Document:

Exhibit 10.2

                              AMENDED AND RESTATED
                              --------------------
                         EXECUTIVE EMPLOYMENT AGREEMENT
                         ------------------------------

     THIS AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement")
is made as of June 1, 2007, by and between Conn's,  Inc, a Delaware  corporation
with its  principle  offices  at 3295  College  Street,  Beaumont,  Texas  77701
("Conn's"), and William C. Nylin, Jr., an individual (the "Executive").

     WHEREAS,  Executive  and Conn's have  previously  entered into that certain
Executive  Employment  Agreement,  dated  November 19, 2003,  as amended by that
First Amendment to Executive Employment Agreement,  dated as of April 22, 2005 )
the "Prior Agreement");

     WHEREAS,  Conn's  and  Executive  desire  to amend  and  restate  the Prior
Agreement

     WHEREAS,  Executive is currently  employed by Conn's as its Executive  Vice
Chairman  of the  Board  and  Chief  Operating  Officer  pursuant  to the  Prior
Agreement;

     WHEREAS,  Conn's  desires to continue to employ  Executive as its Executive
Vice  Chairman of the Board and  Executive  desires to be so employed,  upon the
terms and conditions set forth herein; and

     NOW,  THEREFORE,  in consideration of the foregoing and in consideration of
the mutual promises and agreements contained herein, the parties hereto agree as
follows:

A. Employment Period. The employment period shall be for the period beginning on
the  date  hereof  and  ending  on  January  31,  2010 (as may be  renewed,  the
"Employment  Period"),  unless  earlier  terminated  pursuant to Section D. This
Agreement  may be  extended  for  additional  one year  periods  upon the mutual
written consent of Conn's and Executive.

B. Nature of Duties.
   -----------------

     1.   Executive's  duties and  responsibilities  shall be to serve Conn's as
          its Executive Vice Chairman of the Board and have the responsibilities
          and duties set forth on  Schedule  A, in  conformity  with  management
          policies,  guidelines and directions issued by Conn's,  and shall have
          general  charge  and  supervision  of those  functions  and such other
          responsibilities  as the Conn's Board of Directors (the "Board") shall
          determine.  Executive's  employment  shall be subject to all of Conn's
          corporate   policies  and  personnel   manuals  as  modified  by  this
          Agreement. Executive shall report to the Chairman of the Board.

     2.   Executive  shall work for Conn's on a half-time basis in such capacity
          and shall carry on his employment at Conn's corporate  headquarters in
          Beaumont,  Texas or such other location as Executive and the Board may
          agree. During normal business hours, Executive, on an aggregate basis,
          shall  devote  approximately  one-half  of his time and  attention  to
          Conn's  business.  During  the  Employment  Period,  it shall not be a
          violation of this  Agreement  for Executive to (i) serve on corporate,
          civic or charitable  boards or  committees to the extent  permitted by
          Sections  G  and  Q,  (ii)  deliver   lectures  or  fulfill   speaking
          engagements and (iii) manage personal  investments and engage in other
          activities,  so long as such  activities do not  materially  interfere
          with the  performance  of Executive's  responsibilities  in accordance
          with  this   Agreement.   Executive   shall  perform  his  duties  and
          responsibilities diligently,  faithfully and loyally in order to cause
          the proper, efficient and successful operation of Conn's business.

<PAGE>

C. Compensation and Benefits.
   --------------------------

     1.   Conn's shall pay to Executive as compensation for services rendered by
          Executive  during the term of this Agreement a base annualized  salary
          of $180,000 per year,  (the  "Salary"),  subject to  adjustment as set
          forth below, payable  semi-monthly.  The Compensation  Committee shall
          review the Salary no less  frequently  than annually,  and may, in its
          discretion, adjust the Salary upward or downward.

     2.   With  respect  to each  fiscal  year  during  the  Employment  Period,
          Executive  shall be  eligible  to  receive  an annual  cash bonus (the
          "Incentive  Compensation"),  the amount of such bonus to be determined
          by the  Compensation  Committee  based on  Executive's  attainment  of
          certain   performance   goals  relating  to  Conn's  annual   business
          plan/budget  as  established  by  the  Compensation  Committee.   Such
          performance  goals shall be  communicated  to  Executive in writing no
          later than  sixty (60) days from the  beginning  of each  fiscal  year
          during the Employment  Period. In the event such performance goals are
          met, the  Incentive  Compensation  shall be paid to Executive no later
          than  forty-five  (45) days  following the close of the fiscal year to
          which such Incentive  Compensation  relates. Such bonus is intended to
          be 50% of what  Executive  would have been  entitled to had  Executive
          been working on a full-time basis.

     3.   Executive shall be entitled to participate in 401(k),  life insurance,
          major medical, dental,  disability and other employee benefit plans of
          Conn's that may be in effect from time to time and which other  senior
          executives of Conn's are otherwise  eligible,  to the extent Executive
          is  eligible  under  the  terms  of  such  plans  (collectively,   the
          "Benefits").  For  purposes  of  clarity,  during  the  term  of  this
          Agreement,  Conn's  shall  provide  a major  medical  plan for  senior
          executives of Conn's.

     4.   Conn's,  from time to time, shall grant stock options  exercisable for
          shares of Conn's  common stock to the Executive at such time it grants
          options to other Senior  Executives.  Such options shall be subject to
          the terms and conditions determined by the Compensation Committee.

     5.   Executive shall be entitled to paid vacation each calendar year and to
          such personal and sick leave with pay in accordance with the policy of
          Conn's,  as may be established from time to time by Conn's and applied
          to all other employees of Conn's.

     6.   If Conn's  maintains any liability  insurance  covering members of its
          Board of  Directors,  Executive  will be  included  within the covered
          class of individuals under such policy.

     7.   During the Employment  Period,  Conn's shall provide an automobile (or
          reimburse  Executive for his automobile) and gas card to Executive for
          business and personal use consistent  with what it provided  Executive
          during  the term of the Prior  Agreement.  Income  shall be imputed to
          Executive for the personal use of such automobile.

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<PAGE>

     8.   Conn's shall  reimburse  Executive for all  customary  and  reasonable
          expenses incurred by Executive in performance of his duties under this
          Agreement; provided, however, that Executive must furnish to Conn's an
          itemized account  satisfactory to Conn's,  in  substantiation  of such
          expenditures  and such  expenditures  shall otherwise be in accordance
          with Conn's policies and procedures.

D. Termination.
   ------------

     1.   This Agreement shall terminate automatically upon Executive's death.

     2.   Conn's may terminate  Executive  other than for Cause (as  hereinafter
          defined) or if Executive becomes  permanently  disabled,  at any time,
          upon no fewer than five (5) days prior  written  notice to  Executive.
          For  purposes of this  Agreement,  permanent  disability  (i) shall be
          determined in accordance with the disability insurance that Conn's may
          then  have in  effect,  if any,  or  (ii) if no such  insurance  is in
          effect,   shall   mean  that   Executive   is  subject  to  a  medical
          determination  that he, because of a medically  determinable  disease,
          injury, or other mental or physical  disability,  is unable to perform
          substantially all of his then regular duties, and that such disability
          is  determined  or  reasonably  expected to last at least  twelve (12)
          months, based on then-available medical information.

     3.   Conn's may terminate Executive for Cause, at any time, without written
          notice,  except in the case of a  material  breach of this  Agreement,
          Conn's  shall  provide   Executive   notice  of  such  breach  and  an
          opportunity  to cure  such  breach  within  thirty  (30)  days of such
          notice.

     4.   Executive  may terminate his  employment,  at any time,  upon no fewer
          than thirty (30) days prior written notice to Conn's.

     5.   Any  termination  under this  Section D shall be  communicated  to the
          other  party in writing and if the date of  termination  is other than
          the date of receipt of such notice,  such written notice shall specify
          the date of termination (which shall not be more than ninety (90) days
          after giving of such  notice).  The date of  termination  shall be the
          date of  receipt  of the  notice  of  termination  or any  later  date
          specified therein.

E. Effects of Termination.
   -----------------------

     1.   In the event of automatic  termination by reason of Executive's  death
          or by Conn's by reason of  Executive's  permanent  disability,  Conn's
          shall have no further  obligations under this Agreement except for its
          obligation to pay Executive's Base Salary and Incentive  Compensation,
          if any,  earned and  accrued  but unpaid  through the date of death or
          permanent  disability.  Executive  shall  have the  right  to  receive
          payments under the death or disability  benefits,  if any, provided to
          Executive pursuant to Section C.3. of this Agreement.

                                       3
<PAGE>

     2.   In the event (i) Conn's exercises its right of termination  other than
          for Cause or (ii) this  Agreement  is not  renewed  by Conn's  when it
          expires,  Conn's shall be obligated to pay Executive's Base Salary and
          Incentive Compensation,  if any, earned and accrued but unpaid through
          the date of  termination.  In addition,  Conn's shall pay as severance
          pay one (1) year of  Executive's  current Base Salary.  Such  payments
          shall  be made in equal  installments  in such  intervals  as the Base
          Salary was paid at the time of such termination or expiration.

     3.   In the  event  Conn's  terminates  Executive  for  Cause or  Executive
          terminates his  employment,  Conn's shall have no further  obligations
          under this Agreement  except for its  obligations  to pay  Executive's
          Base  Salary  earned  and  accrued  but  unpaid  through  the  date of
          termination.

F. Certain  Definitions.  For purposes of this  Agreement,  the following  terms
shall have the following meanings:

     1.   "Affiliate"  shall mean,  with  respect to a person,  any other person
          controlling,  controlled  by or under  common  control  with the first
          person.

     2.   "Cause"  shall  mean (i)  behavior  of  Executive  which is adverse to
          Conn's  interests,  (ii)  Executive's  dishonesty,  criminal charge or
          conviction,  grossly negligent misconduct, willful misconduct, acts of
          bad faith,  neglect of duty or (iii) material breach of this Agreement
          which is not cured within the thirty (30) day cure period  pursuant to
          Section D.3.

     3.   "Confidential Information" shall mean information: (i) disclosed to or
          known by the Executive as a consequence  of or through his  employment
          with Conn's,  (ii) not generally  known outside Conn's and (iii) which
          relates  to any  aspect  of  Conn's  or  its  business,  research,  or
          development.  "Confidential  Information" includes, but is not limited
          to Conn's trade  secrets,  proprietary  information,  business  plans,
          marketing plans, methodologies,  computer code and programs, formulas,
          processes,   compilations   of   information,   results  of  research,
          proposals,  reports, records, financial information,  compensation and
          benefit information, cost and pricing information,  customer lists and
          contact information,  supplier lists and contact  information,  vendor
          lists and contact information, and information provided to Conn's by a
          third party under restrictions  against disclosure or use by Conn's or
          others;  provided,  however, that the term "Confidential  Information"
          does not include  information  that (a) at the time it was received by
          Executive was generally  available to the public, (b) prior to its use
          by Executive, becomes generally available to the public through no act
          or failure of Executive, (c) is received by Executive from a person or
          entity other than Conn's or an Affiliate of Conn's who is not under an
          obligation of confidence  with respect to such  information or (d) was
          generally  known by Executive by virtue of his experience and know how
          gained prior to employment with Conn's.

                                       4
<PAGE>

     4.   "Control"  and  correlative  terms  shall mean the  power,  whether by
          contract,  equity  ownership or  otherwise,  to direct the policies or
          management of a person.

     5.   "Copyright Works" shall mean materials for which copyright  protection
          may  be  obtained  including,   but  not  limited  to  literary  works
          (including  all written  material),  computer  programs,  artistic and
          graphic works (including designs,  graphs, drawings,  blueprints,  and
          other  works),  recordings,   models,   photographs,   slides,  motion
          pictures, and audio-visual works,  regardless of the form or manner in
          which documented or recorded.

     6.   "Person" shall mean an individual,  partnership,  corporation, limited
          liability  company,  trust  or  unincorporated   organization,   or  a
          government or agency or political subdivision thereof.

     7.   "Work  Product"  shall mean all  methods,  analyses,  reports,  plans,
          computer files and all similar or related information which (i) relate
          to Conn's or any of its Affiliates  and (ii) are conceived,  developed
          or made by Executive in the course of his employment by Conn's.

G. Non-Disclosure,  Non-Competition and  Non-Solicitation.  Executive and Conn's
acknowledge  and agree that during and solely as a result of his  employment  by
Conn's,   Conn's  has  provided  and  will  continue  to  provide   Confidential
Information  and special  training to Executive  in order to allow  Executive to
fulfill his  obligations  as an executive of a  publicly-held  company and under
this  Agreement.  In  consideration  of the  special  and  unique  opportunities
afforded  to  Executive  by  Conn's as a result of  Executive's  employment,  as
outlined in the previous sentence, Executive hereby agrees as follows:

     1.   Executive  agrees  that  Executive  will not,  except  as  Conn's  may
          otherwise consent or direct in writing, reveal or disclose, sell, use,
          lecture  upon,  publish or  otherwise  disclose to any third party any
          Confidential  Information  of  Conn's  or any of  its  Affiliates,  or
          authorize  anyone else to do these things at any time either during or
          subsequent to  Executive's  employment  with Conn's.  This Section G.1
          shall  continue  in  full  force  and  effect  after   termination  of
          Executive's employment for any reason.  Executive's  obligations under
          this Section G.1 with respect to any specific Confidential Information
          shall  cease  only  when that  specific  portion  of the  Confidential
          Information  becomes  publicly  known,  other  than  as  a  result  of
          disclosure  by  Executive,  in  its  entirety  and  without  combining
          portions of such  information  obtained  separately.  It is understood
          that such Confidential Information of Conn's and any of its Affiliates
          includes  matters that  Executive  conceives  or develops,  as well as
          matters  Executive  learns from other  executives of Conn's and any of
          its Affiliates.

     2.   During the Employment  Period,  Executive will not (other than for the
          benefit of Conn's or any of its Affiliates pursuant to this Agreement)
          compete  with  Conn's  or any of its  Affiliates  by  engaging  in the
          conception, design, development,  production,  marketing, or servicing
          of any  product  or  service  that  is  substantially  similar  to the
          products or services which Conn's or any of its  Affiliates  provides,
          and that he will not work for,  assist,  loan money,  extend credit or
          become  affiliated with as an individual,  owner,  partner,  director,
          officer, stockholder, employee, advisor, independent contractor, joint
          venturer,  consultant,  agent,  representative,  salesman or any other
          capacity,  either  directly or indirectly,  any individual or business
          which  offers or performs  services,  or offers or  provides  products
          substantially  similar to the services and products provided by Conn's
          or any of its Affiliates.  The  restrictions of this Section G.2 shall
          not be violated by the ownership of no more than 1% of the outstanding
          securities  of any company  whose  equity  securities  are traded on a
          national  securities  exchange  or is  quoted on the  NASDAQ  National
          Market.

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<PAGE>

     3.   Executive  agrees that he shall not,  directly or  indirectly,  at any
          time during the period of one (1) year after the  termination  of this
          Agreement  for any  reason,  including  expiration  of the  Agreement,
          within  the  geographical  area  of  100  miles  of  any  existing  or
          specifically  contemplated  Conn's  retail or support  location at the
          time of  termination,  as an  individual,  owner,  partner,  director,
          officer, stockholder, employee, advisor, independent contractor, joint
          venturer,  consultant,  agent,  representative,  salesman or any other
          capacity,  work  for,  assist,  loan  money,  extend  credit or become
          affiliated  with,  either  directly or  indirectly,  any individual or
          business  which  offers or  performs  services,  or offers or provides
          products  substantially  similar to the services and products provided
          by Conn's or any of its Affiliates.  The  restrictions of this Section
          G.3 shall not be violated by the  ownership  of no more than 1% of the
          outstanding  securities  of any company  whose equity  securities  are
          traded on a national  securities  exchange  or is quoted on the NASDAQ
          National Market. It is understood that the geographical area set forth
          in this  covenant  is  divisible  so that if this clause is invalid or
          unenforceable  in an included  geographic area, that area is severable
          and the clause remains in effect for the remaining included geographic
          areas in which the clause is valid.

     4.   Executive  agrees that for the duration of this  Agreement,  and for a
          period of two (2) years after the  termination  of this  Agreement  or
          expiration of this  Agreement,  Executive will not either  directly or
          indirectly,  on his behalf or on behalf of others, solicit, attempt to
          hire, or hire any person  employed by Conn's and any of its Affiliates
          to work for Executive or for another  entity,  firm,  corporation,  or
          individual.

     5.   Executive  acknowledges  that  Conn's  has taken  reasonable  steps to
          maintain the  confidentiality of its Confidential  Information and the
          ownership of its Work Product and Copyright Works,  which is extremely
          valuable to Conn's and provides Conn's with a competitive advantage in
          its market.  Executive  further  acknowledges that Conn's would suffer
          irreparable harm if Executive were to use or enable others to use such
          knowledge,  information,  and  business  acumen  in  competition  with
          Conn's.  Executive  acknowledges  the  necessity  of  the  restrictive
          covenants set forth herein to: protect Conn's legitimate  interests in
          Conn's Confidential Information; protect Conn's customer relations and
          the goodwill with customers and suppliers that Conn's has  established
          at its  substantial  investment;  and  protect  Conn's  as a result of
          providing Executive with specialized knowledge,  training, and insight
          regarding  Conn's  operations as a  publicly-held  company.  Executive
          further agrees and acknowledges that these  restrictive  covenants are
          reasonably  limited  as  to  time,   geographic  area,  and  scope  of
          activities  to be  restricted  and that such  promises do not impose a
          greater  restraint  on  Executive  than is  necessary  to protect  the
          goodwill,  Confidential  Information  and  other  legitimate  business
          interests of Conn's.  Executive agrees that any breach of this Section
          G cannot be remedied solely by money damages,  and that in addition to
          any other  remedies  Conn's  may have,  Conn's is  entitled  to obtain
          injunctive relief against Executive without the requirement of posting
          bond or other security. Nothing herein, however, shall be construed as
          limiting Conn's right to pursue any other  available  remedy at law or
          in equity,  including  recovery  of damages  and  termination  of this
          Agreement.

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<PAGE>

     6.   Executive acknowledges that all writings, records, and other documents
          and things comprising, containing, describing, discussing, explaining,
          or evidencing  any  Confidential  Information,  Work  Product,  and/or
          Copyright Works of Conn's, any Affiliate of Conn's, or any third party
          with which Conn's has a confidential relationship,  is the property of
          Conn's  or  such  Affiliate.  All  property  belonging  to  Conn's  in
          Executive's  custody or possession  that has been obtained or prepared
          in the  course of  Executive's  employment  with  Conn's  shall be the
          exclusive property of Conn's,  shall not be copied and/or removed from
          the  premises of Conn's,  except in pursuit of the business of Conn's,
          and  shall  be  delivered   to  Conn's,   along  with  all  copies  or
          reproductions  of  same,  upon  notification  of  the  termination  of
          Executive's  employment  or at any other  time  requested  by  Conn's.
          Conn's  shall  have the  right to  retain,  access,  and  inspect  all
          property  of any kind in  Executive's  office,  work area,  and on the
          premises of Conn's upon  termination of Executive's  employment and at
          any time during Executive's employment,  to ensure compliance with the
          terms of this Agreement.

     7.   The terms of this Section G are continuing in nature and shall survive
          the termination or expiration of this Agreement.

H. Notices.  All notices and other  communications under this Agreement shall be
in writing and shall be  delivered  personally  or by  facsimile  or  electronic
delivery,  given by hand delivery to the other party,  sent by overnight courier
or sent by registered  or certified  mail,  return  receipt  requested,  postage
prepaid, to:

   If to Executive: William C. Nylin, Jr.,
                    3295 College Street
                    Beaumont, Texas 77701
                    Fax No.: (800) 511-5746

   If to Company:   Conn's, Inc.
                    3295 College Street
                    Beaumont, Texas 77701
                    Attn: General Counsel
                    Fax No.: (409) 212-9521

   with a copy to:  Fulbright & Jaworski L.L.P.
                    2200 Ross Avenue, Suite 2800
                    Dallas, Texas  75201
                    Attn: Thomas W. Hughes
                    Fax No.: (214) 855-8200

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<PAGE>

I. Assignment.  Conn's shall require any successors (whether direct or indirect,
by purchase,  merger,  consolidation or otherwise) to a controlling  interest in
the  business,  assets or equity of Conn's to assume and agree to  perform  this
Agreement  in the  same  manner  and to the same  extent  that  Conn's  would be
required to perform if no such  succession had taken place.  This Agreement is a
personal  employment  contract  and the rights,  obligations  and  interests  of
Executive under this Agreement may not be sold, assigned,  transferred,  pledged
or hypothecated by Executive.

J. Binding  Agreement.  Executive  understands  that his obligations  under this
Agreement   are   binding   upon   Executive's   heirs,   successors,   personal
representatives and legal representatives.

K.  Arbitration.  Except for any  controversy  or claim relating to Section G of
this  Agreement,  any  controversy  or claim  arising out of or relating to this
Agreement  or the  breach of any  provision  of this  Agreement,  including  the
arbitrability  of any  controversy  or claim,  shall be settled  by  arbitration
administered by the American Arbitration  Association ("AAA") under its National
Rules for the  Resolution  of  Employment  Disputes and the  Optional  Rules for
Emergency  Measures  of  Protection  of the AAA,  and  judgment  upon the  award
rendered by the  arbitrator(s)  may be entered in any court having  jurisdiction
thereof.  Any  provisional  remedy which would be available from a court of law,
shall be available from the arbitrator to the parties to this Agreement  pending
arbitration.  Arbitration  of disputes is  mandatory  and in lieu of any and all
civil  causes of action and  lawsuits  either  party may have  against the other
arising out of Executive's  employment  with Conn's.  Civil  discovery  shall be
permitted  for the  production  of  documents  and  taking of  depositions.  The
arbitrator(s)  shall be guided by the Texas Rules of Civil Procedure in allowing
discovery and all issues regarding  compliance with discovery  requests shall be
decided by the  arbitrator(s).  The Federal  Arbitration  Act shall  govern this
Section  K.  This  Agreement  shall  in  all  other  respects  be  governed  and
interpreted by the laws of the State of Texas, excluding any conflicts or choice
of  law  rule  or  principles  that  might   otherwise  refer   construction  or
interpretation of this Agreement to the substantive law of another jurisdiction.
The arbitration shall be conducted in Beaumont,  Texas by one neutral arbitrator
chosen by AAA according to its National  Rules for the  Resolution of Employment
Disputes if the amount of the claim is one million  dollars  ($1,000,000.00)  or
less and by three  neutral  arbitrators  chosen by AAA in the same manner if the
amount of the claim is more than one million  dollars  ($1,000,000.00).  Neither
party nor the arbitrator(s) may disclose the existence,  content,  or results of
any  arbitration  hereunder  without the prior  written  consent of both parties
unless  compelled to do so either by judicial  process or in order to enforce an
arbitration  award rendered pursuant to this Section K. All fees and expenses of
the arbitration shall be borne by the parties equally. However, each party shall
bear the expense of its own counsel,  experts,  witnesses,  and  preparation and
presentation of proofs.  The prevailing party,  according to the  arbitrator(s),
shall be entitled to an award of its reasonable attorneys' fees.

L. Waiver.  No waiver by either party to this  Agreement of any right to enforce
any term or condition  of this  Agreement,  or of any breach of this  Agreement,
shall be deemed a waiver of such  right in the  future or of any other  right or
remedy available under this Agreement.

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<PAGE>

M.  Severability.  If any provision of this Agreement as applied to either party
or to any circumstances  shall be adjudged by a court of competent  jurisdiction
or arbitrator to be void or  unenforceable  the same shall in now way affect any
other  provision of this  Agreement or the  validity or  enforceability  of this
Agreement. If any court or arbitrator construes any of the provisions of Section
G of this  Agreement,  or any part thereof,  to be  unreasonable  because of the
duration of such provision or the geographic or other scope thereof,  such court
or  arbitrator  shall reduce the duration or restrict  the  geographic  or other
scope of such provision or enforce such provision to the maximum extent possible
as so reduced or restricted.

N. Entire Agreement;  Amendment.  This Agreement, the Indemnification  Agreement
entered into by Conn's and Executive  and any  agreements  evidencing  any stock
options  granted to Executive  pursuant to Section C.4 of this  Agreement  shall
constitute the entire agreement  between the parties with respect to Executive's
employment with Conn's during the Employment Period. This Agreement replaces and
supersedes any and all existing  agreements  entered into between  Executive and
Conn's, whether oral or written, regarding the subject matter of this Agreement.
This Agreement may not be amended or modified other than by a written  agreement
executed by the parties to this  Agreement or their  respective  successors  and
legal representatives.

O. Understand Agreement.  Executive represents and warrants that he has (i) read
and understood each and every  provision of this Agreement,  (ii) been given the
opportunity  to obtain  advice from legal  counsel of choice,  if necessary  and
desired,  in order to interpret  any and all  provisions  of this  Agreement and
(iii) freely and voluntarily entered into this Agreement.

P.  Governing  Law.  This  Agreement  shall  be  governed  by and  construed  in
accordance  with the laws of the State of Texas and is  performable in Beaumont,
Texas.

Q. Professional/Personal.  Membership by Executive on corporate and civic boards
should be  accepted  only  after  consideration  of  conflict  of  interest  and
consultation with the Chairman of the Board. Conn's requires Executive to have a
comprehensive annual medical physical examination.

R.  Counterparts.  This  Agreement may be executed in one or more  counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same instrument.

S. Titles;  Pronouns and Plurals.  The titles to the sections of this  Agreement
are inserted for  convenience  of reference only and should not be deemed a part
hereof or affect the  construction or  interpretation  of any provision  hereof.
Whenever  the context may  require,  any pronoun  used in this  Agreement  shall
include the corresponding masculine,  feminine or neuter forms, and the singular
form of nouns, pronouns, and verbs shall include the plural and vice versa.

                                       9
<PAGE>

     Survival.  Sections  E  through  P of  this  Agreement  shall  survive  the
termination of Executive's employment or expiration of this Agreement.

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

EXECUTIVE                                  CONN'S, INC.

/s/ William C. Nylin, Jr.                  By: /s/ Thomas J. Frank
-------------------------                      -------------------
William C. Nylin, Jr.                          Thomas J. Frank, Chairman and CEO

                                       10
<PAGE>

                                   SCHEDULE A

                            DUTIES & RESPONSIBILITIESExhibit 10.1

                      SECOND AMENDMENT TO CREDIT AGREEMENT
                      ------------------------------------

     This Second Amendment to Credit Agreement (this "Second Amendment") is made
as of the 31st day of May, 2007 by and among

     PIER 1 IMPORTS (U.S.), INC. (in such capacity, the "Borrower"),  a Delaware
corporation  with its  principal  executive  offices  at 100 Pier 1 Place,  Fort
Worth, Texas 76102; and

     BANK OF AMERICA,  N.A., a national banking  association with offices at 100
Federal Street,  Boston,  Massachusetts  02110, as administrative agent (in such
capacity, the "Administrative Agent") for its own benefit and the benefit of the
other Credit Parties; and

     BANK OF AMERICA,  N.A., a national banking  association with offices at 100
Federal  Street,  Boston,  Massachusetts  02110,  as  collateral  agent (in such
capacity,  the  "Collateral  Agent")  for its own benefit and the benefit of the
other Credit Parties;

     The LENDERS party hereto;

     WELLS FARGO RETAIL FINANCE,  LLC, a, a Delaware limited  liability  company
with offices at One Boston Place - 19th Floor,  Boston,  Massachusetts 02109, as
Syndication Agent; and

     JPMORGAN CHASE BANK, N.A., a national  banking  association with offices at
2200 Ross Avenue, 6th Floor, Dallas, Texas 75201, as Documentation Agent;

in  consideration  of the mutual  covenants  herein contained and benefits to be
derived herefrom.

                                   WITNESSETH
                                   ----------

     WHEREAS,  the Borrower,  Pier 1 Kids, Inc., the Lenders, the Administrative
Agent, the Collateral Agent and the Issuing Bank entered into a Credit Agreement
dated as of  November  22,  2005,  as amended as of July 28,  2006 (as  amended,
modified,  supplemented,  restated or otherwise modified and in effect from time
to time, the "Credit Agreement"); and

     WHEREAS, Pier 1 Kids, Inc. has merged with and into the Borrower; and

     WHEREAS, the parties desire to amend the terms and conditions of the Credit
Amendment as set forth herein.

     NOW THEREFORE, it is hereby agreed as follows:

1.   Definitions.  All capitalized  terms used herein and not otherwise  defined
     shall have the same meaning herein as in the Credit Agreement.

                                       1
<PAGE>

2.   Amendment to Article I. The provisions of Article I of the Credit Agreement
     are hereby amended as follows:

     (a)  The  definition  of  "Applicable  Margin"  is  hereby  deleted  in its
          entirety and the following substituted in its stead:

     "Applicable Margin" means:

          (a) From and after the Second Amendment Effective Date until the first
     Adjustment Date after the Second Amendment  Effective Date, the percentages
     set forth in Level III of the Pricing Grid below; and

          (b) On the first day of each January,  April, July and October of each
     year (each, an "Adjustment Date"),  commencing July 1, 2007, the Applicable
     Margin shall be determined  from such Pricing Grid based upon Average Daily
     Availability  for the most  recently  ended three month period  immediately
     preceding such  Adjustment  Date;  provided that, upon the occurrence of an
     Event of Default,  upon written notice from the  Administrative  Agent, the
     Applicable Margin shall be immediately increased to that set forth in Level
     I (even if the  Average  Daily  Availability  requirements  for a different
     Level have been met) and interest shall accrue at the Default Rate.

     --------------------- ----------------------------------
     Level  Average Daily  LIBO Applicable     Prime Rate
            Availability       Margin       Applicable Margin
     --------------------- ----------------------------------
     I      Less than or   1.50%            0%
              equal to
            $85,000,000
     --------------------- ----------------------------------
     II     Greater than   1.25%            0%
            $85,000,000
            but less than
            or equal to
            $160,000,000
     --------------------- ----------------------------------
     III    Greater than   1.00%            0%
            $160,000,000
            but less than
            or equal to
            $245,000,000
     --------------------- ----------------------------------
     IV     Greater than   0.75%            0%
            $245,000,000
     --------------------- ----------------------------------

                                       2
<PAGE>

     (b) The  definition of "Borrowing  Base" is hereby  deleted in its entirety
     and the following substituted in its stead:

     "Borrowing Base" means, at any time of calculation, an amount equal to:

          (i) the face amount of Eligible Credit Card Receivables  multiplied by
     the Credit Card Advance Rate;

     plus
     ----

          (ii) (A) until the provisions of clause (B) become effective, the Cost
     of  Eligible  Inventory,  net  of  Inventory  Reserves  multiplied  by  the
     Inventory  Advance  Rate;  and (B) upon  the  completion  of the  appraisal
     described  in the final  sentence  of Section  5.08(b),  from and after the
     delivery of the  Borrowing  Base  Certificate  in August,  2007,  Appraised
     Inventory  Value  of  Eligible   Inventory,   net  of  Inventory  Reserves,
     multiplied by the Appraisal Percentage;

     plus
     ----

          (iii) the Private  Label Credit Card Advance  Rate  multiplied  by the
     Appraisal Value of Eligible Private Label Receivables;

     plus
     ----

          (iv) the lesser of (A) the FMV of Eligible  Real Estate  multiplied by
     the Real Estate Advance Rate; or (B) that amount which is not more than 25%
     of the aggregate  amounts then available  under clauses (i) through (iv) of
     this definition;

     minus
     -----

          (v) the then amount of all Availability Reserves and Realty Reserves.

     (c) The definition of "Issuing Banks" is hereby deleted in its entirety and
the following substituted in its stead:

     "Issuing Banks" means, individually and collectively, in its capacity as an
     issuer of Letters of Credit hereunder,  any Lender (or any Person who was a
     Lender  (or an  Affiliate  of such  Lender  at such  time)  at the  time of
     issuance of the Letter of Credit). Any Lender, as Issuing Bank, may, in its
     discretion,  arrange  for one or more  Letters  of  Credit  to be issued by
     Affiliates  of such Issuing  Bank,  in which case the term  "Issuing  Bank"
     shall include any such  Affiliate  with respect to Letters of Credit issued
     by such Affiliate

     (d) The  definition of "Letter of Credit" is hereby deleted in its entirety
and the following substituted in its stead:

                                       3
<PAGE>

     "Letter  of Credit"  means a letter of credit  that is issued by an Issuing
     Bank pursuant to this Agreement for the account of a Borrower, constituting
     either a Standby Letter of Credit or Commercial Letter of Credit, issued in
     connection  with the  purchase  of  Inventory  by a Borrower  and for other
     purposes  for which such  Borrower  has  historically  obtained  letters of
     credit,  or for any other  purpose  that is  reasonably  acceptable  to the
     Administrative  Agent,  and in form reasonably  satisfactory to the Issuing
     Bank,  provided  that any  Letter  of Credit  issued by a Person  who was a
     Lender  (or an  Affiliate  of such  Lender  at such  time)  at the  time of
     issuance of a Letter of Credit, but is no longer a Lender,  shall be deemed
     a Letter of Credit  hereunder  (other than for purposes of Sections 2.19(c)
     and (d)) only until (i) such  Letter of Credit has  expired  without  being
     drawn, been returned undrawn, or has been otherwise terminated, or (ii) the
     amounts  available  thereunder have been drawn and such Person has received
     reimbursement  for such  drawing.  Letters of Credit may permit  payment by
     presentation  of  either a sight  draft or a time  draft  (not to exceed 90
     days) as selected by the  Borrower.  Without  limiting the  foregoing,  all
     Existing  Letters of Credit shall be deemed to have been issued  hereunder.
     All Banker's  Acceptances and all Existing  Letters of Credit shall for all
     purposes be deemed to be, and shall be subject to all  provisions  relating
     to, "Letters of Credit" hereunder.

     (e) The definition of "Maturity Date" is hereby deleted in its entirety and
the following substituted in its stead:

     "Maturity Date" means May 31, 2012.

     (f) The  definitions of "Lead  Borrower" and "Borrowers" are hereby deleted
in their entirety and the following substituted in their stead:

     "Borrower"  means Pier 1  Imports,  (U.S.),  Inc.  All  references  in this
     Agreement to "Lead Borrower" or to "Borrowers"  shall mean and refer to the
     Borrower.

     (g) The  definition  of  "Permitted  Dispositions"  is  hereby  amended  as
follows:

          (i) by deleting  clause (b) thereof in its entirety  and  substituting
     the following in its stead:

               (b) in addition to Dispositions of Inventory  described in clause
          (f) of this  definition,  bulk  sales  or  other  dispositions  of the
          Borrowers'  Inventory  not in the  ordinary  course of  business in an
          amount  not to exceed  (i) in any  Fiscal  Year of the  Parent and its
          Subsidiaries,  10% of the Cost of the Borrowers' Eligible Inventory as
          of the first day of such Fiscal Year,  and (ii) in the aggregate  from
          and after the Second Amendment  Effective Date, 25% of the Cost of the
          Borrowers'  Inventory  as of the end of the fiscal  month  immediately
          preceding the Second Amendment Effective Date, provided that all sales
          of  Inventory  in  connection  with stores that are closed  within any
          twelve month period  (other than those stores  listed on Schedule 1.11
          hereof)  which are in the  aggregate  in  excess of 10% of the  stores
          operated  as of  the  Second  Amendment  Effective  Date  shall  be in
          accordance   with   liquidation   agreements  and  with   professional
          liquidators reasonably acceptable to the Administrative Agent;

                                       4
<PAGE>

          (ii) by deleting  clause (e) thereof in its entirety and  substituting
     the following in its stead:

          (e) (i) sales,  sale-leaseback transactions and dispositions of assets
          of  Real  Estate  included  in the  Borrowing  Base  as long as (A) no
          Default or Event of Default then exists or would arise therefrom,  and
          (B)  the  Borrower  has  furnished  the   Administrative   Agent  with
          projections  for the 180 day period  after  such sale or  disposition,
          reasonably  satisfactory to the  Administrative  Agent,  demonstrating
          that Availability is projected on a pro forma basis to be at all times
          at  least  30%  of  the  Borrowing  Base;  (ii)  any  other  sales  or
          sale-leaseback  transactions  and  dispositions  of any real  property
          owned by any of the Loan Parties  (other than Real Estate  included in
          the Borrowing Base, as to which clause (e)(i) of this definition shall
          apply),  and  (iii) as long as no  Default  or Event of  Default  then
          exists or would arise therefrom, sales, leases and dispositions of any
          oil, gas and other minerals on, in or under any Real Estate;

     (iii) by relettering  clause (f) as clause (g) and adding the following new
clause (f):

          (f)  Dispositions of Inventory in an amount not to exceed  $32,500,000
          at Cost and more particularly described in Schedule 1.10 hereof.

     (h) The  following  new  definitions  are hereby  inserted  into the Credit
Agreement in appropriate alphabetical order:

          (i) "Appraisal Percentage" means 90%.

          (ii) "Appraised  Inventory Value" means the net appraised  liquidation
     value (which is  expressed  as a  percentage)  of the  Borrower's  Eligible
     Inventory  as set  forth  in  the  Borrower's  inventory  stock  ledger  as
     determined  from  time  to  time  by an  independent  appraiser  reasonably
     satisfactory to the Administrative Agent.

                                       5
<PAGE>

          (iii) "Banker's Acceptance" means a time draft or bill of exchange (in
     each case, payable not more than 90 days duration from acceptance) relating
     to a  Commercial  Letter of Credit  which has been  accepted  by an Issuing
     Bank.

          (iv) "Convertible Notes" means the 6.375% convertible senior notes due
     2036 issued by Pier 1 Imports, Inc. in February 2006.

          (v) "Deed of Trust" means the Deeds of Trust,  Security Agreements and
     Assignments  executed by the Loan Party  owning the Real Estate  encumbered
     thereby for the benefit of the Collateral Agent and the Credit Parties.

          (vi)  "Eligible  Real  Estate"  means Real  Estate  acceptable  to the
     Administrative  Agent  in its  reasonable  discretion  to be  eligible  for
     inclusion in the  calculation of the Borrowing  Base, and without  limiting
     the foregoing, satisfies each of the following conditions:

          a)   a Loan Party owns fee title  thereto  and is  occupied  by a Loan
               Party and/or a lessee of a Loan Party;

          b)   the  applicable  Loan Party has  executed  and  delivered  to the
               Collateral Agent such Deeds of Trust and other security documents
               as the Collateral Agent may reasonably request;

          c)   the applicable  Loan Party shall have delivered to the Collateral
               Agent a Title  Insurance  Policy  issued  by the  Title  Company,
               environmental studies, and other real estate items, as reasonably
               required  by, and  reasonably  satisfactory  to,  the  Collateral
               Agent,  including,  but not limited to,  those items  required by
               FIRREA;

          d)   the Collateral Agent has a perfected  first-priority lien in such
               Real Estate for the benefit of the Credit Parties;

          e)   such Real Estate has been  appraised  by a third party  appraiser
               reasonably acceptable to the Administrative Agent;

          f)   such Real  Estate is free and clear of any Lien  other than Liens
               set forth in the Title Insurance  Policy  furnished for such Real
               Estate; and

          g)   as  to  which   the   mortgagor   is  in   compliance   with  the
               representations,  warranties  and covenants set forth in the Deed
               of Trust  relating to such  property,  unless the  Administrative
               Agent,  in its  discretion,  otherwise  determines  to waive this
               requirement in the determination of Eligible Real Estate.

                                       6
<PAGE>

          (vii) "FIRREA" means The Financial  Institutions Reform,  Recovery and
     Enforcement Act of 1989, as amended,  and the rules and regulations adopted
     pursuant thereto.

          (viii) "FMV" means,  as to any Eligible  Real Estate,  the fair market
     value  of such  Eligible  Real  Estate  determined  in  accordance  with an
     independent  appraisal reasonably  acceptable to the Administrative  Agent,
     which appraisal shall assume,  among other things,  a marketing time of not
     greater than six (6) months.

          (ix) "Real Estate Advance Rate": means 50%.

          (x) "Realty Reserves" means such reserves as the Administrative  Agent
     from  time to time  determines  in the  Administrative  Agent's  reasonable
     discretion as being  appropriate to reflect the  impediments to the Agents'
     ability to realize upon any  Eligible  Real  Estate.  Without  limiting the
     generality  of the  foregoing,  Realty  Reserves  may include  (but are not
     limited to)  reserves for (i)  environmental  remediation,  (ii)  municipal
     taxes  and  assessments  having  priority  over the Lien of the  Collateral
     Agent,  (iii) major repairs not covered by insurance,  and (iv) remediation
     of title defects.

          (xi) "Second Amendment Effective Date" means May 31, 2007.

          (xii) `Title Insurance  Company" means Chicago Title Insurance Company
     or such other company as the Agents and the Borrower may agree.

          (xiii) "Title  Insurance  Policy" means, in relation to each parcel of
     Real Estate  subject to a Deed of Trust,  an ALTA  standard form (or if the
     Real Estate is not in a state that issues ATLA policies,  in the equivalent
     standard  form for such state) title  insurance  policy issued by the Title
     Insurance  Company (with such reinsurance or co-insurance as the Agents may
     require,  any such  reinsurance to be with direct access  endorsements)  in
     such amount as may be determined by the Agents (not  exceeding $65 million)
     insuring the priority of the Deed of Trust of such Real Estate and that one
     of the Loan Parties holds marketable (or in Texas, indefeasible) fee simple
     or leasehold  title to such Real Estate,  subject only to the  encumbrances
     permitted by such Deed of Trust and which shall not contain  exceptions for
     mechanics liens,  persons in occupancy or matters which would be shown by a
     survey (except as may be permitted by such Deed of Trust), shall not insure
     over any matter except to the extent that any such affirmative insurance is
     acceptable to the Agents in their reasonable discretion,  and shall contain
     such  endorsements  and  affirmative  insurance  as  the  Agents  in  their
     reasonable  discretion  may  require,  including  but  not  limited  to (a)
     comprehensive endorsement,  (b) variable rate of interest endorsement,  (c)
     usury   endorsement,   (d)  revolving   credit   endorsement,   (e)  tie-in
     endorsement, and (f) doing business endorsement.

                                       7
<PAGE>

3.   Amendments  to  Article  II.  The  provisions  of  Article II of the Credit
     Agreement are hereby amended as follows:

     (a) The  provisions of Section  2.01(a)(ii)  are hereby amended by deleting
the  number  "$200,000,000"   appearing  therein  and  substituting  the  number
"$250,000,000" in its stead.

     (b) The  provisions of Section  2.02(b) are hereby  amended by deleting the
word "and" at the end of clause (v), renumbering clause (vi) as clause (vii) and
inserting the following new clause (vi):

     (vi) The  Borrowers  and the  Administrative  Agent shall have agreed on an
amendment to the "Average Daily Availability" levels in Pricing Grid included in
the definition of "Applicable Margin" to reflect the increased Commitments.

     (c) The  provisions of Section  2.13(a) are hereby  amended by deleting the
number  "$200,000,000"  appearing in clause (i) of the first proviso thereto and
substituting the number "$250,000,000" in its stead.

4.   Amendments  to  Article  V.  The  provisions  of  Article  V of the  Credit
     Agreement are hereby amended as follows:

     (a) Section 5.01 is hereby amended by deleting the word "and" at the end of
clause (i), relettering clause (j) as clause (k) and inserting the following new
clause (j):

     (j) as soon as  available,  but in any event at least 30 days after the end
     of each Fiscal Year of the Parent,  forecasts prepared by management of the
     Parent,  in  form  satisfactory  to the  Administrative  Agent,  of (i) the
     forecasted  consolidated  balance sheets of the Parent and its Subsidiaries
     as of the end of the immediately following Fiscal Year, (ii) the forecasted
     consolidated  statements  of income or  operations  and  consolidated  cash
     forecasts on a quarterly basis, and (iii)  Availability on a monthly basis,
     in each case,  for the  immediately  following  Fiscal Year  (including the
     Fiscal Year in which the Maturity Date occurs).

     (b) Section 5.08(b) is hereby amended as follows:

          (i) By  deleting  the words  "after  the  occurrence  and  during  the
     continuance  of a Cash  Dominion  Event" at the  beginning  of  clause  (y)
     thereto.

          (ii) By adding the following new sentence at the end of such section:

                                       8
<PAGE>

          In any event, and without  limiting the foregoing,  the Borrower shall
          permit the  Administrative  Agent to undertake  and  complete,  at the
          Borrower's  expense,  an appraisal of the  Borrower's  Inventory on or
          before July 31, 2007. Further,  the Administrative Agent may undertake
          one (1) appraisal of any Real Estate included in the Borrowing Base in
          each calendar year at the expense of the Loan Parties  (provided  that
          the  Administrative  Agent may, in its reasonable  discretion,  if any
          Event of Default exists, cause additional Real Estate appraisals to be
          undertaken as the Administrative Agent reasonably determines (each, at
          the expense of the Loan Parties)).

     (c) Section 5.11 is hereby amended by deleting the final  sentence  thereof
and substituting the following in its stead:

          No part of the proceeds of any Loan will be used,  whether directly or
          indirectly, (i) for any purpose that entails a violation of any of the
          regulations of the Board,  including  Regulations U and X, or (ii) for
          the  purchase,   repayment,   redemption,   retirement,   acquisition,
          cancellation or termination of the Convertible Notes.

     5.  Amendment to Article VI. The  provisions  of Section 6.10 of the Credit
Agreement are hereby deleted in their entirety and the following  substituted in
their stead:

          If  Availability  is at any time in less than or equal to ten  percent
          (10%) of the Revolving  Credit Ceiling,  the Borrower shall not permit
          the Fixed Charge Coverage Ratio,  calculated on a trailing twelve (12)
          month basis,  to be less than 1.10:  1.00.  Such Fixed Charge Coverage
          Ratio shall be first tested as of the Fiscal Month ending  immediately
          prior to the date that Availability is first less than or equal to ten
          percent (10%) of the Revolving  Credit Ceiling,  and shall continue to
          be tested monthly until Availability has exceeded ten percent (10%) of
          the  Revolving  Credit  Ceiling  on each  day for two (2)  consecutive
          Fiscal Months.  To the extent that the Fixed Charge  Coverage Ratio is
          being tested in accordance  herewith,  within  fifteen (15) days after
          the end of each Fiscal Month of the Parent,  the Lead  Borrower  shall
          furnish the  Administrative  Agent with  Consolidated  balance sheets,
          Consolidated  statements of operations,  and cash flows of the Parent,
          as of the end of and for such Fiscal Month and the elapsed  portion of
          the Fiscal Year,  setting forth in each case in  comparative  form the
          Consolidated figures for the previous Fiscal Year.

     6.  Amendment  to Article  IX. The  provisions  of Article IX of the Credit
Agreement are hereby amended as follows:

                                       9
<PAGE>

     (a) The provisions of Section 9.01 are hereby amended to delete the address
appearing in clause (b) thereof and substitute  the address 100 Federal  Street,
Boston, Massachusetts 02110 in its stead.

     (b) The provisions of Section  9.02(b)(ii) are hereby amended by adding the
following at the end thereof:

          provided  that  the  foregoing  shall  not  limit  the  rights  of the
          Administrative  Agent to amend the  Pricing  Grid in  accordance  with
          Section 2.02(b)(vi) hereof;

     (c) The  provisions  of Section  9.04(b)  are hereby  amended by adding the
following at the end of the first proviso thereto:

          provided  further that no such consent of the Lead  Borrower  shall be
          required in connection with the assignment of up to $50,000,000 of the
          Commitments  of Bank of  America,  N.A.  after  the  Second  Amendment
          Effective Date;

     (d) The  following  new  Section  9.19 is  hereby  inserted  in the  Credit
Agreement:

          SECTION  9.19 Real  Estate  Release.  Notwithstanding  anything to the
          contrary in this  Agreement  or any of the other Loan  Documents,  the
          Administrative  Agent and Lenders  shall release all Liens on any Real
          Estate that is  Collateral  upon request by Borrower (a) in connection
          with a Permitted Disposition described in clauses (e)(i) or (e)(ii) of
          the  definition of such term,  (b) the  Obligations  have been paid in
          full and the  Commitments  have  terminated,  or (c) if no  Default or
          Event of Default then exists or would arise therefrom and the Borrower
          has furnished the  Administrative  Agent with  projections for the 180
          day  period  after  such  release,   reasonably  satisfactory  to  the
          Administrative Agent,  demonstrating that Availability is projected on
          a pro forma  basis to be at all  times at least  30% of the  Borrowing
          Base.

     7. Amendment to Schedules. The Schedules are hereby amended by

     (a) deleting  Schedule 1.1 and  substituting a new Schedule 1.1 in the form
annexed hereto in its stead.

     (b) adding new Schedules 1.10 and 1.11 in the form annexed hereto.

     8.  Conditions  to  Effectiveness.  This  Second  Amendment  shall  not  be
effective until each of the following conditions precedent has been fulfilled to
the satisfaction of the Administrative Agent:

                                       10
<PAGE>

     (a) This Second  Amendment  shall have been duly  executed and delivered by
the Borrowers, the Facility Guarantors, the Administrative Agent, the Collateral
Agent and the  Lenders.  The  Administrative  Agent shall have  received a fully
executed copy hereof and of each other document required hereunder.

     (b) All  necessary  consents and approvals to this Second  Amendment  shall
have been obtained.

     (c) The Agents  shall have  received  legal  opinions  from  counsel to the
Borrower reasonably satisfactory in form and substance to the Agents.

     (d) The Borrowers shall have paid to the Administrative  Agent, (i) for the
benefit of the  Lenders,  an amendment  fee in the amount of $406,250,  and (ii)
those fees described in an Amendment Fee Letter of even date herewith.

     (e) The Agents shall have completed of due diligence, including real estate
title  examinations by Rattikin Title Company or such other company as the Agent
and the Borrower may agree),  real estate appraisals,  and Phase I environmental
site  assessments  from  Benchmark  Environmental  (or such other company as the
Agent and the  Borrower  may agree),  the  results of which shall be  reasonably
satisfactory to the Agents.

     (f) The Agents shall have filed all deeds of trust and shall have given all
such  notices as may be necessary  for the Agents to perfect  their liens in the
Real Estate included in the Borrowing Base for itself and for the benefit of the
Lenders and to assure its first priority status therein.

     (g) Any other information  (financial or otherwise) reasonably requested by
the Agents  shall  have been  received  by,  and shall be in form and  substance
reasonably  satisfactory  to the Agents.  Without  limiting the  foregoing,  the
Agents shall have received a satisfactory  Title Insurance Policy from the Title
Insurance  Company  insuring the Agents' interest in the Real Estate included in
the Borrowing Base  containing  such  endorsements  as the Agents may reasonably
require.

     (h) No material misstatements in or omissions from the materials previously
furnished to the Agents for its review.  The Agents must be  satisfied  that any
financial statements delivered to them fairly present the business and financial
condition  of the  Borrower  and its  Subsidiaries,  and that  there has been no
material adverse change in the assets, business,  financial condition, income or
prospects  of  the  Borrower  since  the  date  of  the  most  recent  financial
information delivered to the Agents.

     (i) There shall not exist any litigation or other  proceeding the result of
which could  reasonably  be expected  to have a material  adverse  effect on the
Borrower.

     (j) The absence of any default of any material contract or agreement of the
Borrower or any of its Subsidiaries

                                       11
<PAGE>

     (k) No Default or Event of Default shall have  occurred and be  continuing,
both before and immediately  after giving effect to the execution of this Second
Amendment.

     9. Miscellaneous.

     (a)  Except as  provided  herein,  all terms and  conditions  of the Credit
Agreement and the other Loan Documents remain in full force and effect. The Loan
Parties  hereby  ratify,  confirm,  and  reaffirm  all of  the  representations,
warranties  and covenants  therein  contained,  other than  representations  and
warranties that relate solely to an earlier date.

     (b) The Loan  Parties  hereby  acknowledge  and  agree  that  they  have no
offsets,  defenses, claims, or counterclaims against the Agents or any Lender or
the Issuing Bank, or any of their  respective  officers,  directors,  employees,
attorneys, representatives, predecessors, successors, or assigns with respect to
the Loan Documents, the Obligations,  or otherwise, and that if the Loan Parties
now have, or ever did have,  any offsets,  defenses,  claims,  or  counterclaims
against the Agents or any Lender or the Issuing Bank, or any of their respective
officers,  directors,  employees,  attorneys,   representatives,   predecessors,
successors,  or assigns,  whether known or unknown,  at law or in equity, all of
them are hereby expressly WAIVED, and the Loan Parties hereby RELEASE the Agents
and each Lender and the Issuing  Bank,  and each of their  respective  officers,
directors, employees, attorneys, representatives,  predecessors, successors, and
assigns from any liability therefor.

     (c) The Borrowers shall pay all reasonable out-of-pocket costs and expenses
incurred by the  Administrative  Agent in connection with this Second Amendment,
including,  without limitation, all reasonable attorneys' fees (which attorneys'
fees, exclusive of out-of-pocket expenses, shall not exceed $25,000).

     (d) This Second  Amendment may be executed in several  counterparts  and by
each  party on a  separate  counterpart,  each of  which  when so  executed  and
delivered,  shall be an original, and all of which together shall constitute one
instrument.

     (e) NOTICE OF INDEMNIFICATION:  THE BORROWER AND FACILITY GUARANTORS HEREBY
ACKNOWLEDGE  AND AGREE  THAT THE CREDIT  AGREEMENT  AND THE  SECURITY  DOCUMENTS
CONTAIN CERTAIN INDEMNIFICATION PROVISIONS (INCLUDING, WITHOUT LIMITATION, THOSE
CONTAINED IN SECTION 9.03 OF THE CREDIT  AGREEMENT  AND  SUBPARAGRAPHS  6(c) AND
26(b) OF THE DEED OF TRUST,  WHICH IN CERTAIN  CIRCUMSTANCES,  COULD  INCLUDE AN
INDEMNIFICATION  OF THE  AGENTS  AND THE CREDIT  PARTIES  FROM  CLAIMS OR LOSSES
ARISING AS A RESULT OF THE AGENTS' AND THE CREDIT  PARTIES' OWN NEGLIGENCE OR ON
ACCOUNT OF CLAIMS OF STRICT LIABILITY.

                                       12
<PAGE>

     (f) This Second Amendment expresses the entire understanding of the parties
with  respect  to  the  matters  set  forth  herein  and  supersedes  all  prior
discussions or negotiations hereon.

     (g) By executing this Second Amendment, the undersigned Facility Guarantors
hereby consent to the Second  Amendment to Credit Agreement and acknowledge that
their Guarantee remains in full force and effect.

                            [SIGNATURE PAGES FOLLOW]

                                       13
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
be executed and their seals to be hereto affixed as the date first above
written.

     BORROWERS:

                              PIER 1 IMPORTS (U.S.), INC.

                              By:___________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President and CFO

                              FACILITY GUARANTORS:

                              PIER 1 IMPORTS, INC.

                              By:____________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President, CFO and Treasurer

                              PIER 1 ASSETS, INC.

                              By:____________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President, CFO and Treasurer

                              PIER 1 LICENSING, INC.

                              By:____________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President and CFO

                                       14
<PAGE>

                              PIER 1 HOLDINGS, INC.

                              By:____________________________________
                              Name: Charles H. Turner
                              Title:  Executive Vice President and CFO

                              PIER 1 SERVICES COMPANY, a Delaware
                              statutory trust

                              By: Pier 1 Holdings, Inc., Managing Trustee

                              By:_________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President and CFO

                              PIER 1 VALUE SERVICES, LLC

                              By: Pier 1 Imports (U.S.), Inc., its sole member
                                  and manager

                              By:____________________________________
                              Name: Charles H. Turner
                              Title: Executive Vice President and CFO

                                       15
<PAGE>

                              BANK OF AMERICA, N.A.
                              As Administrative Agent, as Collateral Agent, as
                              Swingline Lender, and as Lender

                              By:____________________________________
                                  Name: Stephen J. Garvin
                                  Title: Managing Director

                                  Address:
                                  40 Broad Street, 10th Floor
                                  Boston, Massachusetts 02109
                                  Attn: Stephen J. Garvin
                                  Telephone: (617) 434-9399
                                  Telecopy: (617) 434-4339

                                       16
<PAGE>

                              WELLS FARGO RETAIL
                              FINANCE, LLC,
                              As Syndication Agent and as Lender

                              By:_________________________________
                              Name:______________________________
                              Title:_______________________________
                              Address: One Boston Place, 18th fl Boston MA 02108
                              Telephone:
                              Telecopy:

                              JPMORGAN CHASE BANK, N.A.,
                              As Documentation Agent and as Lender

                              By:_________________________________
                              Name:______________________________
                              Title:_______________________________
                              Address:
                              Telephone:
                              Telecopy:

                                       17
<PAGE>

                              GENERAL ELECTRIC CAPITAL CORPORATION,
                              As Lender

                              By:_________________________________
                              Name:______________________________
                              Title:_______________________________
                              Address:
                              Telephone:
                              Telecopy:

                              SUNTRUST BANK,
                              As Lender

                              By:_________________________________
                              Name:______________________________
                              Title:_______________________________
                              Address:
                              Telephone:
                              Telecopy:

                                       18

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