##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number 001-00091
 Furniture Brands International, Inc.
  Delaware
(State or other jurisdiction of incorporation or organization)
    
    43-0337683
(I.R.S. Employer Identification No.)1 North Brentwood Blvd., St. Louis, Missouri
(Address of principal executive offices)
    
    63105
(Zip Code)
 
 
  þ o
  o o
  Large accelerated filer o
Accelerated filer þ
Non-accelerated filer o(Do not check if a smaller reporting company)Smaller reporting company o  o þ




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##### 



FURNITURE BRANDS INTERNATIONAL, INC.
TABLE OF CONTENTS
 PagePART I. FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Financial Statements (unaudited):Consolidated Balance Sheets:
    
    
    3March 31, 2011December 31, 2010Consolidated Statements of Operations:
    
    
    4Three Months Ended March 31, 2011Three Months Ended March 31, 2010Consolidated Statements of Cash Flows:
    
    
    5Three Months Ended March 31, 2011Three Months Ended March 31, 2010Notes to Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    20Item 4. Controls and Procedures
    
    
    21PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    22Item 1A. Risk Factors
    
    
    22Item 2. Unregistered Sale of Equity Securities and Use of Proceeds
    
    
    26Item 6. Exhibits
    
    
    27EX-31.1EX-31.2EX-32.1EX-32.2
   2




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PART I
 
 Item 1. Financial Statements
 
 FURNITURE BRANDS INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands except per share data)
(unaudited)
 March 31,
    
    
    December 31,2011
    
    
    2010ASSETSCurrent assets:Cash and cash equivalents
    
    $
    40,846
    
    
    $
    51,964Receivables, less allowances of $16,594 ($18,076 at December 31, 2010)
    
    
    123,655
    
    
    
    114,535Inventories
    
    
    255,511
    
    
    
    249,691Prepaid expenses and other current assets
    
    
    13,850
    
    
    
    11,242Total current assets
    
    
    433,862
    
    
    
    427,432Property, plant, and equipment, net
    
    
    120,066
    
    
    
    124,866Trade names
    
    
    86,508
    
    
    
    86,508Other assets
    
    
    46,572
    
    
    
    37,607Total assets
    
    $
    687,008
    
    
    $
    676,413LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    96,590
    
    
    $
    79,846Accrued employee compensation
    
    
    17,629
    
    
    
    18,336Other accrued expenses
    
    
    38,442
    
    
    
    42,887Total current liabilities
    
    
    152,661
    
    
    
    141,069Long-term debt
    
    
    77,000
    
    
    
    77,000Deferred income taxes
    
    
    22,180
    
    
    
    23,114Pension liability
    
    
    103,558
    
    
    
    104,736Other long-term liabilities
    
    
    72,305
    
    
    
    70,927Shareholders equity:Preferred stock, 10,000,000 shares authorized, no par value  none issued
    
    
    
    
    
    
    Common stock, 200,000,000 shares authorized, $1.00 stated value 
60,614,741 shares issued at March 31, 2011 and December 31, 2010
    
    
    60,615
    
    
    
    60,615Paid-in capital
    
    
    205,274
    
    
    
    210,945Retained earnings
    
    
    225,745
    
    
    
    228,803Accumulated other comprehensive loss
    
    
    (113,875
    )
    
    
    (115,675
    )Treasury stock at cost 5,291,322 shares at March 31, 2011 and 5,586,251
shares at December 31, 2010
    
    
    (118,455
    )
    
    
    (125,121
    )Total shareholders equity
    
    
    259,304
    
    
    
    259,567Total liabilities and shareholders equity
    
    $
    687,008
    
    
    $
    676,413
  3




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FURNITURE BRANDS INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share data)
(unaudited)
 Three Months Ended March 31,2011
    
    
    2010Net sales
    
    $
    297,856
    
    
    $
    322,391Cost of sales
    
    
    220,312
    
    
    
    237,942Gross profit
    
    
    77,544
    
    
    
    84,449Selling, general, and administrative expenses
    
    
    79,598
    
    
    
    79,864Operating earnings (loss)
    
    
    (2,054
    )
    
    
    4,585Interest expense
    
    
    761
    
    
    
    844Other income, net
    
    
    511
    
    
    
    279Earnings (loss) before income tax expense
    
    
    (2,304
    )
    
    
    4,020Income tax expense
    
    
    754
    
    
    
    523Net earnings (loss)
    
    $
    (3,058
    )
    
    $
    3,497Net earnings (loss) per common share  basic and diluted:
    
    $
    (0.06
    )
    
    $
    0.07Weighted average shares of common stock outstanding:Basic
    
    
    54,818
    
    
    
    48,297Diluted
    
    
    54,818
    
    
    
    48,356
  4




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FURNITURE BRANDS INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 Three Months Ended March 31,2011
    
    
    2010Cash flows from operating activities:Net earnings (loss)
    
    $
    (3,058
    )
    
    $
    3,497Adjustments to reconcile net earnings (loss) to net
cash used in operating activities:Depreciation and amortization
    
    
    6,114
    
    
    
    6,105Compensation expense related to stock option
grants and restricted stock awards
    
    
    974
    
    
    
    226Other, net
    
    
    (791
    )
    
    
    (1,530
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (9,120
    )
    
    
    (3,395
    )Inventories
    
    
    (5,820
    )
    
    
    (5,314
    )Prepaid expenses and other assets
    
    
    (2,515
    )
    
    
    (292
    )Accounts payable and other accrued expenses
    
    
    10,663
    
    
    
    2,769Deferred income taxes
    
    
    (6
    )
    
    
    (87
    )Other long-term liabilities
    
    
    (1,452
    )
    
    
    (2,702
    )Net cash used in operating activities
    
    
    (5,011
    )
    
    
    (723
    )Cash flows from investing activities:Additions to property, plant, equipment, and software
    
    
    (8,340
    )
    
    
    (7,494
    )Proceeds from the disposal of assets
    
    
    2,212
    
    
    
    1,869Net cash used in investing activities
    
    
    (6,128
    )
    
    
    (5,625
    )Cash flows from financing activities:Payments of long-term debt
    
    
    
    
    
    
    (17,000
    )Other
    
    
    21
    
    
    
    Net cash provided (used) by financing activities
    
    
    21
    
    
    
    (17,000
    )Net decrease in cash and cash equivalents
    
    
    (11,118
    )
    
    
    (23,348
    )Cash and cash equivalents at beginning of period
    
    
    51,964
    
    
    
    83,872Cash and cash equivalents at end of period
    
    $
    40,846
    
    
    $
    60,524Supplemental disclosure:Cash payments (refunds) for income taxes, net
    
    $
    (606
    )
    
    $
    103Cash payments for interest expense
    
    $
    652
    
    
    $
    866
  5




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FURNITURE BRANDS INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 BASIS OF PRESENTATION
   RESTRUCTURING AND ASSET IMPAIRMENT CHARGES
   Three Months Ended March 31,2011
    
    
    2010Restructuring charges:Contract termination costs
    
    $
    
    
    
    $
    614Facility costs to shutdown, cleanup, and vacate
    
    
    195
    
    
    
    Termination benefits
    
    
    (94
    )
    
    
    33Closed store occupancy and lease costs
    
    
    1,422
    
    
    
    932Loss (gain) on the sale of assets
    
    
    (439
    )
    
    
    (928
    )1,084
    
    
    
    651Impairment charges
    
    
    502
    
    
    
    67$
    1,586
    
    
    $
    718Statement of Operations classification:Cost of sales
    
    $
    1,178
    
    
    $
    33Selling, general, and administrative expenses
    
    
    408
    
    
    
    685$
    1,586
    
    
    $
    718
  6




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Three Months Ended March 31,2011
    
    
    2010Accrual for closed store lease liabilities at beginning of period
    
    $
    21,704
    
    
    $
    26,645Charges to expense
    
    
    307
    
    
    
    478Less cash payments
    
    
    1,330
    
    
    
    2,549Accrual for closed store lease liabilities at end of period
    
    $
    20,681
    
    
    $
    24,574
   MinimumLeasePayments Year
    
    Closed Stores2011
    
    $
    6,0742012
    
    
    8,2852013
    
    
    8,1852014
    
    
    7,0742015
    
    
    3,760thereafter
    
    
    1,833$
    35,211
  Three Months Ended March 31,2011
    
    
    2010Accrual for termination benefits at beginning of period
    
    $
    4,950
    
    
    $
    4,138Charges (credit) to expense
    
    
    (94
    )
    
    
    33Less cash payments
    
    
    775
    
    
    
    2,226Accrual for termination benefits at end of period
    
    $
    4,081
    
    
    $
    1,945
  7




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INVENTORIES
  March 31,
    
    
    December 31,2011
    
    
    2010Finished products
    
    $
    161,411
    
    
    $
    156,129Work-in-process
    
    
    17,376
    
    
    
    16,395Raw materials
    
    
    76,724
    
    
    
    77,167$
    255,511
    
    
    $
    249,691
 PROPERTY, PLANT, AND EQUIPMENT
  March 31,
    
    
    December 31,2011
    
    
    2010Land
    
    $
    10,820
    
    
    $
    11,375Buildings and improvements
    
    
    180,912
    
    
    
    190,855Machinery and equipment
    
    
    217,724
    
    
    
    217,404409,456
    
    
    
    419,634Less accumulated depreciation
    
    
    289,390
    
    
    
    294,768$
    120,066
    
    
    $
    124,866
  LONG-TERM DEBT
  March 31,
    
    
    December 31,2011
    
    
    2010Asset-based loan
    
    $
    77,000
    
    
    $
    77,000Less: current maturities
    
    
    
    
    
    
    Long-term debt
    
    $
    77,000
    
    
    $
    77,000
     8




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1 2
  LIQUIDITY
    EMPLOYEE BENEFITS
  Three Months Ended March 31,2011
    
    
    2010Defined benefit plans
    
    $
    790
    
    
    $
    2,714Defined contribution plan (401k plan)  company match
    
    
    1,679
    
    
    
    1,673Other
    
    
    348
    
    
    
    130$
    2,817
    
    
    $
    4,517
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Three Months Ended March 31,2011
    
    
    2010Service cost
    
    $
    
    
    
    $
    605Interest Cost
    
    
    6,388
    
    
    
    6,464Expected return on plan assets
    
    
    (6,656
    )
    
    
    (6,227
    )Net amortization and deferral
    
    
    1,058
    
    
    
    1,872Net periodic pension expense
    
    $
    790
    
    
    $
    2,714
    STOCK OPTIONS, RESTRICTED STOCK, AND RESTRICTED STOCK UNITS
   WeightedAverageExerciseShares
    
    
    PriceOutstanding at December 31, 2010
    
    
    2,621,267
    
    
    $
    15.97Granted
    
    
    687,888
    
    
    
    4.64Exercised
    
    
    
    
    
    
    Forfeited or expired
    
    
    (478,195
    )
    
    
    23.02Outstanding at March 31, 2011
    
    
    2,830,960
    
    
    $
    10.91
  10




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WeightedAverageGrant-DateShares
    
    
    Fair ValueOutstanding at December 31, 2010
    
    
    826,958
    
    
    $
    7.85Granted
    
    
    297,448
    
    
    
    4.59Vested
    
    
    (9,167
    )
    
    
    6.55Forfeited
    
    
    (6,234
    )
    
    
    7.03Outstanding at March 31, 2011
    
    
    1,109,005
    
    
    $
    6.99
   EARNINGS PER SHARE
  Three Months Ended March 31,2011
    
    
    2010Weighted average shares used for basic earnings (loss) per common share
    
    
    54,818,000
    
    
    
    48,297,000Effect of dilutive stock options and restricted stock
    
    
    
    
    
    
    59,000Weighted average shares used for diluted earnings (loss) per common share
    
    
    54,818,000
    
    
    
    48,356,000
  INCOME TAXES
    11




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OTHER LONG-TERM LIABILITIES
  COMPREHENSIVE INCOME (LOSS)
  Three Months Ended March 31,2011
    
    
    2010Net earnings (loss)
    
    $
    (3,058
    )
    
    $
    3,497Other comprehensive income:Pension liability
    
    
    1,058
    
    
    
    1,870Foreign currency translation
    
    
    742
    
    
    
    7791,800
    
    
    
    2,649Income tax expense
    
    
    
    
    
    
    (709
    )Other compressive income
    
    
    1,800
    
    
    
    1,940Total comprehensive income (loss)
    
    $
    (1,258
    )
    
    $
    5,437
  March 31,
    
    
    December 31,2011
    
    
    2010Pension liability
    
    $
    (117,087
    )
    
    $
    (118,145
    )Foreign currency translation
    
    
    3,212
    
    
    
    2,470$
    (113,875
    )
    
    $
    (115,675
    )
 CONTINGENT LIABILITIES
   12




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13




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
 Forward-Looking Statements
  Overview
    
    
    Broyhill has collections of mid-priced furniture, including both wood furniture and
upholstered products, in a wide range of styles and product categories including bedroom,
dining room, living room, occasional, youth, home office, and home entertainment.
    
    Lane focuses primarily on mid-priced upholstered furniture, including motion and stationary
furniture with an emphasis on home entertainment and family rooms.
    
    Thomasville has both wood furniture and upholstered products in the mid- to upper-price
ranges and also manufactures and markets ready-to-assemble furniture under the Creative
Interiors brand name, as well as case goods for the hospitality and contract markets.
    
    Drexel Heritage markets both casegoods and upholstered furniture in categories ranging from
mid- to premium-priced.
    
    Henredon specializes in both wood furniture and upholstered products in the premium-price
category.
    
    Hickory Chair manufactures premium-priced wood and upholstered furniture, offering
traditional and modern styles.
    
    Pearson offers contemporary and traditional styles of finely tailored upholstered furniture
in the premium-price category.
    
    Laneventure markets a premium-priced outdoor line of wicker, rattan, bamboo, exposed
aluminum, and teak furniture, as well as casual indoor home furnishings.
    
    Maitland-Smith designs and manufactures premium hand crafted, antique-inspired furniture,
accessories, and lighting, utilizing a wide range of unique materials. Maitland-Smith markets
under both the Maitland-Smith and LaBarge brand names.
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Business Trends and Strategy
    
    
    More product launches driven by a multi-stage product development process that blends
the decades of experience of our designers, merchandisers, marketers and dealers with
proven consumer research methodologies that are new to the furniture industry.
    
    Increased support of our retail partners with a larger investment in national television
and print advertising, innovative promotions and a web presence that drives consumer
traffic to their locations.
    
    Further reductions to manufacturing costs through the implementation of lean and
cellular manufacturing methods and through strategic sourcing relationships with suppliers
that leverage the companys scale.
  15




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Results of Operations
  Three Months Ended March 31,2011
    
    
    2010% of
    
    
    
    
    
    
    % of(in millions, except per share data)
    
    Dollars
    
    
    Net Sales
    
    
    Dollars
    
    
    Net SalesNet sales
    
    $
    297.9
    
    
    
    100.0
    %
    
    $
    322.4
    
    
    
    100.0
    %Cost of sales
    
    
    220.3
    
    
    
    74.0
    
    
    
    237.9
    
    
    
    73.8Gross profit
    
    
    77.5
    
    
    
    26.0
    
    
    
    84.4
    
    
    
    26.2Selling, general, and administrative expenses
    
    
    79.6
    
    
    
    26.7
    
    
    
    79.9
    
    
    
    24.8Earnings (loss) from operations
    
    
    (2.1
    )
    
    
    (0.7
    )
    
    
    4.6
    
    
    
    1.4Interest expense
    
    
    0.8
    
    
    
    0.3
    
    
    
    0.8
    
    
    
    0.3Other income, net
    
    
    0.5
    
    
    
    0.2
    
    
    
    0.3
    
    
    
    0.1Earnings (loss) before income tax expense
    
    
    (2.3
    )
    
    
    (0.8
    )
    
    
    4.0
    
    
    
    1.2Income tax expense
    
    
    0.8
    
    
    
    0.3
    
    
    
    0.5
    
    
    
    0.2Net earnings (loss)
    
    $
    (3.1
    )
    
    
    (1.0
    )%
    
    $
    3.5
    
    
    
    1.1
    %Net earnings (loss) per common share 
basic and diluted
    
    $
    (0.06
    )
    
    
    
    
    
    $
    0.07
 Three Months Ended March 31, 2011 Compared to Three Months Ended March 31, 2010
      16




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Retail Results of Operations
  Thomasville Stores (a)
    
    
    All Other Retail Locations (b)Three Months Ended March 31,
    
    
    Three Months Ended March 31,(Dollars in millions)
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010Net sales
    
    $
    29.0
    
    
    $
    25.6
    
    
    $
    10.0
    
    
    $
    10.0Cost of sales
    
    
    17.6
    
    
    
    14.6
    
    
    
    6.7
    
    
    
    5.9Gross profit
    
    
    11.4
    
    
    
    11.0
    
    
    
    3.3
    
    
    
    4.1Selling, general and administrative
expenses  open stores
    
    
    15.9
    
    
    
    15.3
    
    
    
    5.0
    
    
    
    5.8Operating loss  open stores (c)
    
    $
    (4.6
    )
    
    $
    (4.3
    )
    
    $
    (1.7
    )
    
    $
    (1.8
    )Selling, general and administrative
expenses  closed stores
    
    
    
    
    
    
    
    
    
    
    1.4
    
    
    
    0.9Operating loss (c)
    
    $
    (4.6
    )
    
    $
    (4.3
    )
    
    $
    (3.1
    )
    
    $
    (2.7
    )Number of open stores and showrooms at end
of period
    
    
    47
    
    
    
    51
    
    
    
    18
    
    
    
    21Number of closed locations at end of period
    
    
    
    
    
    
    
    
    
    
    27
    
    
    
    28Same-store-sales (d):Percentage increase
    
    
    17
    %
    
    
    16
    %
    
    
    (e
    )
    
    
    (e
    )Number of stores
    
    
    46
    
    
    
    40
 
 a)
    
    This supplemental data includes company-owned Thomasville retail store locations that
were open during the three months ended March 31, 2011 and 2010.b)
    
    This supplemental data includes all company-owned retail locations other than open
Thomasville stores (all other retail locations). Selling, general and administrative
expenses  closed stores includes occupancy costs, lease termination costs, and costs
associated with closed store lease liabilities.c)
    
    Operating loss does not include our wholesale profit on the above retail net sales.d)
    
    The same-store-sales percentage is based on sales from stores that have been in
operation and company-owned for at least 15 months.e)
    
    Same-store-sales information is not meaningful and is not presented for all other
retail locations because results include retail store locations of multiple brands,
including seven Drexel Heritage stores, two Lane stores, one Henredon store, one Broyhill
store, and seven designer showrooms at March 31, 2011; and it is not one of our long-term
strategic initiatives to grow non-Thomasville brand company-owned retail locations.  17




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Financial Condition and Liquidity
 Liquidity
    18




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Financing Arrangements
  March 31,
    
    
    December 31,2011
    
    
    2010Asset-based loan
    
    $
    77.0
    
    
    $
    77.0Less: current maturities
    
    
    
    
    
    
    Long-term debt
    
    $
    77.0
    
    
    $
    77.0
       1 2
   Funded Status of Qualified Defined Benefit Pension Plan
  19




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Contractual Obligations and Other Commitments
 Off-Balance Sheet Arrangements
  Critical Accounting Policies
   Subsequent Events
  
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
  20




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Item 4. Controls and Procedures
 a)
    
    Evaluation of Disclosure Controls and ProceduresUnder the supervision and with the participation of our management, including our Chief
Executive Officer and Chief Financial Officer, we conducted an evaluation of the
effectiveness of our disclosure controls and procedures, as such terms are defined in Rules
13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934 (the Exchange
Act), as of March 31, 2011, the end of the period covered by this Quarterly Report on Form
10-Q.Disclosure controls and procedures are controls and procedures designed to ensure that
information required to be disclosed in our reports filed under the Exchange Act, such as
this report, is recorded, processed, summarized and reported within the time periods
specified in the SECs rules and forms. Disclosure controls are also designed to ensure that
such information is accumulated and communicated to our management, including our Chief
Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions
regarding required disclosure.Based on this evaluation, management, including our Chief Executive Officer and Chief
Financial Officer, has concluded that our disclosure controls and procedures were effective
as of March 31, 2011.b)
    
    Changes in Internal Control over Financial ReportingThere have not been any changes in our internal control over financial reporting during the
quarter ended March 31, 2011, that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
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PART II
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
 We describe the risk factors associated with our business below. This description includes any
material changes to and supersedes the description of the risk factors associated with our business
previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended
December 31, 2010. Additional risks and uncertainties that we are unaware of or that we currently
deem immaterial also may become important factors that affect our company. You should carefully
consider the risks described below in addition to all other information provided to you in this
document, in our Annual Report on Form 10-K for the year ended December 31, 2010, and in our
subsequent filings with the Securities and Exchange Commission. Any of the following risks could
materially and adversely affect our business, results of operations, and financial condition.
 Unfavorable economic conditions could result in a decrease in our future sales, earnings, and
liquidity.
  Market returns could have a negative impact on the return on plan assets for our qualified pension
plan, which may require significant funding.
  Loss of market share and other financial or operational difficulties due to competition would
likely result in a decrease in our sales and earnings.
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An inability to forecast demand or respond to changes in consumer tastes and fashion trends in a
timely manner could result in a decrease in our future sales and earnings.
  A change in our mix of product sales could result in a decrease in our future earnings.
  Business failures of large dealers, a group of customers or our own retail stores could result in a
decrease in our future sales and earnings.
  Inventory write-downs or write-offs could result in a decrease in our earnings.
  Sales distribution realignments can result in a decrease in our sales and earnings.
  Manufacturing realignments and cost savings programs could result in a decrease in our near-term
earnings and liquidity.
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Reliance on offshore sourcing of our products subjects us to changes in local government
regulations and currency fluctuations which could result in a decrease in our earnings.
  Our operations depend on production facilities located outside the United States which are subject
to increased risks of disrupted production which could cause delays in shipments, loss of
customers, and decreases in sales and earnings.
  Fluctuations in the price, availability, and quality of raw materials could cause delays in
production and could increase the costs of materials which could result in a decrease in our sales
and earnings.
  We are subject to litigation, environmental regulations, and governmental matters that could
adversely impact our sales, earnings, and liquidity.
  We may not realize the anticipated benefits of mergers, acquisitions, or dispositions.
  Loss of key personnel or the inability to hire qualified personnel could adversely affect our
business.
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Impairment of our trade name intangible assets would result in a decrease in our earnings and net
worth.
  Provisions in our certificate of incorporation and our shareholders rights plan could discourage a
takeover and could result in a decrease in the value of our common stock.
  A change in control could limit the use of our net operating loss carry forwards and decrease a
potential acquirers valuation of our businesses, both of which could decrease our liquidity and
earnings.
  If we and our dealers are not able to open new stores or effectively manage the growth of these
stores, our ability to grow sales and profitability could be adversely affected.
  We may not be able to comply with our debt agreement or secure additional financing on favorable
terms or generate sufficient profit to meet our future capital needs, which could significantly
adversely impact our liquidity and our business .
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Item 2. Unregistered Sale of Equity Securities and Use of Proceeds
  Total Number of
    
    
    Maximum NumberTotal
    
    
    
    
    
    
    Shares Purchased as
    
    
    of Shares that MayNumber of
    
    
    Average
    
    
    Part of Publicly
    
    
    Yet Be PurchasedShares
    
    
    Price Paid
    
    
    Announced Plans or
    
    
    Under the Plans orPurchased
    
    
    per Share (1)
    
    
    Programs
    
    
    Programs.January 2011:January 1,
2011 through January 31,
2011
    
    
    
    
    
    $
    
    
    
    
    (2)
    
    
    
    (2)February 2011:February
1, 2011 through February
28, 2011
    
    
    3,361
    
    
    
    4.46
    
    
    
    (2)
    
    
    
    (2)March 2011:March 1, 2011
through March 31, 2011
    
    
    
    
    
    
    
    
    
    
    (2)
    
    
    
    (2)Total
    
    
    3,361
    
    
    $
    4.46
 
 (1)
    
    Shares valued at the average of the high and low prices of common stock as reported by
the New York Stock Exchange on the vesting date.(2)
    
    We did not have any publicly announced plan or program to repurchase equity securities
during the quarter ended March 31, 2011. 26




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Item 6. Exhibits
 FiledwithExhibit
    
    
    
    the    

    Incorporated by ReferenceIndex
    
    
    
    Form
    
    
    
    Filing Date
    
    ExhibitNo.
    
    Exhibit Description
    
    10-Q
    
    Form
    
    with the SEC
    
    No.3.1
    
    Restated
Certificate of
Incorporation of
the Company, as
amended
    
    
    
    10-Q
    
    May 14, 2002
    
    
    33.2
    
    By-Laws of the
Company, as amended
effective as of
August 5, 2010
    
    
    
    8-K
    
    August 10, 2010
    
    
    3.13.3
    
    Certificate of
Designation of
Series B Junior
Participating
Preferred Stock
    
    
    
    8-K
    
    August 4, 2009
    
    
    3.14.1
    
    Amended and
Restated
Stockholders Rights
Agreement, dated as
of February 26,
2010, between the
Company and
American Stock
Transfer and Trust
Company, LLC, as
Rights Agent
    
    
    
    8-K
    
    March 1, 2010
    
    
    4.131.1
    
    Certification of
Chief Executive
Officer of the
Company, Pursuant
to Rule
13a-14(a)/15d-14(a)
    
    X31.2
    
    Certification of
Chief Financial
Officer (Principal
Financial Officer)
of the Company,
Pursuant to Rule
13a-14(a)/15d-14(a)
    
    X32.1
    
    Certification of
Chief Executive
Officer of the
Company, Pursuant
to 18 U.S.C.
Section 1350
    
    X32.2
    
    Certification of
Chief Financial
Officer (Principal
Financial Officer)
of the Company,
Pursuant to 18
U.S.C. Section 1350
    
    X
 27




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SIGNATURE
  Furniture Brands International, Inc.
(Registrant)By:
    /s/ Steven G. RollsSteven G. RollsChief Financial Officer
(On behalf of the registrant and as Principal Financial Officer)
Date: May 6, 2011 28