for any fiscal year consisting of less than twelve
full months or for which the  Executive  has been  employed for less than twelve
full months) for the most recently  completed  fiscal year during the Employment
Period,  if any, and (y) the average  annualized (for any fiscal year consisting
of less than twelve full months or with respect to which the  Executive has been
employed for less than twelve full months)  bonus paid or payable,  including by
reason of any  deferral,  to the  Executive  by the Company  and its  affiliated
companies in respect of the three fiscal years immediately  preceding the fiscal
year in which the Date of  Termination  occurs  (such  greater  amount  shall be
hereinafter  referred to as the "Highest Annual Bonus") and (B) a fraction,  the
numerator of which is the number of days in the current  fiscal year through the
Date of Termination,  and the denominator of which is 365; (3) any  compensation
previously  deferred by the  Executive  (together  with any accrued  interest or
earnings  thereon)  to the  extent not  theretofore  paid;  and (4) any  accrued
vacation  pay,  to the  extent  not  theretofore  paid  (the sum of the  amounts
described in clauses (1), (2), (3) and (4) shall be  hereinafter  referred to as
the "Accrued Obligations"); and

               (ii) The Company shall pay to the Executive in a lump sum in cash
within 30 days after the Date of Termination the sum of the  Executive's  Annual
Base Salary and Highest  Annual Bonus payable to the Executive  from the Date of
Termination to the end of the Employment Period; and

               (iii) For the remainder of the Employment  Period, or such longer
period as any plan, program,  practice or policy may provide,  the Company shall
continue benefits to the Executive and/or the Executive's  family at least equal
to those which would have been  provided to them in  accordance  with the plans,
programs,   practices  and  policies   described  in  Section  2(b)(iv)  if  the
Executive's  employment  had not been  terminated  in  accordance  with the most
favorable  plans,  practices,  programs  or  policies  of the  Company  and  its
affiliated  companies  as in  effect  and  applicable  generally  to other  peer
executives and their families during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to other peer executives of the Company and its
affiliated  companies  and  their  families,  provided,  however,  that  if  the
Executive  becomes  reemployed with another  employer and is eligible to receive
medial or

(page 111)
other welfare  benefits  under another  employer  provided  plan, the medial and
other welfare  benefits  described  herein shall be secondary to those  provided
under  such  other plan  during  such  applicable  period of  eligibility  (such
continuation  of such benefits for the applicable  period herein set forth shall
be hereinafter referred to as "Welfare Benefit  Continuation").  For purposes of
determining  eligibility of the Executive for retiree benefits  pursuant to such
plans,  practices,  programs and policies,  the Executive shall be considered to
have  remained  employed  until  the end of the  Employment  Period  and to have
retired on the last day of such period; and

               (iv) To the extent not theretofore paid or provided,  the Company
shall timely pay or provide to the Executive  and/or the Executive's  family any
other amounts or benefits required to be paid or provided or which the Executive
and/or the Executive's  family is eligible to receive pursuant to this Agreement
and under any plan, program,  policy or practice or contract or agreement of the
Company and its affiliated  companies as in effect and  applicable  generally to
other peer  executives and their families  during the 90-day period  immediately
preceding  the  Effective  Date or, if more  favorable to the  Executive,  as in
effect generally thereafter with respect to other peer executives of the Company
and its affiliated companies and their families (such other amounts and benefits
shall be hereinafter referred to as the "Other Benefits").

          (b) Death.  If the  Executive's  employment is terminated by reason of
the  Executive's  death  during the  Employment  Period,  this  Agreement  shall
terminate without further  obligations to the Executive's legal  representatives
under this Agreement, other than for payment of Accrued Obligations (which shall
be paid to the Executive's estate or beneficiary,  as applicable,  in a lump sum
in cash  within 30 days of the Date of  Termination)  and the timely  payment or
provision of the Welfare Benefit Continuation and Other Benefits.

          (c) Cause. If the Executive's employment shall be terminated for Cause
during the Employment  Period,  this Agreement shall  terminate  without further
obligations  to the Executive  other than the obligation to pay to the Executive
his Annual Base Salary  through the Date of  Termination  plus the amount of any
compensation  previously  deferred by the Executive,  in each case to the extent
theretofore unpaid.

          (d) Time of Payment.  The Company shall make all payments  required by
this Section 4 within the time periods provided in Sections 4(a), 4(b) and 4(c);
provided,  however,  that in the  event  that any  such  payments  would  become
non-deductible  to the Company  under the  provisions  of Section  162(m) of the
Internal  Revenue Code of 1986, as amended (the "Code"),  and the Executive is a
"covered  employee" as defined in Treas.  Reg.  Section  1.162-27(c)(2)  for the
taxable year of the Company during which the Date of Termination occurred or for
the  immediately  preceding  year,  the Company  shall make any such payment not
earlier than 90 days

(page 112)
following the end of the Company's taxable year during which the
Executive last was a "covered employee."

     5. Nonexclusivity of Rights. Except as provided in Sections 4(a)(iii), 4(b)
and 4(c),  nothing in this  Agreement  shall  prevent  or limit the  Executive's
continuing  or future  participation  in any plan,  program,  policy or practice
provided by the  Company or any of its  affiliated  companies  and for which the
Executive may qualify,  nor shall anything herein limit or otherwise affect such
rights as the  Executive  may have  under any  contract  or  agreement  with the
Company or any of its affiliated companies. Amounts which are vested benefits or
which the  Executive is otherwise  entitled to receive  under any plan,  policy,
practice or program of or any contract or  agreement  with the Company or any of
its affiliated  companies at or subsequent to the Date of  Termination  shall be
payable in accordance with such plan, policy, practice or program or contract or
agreement except as explicitly modified by this Agreement.

     6.            Full Settlement; Resolution of Disputes.

          (a) The Company's  obligation to make the payment provided for in this
Agreement  and  otherwise  to perform  its  obligations  hereunder  shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim, right
or action  which the Company may have  against the  Executive  or others.  In no
event shall the  Executive  be obligated  to seek other  employment  or take any
other action by way of mitigation of the amounts  payable to the Executive under
any of the  provisions  of this  Agreement  and,  except as  provided in Section
4(a)(iii)  with respect to Welfare  Benefit  Continuation  and Section 8(a) with
respect to non-competition, such amounts shall not be reduced whether or not the
Executive  obtains  other  employment.  The  Company  agrees to pay, to the full
extent  permitted  by law,  all  reasonable  legal  fees and  expenses  that the
Executive  may incur to enforce this  Agreement and that result from a breach of
this Agreement by the Company; provided, however, that the reasonableness of the
fees  and  expenses  must be  determined  by an  independent  arbitrator,  using
standard legal principles, mutually agreed upon by the Company and the Executive
in accordance with rules set forth by the American Arbitration Association.

          (b) If  there  shall  be any  dispute  between  the  Company  and  the
Executive in the event of any termination of the  Executive's  employment by the
Company  or  by  the  Executive,  then,  unless  and  until  there  is a  final,
nonappealable  judgment by a court of competent jurisdiction declaring that such
termination  was for Cause,  the Company shall pay all amounts,  and provide all
benefits, to the Executive and/or the Executive's family or other beneficiaries,
as the case may be,  that  the  Company  would  be  required  to pay or  provide
pursuant to Section 4(a) as though such  termination were by the Company without
Cause or by the  Executive;  provided,  however,  that the Company  shall not be
required to

(page 113)
pay any disputed  amounts  pursuant to this paragraph  except upon receipt of an
undertaking  (which may be  unsecured) by or on behalf of the Executive to repay
all such amounts to which the Executive is ultimately adjudged by such court not
to be entitled.

     7.  Confidential  Information.  The  Executive  shall  hold in a  fiduciary
capacity for the benefit of the Company all secret or confidential  information,
knowledge or data  relating to the Company or any of its  affiliated  companies,
and their respective businesses, which shall have been obtained by the Executive
during  the  Executive's  employment  by the  Company  or any of its  affiliated
companies and which shall not be or become public  knowledge (other than by acts
by the  Executive  or  representatives  of the  Executive  in  violation of this
Agreement).  After  termination of the Executive's  employment with the Company,
the Executive  shall not,  without the prior  written  consent of the Company or
except as may  otherwise  be required by law or legal  process,  communicate  or
divulge any such information, knowledge or data to anyone other than the Company
and those  designated  by it. In no event  shall an  asserted  violation  of the
provisions of this Section 7 constitute a basis for deferring or withholding any
amounts otherwise payable to the Executive under this Agreement.

     8.            Non-Compete; Non-Solicitation.

          (a) Except as is set forth below, for a period  commencing on the date
hereof  and  ending  on the date 36  months  after  the  Executive  ceases to be
employed by the Company (the "Non-Competition  Period"), the Executive shall not
in the United States of America,  directly or indirectly,  either for himself or
any other person, own, manage,  control,  materially  participate in, invest in,
permit his name to be used by, act as consultant or advisor to, render  material
services for (along or in  association  with any person,  firm,  corporation  or
other business  organization)  or otherwise assist in any manner any entity that
engages in or owns,  invests in,  manages or controls any venture or  enterprise
engaged in the retail furniture industry (or any other business of the type that
constitutes  a  substantial  portion of the  Company's  business at the date the
Executive ceases to be employed by the Company ) (collectively, a "Competitor");
provided,  however,  that the  restrictions  set forth above  shall  immediately
terminate  and  shall be of no  further  force or  effect  (i) in the event of a
default by the Company in the payment of any  compensation  or benefits to which
the Executive is entitled hereunder,  which default is not cured within ten (10)
days after written notice  thereof,  or (ii) at the election of the Executive if
the  Executive's  employment  has been  terminated by the Company other than for
Cause and if the Executive (A) gives  written  notice to the Company  during the
Non-Competition  Period that he desires to accept  employment with a Competitor;
and (B) agrees that the severance  payment  specified in Section  4(a)(i) hereof
shall be mitigated by the amount of salary and pro rata target bonus  payable to
the Executive by the Competitor and

(page 114)
attributable  to  employment  during  the   Non-Competition   Period  (it  being
understood  that the  amount of such  mitigated  severance  shall be paid by the
Executive to the Company in a lump-sum payment within thirty (30) days after the
Executive  commences  employment  with the  Competitor).  Nothing  herein  shall
prohibit  the  Executive  from being a passive  owner of not more than 2% of the
equity  securities of a corporation  engaged in such business  which is publicly
traded,  so long  as he has no  active  participation  in the  business  of such
corporation.

          (b)  During  the  Non-Competition  Period,  the  Executive  shall not,
directly  or  indirectly,  (i)  induce or  attempt  to  induce or aid  others in
inducing an employee  of the Company to leave the employ of the  Company,  or in
any way interfere with the  relationship  between the Company and an employee of
the Company except in the proper exercise of the Executive's authority,  or (ii)
in any way interfere with the relationship between the Company and any customer,
supplier, licensee or other business relation of the Company.

          (c) If, at the time of  enforcement  of this  Section 8, a court shall
hold that the  duration,  scope,  area or other  restrictions  stated herein are
unreasonable  under  circumstances  then  existing,  the parties  agree that the
maximum  duration,  scope,  area or other  restrictions  reasonable  under  such
circumstances shall be substituted for the stated duration, scope, area or other
restrictions.

          (d) The  covenants  made in this  Section 8 shall be  construed  as an
agreement  independent  of any other  provisions  of this  Agreement,  and shall
survive the termination of this Agreement.  Moreover, the existence of any claim
or  cause  of  action  of  the  Executive  against  the  Company  or  any of its
affiliates,  whether or not predicated upon the terms of this  Agreement,  shall
not constitute a defense to the enforcement of these covenants.

     9.            Indemnity.  The Company will indemnify the Executive, in his
capacity as an officer and director of the Company, to the fullest extent
permitted by the Company's Articles of Incorporation and Bylaws.

     10.           Successors.

          (a) This  Agreement is personal to the Executive and without the prior
written  consent  of the  company  shall  not  be  assignable  by the  Executive
otherwise than by will or the laws of descent and  distribution.  This Agreement
shall  inure to the  benefit  of and be  enforceable  by the  Executive's  legal
representatives.

          (b) This  Agreement  shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

(page 115)
          (c)  The  Company  will  require  any  successor  (whether  direct  or
indirect,   by  purchase,   merger,   consolidation  or  otherwise)  to  all  or
substantially  all of the  business  and/or  assets  of the  Company  to  assume
expressly and agree to perform this Agreement in the same manner and to the same
extent  that the Company  would be required to perform it if no such  succession
had taken place. As used in this Agreement,  "Company" shall mean the Company as
hereinbefore  defined  and  any  successor  to its  business  and/or  assets  as
aforesaid  which  assumes and agrees to perform  this  Agreement by operation of
law, or otherwise.

     11.           Miscellaneous.

          (a) This  Agreement  shall be governed by and  construed in accordance
with the laws of the Commonwealth of Virginia,  without  reference to principles
of  conflict  of  laws.  The  captions  of this  Agreement  are not  part of the
provisions  hereof and shall have no force or effect.  This Agreement may not be
amended  or  modified  otherwise  than by a written  agreement  executed  by the
parties hereto or their respective successors and legal representatives.

          (b) All notices and other communications hereunder shall be in writing
and shall be given by hand  delivery  to the  other  party or by  registered  or
certified mail, return receipt requested, postage prepaid, addressed as follows:

         If to the Executive to:                    If to the Company to:
         Troy A. Peery, Jr.                         Heilig-Meyers Company
         14 Broad Run Road                          2235 Staples Mill Road
         Manakin Sabot, Virginia 23103              Richmond, Virginia  23230
                                              Attention:  Corporate Secretary

or to such other  address as either  party shall have  furnished to the other in
writing in accordance  herewith.  Notice and  communications  shall be effective
when actually received by the addressee.

                   (c) The  invalidity or  unenforceability  of any provision of
this  Agreement  shall not affect the  validity or  enforceability  of any other
provision of this Agreement.

                   (d) The Company may withhold  from any amount  payable  under
this  Agreement  such  Federal,  state or local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.

                   (e) The  Executive's or the Company's  failure to insist upon
strict  compliance  with any  provision  hereof or any other  provision  of this
Agreement  or the failure to assert any right the  Executive  or the Company may
have hereunder, shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.

(page 116)
                   (f) Any  entitlements to the Executive  created under Section
2(b) shall be contract rights to the extent not prohibited by law. However,  the
Company  shall not be required to amend,  or refrain from  amending,  any of its
plans to so provide the contract rights.

                   (g) The  Executive  and the Company agree that as of the date
hereof,  this  Agreements  supersedes and  terminates  the Employment  Agreement
between the Company and the  Executive  dated  September  11,  1989,  as amended
August 26, 1993.

         IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors,  the Company has
caused  these  presents to be executed in its name on its behalf,  all as of the
day and year first above written.

                                               HEILIG-MEYERS COMPANY

                                               By:/s/ William C. DeRusha
                                               Title:Chairman and CEO
                                               /s/ Troy A. Peery, Jr.
                                               Troy A. Peery, Jr.

(page 117)