Amendment 1 to the Furniture Brands Credit Agreement dated 04/16/07


     

    AMENDMENT
      NO. 1 TO CREDIT AGREEMENT

     

    THIS
      AMENDMENT NO. 1 TO CREDIT AGREEMENT
      (this
“Amendment”) is entered into as of April 16, 2007 by and among FURNITURE
      BRANDS INTERNATIONAL, INC.,
      a
      Delaware corporation (“Furniture Brands”), BROYHILL
      FURNITURE INDUSTRIES, INC.,
      a North
      Carolina corporation (“Broyhill”), HDM
      FURNITURE INDUSTRIES, INC.,
      a
      Delaware corporation (“HDM”), LANE
      FURNITURE INDUSTRIES, INC.,
      a
      Mississippi corporation (“Lane”),
      THOMASVILLE FURNITURE INDUSTRIES, INC.,
      a
      Delaware corporation (“Thomasville”, and, together with Furniture Brands, HDM,
      Broyhill and Lane, each a “Borrower,” and, collectively, the “Borrowers”),
the
      Lenders party to the Credit Agreement, and JPMORGAN
      CHASE BANK, N.A.,
      as
      Administrative Agent (the “Administrative Agent”).

     

     

    RECITALS

     

    A. The
      Borrowers, the Lenders, the Co-Syndication Agents, the Administrative Agent
      and
      the Lead Arranger are party to that certain Credit Agreement dated as of April
      21, 2006 (the “Credit Agreement”). Unless otherwise specified herein,
      capitalized terms used in this Amendment shall have the meanings ascribed to
      them by the Credit Agreement.

     

    B. The
      Borrowers, the Lenders, and the Administrative Agent wish to amend the Credit
      Agreement on the terms and conditions set forth below.

     

    Now,
      therefore, in consideration of the mutual execution hereof and other good and
      valuable consideration, the parties hereto agree as follows:

     

    1. Amendment
      to Credit Agreement.
      The
      Credit Agreement is hereby amended as follows effective as of March 31,
      2007:

     

    (a) The
      defined terms “Applicable Base Rate Margin” and “Applicable Eurodollar Margin”
in Section 1.01 of the Credit Agreement are hereby 

    amended
      by adding
      the following as the final sentence of the definition thereof:

     

    Notwithstanding
      the foregoing, solely for the period from and including March 31, 2007 to but
      excluding June 30, 2007, the respective percentage per annum set forth above
      for
      (i) the Applicable Eurodollar Margin for Pricing Levels 4 and 5 shall be 1.00%
      and 1.25%, respectively and (ii) the Applicable Base Rate Margin for Pricing
      Level 5 shall be .25%.

     

    (b) The
      defined term “Credit Documents” in Section 1.01 of the Credit Agreement is
      hereby deleted and replaced with the following: 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Credit
      Documents” shall mean this Agreement and, after the execution and delivery
      thereof pursuant to the terms of this Agreement, each Revolving Note, the
      Swingline Note and the Guaranty and, after the execution and delivery thereof,
      the Intercreditor Agreement, each Security Document and each additional guaranty
      executed pursuant to Section 9.09. 

     

    (c) The
      defined term “Expiration Date” in Section 1.01 of the Credit Agreement is hereby
      deleted and replaced with the following: 

     

    “Expiration
      Date” shall mean (x) with respect to each Letter of Credit, the final stated
      expiration date (or, if later, the stated final drawing date) thereof or such
      earlier date on which such Letter of Credit was canceled and returned to the
      Issuing Lender and (y) with respect to each Acceptance, the date on which such
      Acceptance matures as provided by the terms of the draft under the Letter of
      Credit related thereto.

     

    (d) Section
      1.01 of the Credit Agreement is amended by adding the following definitions
      in
      appropriate alphabetical order:

     

    “Asset
      Disposition”
shall
      mean any sale, transfer or other disposition of any asset of Furniture Brands
      or
      any Subsidiary thereof in a single transaction or in a series of related
      transactions (other than (i) the sale of inventory or products in the ordinary
      course or the sale of obsolete or worn out property in the ordinary course
      and
      (ii) the sale of cash equivalent investments in the ordinary course of the
      cash
      management of the business of Furniture Brands and its
      Subsidiaries).

     

    “Collateral”
shall
      mean all property with respect to which any security interests have been granted
      (or purported to be granted) pursuant to any Security Document.

     

    “Collateral
      Agent”
shall
      mean the Administrative Agent acting as collateral agent for the Secured
      Creditors pursuant to the Security Documents.

     

    “Equity
      Interests”
shall
      mean shares of capital stock, partnership interests, membership interests in
      a
      limited liability company, beneficial interests in a trust or other equity
      ownership interests in a Person, and any warrants, options or other rights
      entitling the holder thereof to purchase or acquire any such equity
      interest.

     

    “Intercreditor
      Agreement”
shall
      mean the Intercreditor and Collateral Agency Agreement dated as of the date
      of
      Amendment No. 1 hereto entered into among the holders of the Borrowers’ 6.83%
      Senior Notes due May 17, 2018, the Collateral Agent and the Administrative
      Agent
      on its on behalf and on behalf of each of the Lenders, as amended, restated,
      modified or supplemented from time to time.

     

    


    
      
        
        

      

      
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    “Pledge
      Agreement”
shall
      mean the Pledge Agreement dated as of the date of Amendment No. 1 hereto made
      by
      the Borrowers and the other Guarantors party thereto in favor of the Collateral
      Agent for the benefit of the Secured Creditors, as the same may be amended,
      restated, modified or supplemented from time to time.

     

    “Pledge
      Agreements”
shall
      mean, collectively, the Pledge Agreement and each other document or instrument
      pursuant to which Equity Interests are pledged to the Collateral Agent for
      the
      benefit of the Secured Creditors pursuant hereto, in each case as the same
      may
      be amended, restated, modified or supplemented from time to time.

     

    “Secured
      Creditors”
shall
      mean the Lenders, the Administrative Agent, the Collateral Agent, the “Other
      Creditors” (as defined in the Guaranty) and the holders of the Borrowers’ 6.83%
      Senior Notes due May 17, 2018, all as more specifically described in the
      respective Security Documents.

     

    “Security
      Agreement”
shall
      mean the Security Agreement dated as of the date of Amendment No. 1 hereto
      made
      by the Borrowers and the other Guarantors party thereto in favor of the
      Collateral Agent for the benefit of the Secured Creditors, as the same may
      be
      amended, restated, modified or supplemented from time to time. 

     

    “Security
      Agreements”
shall
      mean, collectively, the Security Agreement, and each other document or
      instrument pursuant to which security interests are granted in the Collateral
      to
      the Collateral Agent for the benefit of the Secured Creditors pursuant hereto,
      in each case as the same may be amended, restated, modified or supplemented
      from
      time to time.

     

    “Security
      Documents”
shall
      mean and include the Security Agreements, the Pledge Agreements and each other
      document or instrument pursuant to which security is granted to the Collateral
      Agent for the benefit of the Secured Creditors pursuant hereto or in connection
      herewith.

     

    “Substantial
      Portion”
shall
      mean, with respect to the property of Furniture Brands and its Subsidiaries,
      property which (i) represents more than 10% of the consolidated assets of
      Furniture Brands and its Subsidiaries as would be shown in the consolidated
      financial statements of Furniture Brands and its Subsidiaries as at the
      beginning of the twelve-month period ending with the last day of the month
      preceding the month in which such determination is made or (ii) is responsible
      for more than 10% of the consolidated net sales or of the consolidated net
      income of 

     

    
      
        
        

      

      
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    Furniture
      Brands and its Subsidiaries as would be reflected in the financial statements
      referred to in clause (i) above for such twelve-month period. 

     

    (e) Section
      8
      of the Credit Agreement is hereby amended by adding a new Section 8.20 as
      follows: 

     

    8.20
      Security
      Documents.
      The
      security interests created in favor of the Collateral Agent, for the benefit
      of
      the Secured Creditors, under the Security Agreements and Pledge Agreements
      constitute valid and enforceable security interests in the Collateral described
      in such Security Document under its governing law, subject to no Lien of any
      other Person, except as permitted by such Security Document. No filings or
      recordings (other than filings or recordings that have been made) are required
      in order to perfect (or maintain the perfection or priority of) the security
      interests created in the Collateral pledged under any Security Document other
      than with respect to Collateral of a type as to which perfection may not be
      accomplished by filing under the Uniform Commercial Code.

     

    (f) Section
      9.09 of the Credit Agreement is hereby deleted and replaced with the
      following:

     

    9.09
      Additional Subsidiary Guarantors and Collateral. Unless
      the Required Lenders otherwise agree, each Borrower agrees to cause each of
      its
      Wholly-Owned Domestic Subsidiaries (other than such Subsidiaries having less
      than $10,000 of assets) that are acquired or created after the Effective Date
      (or, in the case of such Subsidiaries which exist but have less than $10,000
      of
      assets on the Effective Date, first acquires in excess of $10,000 of assets
      after the Effective Date) to promptly (and in any event within 10 Business
      Days
      (or, in the case of (iii) below, 20 Business Days) of such acquisition or
      creation) (i) execute and deliver a counterpart of the Joinder Agreement to
      the
      Guaranty in the form of Exhibit I hereto (the “Joinder Agreement”) and take the
      actions specified therein, (ii) execute and deliver a joinder to such Security
      Documents as the Administrative Agent may request, and (iii) execute such
      additional Security Documents as the Administrative Agent may request, in each
      case as deemed appropriate by the Administrative Agent to cause substantially
      all personal property of such Wholly-Owned Domestic Subsidiary other than Equity
      Interests in Foreign Subsidiaries to constitute Collateral
      and in
      form and substance satisfactory to the Administrative Agent and, in the case
      of
      (i), (ii) and (iii) above, accompanied by such resolutions, opinions, corporate
      certificates and other documents as the Administrative Agent may reasonably
      request. 

     

    (g) Section
      9
      of the Credit Agreement is hereby amended by adding a new Section 9.10 as
      follows:

     

    
      
        
        

      

      
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    9.10
      Further
      Assurances; etc.
      (a) The
      Borrowers will, and will cause each of their respective Subsidiaries to, at
      the
      expense of the Borrowers, make, execute, endorse, acknowledge, file and/or
      deliver to the Collateral Agent from time to time such schedules, confirmatory
      assignments, conveyances, financing statements, transfer endorsements, powers
      of
      attorney, certificates, reports, and other assurances or instruments and take
      such further steps relating to the Collateral covered by any of the Security
      Documents as the Administrative Agent may reasonably require to assure the
      creation and continuation of perfected security interests in the Collateral
      and
      as are generally consistent with the terms of this Agreement and the Security
      Documents. Furthermore, the Borrowers will, and will cause their respective
      Subsidiaries to, deliver to the Collateral Agent such opinions of counsel and
      other related documents as may be reasonably requested by the Administrative
      Agent to assure compliance with this Section 9.10. Without limiting the
      foregoing, the Borrowers shall use their best efforts to cause to be delivered
      to the Administrative Agent (i) a landlord waiver and/or mortgagee estoppel
      letter, as applicable, with respect to each material parcel of real property
      leased by any of the Borrowers or any of the Subsidiary Guarantors as and to
      the
      extent the Administrative Agent shall request, each in form and substance
      acceptable to the Administrative Agent and (ii) such bailee letters with respect
      to Collateral held by third parties as and to the extent the Administrative
      Agent shall request, each in form and substance acceptable to the Administrative
      Agent.

     

    (b) The
      Borrowers agree that each action required by clause (a) of this Section 9.10
      shall be completed as soon as reasonably practical, but in no event later than
      twenty (20) Business Days (or such greater number of days as the Administrative
      Agent may agree) after such action is requested to be taken by the
      Administrative Agent or the Required Lenders. 

     

    (h) Section
      10.01 of the Credit Agreement is hereby amended by deleting the word “or” at the
      conclusion of subsection 10.01(xiv), replacing the “.” at the conclusion of
      subsection 10.01(xv) with “; or” and adding a new subsection 10.01(xvi) as
      follows:

     

    (xvi)
      Liens created pursuant to the Security Documents.

     

    
      
        
        

      

      
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    (i) Section
      10.02 of the Credit Agreement is hereby amended by deleting the first sentence
      thereof up to and including the words “shall be permitted” and replacing such
      deleted words with the following:

     

    (a)
      Furniture Brands will not, and will not permit any of its Subsidiaries to,
      consolidate with or merge into any other Person or permit any other Person
      to
      merge into it or any of its Subsidiaries, except that the following shall be
      permitted: 

     

    and
      Section 10.02 of the Credit Agreement is hereby further amended by adding a
      new
      Section 10.02(b) as follows:

     

    (b) Furniture
      Brands will not, and will not permit any of its Subsidiaries to, make any Asset
      Disposition except for (i) Asset Dispositions among the Credit Parties, (ii)
      Asset Dispositions expressly permitted by Section 10.02(a) and (iii) other
      Asset
      Dispositions of property that, together with all other property of Furniture
      Brands and its Subsidiaries previously leased, sold or disposed of in Asset
      Dispositions made pursuant to Section 10.02(b)(iii) during the twelve-month
      period ending with the month in which any such lease, sale or other disposition
      occurs, do not constitute a Substantial Portion of the property of Furniture
      Brands and its Subsidiaries.

     

    (j) Section
      10.03(viii) of the Credit Agreement is hereby deleted and replaced with the
      following: 

     

    (viii)
      intercompany Indebtedness among the Borrowers and their Subsidiaries;
provided
      that if
      such Indebtedness is owing to a Guarantor, the Indebtedness is a senior
      obligation of the obligor, and if such Indebtedness is owing by a Guarantor
      to a
      Subsidiary which is not a Guarantor, the Indebtedness is at all times after
      the
      effectiveness of Amendment No. 1 hereto subordinated to the Obligations on
      terms
      reasonably satisfactory to the Administrative Agent;

     

    (k) Section
      10.05 of the Credit Agreement is hereby amended by deleting such subsection
      in
      its entirety and replacing it with the following:

     

    10.05
      Maximum
      Leverage Ratio. The
      Borrowers will not permit the Leverage Ratio at any time to be greater than
      or
      equal to 3.25:1.00; provided, however, that solely with respect to the period
      from and including March 31, 2007 through and including June 29, 2007, the
      Borrowers shall be deemed in compliance with this Section 10.05 so long as
      the
      Leverage Ratio is not at any time during such period greater than
      4.25:1.00.

     

    (l) Section
      10.06 of the Credit Agreement is hereby amended by deleting such subsection
      in
      its entirety and replacing it with the following:

     

    
      
        
        

      

      
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    10.06
      Minimum
      Coverage Ratio.
      The
      Borrowers will not (i) permit the Coverage Ratio as of the end of the fiscal
      quarter of the Borrowers ending on March 31, 2007 to be less than or equal
      to
      1.90:1.00, (ii) permit the Coverage Ratio as of the end of any fiscal quarter
      of
      the Borrowers ending prior to March 31, 2009 (other than the fiscal quarter
      of
      the Borrowers ending March 31, 2007) to be less than or equal to 2.75:1.00
      or
      (iii) permit the Coverage Ratio as of the end of any fiscal quarter of the
      Borrowers ending on or after March 31, 2009 to be less than or equal to
      3.00:1.00. 

     

    (m) Section
      10.12 of the Credit Agreement is hereby amended and restated to read in its
      entirety as follows:

     

    10.12
      Restricted
      Payments.
      Furniture Brands will not, and will not permit any of its Subsidiaries to,
      declare or make, or agree to pay or make, directly or indirectly, any Restricted
      Payment, except (a) Furniture Brands may declare and pay dividends with respect
      to its Equity Interests payable solely in additional shares of its common stock,
      (b) Subsidiaries of Furniture Brands may declare and pay dividends ratably
      with
      respect to their Equity Interests,
      (c) so
      long as no Default or Event of Default exists or would result therefrom,
      Furniture Brands may (i) pay cash dividends in an amount not in excess of $.64
      per common share per calendar year (adjusted for any stock splits after the
      date
      hereof) and (ii) repurchase at market price in any fiscal year a number of
      its
      common shares not in excess of the number of common shares of Furniture Brands
      issued through the exercise of stock options in such fiscal year and (d)
      Furniture Brands may make other Restricted Payments so long as (i) no Default
      or
      Event of Default exists or would result therefrom and (ii) the Leverage Ratio
      shall be less than 3.25:1.00 both before and after giving effect to such
      Restricted Payment.

     

    (n) Section
      10 of the Credit Agreement is hereby amended by adding new Sections 10.13 and
      10.14 as follows:

     

    10.13
      Certain
      Prepayments.
      Furniture Brands will not, and will not permit any of its Subsidiaries to,
      directly or indirectly (i) voluntarily prepay, defease or in substance defease,
      purchase, redeem, retire or otherwise acquire, any Indebtedness (other than
      the
      Obligations and the Senior Notes (as defined in Amendment No. 1 hereto)) having
      an aggregate principal amount in excess of $1,000,000, (ii) during the period
      from the date of the First Amendment hereto to and including June 30, 2007,
      voluntarily prepay, defease or in substance defease, purchase, redeem, retire
      or
      otherwise acquire, any principal amounts of Indebtedness outstanding under
      or
      evidenced by the Senior Notes or (iii) at any time after June 30, 2007,
      voluntarily prepay, defease or in substance defease, purchase, redeem, retire
      or
      otherwise acquire, any principal amounts of 

     

    
      
        
        

      

      
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    Indebtedness
      outstanding under or evidenced by the Senior Notes using proceeds of a borrowing
      hereunder.

     

    10.14
      Restricted
      Investments and Acquisitions.
      Unless
      both immediately before and immediately after giving effect to such transaction
      the Leverage Ratio is less than 3.25:1.00, the Borrowers will not, and will
      not
      permit any of their Subsidiaries to, purchase or acquire (including pursuant
      to
      any merger with any Person that was not a Wholly-Owned Subsidiary prior to
      such
      merger) any capital stock or other securities (including any option, warrant
      or
      other right to acquire any of the foregoing) of, make any investment or acquire
      any other interest in, any other Person, or purchase or otherwise acquire (in
      one transaction or a series of transaction) any assets of any other Person
      constituting a business unit, except for (a) acquisitions of dedicated dealer
      stores acquired by a Borrower or a Subsidiary of a Borrower in the ordinary
      course of business so long as the aggregate cash payments for all such
      acquisitions does not exceed $25,000,000 in any fiscal year, except that any
      unused balance of such amount in any fiscal year may be carried forward at
      the
      Borrowers’ discretion and applied in subsequent fiscal years and (b)
      acquisitions for which the consideration consists solely of common stock of
      Furniture Brands. 

     

    (o) Section
      11.03(i) of the Credit Agreement is hereby amended by deleting the phrase “in
      Section 9.01(d)(i), 9.07, 9.09” and replacing it with “in Section 9.01(b),
      9.01(d)(i), 9.07, 9.09”.

     

    (p) Section
      11 of the Credit Agreement is hereby further amended by deleting the word “or”
at the conclusion of Section 11.09, adding the word “or” at the conclusion of
      Section 11.10 and adding a new Section 11.11 as follows:

     

    11.11
      Security
      Documents.
      Any
      Security Document shall cease to be in full force and effect, or shall cease
      to
      give the Collateral Agent for the benefit of the Secured Creditors the Liens,
      rights, powers and privileges purported to be created thereby, or any of the
      Borrowers or Subsidiary Guarantors shall default in the due performance or
      observance of any term, covenant or agreement on its part to be performed or
      observed pursuant to such Security Document and such default shall continue
      beyond the period of grace, if any, specifically applicable thereto pursuant
      to
      the terms of such Security Document;

     

    (q) Section
      12 of the Credit Agreement is hereby amended by adding new Sections 12. 11
      and
      12.12 as follows:

     

    12.11
      Collateral
      Agent.
      Each
      of
      the Lenders and each Issuing Lender hereby irrevocably appoints the Collateral
      Agent as its agent and authorizes the Collateral Agent to take such actions
      on
      its behalf and to exercise such powers as are delegated to the Collateral Agent
      by the terms 

     

    
      
        
        

      

      
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    hereof
      or
      of the other Credit Documents, together with such actions and powers as are
      reasonably incidental thereto. All provisions of this Section 12 relating to
      the
      Administrative Agent (and all indemnities of the Administrative Agent by the
      Borrowers herein) shall be equally applicable to the Collateral Agent
mutatis mutandis.
      Without
      limiting the foregoing, if any Collateral is sold in a transaction permitted
      hereunder (other than to any Borrower or any Subsidiary thereof), such
      Collateral shall, to the extent so provided in the applicable Security
      Agreement, be sold free and clear of the Liens created by the Security Documents
      and the Administrative Agent and the Collateral Agent shall be authorized to
      take any actions deemed appropriate in order to effect the
      foregoing.

     

    12.12 Intercreditor
      Agreement.
      Each
      Lender hereby authorizes and directs the Administrative Agent to enter into
      the
      Intercreditor Agreement as attorney-in-fact on behalf of such Lender and agrees
      that in consideration of the benefits of the security being provided to such
      Lender in accordance with the Security Documents and the Intercreditor Agreement
      and by acceptance of those benefits, each Lender (including any Lender which
      becomes such by assignment pursuant to Section 13.04 after the date hereof)
      shall be bound by the terms and provisions of the Intercreditor Agreement and
      shall comply (and cause any Affiliate thereof which is the holder of any Senior
      Indebtedness (as defined therein) to comply) with such terms and provisions.
      The
      foregoing agreement shall inure to the benefit of all “Senior Lenders” under the
      Intercreditor Agreement.

     

    (r) Exhibit
      J
      to the Credit Agreement is amended by adding the following as the penultimate
      paragraph thereof (immediately prior to the paragraph commencing “The terms set
      forth in this Assignment”):

     

    By
      its
      acceptance of this Assignment, the Assignee hereby agrees to be bound by the
      terms and provisions of the Intercreditor Agreement and to comply (and cause
      any
      Affiliate thereof which is the holder of any Senior Indebtedness (as defined
      in
      the Intercreditor Agreement) to comply) with such terms and provisions. The
      foregoing agreement shall inure to the benefit of all “Senior Lenders” under the
      Intercreditor Agreement.

     

    Giving
      effect to such amendment, Exhibit J to the Credit Agreement reads in its
      entirety as set forth on Exhibit J hereto.

     

    2. Representations
      and Warranties of the Borrowers.
      Each of
      the Borrowers represents and warrants that:

     

    (a) The
      execution, delivery and performance by the Borrowers of this Amendment have
      been
      duly authorized by all necessary corporate action and that this Amendment is
      a
      legal, valid and binding obligation of the Borrowers enforceable against


     

    
      
        
        

      

      
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    the
      Borrowers in accordance with its terms, except as the enforcement thereof may
      be
      subject to the effect of any applicable bankruptcy, insolvency, reorganization,
      moratorium or similar law affecting creditors’ rights generally;

     

    (b) Each
      of
      the representations and warranties contained in the Credit Agreement (treating
      this Amendment and the Credit Agreement as amended hereby as “Credit Documents”
for purposes thereof) is true and correct in all material respects on and as
      of
      the date hereof as if made on the date hereof;

     

    (c) After
      giving effect to this Amendment, no Default or Event of Default has occurred
      and
      is continuing.

     

    3. Effective
      Date.
      This
      Amendment shall become effective as of March 31, 2007 upon the execution and
      delivery hereof by the Borrowers, the Required Lenders, and the Administrative
      Agent (without
      respect to whether it has been executed and delivered by all the Lenders) and
      the satisfaction of the following additional conditions:

     

    (a) Each
      of
      the Guarantors has executed and delivered a Reaffirmation and Amendment of
      Guaranty in the form of Exhibit A hereto.

     

    (b) Each
      of
      the Borrowers, the Subsidiary Guarantors and the Collateral Agent shall have
      executed and delivered the Security Agreement, the Pledge Agreement and such
      other Security Documents as the Administrative Agent shall request in order
      to
      grant to the Collateral Agent for the benefit of the Secured Parties a security
      interest in substantially all of the personal property of the Borrowers and
      Subsidiary Guarantors (other than Equity Interests in Foreign Subsidiaries)
      to
      equally and ratably secure the Obligations and the obligations of the Borrowers
      in respect of their 6.83% Senior Notes due May 17, 2018 (the “Senior
      Notes”).

     

    (c) The
      Administrative Agent shall have received insurance certificates or binders
      for
      all insurance as the Administrative Agent shall request naming the Collateral
      Agent, on behalf of the Secured Creditors, as loss payee for any casualty
      policies and additional insured for any liability policies, in form and
      substance acceptable to the Administrative Agent.

     

    (d) The
      Administrative Agent shall have received such duly completed and executed UCC-1
      financing statements as the Administrative Agent shall have requested to perfect
      the Collateral Agent’s security interest in the Collateral and such copies of
      searches of and financing statements filed under the UCC, together with tax
      lien
      and judgment searches with respect to the assets of the Borrowers and the
      Subsidiary Guarantors, in both cases in such jurisdictions as the Administrative
      Agent may request.

     

    (e) The
      Collateral Agent shall have received all stock (or unit) certificates evidencing
      all Equity Interests to be pledged pursuant to the Pledge Agreement, accompanied
      by undated stock (or unit) powers executed in blank.

     

    (f) The
      requisite holders of the Senior Notes shall have consented to the transactions
      contemplated hereby in a document in form and substance satisfactory to


     

    
      
        
        

      

      
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    the
      Administrative Agent and the Required Lenders and intercreditor arrangements
      (the “Intercreditor Agreement”) with respect to the Senior Notes satisfactory to
      the Administrative Agent and the Required Lenders shall have been entered into
      with the requisite holders of the Senior Notes, all in form and substance
      satisfactory to the Administrative Agent and the Required Lenders.

     

    (g) The
      Borrower shall have paid (i) to the Administrative Agent for the account of
      each
      Lender consenting to this Amendment an amendment fee equal to .02% of such
      Lender’s Commitment as of the date hereof after giving effect to this Amendment
      and (ii) to the Administrative Agent for its own account any other agreed fees
      relating hereto, which fees shall be deemed fully earned and non-refundable
      on
      the date hereof.

     

    (h) The
      Borrowers shall have provided such other corporate and other certificates,
      opinions, documents, instruments and agreements as the Administrative Agent
      may
      reasonably request. 

     

    4. Amendment
      of Guaranty.
      Each of
      the parties hereto consents to the amendment of the Guaranty as set forth on
      Exhibit A hereto.

     

    5. Reference
      to and Effect Upon the Credit Agreement; Intercreditor Agreement.

     

    (a) Except
      as
      specifically amended above, the Credit Agreement and the other Credit Documents
      shall remain in full force and effect and are hereby ratified and
      confirmed.

     

    (b) The
      execution, delivery and effectiveness of this Amendment shall not operate as
      a
      waiver of any right, power or remedy of the Administrative Agent or any Lender
      under the Credit Agreement or any other Credit Document, nor constitute a waiver
      of any provision of the Credit Agreement or any other Credit Document, except
      as
      specifically set forth herein. Upon the effectiveness of this Amendment, each
      reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”,
“herein” or words of similar import shall mean and be a reference to the Credit
      Agreement as amended hereby.

     

    6. Costs
      and Expenses.
      The
      Borrowers hereby affirm their obligations under Section 13.01 of the Credit
      Agreement to reimburse the Administrative Agent for all reasonable out-of-pocket
      costs and expenses incurred by the Administrative Agent in connection with
      the
      preparation, execution and delivery of this Amendment, including but not limited
      to the reasonable fees, charges and disbursements of attorneys for the
      Administrative Agent with respect thereto.

     

    7. Governing
      Law.
      This
      Amendment shall be construed in accordance with and governed by the law of
      the
      State of New York.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    8. Headings.
      Section
      headings in this Amendment are included herein for convenience of reference
      only
      and shall not constitute a part of this Amendment for any other
      purposes.

     

    9. Counterparts.
      This
      Amendment may be executed in any number of counterparts, each of which when
      so
      executed shall be deemed an original but all such counterparts shall constitute
      one and the same instrument.

     

    


    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have executed this Amendment as of the date and
      year first above written.

     

     

    
      	 	 FURNITURE
              BRANDS INTERNATIONAL, INC.
	 	 BROYHILL
              FURNITURE INDUSTRIES, INC.
	 	 HDM
              FURNITURE INDUSTRIES, INC.
	 	 LANE
              FURNITURE INDUSTRIES, INC.
	 	 THOMASVILLE
              FURNITURE INDUSTRIES, INC.
	 	 	 
	 	 By	 /s/
              Denise L. Ramos
	 	 	 Denise
              L. Ramos
	 	 Title:	 Senior
              Vice President and Chief Financial 
	 	 	
               Officer
                of Furniture Brands International, Inc.

            
	 	 	 and
              Vice President of each other Borrower
	 	 	 
	 	 	 On
              behalf of each of the Borrowers


    

    
 

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
              JPMORGAN
                CHASE BANK, N.A.,

            
	
              Individually
                and as Administrative Agent

            
	 	 
	
              By

            	
              /s/
                James M. Sumeski

            
	
              Name:

            	 James
              M. Sumeski
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              PNC
                BANK, NATIONAL ASSOCIATION

            
	 	 
	
              By

            	
              /s/
                Holland Vogel

            
	
              Name:

            	 Holland
              Vogel
	
              Title:

            	 Credit
              Officer
	 	 
	 	 
	
              THE
                BANK OF TOKYO-MITSUBISHI UFJ, LTD.

            
	 	 
	
              By

            	
              /s/
                Masakazu Sato

            
	
              Name:

            	 Masakazu
              Sato
	
              Title:

            	 Deputy
              General Manager
	 	 
	 	 
	
              WACHOVIA
                BANK, NATIONAL ASSOCIATION

            
	 	 
	
              By

            	
              /s/
                Denis Waltrich

            
	
              Name:

            	 Denis
              Waltrich
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              WELLS
                FARGO BANK, NA

            
	 	 
	
              By

            	
              /s/
                Anthony Clarkson

            
	
              Name:

            	 Anthony
              Clarkson
	
              Title:

            	 Relationship
              Manager
	 	 
	 	 
	
              BANK
                OF AMERICA, N.A.

            
	 	 
	
              By

            	
              /s/
                Eric A. Escagne

            
	
              Name:

            	 Eric
              A. Escagne
	
              Title:

            	 Vice
              President
	 	 


    

    


    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    


    
      	
              BNP
                PARIBAS

            
	 	 
	
              By

            	
              /s/
                Christopher Grumboski

            
	
              Name:

            	 Christopher
              Grumboski
	
              Title:

            	 Director
	 	 
	 By	/s/
              Michael Pearce 
	 Name:	Michael
              Pearce
	 Title:	Director 
	 	 
	
              SUNTRUST
                BANK

            
	 	 
	
              By

            	
              /s/
                Katherine L. Bass

            
	
              Name:

            	 Katherine
              L. Bass
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              MIZUHO
                CORPORATE BANK, LTD.

            
	 	 
	
              By

            	
              /s/
                Leon Mo

            
	
              Name:

            	 Leon
              Mo
	
              Title:

            	 Senior
              Vice President
	 	 
	 	 
	
              NATIONAL
                CITY BANK

            
	 	 
	
              By

            	
              /s/
                Stephen Sainz

            
	
              Name:

            	 Stephen
              Sainz
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              COMERICA
                BANK

            
	 	 
	
              By

            	
              /s/
                Mark J. Leveille

            
	
              Name:

            	 Mark
              J. Leveille
	
              Title:

            	 Assistant
              Vice President
	 	 


    

    


    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
      	
              REGIONS
                BANK

            
	 	 
	
              By

            	
              /s/
                Amanda Schmitt

            
	
              Name:

            	 Amanda
              Schmitt
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              THE
                NORTHERN TRUST COMPANY

            
	 	 
	
              By

            	
              /s/
                Roger McDougal

            
	
              Name:

            	 Roger
              McDougal
	
              Title:

            	 Vice
              President
	 	 
	 	 
	
              US
                BANK NATIONAL ASSOCIATION

            
	 	 
	
              By

            	
              /s/
                Veronica Morrissette

            
	
              Name:

            	 Veronica
              Morrissette
	
              Title:

            	 Vice
              President