Section 3. Status of Employment Agreement. The Company and the Executiveacknowledge that they are parties to an Employment Agreement dated June 22, 2005 (the “EmploymentAgreement”). The Company and the Executive hereby agree that Sections 1, 2, 3, 4 and 5 of theEmployment Agreement in their entirety are hereby terminated and are of no further force or effectas of the Effective Time (other than the definitions of terms specified in such sections, whichshall continue tobe applicable to the Sections of the Employment Agreement that survive the Effective Time).Notwithstanding any provision of the Employment Agreement to the contrary, the Company and theExecutive further agree that Sections 6, 7, 8, 9, 10, 11, 12 and 13 of the Employment Agreementshall remain in full force and effect following the Effective Time in accordance with theprovisions thereof. All other employment or similar agreements or arrangements, if any, betweenthe Company or any of its subsidiaries and the Executive are hereby terminated.Section 4. Salary; Vacation; Expenses; Other. The Executive agrees that theCompany and/or the appropriate subsidiary or affiliate of the Company have paid in full to theExecutive all salary, vacation, compensation and other amounts to which he is entitled inconnection with all of his services as a director and employee of the Company and/or any of itssubsidiaries or affiliates through and including the Company’s last payroll date preceding the dateof this Agreement and that he shall not be entitled to any additional salary or compensation fromthe Company and/or any of its subsidiaries or affiliates following the date of this Agreement, (a)other than his normal salary from such last payroll date through and including the Effective Time,which shall be paid in accordance with the Company’s usual payroll practices, and (b) payment forten (10) days of accrued but unused vacation for which the Executive shall be paid at the EffectiveTime. In addition, the Executive represents that, to his best knowledge, he has submitted all orsubstantially all expense reports and other requests for expense reimbursement to the Company priorto the date of this Agreement, and the Executive agrees that the Company and/or the appropriatesubsidiary or affiliate have reimbursed him for all of such expense reports and requests forreimbursement through and including the date of this Agreement, except for the expense reportsubmitted by the Executive on the date hereof. In the event that a request for expensereimbursement has not been made by the Executive on or prior to the date of this Agreement, theExecutive shall submit such request to the Company on or before July 31, 2008 in a mannerconsistent with the Company’s policies and procedures, and the Executive represents and agrees thateach such request shall represent previously unreimbursed expenses incurred by him in the ordinaryand usual course of the Company’s business. The Company shall promptly reimburse the Executive forsuch expenses in accordance with its policies and procedures on business expense reimbursement.Section 5. Status of Employee Benefit Plans.(a) Employee Benefit Plans. The Executive’s and his spouse’s participation andeligibility to participate in, and all benefits or payments under, any and all employee benefitplans (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, asamended) and any and all other plans, programs, arrangements or policies sponsored, maintained oroffered by the Company or any of its subsidiaries (including, but not limited to, any health,medical, life, accidental death, disability, retirement, profit sharing, incentive compensation(including, but not limited to, the Company’s 2007 Executive Incentive Plan (“2007 IncentivePlan”), deferred compensation and any other plan, program, arrangement or policy sponsored,maintained or offered by the Company) shall terminate and cease as of the Effective Time; provided,however, that (i) all benefits of the Executive that are fully vested under the Company’s EmployeeStock Ownership Plan (“ESOP”) and the Company’s Savings Plan (“401(k) Plan”) shall be paid to theExecutive in accordance with the terms of such plans, and (ii) in the event the Executive electscoverage for himself and/or his spouse under the Company’s group health insurance plan inaccordance with the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the Company shallreimburse the Executive for the premiums paid by him associated with such continued coverage underthe Company’s group health insurance plan and under the Exec-U-Care medical insurance policymaintained by the Company (up to $15,000 per calendar year) until the earlier of (I) the end of theExecutive’s entitlement to continued coverage under the Company’s group health insurance planpursuant to COBRA, or (II) the date on which the Executive becomes covered by a health plansponsored oroffered by another employer or person. The Executive hereby forever releases, waives andrelinquishes any and all benefits, payments, rights, claims and interests in and under all plans,programs, arrangements and policies sponsored, maintained or offered by the Company or any of itssubsidiaries other than as expressly set forth above.
 
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(b) Retirement Status. The Executive understands and agrees that he has not satisfiedthe requirements for retirement or early retirement under any of the plans, programs, arrangementsor policies referenced in Section 5(a) above.Section 6. Severance Payment. So long as the Executive has executed theRelease of Claims attached hereto as Exhibit A, the Company shall pay a severance paymentto the Executive in the aggregate amount of Seven Hundred Eighty Thousand Dollars ($780,000)(“Severance Payment”), which shall be paid in accordance with this Section. The payment of theSeverance Payment shall be suspended for a six-month period following the Effective Time asrequired by Section 409A of the Internal Revenue Code of 1986, as amended, because the Executive isa Specified Employee as defined in Treasury Regulation §1.409A-1(h). On December 31, 2008, theExecutive shall receive twenty-five percent (25%) of the Severance Payment in a lump sum paymentequal to $195,000. The Executive shall receive the remaining seventy-five percent (75%) of theSeverance Payment in eighteen (18) equal monthly installments of Thirty Two Thousand Five HundredDollars ($32,500) each beginning on January 31, 2009 and on the last day of each month thereafterthrough June 30, 2010. The Company shall deduct all required taxes and withholdings from the lumpsum portion and the monthly installments of the Severance Payment.Notwithstanding the foregoing or the termination of Section 5(g) of the Employment Agreement,the Severance Payment payable to the Executive under this Agreement shall (a) be subject totermination or reduction in the same manner provided in Section 5(g) of the Employment Agreementapplicable to “Monthly Severance Payments,” and (b) terminate immediately without reinstatement ofany obligation of the Company to resume paying the Severance Payment hereunder if the Executivebreaches any of the provisions of this Agreement (or the Release of Claims attached hereto asExhibit A) or any of the sections of the Employment Agreement that survive the EffectiveTime. The lump sum payment specified in the preceding paragraph shall be subject to termination orreduction on a pro-rata basis in the event that, had the Executive been able to receive monthlyinstallments of the Severance Payment commencing as of the Effective Time, any of such monthlyinstallments would have been terminated or reduced between the Effective Time and December 31, 2008in the same manner provided in Section 5(g) of the Employment Agreement.The Executive agrees that the Severance Payment payable under this Agreement constitutes fullsatisfaction and discharge of the Company’s obligations under the Employment Agreement. TheExecutive further agrees that the Severance Payment payable under this Agreement constitutesadequate consideration for his covenants and agreements set forth in the Release of Claims attachedhereto as Exhibit A, Section 6 (Non-Disclosure, etc.), Section 7 (Non-Competition), Section8 (Non-Solicitation) and Section 9 (Intellectual Property) of the Employment Agreement, whichcovenants and agreements the Executive agrees and affirms are applicable to him in accordance withtheir terms.
 
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In consideration of the Company’s obligation to pay the Severance Payment to the Executiveunder this Agreement, subject to termination or reduction as provided above, the Executive herebyforever releases, waives and relinquishes any and all salary, compensation, employee benefits,payments, incentive compensation awards, bonuses and other amounts from the Company and any of itssubsidiaries or affiliates (whether under the Employment Agreement, the 2007 Incentive Plan or anyother plan,program, arrangement, policy or promise of the Company or any of its subsidiaries oraffiliates, or otherwise) other than (i) the Severance Payment, (ii) reimbursement for premiums forthe Exec-U-Care medical insurance policy and the continuation coverage under the Company’s grouphealth insurance plan as specified in Section 5(a) hereof, (iii) the fees and expenses related tothe Executive’s advisory and cooperation services contemplated by Section 8 and Section 10(d)hereof, respectively, (iv) the payments or amounts to be paid to the Executive in accordance withthe ESOP and the 401(k) Plan, (v) reimbursement for the fees for the executive outplacementservices as contemplated by Section 10(f) hereof, (vi) reimbursement for the Executive’s attorneysfees as contemplated by Section 10(g) hereof, and (vii) payment of the purchase price for theShares as contemplated by Section 10(h) hereof.Section 7. Awards Under Incentive Compensation Plans. All outstanding cashand stock-based awards granted to the Executive, and all rights to any awards or payments, underthe 2007 Incentive Plan (including the short term incentive program or opportunities and the longterm incentive program or opportunities under the 2007 Incentive Plan), the Company’s Short TermExecutive Incentive Plan (as amended and restated effective January 1, 2002), the Company’s LongTerm Executive Incentive Plan (as amended and restated effective January 1, 2002) and any otherplan, policy or program of the Company, if any, are hereby terminated and forfeited as of the dateof this Agreement, and the Executive hereby forever releases, waives and relinquishes any and allrights, claims or interests in or to such awards. All award agreements between the Company and theExecutive relating to any awards under the 2007 Incentive Plan are hereby terminated as of the dateof this Agreement.Section 8. Advisory Role. For a period of ninety (90) days following the dateof this Agreement, the Executive shall serve as an advisor to the Board of Directors and the newChief Executive Officer of the Company. The Executive shall provide advisory services under thisAgreement on transition and strategic matters relating to the Company or any of its subsidiariesduring normal business hours as may be reasonably requested by the Lead Director or the new ChiefExecutive Officer of the Company. The Company shall pay the Executive a fee of $1,500 per day thathe provides such advisory services and shall reimburse the Executive for all out-of-pocket traveland other expenses incurred in connection with such services that are approved by the new ChiefExecutive Officer of the Company. The Company and the Executive shall mutually agree, in advanceof the Executive providing any advisory services hereunder, to the number of days and timing thateach request for such services shall require.All advisory services provided by the Executive under this Agreement shall be performed by himas an independent contractor, and not as a director, employee, agent or representative of theCompany or any of its subsidiaries or affiliates. In addition, the Executive understands andagrees that, during the ninety (90) day advisory period, he shall not participate in any employeebenefit, retirement, incentive compensation or other plans or programs of the Company or any of itssubsidiaries or affiliates and he shall not have, nor will he hold himself out as having, anyright, power or authority to bind (or to create any contract, commitment or obligation for, in thename of or on behalf of) the Company or any of its subsidiaries or affiliates.The Executive understands and agrees that (i) he shall be solely responsible for any and alltaxes due and owing on any advisory and cooperation fees paid to him under this Agreement,including, but not limited to, income, FICA and self-employment taxes, and (ii) the Company shallissue a Form 1099 to the Executive, and shall not withhold any taxes for, any advisory andcooperation fees paid to him under this Agreement.
 
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Section 9. Mutual Release.(a) By the Executive. In exchange for the consideration provided in this Agreementand the release by the Company set forth in this Agreement, and as a material inducement for bothparties to enter into this Agreement, contemporaneously with the execution of this Agreement, theExecutive has executed and delivered to the Company the Release of Claims attached hereto asExhibit A.(b) By the Company. In exchange for the consideration provided in this Agreement andthe releases of the Executive set forth in this Agreement and in the Release of Claims attachedhereto as Exhibit A, and as a material inducement for both parties to enter into thisAgreement, the Company hereby irrevocably and unconditionally releases and forever waives anddischarges any and all complaints, claims, demands, liabilities, obligations, actions, rights ofactions, proceedings, promises, agreements and compensation of any nature whatsoever (including,but not limited to, claims for damages, attorneys fees, interest and costs) against the Executiveand his heirs, spouse, insurers, personal representatives, attorneys, successors and assignsrelated in any manner to his position as a director, officer or employee of the Company, whetherknown or unknown, matured or unmatured, suspected or unsuspected or otherwise that exist as of ormay have existed prior to the date of this Agreement, other than any claim that the Company mayhave against the Executive for theft or willful misconduct. Notwithstanding the foregoing, thisrelease by the Company shall be effective only if the Executive has executed and does not revoke orrescind the Release of Claims attached hereto as Exhibit A as set forth therein. If theExecutive revokes or rescinds such Release of Claims, then this release by the Company shallterminate and be of no force or effect whatsoever *ab initio*. Such Release of Claims shall be inaddition to the releases contained in this Agreement.Section 10. Certain Other Matters.(a) Compliance with Law. The Executive understands and agrees that he has ongoingresponsibilities under and shall comply with the federal securities laws, including but not limitedto Section 16 of the Securities Exchange Act of 1934 and the rules and regulations thereunder.(b) Return of Property. On or before the Effective Time, the Executive shall returnto the Company at its headquarters all vehicles, equipment, computers, mobile telephones, personaldata assistants, credit cards, keys, access cards, passwords and other property of the Company thatare still in the Executive’s possession or control as of the Effective Time or the location ofwhich the Executive knows, and the Executive shall cease using any of the foregoing on and afterthe Effective Time; provided, however, that the Company shall transfer to the Executive, for noadditional consideration, at the Effective Time the Company’s laptop computer, keyboard and printerthat the Executive is currently using. Prior to such transfer, the Executive shall certify inwriting that he has deleted all files and other information relating to the Company or any of itssubsidiaries or affiliates.(c) Non-Disparagement. The Executive shall not publicly disparage or make or publishany negative statements or comments about the Company, any of its subsidiaries, any of theirrespective products or strategies or any of their respective directors, officers, employees,managers, representatives or agents. Subject to applicable law, no executive officer of theCompany or member of the Company’s Board of Directors shall publicly disparage or make or publishany negative statements or comments about the Executive.
 
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(d) Cooperation. For a period of two (2) years following the Effective Time, upon therequest of the Company or any of its subsidiaries, the Executive shall cooperate and make himselfreasonably available at appropriate times and places determined by the Company or any of itssubsidiaries in connection with any claim, demand, action, suit, proceeding, examination,investigation or litigation (regulatory or otherwise) by, against or affecting the Company or anyof its subsidiaries. The Company or the appropriate subsidiary shall pay the Executive a fee of$1,500 per day in connection with such services and shall reimburse the Executive for hisreasonable out-of-pocket travel expenses incurred in connection with the foregoing that areapproved by the Chief Executive Officer of the Company. The Company and the Executive shallmutually agree, in advance of the Executive providing any services hereunder, to the number of daysand timing that each request for such services shall require.(e) No Assignment. The Executive represents and agrees that he has not made and shallnot make any assignment or other transfer of any interest in any claim, right, demand or actionwhich he had, has or may have against the Company or any of its subsidiaries or affiliates oragainst any of their respective directors, officers, employees, managers, fiduciaries,administrators, representatives or agents.(f) Executive Outplacement Services. The Company shall, upon a request by theExecutive, promptly reimburse the Executive for fees incurred by him in connection with executiveoutplacement services utilized by him in an amount not to exceed Ten Thousand Dollars ($10,000) inthe aggregate.(g) Reimbursement of Certain Attorney’s Fees. The Company shall, upon a request bythe Executive, promptly reimburse the Executive for his attorneys fees incurred in reviewing andnegotiating this Agreement in an amount not to exceed Fifteen Thousand Five Hundred Dollars($15,500).(h) Repurchase of Shares. The Executive shall have the right to sell to the Companyall of the Forty Two Thousand (42,000) shares of common stock of the Company owned by the Executive(the “Shares”) on July 1, 2008. If the Executive determines to exercise such right, he shallprovide written notice thereof to the Company on or before June 27, 2008 and the Company shall thenpurchase the Shares on July 1, 2008 at a price equal to the average of the high and low prices ofthe Company’s common stock on each of the twenty (20) business days prior to the date that theExecutive provides such notice to the Company. The Company shall pay the purchase price inimmediately available funds on July 1, 2008. As a condition to the Company’s obligation topurchase the Shares as provided herein, the Executive shall on July 1, 2008 (a) represent andwarrant to the Company that he owns the Shares individually and not jointly or together with anythird party, (b) represent and warrant to the Company that he owns the Shares free and clear of allliens, security interests, pledges, options, claims and rights of any third party, (c) deliver tothe Company all stock certificates representing the Shares, and (d) deliver to the Company arelease substantially in form and content as set forth in Exhibit A hereto with respect tothe period from the date of this Agreement through and including the Effective Time.(i) Press Release. The Company agrees to provide to the Executive a draft of thepress release relating to the Company’s announcement of the Executive’s departure from the Companynot less than 24 hours prior to the issuance thereof. The Company agrees to consider any commentsthat the Executive may have to such draft press release; provided, however, that (i) the Executiveshall have no approval right as to the form, content and timing of the final press releaseultimately issued by the Company, and (ii) the Company shall make the final decision as to theform, content and timing of the press release that it issues.
 
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Section 11. Miscellaneous.(a) Binding Effect; Assignment. This Agreement shall be binding upon and inure to thebenefit of the parties hereto and their respective successors, assigns, executors, representativesand heirs; provided, however, that neither party may assign this Agreement without the prior writtenconsent of the other party except that the Company may, without the prior consent of the Executive,assign this Agreement to any subsidiary or successor of the Company (whether in connection with anymerger, consolidation, share exchange, combination, change in control, sale of stock, assets orbusiness or similar transaction involving the Company or any of its subsidiaries). In the event ofthe Executive’s death, any unpaid balance of the Severance Payment shall be paid to the Executive’sestate in accordance with the same payment schedule specified in this Agreement.(b) Waiver; Amendment. Either party hereto may, by a writing signed by the waivingparty, waive the performance by the other party of any of the covenants or agreements to beperformed by such other party under this Agreement. The waiver by either party hereto of a breachof or noncompliance with any provision of this Agreement shall not operate or be construed as acontinuing waiver or a waiver of any other or subsequent breach or noncompliance hereunder. Thefailure or delay of either party at any time to insist upon the strict performance of any provisionof this Agreement or to enforce its rights or remedies under this Agreement shall not be construedas a waiver or relinquishment of the right to insist upon strict performance of such provision, orto pursue any of its rights or remedies for any breach hereof, at a future time.This Agreement may be amended, modified or supplemented only by a written agreement executedby the Company and the Executive.(c) Headings. The headings in this Agreement have been inserted solely for ease ofreference and shall not be considered in the interpretation, construction, or enforcement of thisAgreement.(d) Severability. All provisions of this Agreement are severable from one another.In case any one or more of the provisions (or any portion thereof) contained in this Agreementshall, for any reason, be held to be invalid, illegal or unenforceable in any respect, suchinvalidity, illegality or unenforceability shall not affect any other provision of this Agreement,but this Agreement shall be construed as if such invalid, illegal or unenforceable provision orprovisions (or portion thereof) had never been contained herein.(e) Counterparts. This Agreement may be executed in any number of counterparts, eachof which shall be an original, but such counterparts shall together constitute one and the sameagreement.(f) Governing Law; Jurisdiction; Venue; Waiver of Jury Trial. This Agreement shall begoverned by and construed in accordance with the laws of the State of Indiana, without reference toany choice of law provisions, principles or rules thereof (whether of the State of Indiana or anyother jurisdiction) that would cause the application of any laws of any jurisdiction other than theState of Indiana. The parties hereto hereby agree that all demands, claims, actions, causes ofaction, suits, proceedings and litigation between or among the parties relating to this Agreement,shall be filed, tried and litigated only in a federal or state court located in the State ofIndiana. In connection with the foregoing, the parties hereto irrevocably consent to thejurisdiction and venue of such court and expressly waive any claims or defenses of lack ofjurisdiction of or proper venue by such court. THE COMPANY AND THE EXECUTIVE HEREBY IRREVOCABLYAND UNCONDITIONALLY WAIVE TO THE MAXIMUM EXTENT PERMITTED BY LAW ANY AND ALL RIGHT TO A TRIAL BYJURY IN ANY DEMAND, CLAIM, ACTION, SUIT, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR OTHERWISERELATING TO THIS AGREEMENT.
 
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(g) Entire Agreement. This Agreement (including the Release of Claims attachedhereto), the Employment Agreement (to the extent not terminated pursuant to Section 3 hereof), theESOP and the 401(k) Plan constitute the entire understanding and agreement between the partieshereto relating to the subject matter hereof and thereof and supersede all other understandings,commitments, representations, negotiations, contracts, agreements, plans, programs, arrangements orpolicies, whether oral or written, between the parties hereto relating to the matters contemplatedhereby or thereby.(h) Construction. This Agreement shall be deemed to have been drafted by both partieshereto. This Agreement shall be construed in accordance with the fair meaning of its provisionsand its language shall not be strictly construed against, nor shall ambiguities be resolvedagainst, any party.(i) Taxes. All federal, state, local and other taxes (including, but not limited to,interest, fines and penalties) resulting from, imposed upon by virtue of or relating to thetransactions or the payments or benefits to the Executive contemplated by or referenced in thisAgreement shall be paid by the Executive, other than payment by the Company of its portion of anyFICA or other employment taxes.(j) Review and Consultation. The Executive hereby acknowledges and agrees that he (i)has read this Agreement in its entirety prior to executing it, (ii) understands the provisions andeffects of this Agreement, (iii) has consulted with such of his own attorneys, accountants andfinancial and other advisors as he has deemed appropriate in connection with his execution of thisAgreement, and (iv) has executed this Agreement voluntarily. **THE EXECUTIVE HEREBY UNDERSTANDS,ACKNOWLEDGES AND AGREES THAT HE HAS NOT RECEIVED ANY ADVICE, COUNSEL OR RECOMMENDATION WITH RESPECTTO THIS AGREEMENT FROM THE COMPANY, ANY DIRECTOR, OFFICER OR EMPLOYEE OF THE COMPANY OR ANYATTORNEY, ACCOUNTANT OR ADVISOR FOR THE COMPANY.**(k) Recitals. The recitals and “Whereas” clauses contained on page 1 of thisAgreement are expressly incorporated into and made a part of this Agreement.(l) Non-Admission. The Company and the Executive hereby agree that this Agreementdoes not constitute an admission or evidence of any (i) violation by the Company or the Executiveof any statute, law, rule or regulation, or (ii) wrongdoing on the part of the Company or theExecutive.IN WITNESS WHEREOF, the Company and the Executive have made, entered into, executed anddelivered this Agreement as of the day and year first above written.          /s/ Benjamin M. Anderson-Ray         Benjamin M. Anderson-Ray           CHROMCRAFT REVINGTON, INC.           By: /s/ Frank T. Kane       Frank T. Kane, Senior Vice President and      Chief Financial Officer  
 
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