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<SEC-DOCUMENT>0001104659-09-063865.txt : 20100129
<SEC-HEADER>0001104659-09-063865.hdr.sgml : 20100129
<ACCEPTANCE-DATETIME>20091110092456
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001104659-09-063865
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20091110

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ETHAN ALLEN INTERIORS INC
		CENTRAL INDEX KEY:			0000896156
		STANDARD INDUSTRIAL CLASSIFICATION:	WOOD HOUSEHOLD FURNITURE, (NO UPHOLSTERED) [2511]
		IRS NUMBER:				061275288
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		ETHAN ALLEN DR
		STREET 2:		PO BOX 1966
		CITY:			DANBURY
		STATE:			CT
		ZIP:			06811
		BUSINESS PHONE:		2037438000
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div style="font-family:Times New Roman;">

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">November&nbsp;9,
2009</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Mr.&nbsp;John
Cash, Branch Chief</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">United
States Securities and Exchange Commission</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Division
of Corporation Finance</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Mail
Stop 7010</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">100
F Street N.E.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Washington,
DC 20549-5546</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Re:&#160; Ethan Allen Interiors,&nbsp;Inc.</font></b></p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Form&nbsp;10-K
for the fiscal year ended June&nbsp;30, 2009</font></b></p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">File No.&nbsp;1-11692</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dear
Mr.&nbsp;Cash:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In
the attached responses to your letter dated October&nbsp;15, 2009, we have
noted your original comments below followed by our response to facilitate the
review process. &#160;Further, in providing
the attached responses, we hereby acknowledge the following:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">the Company is responsible for the adequacy
and accuracy of the disclosure in its filings with the Commission;</font></p>

<p style="margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">Staff comments or changes to disclosure in
response to Staff comments do not foreclose the Commission from taking any
action with respect to the filing; and</font></p>

<p style="margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">the Company may not assert Staff comments as
a defense in any proceeding initiated by the Commission or any person under the
federal securities laws of the United States.</font></p>

<p style="margin:0in 0in .0001pt 27.0pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="line-height:normal;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company further understands that the Division of
Enforcement has access to all information that Ethan Allen provides to the
Staff of the Division of Corporation Finance in your review of the Company&#146;s
filing or in response to the Staff&#146;s comments on the Company&#146;s filing.</font></p>

<p style="line-height:normal;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Should
you have any additional questions or require further information please contact
me directly at (203) 743-8305.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.44%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Sincerely,</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.06%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0in 0in 0in 0in;width:47.5%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.44%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.06%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0in 0in 0in 0in;width:47.5%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.44%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.06%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0in 0in 0in 0in;width:47.5%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Vice President, Finance</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.44%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ David R. Callen</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.06%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0in 0in 0in 0in;width:47.5%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&amp; Treasurer</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:49.44%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(David R. Callen)</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.06%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0in 0in 0in 0in;width:47.5%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div style="font-family:Times New Roman;">

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Annual Report on Form&nbsp;10-K
for fiscal year ended June&nbsp;30, 2009</font></u></b></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><b><i><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">Critical Accounting
Policies &#151; Impairment of Long-Lived Assets and Goodwill, page&nbsp;23</font></u></i></b></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:-.25in;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">1.</font></i></b><b><i><font size="1" style="font-size:3.0pt;font-style:italic;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></i></b><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">In
future filings, if the fair value of your long-lived assets and goodwill are
not substantially in excess of the carrying value, please disclose the
following:</font></i></b></p>

<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">The percentage by which fair
value exceeds carrying value as of the most-recent step-one test;</font></i></b></p>

<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">A description of the methods and
key assumptions used and how the key assumptions were determined;</font></i></b></p>

<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">A discussion of the degree of
uncertainties associated with the key assumption, and;</font></i></b></p>

<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;">&#183;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">A discussion of any potential
events, trends and/or changes in circumstances that could reasonably be
expected to negatively affect the key assumptions.</font></i></b></p>

<p style="margin:0in 0in .0001pt .5in;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">If you have determined that estimated fair values
substantially exceed carrying values, please disclose that determination.&#160; Refer to Item 303 of Regulation S-K and Section&nbsp;V
of Interpretive Release 33-8350 for guidance.&#160;
Please provide us with your proposed future disclosures.</font></i></b></p>

<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Response:</font></u></b><font size="2" style="font-size:10.0pt;">&#160; We have noted the Staff&#146;s comments on
critical accounting policies and will comply.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
following was included in &#147;Critical Accounting Policies&#148; in Item 2, &#147;Management&#146;s
Discussion and Analysis of Financial Condition and Results of Operations&#148; in
the Company&#146;s Quarterly Report on Form&nbsp;10-Q filed for the quarter ended September&nbsp;30,
2009:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font style="color:windowtext;letter-spacing:0pt;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">Impairment of Long-Lived Assets and Goodwill</font></i></b></font><font style="color:windowtext;letter-spacing:0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"> &#151; We periodically evaluate whether events or
circumstances have occurred that indicate that long-lived and indefinite-lived assets
may not be recoverable or that the remaining useful life may warrant
revision.&#160; When such events or
circumstances are present, the Company determines whether the carrying value
exceeds the fair value as described below.</font></font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font style="color:windowtext;letter-spacing:0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In accordance with </font></font><font style="color:windowtext;letter-spacing:0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ASC Topic 360, <i>&#147;Property, Plant and Equipment&#148;</i> (SFAS No.&nbsp;144),</font></font><font style="color:windowtext;letter-spacing:0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"> the recoverability of long-lived assets are
evaluated for impairment by determining whether the carrying value will be
recovered through the expected undiscounted future cash flows resulting from
the use of the asset.&#160; In the event the
sum of the expected undiscounted future cash flows is less than the carrying
value of the asset, an impairment loss equal to the excess of the asset&#146;s
carrying value over its fair value is recorded.&#160;
The long-term nature of these assets requires the estimation of cash
inflows and outflows several years into the future and only takes into
consideration technological advances known at the time of the impairment test.</font></font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;letter-spacing:0pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In accordance with ASC Topic 350, <i>&#147;Intangibles-Goodwill and
Other&#148;</i> (SFAS No.&nbsp;142), goodwill and other indefinite-lived
intangible assets are evaluated for impairment on an annual basis and between
annual tests whenever events or circumstances indicate that the carrying value
of the </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;letter-spacing:0pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">goodwill or other intangible asset may exceed its fair value. We
conduct our required annual impairment test of goodwill and other intangible
assets during the fourth quarter of each fiscal year.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To
evaluate goodwill, the Company determines the current fair value of the
Reporting Units using a combination of &#147;Market&#148; and &#147;Income&#148; approaches.&#160; In the Market approach, the &#147;Guideline
Company&#148; method is used, which focuses on comparing the Company&#146;s risk profile
and growth prospects to reasonably similar publicly traded companies.&#160; Key assumptions used for the Guideline
Company method are total invested capital (&#147;TIC&#148;) multiples for revenues and
operating cash flows, as well as consideration of control premiums.&#160; The TIC multiples are determined based on
public furniture companies within our peer group, and if appropriate, recent
comparable transactions are also considered.&#160;
Control premiums are determined using recent comparable transactions in
the open market. Under the Income approach, a discounted cash flow method is
used, which includes a terminal value, and is based on external analyst
financial projection estimates, as well as internal financial projection
estimates prepared by management. The long-term terminal growth rate
assumptions reflect our current long-term view of the market in which we
compete.&#160; Discount rates use the weighted
average cost of capital for companies within our peer group, adjusted for
specific company risk premium factors.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
fair value of our trade name, which is the Company&#146;s only indefinite lived intangible
asset other than goodwill, is valued using the relief-from-royalty method.
Significant factors used in trade name valuation are rates for royalties,
future growth, and a discount factor.&#160;
Royalty rates are determined using an average of recent comparable
values.&#160; Future growth rates are based on
the Company&#146;s perception of the long term values in the market in which we
compete, and the discount rate is determined using the weighted average cost of
capital for companies within our peer group, adjusted for specific company risk
premium factors. The fair value of the trade name substantially exceeded the
carrying value in fiscal 2009.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;letter-spacing:0pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As a result of the economic downturn that began in the fall of 2008,
the Company&#146;s revenues and operating margins were negatively impacted.&#160; In response, the Company reduced headcount,
consolidated its manufacturing, retail, and logistics footprint and
repositioned its marketing approach.&#160; As
a result of these changes, the Company&#146;s cash flow forecasts were continually
updated to reflect the rapid changes in the business and the industry.&#160; The cash flow projections used in its fair
value evaluations are the best estimates of the Company and require significant
management judgment.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the fiscal quarter ended June&nbsp;30, 2009, the Company performed
its annual impairment test and no impairment of goodwill was appropriate as the
fair value of the Wholesale reporting unit net assets exceeded the book value
by approximately 10%. During the quarter ending September&nbsp;30, 2009, the
business performance was consistent with the previous quarter, revenues and
operating costs were on plan, the Company&#146;s average quarterly stock price
increased 13% (from $12.11 for the quarter ended June&nbsp;30, 2009, to $13.69
for the quarter ended September&nbsp;30, 2009), and cash reserves increased to
$72.5 million at September&nbsp;30, 2009 from $53.0 million at June&nbsp;30,
2009. The Company considered these and other factors and concluded that an
interim impairment test was not required. There can be no assurance that the
outcome of future reviews will not result in substantial impairment charges.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>

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<div style="font-family:Times New Roman;">

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To
calculate fair value of the assets described above, management relies on
estimates and assumptions which by their nature have varying degrees of
uncertainty. Wherever possible, management therefore looks for third party
transactions as described above to provide the best possible support for the
assumptions incorporated. Management considers several factors to be significant
when estimating fair value including expected financial outlook of the
business, changes in the Company&#146;s stock price, the impact of changing market
conditions on financial performance and expected future cash flows, and other
factors. Deterioration in any of these factors may result in a lower fair value
assessment which could lead to impairment of the long-lived assets and goodwill
of the Company.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><i><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">Liquidity and Capital Resources, page&nbsp;30</font></u></i></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:-.25in;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">2.</font></i></b><b><i><font size="1" style="font-size:3.0pt;font-style:italic;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></i></b><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">We
note your credit facility contains covenants including the fixed charge
coverage ratio.&#160; Please tell us whether
you were in compliance with all of the required covenants of your credit
facility at the end of the period presented.&#160;
Also, please disclose the status of your compliance in future
filings.&#160; Additionally, in future
filings, if it becomes reasonably likely that you may not comply with a
material covenant, please present, for your most significant and restrictive
covenants, actual ratios and other actual amounts versus minimum/maximum
rations/amounts required as of each reporting date.&#160; Such presentation will allow investors to
more easily understand your current ability to meet your financial
covenants.&#160; It may also be necessary to
show specific computations used to arrive at the actual ratios with corresponding
reconciliations to US GAAP amounts, if applicable.&#160; Se Sections I.D and IV.C of the SEC
Interpretive Release No.&nbsp;33-8350 and Question 10 of our FAQ Regarding the
Use of Non-GAAP Financial Measures dated June&nbsp;13, 2003.</font></i></b></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Response:</font></u></b><font size="2" style="font-size:10.0pt;">&#160; We have noted the Staff&#146;s comments and in
future filings, will disclose the status of our compliance.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As
of June&nbsp;30, 2009, we were in compliance with all covenants of our credit
facility. As noted on page&nbsp;31 of the Company&#146;s June&nbsp;30, 2009 Form&nbsp;10-K
in &#147;Liquidity and Capital Resources&#148; in Item 2, &#147;Management&#146;s Discussion and
Analysis of Financial Condition and Results of Operations&#148;, the fixed charge
coverage ratio is not applicable as the Company exceeded the average monthly
availability requirement.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
following was included in &#147;Liquidity and Capital Resources&#148; in Item 2, &#147;Management&#146;s
Discussion and Analysis of Financial Condition and Results of Operations&#148; in
the Company&#146;s Quarterly Report on Form&nbsp;10-Q filed for the quarter ended September&nbsp;30,
2009: &#160;&#147;As of September&nbsp;30, 2009, we
are in compliance with all covenants of our credit facility.&#148;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Additionally,
if it becomes reasonably likely that we may not comply with a material covenant
we will present, for our most significant and restrictive covenants, supporting
information to allow </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>

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</div>
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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">investors
to easily understand our ability to meet financial covenants. We will included
such disclosure in &#147;Liquidity and Capital Resources&#148; in Item 2, &#147;Management&#146;s
Discussion and Analysis of Financial Condition and Results of Operations&#148; in
our Quarterly Report on Form&nbsp;10-Q and/or &#147;Liquidity and Capital Resources&#148;
in Item 7, &#147;Management&#146;s Discussion and Analysis of Financial Condition and
Results of Operations&#148; in our Annual Report on Form&nbsp;10-K.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><b><i><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">Exhibits 31.1 and 31.2</font></u></i></b></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;page-break-after:avoid;text-indent:-.25in;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;font-weight:bold;">3.</font></i></b><b><i><font size="1" style="font-size:3.0pt;font-style:italic;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></i></b><b><i><font size="2" style="font-size:10.0pt;font-style:italic;font-weight:bold;">Item
601(b)(31) of Regulation S-K specifies that the certifications must be exactly
as set forth in the item.&#160; In future
filings, change the words &#147;as filed by&#148; to the word &#147;of&#148; in paragraph 1 and do
not replace the word &#147;registrant&#148; with &#147;Company.&#148;</font></i></b></p>

<p style="margin:0in 0in .0001pt .5in;page-break-after:avoid;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Response:</font></u></b><font size="2" style="font-size:10.0pt;">&#160; We
have noted the Staff&#146;s comment and in future filings, the certifications which
we file as exhibits will use the words prescribed.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Please
see Exhibits 31.1 and 31.2 to our Quarterly Report on Form&nbsp;10-Q filed for
the quarter ended September&nbsp;30, 2009.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">*&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; *&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; *&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; *&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; *&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; *</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

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