exv10w1






Exhibit 10.1




EXECUTION VERSION




AMENDED AND RESTATED

EXECUTIVE EMPLOYMENT AGREEMENT




          THIS AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is effective
July 1, 2010, by and between Furniture Brands International, Inc., a Delaware corporation
(“Company”) and Ralph Scozzafava (“Executive”).




          WHEREAS, Executive has been employed by and currently serves as the Company’s Chairman and
Chief Executive Officer of the Company pursuant to an employment agreement between Executive and
the Company, dated as of June 18, 2007, as amended effective May 1, 2008, which expires by its
terms on June 30, 2010 (the “Original Agreement”); and




          WHEREAS, Executive and the Company desire to amend, restate and extend the Original Agreement
in the form of this Agreement, effective on the day following the stated expiration date of the
Original Agreement.




          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) “Change of Control” means (1) an acquisition by an individual or entity of 35% of
the outstanding common stock or voting power of the Company, (2) a contested change of a majority
of the non-employee member of the Board of the Company, (3) the consummation via execution of an
final written agreement for merger, sale, acquisition, or other such transaction where the
shareholders of the Company immediately prior to such transaction do not own 60% of the outstanding
common stock of the Company immediately following such





 









 







transaction, or (4) shareholder approval of a complete dissolution of the Company (excluding
bankruptcy).




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




          (e) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder.




          (f) “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 (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, (v) business
strategy, including acquisition, merger and/or divestiture strategies, and (v) designs, plans,
notes, memoranda, work sheets, formulas and processes, but shall not include Executive’s rolodex
(or other tangible or electronic address book).




          (g) “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, or
failure to elect or re-elect 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;
or
	 
	 	(iii)	 	a material reduction in Executive’s base pay,
incentive compensation or benefits.
	 
	 	 	 	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





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	 	 	 	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.





          (h) “Customer” means any Person or entity to whom the Company has sold any products
(i) in the case of on-going employment, during the 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 24 calendar months preceding Executive’s termination of employment.




          (i) “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.




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




          (k) “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 continue to employ Executive and Executive hereby
accepts such continued employment with the Company, upon the terms and conditions set forth in this
Agreement, for the period beginning on July 1, 2010 (“Commencement Date”) and ending as
provided in Section 2.4 of this Agreement (the “Employment Period”).




          2.2 Position and Duties.




          (a) Executive shall continue to serve as Chairman and Chief Executive Officer of the Company.
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.




          (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






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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
$750,000 payable in bi-weekly installments. The Base Salary level shall be reviewed
annually , 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 be eligible for an annual target
incentive of 100% of Executive’s Base Salary in accordance with the provisions of the
Company’s Short-Term Incentive Plan (or successor plan) (“Annual Incentive Bonus”).




     (c) Long-Term Compensation. Executive shall be eligible for an annual
long-term compensation award, which may be payable in a combination of cash and equity-based
awards (such as stock options or performance shares) (the “LTI Bonus”). The Company
anticipates, but does not covenant, that the target LTI Bonus shall be an amount that is not
less than 300% of Executive’s Base Salary, subject to increases or decreases on the same
basis as applied to other executives of the Company. Awards outstanding on the effective
date of this Agreement shall continue to be subject to the terms thereof and the Original
Agreement, without amendment under this Agreement except as specifically provided otherwise
in Sections 2.4(c)(v) and 2.4(c)(vii) below.




     (d) Vacation. Executive shall receive 4 weeks of vacation annually.




     (e) 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 Executive commenced employment with the
Company on June 18, 2007) (“Benefits”).



          2.4 Term.




          (a) General Term. This Agreement shall commence on July 1, 2010, and terminate on
June 30, 2013, unless extended prior to that date (the “Term”).




          (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 Termination Date, but shall not be entitled to
any further Base Salary or any applicable bonus or Benefits under Section 2.3(e) for that year or
any future year, except for: (i) any prior year earned unpaid bonus, (ii) any unreimbursed
business expenses incurred on or prior to the Termination Date 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 (“Accrued Benefits”) .




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          (c) Termination Without Cause. If Executive is terminated without Cause or if the
Executive terminates employment due to 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) Executive’s target
annual bonus amount under the Company’s Short-Term Incentive Plan with respect to
the year in which the Termination Date occurs. The Severance Payment shall be paid
in a single lump-sum cash payment, less all applicable withholding taxes, within
fifteen days following Executive’s termination of employment if it is not subject to
Section 409A of the Code or, if it is subject to Section 409A of the Code, it shall
be paid on the first day of the seventh month following Executive’s Termination Date
or, if earlier, the date that Executive dies following the Termination Date.




     (ii) A prorated Annual Incentive Bonus in respect of the fiscal year during
which the Termination Date occurs, the amount of which shall be equal to the amount
of the Annual Incentive Bonus, if any, that would be due under the Company’s
Short-Term Incentive Plan (or successor plan) had Employee still been employed
through the end of such fiscal year, multiplied by a fraction, the numerator of
which is the number of days in such fiscal year prior to the Termination Date and
the denominator of which is 365, payable at time such Annual Bonus would have been
paid had Executive remained employed through the date of such payment (a
“Pro-Rata Bonus”).




     (iii) For two years following the Termination Date (irrespective of whether
COBRA otherwise would terminate prior to expiration of such two-year period),
Executive shall be eligible to participate in the Company’s health, dental and
vision benefit plans under the Company’s medical plan that the Company generally
makes available to its senior executives on substantially the same terms as an
actively employed senior executive; provided that such coverage shall be provided on
an after-tax basis, meaning that the Company shall report to the appropriate tax
authorities the cost of such coverage as taxable income to Executive.




     (iv) 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 previously granted to Executive
by the Company (collectively “Equity Awards”) which are outstanding on
Executive’s Termination Date in accordance with the terms of the plan(s) under which
such Equity Awards were granted and, notwithstanding the terms of the applicable
plan or Equity Award, Executive shall be entitled to exercise each such stock option
and stock appreciation right until the earlier of (i) the one year anniversary of
the Termination Date and (ii) the last day of its original term.



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     (v) In the event that the Termination Date occurs 18 months or more after the
commencement of a three-year performance cycle (or after one-half of the period has
elapsed of any cycle of other than three years’ duration) under the Company’s
Long-Term Incentive Plan, Executive shall be entitled to receive a payment equal to
the pro-rata portion (determined as of the Termination Date) of the long-term cash
bonus in respect of such performance cycle otherwise payable under the terms of the
Company’s Long-Term Incentive Plan. Such payment will be paid at the same time that
such bonus would have been paid under the Company’s Long-Term Incentive Plan had
Executive continued employment through end of the performance period during which
the Termination Date occurred.




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




     (A) 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




     (B) Allow Executive to participate in the welfare plans, other than
health, dental and vision benefit plans, that 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 Termination Date, 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 Treasury Regulation Section
1.409A-1(b)(9)(v) thereunder, and on the first day of the seventh month
following the Termination Date 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.




     (vii) Executive has been granted, and may in the future be granted, options to
purchase shares of Company stock (“Stock Options”), as well as shares of
restricted Company stock (“Restricted Stock Awards”). If Executive’s
employment is terminated within six months prior to a Change of Control, the Company
shall pay to Executive an additional cash bonus equal to the sum of (a) and (b),
where (a) equals the fair market value, on the date of the Change of Control, of
 shares of stock under Restricted Stock Awards that were unvested and forfeited on
the Termination Date and otherwise would have been vested on the date of the Change
of Control had Executive been continuously employed from the Termination Date
through the date of the Change of Control, and (b) equals the excess of the fair
market value, on the date of the Change of Control, of shares



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of stock subject to Stock Options that were nonexercisable and forfeited on the
Termination Date and otherwise would have been exercisable on the date of the Change
of Control had Executive been continuously employed from the Termination Date
through the date of the Change of Control, over the aggregate option exercise price
in respect of such shares. Such cash bonus shall be paid on the effective date of
the Change of Control.



          (d) 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 Date.




          (e) Cap on Certain Payments by the Company/Certain Additional Payments by the Company
During the Initial Period. In the event that, during the 18-month period commencing on the
Commencement Date (the “Initial Period”), (i) the aggregate value, as determined for
purposes of Section 280G of the Code, of any payments 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 (“Payments”), would equal or exceed the product of
three and Executive’s “Base Amount” (as defined in Section 280G of the Code), and any such Payments
would be subject to the excise tax imposed by Section 4999 of the of the Code, or (ii) any interest
or penalties would be 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 (A) if the value of the Payments exceeds the product of three and
Executive’s Base Amount by an amount greater than 10% of such product, then 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 Tax and any income and employment 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, and (B) if the
value of the Payments does not exceed the product of three and Executive’s Base Amount by an amount
greater than 10% of such product, then, notwithstanding anything in this Agreement to the contrary,
the Payments shall be reduced to the “Reduced Amount” (as defined below) . Any Gross Up Payment
due pursuant to clause (A) of the preceding sentence shall be paid by the Company to Executive as
soon as administratively practicable but in no event later than the end of Executive’s taxable year
following the year in which Executive remits the Excise Tax to the Internal Revenue Service.




          (f) Certain Reductions of Payments following the Initial Period. In the event that,
after the Initial Period, any Payments to or for the benefit of Executive would equal or exceed the
product of three and Executive’s Base Amount, then, notwithstanding anything in this Agreement to
the contrary, the Payments shall be reduced to the Reduced Amount if Executive would have a greater
“Net After-Tax Receipt” (as defined below) of aggregate Payments if Executive’s Payments were
reduced to the Reduced Amount. If a reduction of the Payments to the Reduced Amount would not
result in Executive having a greater Net After-Tax Receipt than in the absence of such reduction,
Executive shall receive all Payments to which Executive is entitled under this Agreement.







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All determinations required to be made under Sections 2.4(e) and 2.4(f), including whether and when
a Gross Up Payment is required pursuant to Section 2.4(e), the amount of any such Gross Up Payment,
and any reductions to Payments required by Section 2.4(e) or Section 2.4(f), and the assumptions to
be utilized in arriving at such determinations, 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. For purposes of reducing the Payments to the Reduced Amount where required pursuant to
Section 2.4(e) or Section 2.4(f), only amounts payable under this Agreement (and no other Payments)
shall be reduced. The reduction of the amounts payable hereunder, if applicable, shall be made by
reducing the payments and benefits under the following sections in the following order: Section
2.4(c)(i), Section 2.4(c)(ii), Section 2.4(c)(v), Section 2.4(c)(vii) and Section 2.4(c)(iv). For
purposes hereof, “Reduced Amount” shall mean the greatest amount of Payments that can be
paid that would not result in the imposition of the Excise Tax; and “Net After-Tax Receipt”
shall mean the present value (as determined in accordance with Sections 280G(b)(2)(A)(ii) and
280G(d)(4) of the Code) of the Payments net of all taxes imposed on Executive with respect thereto
under Sections 1, 3101 and 4999 of the Code and under applicable state and local laws, determined
by applying the highest marginal rate under Section 1 of the Code and under state and local laws
that applied to Executive’s taxable income for the immediately preceding taxable year, or such
other rate(s) as Executive certifies, to the reasonable satisfaction of the Company, as likely to
apply to him in the relevant tax year(s).




          (g) Severance Forfeiture. Executive agrees that Executive shall be entitled to the
payments and benefits 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 and benefits 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.




          (h) 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.




          (i) 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 (i) all previously earned and
accrued but unpaid Base Salary, (ii) accrued unused vacation up to such date and (iii) a Pro-Rata
Bonus. 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.




          (j) Post-Term Termination Medical Benefits. In the event that Executive’s termination
of employment occurs after June 30, 2013 for any reason other than by the Company for Cause, for
three years following the Termination Date (irrespective of whether COBRA otherwise would terminate
prior to expiration of such three-year period) Executive shall have the






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right to participate in the Company’s health, dental and vision benefit plans under the
Company’s medical plan that the Company generally makes available to its senior executives on
substantially the same terms as an actively employed senior executive; provided that Executive must
pay to the Company the amount of the applicable COBRA premium for the period of such coverage; and
further provided that such three-year period shall be reduced by, and commence immediately
following, the period, if any, during which Executive receives such coverage pursuant to Section
2.4(c)(vi)(B) above.




          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 Information. Executive agrees, by acceptance of the benefits under
this Agreement, to protect all Confidential Information concerning the business activities of the
Company which was acquired in connection with or as a result of the performance of service for the
Company.




          2.6 Competitive Activity. For a period of 24 months following Executive’s Termination
Date, 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 conduct 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.




          2.8 Recoupment.




          (a) In the event of a restatement of the Company’s financial statements that reduces
previously reported net income or increases previously reported net loss, the Company shall have
the right to recoup from Executive any portion of any bonus and other equity or non-equity
compensation received by Executive, the grant or vesting of which was expressly conditioned on the
achievement of one or more specific financial performance targets with respect to the period for
which such financial statements are restated, regardless of whether Executive engaged in any
misconduct or was at fault or responsible in any way for causing the restatement, if, based on the
financial statements as so restated, Executive otherwise would not have received such bonus or
other compensation or portion thereof. In the event the Company is entitled to, and seeks,
recoupment under this Section 2.8, Executive shall promptly reimburse the after-tax portion (after
taking into account all available deductions in respect of such reimbursement) of such bonus or
other compensation which the Company is entitled to recoup hereunder. In the event Executive fails
to make prompt reimbursement of any such bonus or other compensation which the Company is entitled
to recoup and as to which the Company seeks recoupment hereunder, Executive acknowledges and agrees
that the Company shall have the right to (i) deduct the amount to be reimbursed hereunder from the
compensation or other payments due to Executive from the Company or (ii) take any other appropriate
action to recoup





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such payments. The Company’s right of recoupment pursuant to this Section 2.8
shall not apply
to compensation which was paid or which became vested, as applicable, more than three years
prior to the earlier of the first public issuance or first filing with the Securities and Exchange
Commission of the applicable restatement of financial statements. Any waiver of the Company’s
right of recoupment must be done in a writing that is signed by both the Company and Executive.




          (b) The rights contained in this Section 2.8 shall be in addition to, and shall not limit, but
shall not duplicate any recoupment pursuant to, any other rights or remedies that the Company may
have under law, in equity or otherwise, including, without limitation, any rights the Company may
have under any other Company recoupment policy or other agreement or arrangement with Executive.




          2.9 Attorney’s Fees and Costs. The Company shall also pay Executive’s reasonable cost
and expenses (including legal fees at 

non-premium rates) incurred in connection with the
negotiation of this Agreement, up to a maximum of $20,000. The Company shall treat such payment as
a non-taxable “working condition fringe,” as defined in Section 132(d) of the Code.




          2.10 Code Section 409A. This Agreement is intended to comply with the requirements of
Section 409A of the Code or an exemption or exclusion therefrom and, with respect to amounts that
are subject to Section 409A of the Code, shall in all respects be administered in accordance with
Section 409A of the Code. Each payment under this Agreement shall be treated as a separate payment
for purposes of Section 409A of the Code. In no event may Executive, directly or indirectly,
designate the calendar year of any payment to be made under this Agreement. All reimbursements and
in-kind benefits, including any taxable health, dental and vision benefits provided under this
Agreement that constitute deferred compensation within the meaning of Section 409A of the Code
shall be made or provided in accordance with the requirements of Section 409A of the Code,
including, without limitation, that (i) in no event shall reimbursements by Company under this
Agreement be made later than the end of the calendar year next following the calendar year in which
the applicable fees and expenses were incurred, provided, that Executive shall have submitted an
invoice for such fees and expenses at least 10 days before the end of the calendar year next
following the calendar year in which such fees and expenses were incurred; (ii) the amount of
in-kind benefits that Company is obligated to pay or provide in any given calendar year (other than
medical reimbursements described in Treas. Reg. § 1.409A-3(i)(1)(iv)(B)) shall not affect the
in-kind benefits that Company is obligated to pay or provide in any other calendar year; (iii)
Executive’s right to have the Company pay or provide such reimbursements and in-kind benefits may
not be liquidated or exchanged for any other benefit; and (iv) in no event shall Company’s
obligations to make such reimbursements or to provide such in-kind benefits apply later than
Executive’s remaining lifetime or if longer, through the 20th anniversary of the Effective Date.
If Executive dies following the Termination Date and prior to the payment of the any amounts
delayed on account of Section 409A of the Code, such amounts shall be paid to the personal
representative of Executive’s estate within 30 days after the date of Executive’s death.










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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, 2.6 and 2.8 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

1 N. Brentwood Blvd.

St. Louis, Missouri 63105




To Executive:




Ralph Scozzafava

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




          Or to 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,





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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 its successors and assigns. This Agreement is personal to Executive and, except
as otherwise specifically provided herein, 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(f)). 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, effective July 1, 2010, shall supersede any other agreement between the
parties, oral or written, concerning the same subject matter, including, without limitation, the
Original Agreement. The Original Agreement shall apply from the date hereof through June 30, 2010.




          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.




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          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 Executive’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 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. The 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




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even if
Executive signs an acknowledgement or otherwise agrees to the provisions of such policy, code, plan
or program.




          IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement this
4th day of February 2010, and effective as of the date first written above.




	 	 	 	 	 
	 	FURNITURE BRANDS INTERNATIONAL, INC.

 	 
	 	By:  	/s/ Beth Sweetman
 	 
	 	 	Name:  	Beth Sweetman 	 
	 	 	Title:  	Senior Vice President-Human Resources 	 
	 
	 	RALPH P. SCOZZAFAVA

 	 
	 	By:  	/s/ Ralph P. Scozzafava
 	 
	 	 	Name:  	Ralph P. Scozzafava 	 
	 	 	 	 
	 




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