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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0001171843-08-000419.txt : 20080530
<SEC-HEADER>0001171843-08-000419.hdr.sgml : 20080530
<ACCEPTANCE-DATETIME>20080530141418
ACCESSION NUMBER:		0001171843-08-000419
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20080527
FILED AS OF DATE:		20080530
DATE AS OF CHANGE:		20080530
EFFECTIVENESS DATE:		20080530

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			HOOKER FURNITURE CORP
		CENTRAL INDEX KEY:			0001077688
		STANDARD INDUSTRIAL CLASSIFICATION:	HOUSEHOLD FURNITURE [2510]
		IRS NUMBER:				540251350
		STATE OF INCORPORATION:			VA
		FISCAL YEAR END:			0131

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-25349
		FILM NUMBER:		08869910

	BUSINESS ADDRESS:	
		STREET 1:		440 E COMMONWEALTH BLVD
		CITY:			MARTINSVILLE
		STATE:			VA
		ZIP:			24112
		BUSINESS PHONE:		5406322133

	MAIL ADDRESS:	
		STREET 1:		440 E COMMONWEALTH BLVD
		CITY:			MARTINSVILLE
		STATE:			VA
		ZIP:			24112
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>f14a_052708.htm
<DESCRIPTION>FORM DEF 14A
<TEXT>
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    <div style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px" align="center"><font size="4" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SECURITIES AND EXCHANGE COMMISSION
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20549</font></font></div>
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    <div style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px" align="center"><font size="5" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SCHEDULE 14A </font></font></div>
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    <div style="MARGIN-TOP: 16px; MARGIN-BOTTOM: 0px" align="center"><font size="3" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Proxy Statement Pursuant to Section
14(a) of the</font></font></div>
    <div style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px" align="center"><font size="3" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Securities Exchange Act of
1934</font></font></div>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
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          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Confidential, for
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          <td align="left" valign="top" width="4%"><font size="2" style="FONT-FAMILY: times new roman"><font FACE="WINGDINGS">&#120;</font></font></td>
          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman">Definitive Proxy Statement </font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 6px; MARGIN-BOTTOM: 0px">&#160;</div>
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          <td align="left" valign="top" width="4%"><font color="#000000" size="2" FACE="wingdings">&#168;</font></td>
          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman">Definitive Additional Materials </font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 6px; MARGIN-BOTTOM: 0px">&#160;</div>
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          <td align="left" valign="top" width="4%"><font color="#000000" size="2" FACE="wingdings">&#168;</font></td>
          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman">Soliciting Material Pursuant to &#167;240.14a-12
</font></td>
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    <div style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px" align="center"><font size="3" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Hooker Furniture
Corporation</font></font></div>
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    <div style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px" align="center"><font size="1" style="FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">(Name of Registrant as Specified In
Its Charter)</font></font></div>
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Statement, if other than the Registrant) </font></font></div>
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    <div style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%; TEXT-INDENT: -2%"><font size="2" style="FONT-FAMILY: Times New Roman">Payment of Filing Fee (Check the
appropriate box): </font></div>
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          <td align="left" valign="top" width="4%"><font color="#000000" size="2" FACE="WINGDINGS">&#168;</font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
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        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
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    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

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          <td width="4%"><font size="1">&#160;</font></td>
          <td align="left" valign="top" width="4%"><font size="2" style="FONT-FAMILY: times new roman">(3)</font></td>
          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman">Per unit price or other underlying value of the transaction
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      the filing fee is calculated and state how it was determined):
  </font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
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        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
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        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
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    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table width="99%">

        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
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    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

        <tr>
          <td align="left" valign="top" width="4%">
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

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          <td align="left" valign="top" width="4%"><font color="#000000" size="2" FACE="WINGDINGS">&#168;</font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
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      was paid previously. Identify the previous filing by registration
      statement number, or the Form or Schedule and the date of its filing.
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

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          <td width="4%"><font size="1">&#160;</font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table width="99%">

        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
    </table></div>
    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

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          <td width="4%"><font size="1">&#160;</font></td>
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</font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table width="99%">

        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
    </table></div>
    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

        <tr>
          <td width="4%"><font size="1">&#160;</font></td>
          <td align="left" valign="top" width="4%"><font size="2" style="FONT-FAMILY: times new roman">(3)</font></td>
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    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table width="99%">

        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
    </table></div>
    <div><table border="0" cellpadding="0" cellspacing="0" width="100%" style="BORDER-COLLAPSE: collapse">

        <tr>
          <td width="4%"><font size="1">&#160;</font></td>
          <td align="left" valign="top" width="4%"><font size="2" style="FONT-FAMILY: times new roman">(4)</font></td>
          <td align="left" valign="top"><font size="2" style="FONT-FAMILY: times new roman">Date Filed: </font></td>
        </tr>
    </table></div>
    <div style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div><table width="99%">

        <tr>
          <td width="3%">&#160;</td>
          <td width="96%">
            <hr style="COLOR: #000000" align="left" noshade size="1">    </td>
        </tr>
    </table></div>
    <div style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px">&#160;</div>
    <div>&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 17pt; FONT-FAMILY: Arial Narrow"><img src="logo.jpg" alt=""><br>Hooker Furniture Corporation</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 11pt; FONT-FAMILY: Arial Narrow">440
East Commonwealth Boulevard</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 11pt; FONT-FAMILY: Arial Narrow">Martinsville,
Virginia&#160;&#160;24112</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">To
be held June 30, 2008</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">NOTICE IS
HEREBY GIVEN that the Annual Meeting of Shareholders of Hooker Furniture
Corporation (the &#8220;Company&#8221;) will be held at the Company&#8217;s corporate offices at
440 East Commonwealth Boulevard, Martinsville, Virginia, on Monday, June 30,
2008, at 2:00 p.m., for the following purposes:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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          <tr valign="top">
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      to serve a one-year term on the Company&#8217;s Board of Directors;
      and</font></div>
            </td>
          </tr>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">To
      transact such other business as may properly be brought before the meeting
      or any adjournment of the meeting.</font></div>
            </td>
          </tr>
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    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
shareholders of record of the Company&#8217;s Common Stock at the close of business on
May&#160;15,&#160;2008 are entitled to notice of and to vote at this Annual
Meeting or any adjournment of the meeting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Even
if you plan to attend the meeting in person, we request that you mark, date,
sign and return your proxy in the enclosed self-addressed envelope as soon as
possible so that your shares may be certain of being represented and voted at
the meeting. Any proxy given by a shareholder may be revoked by that shareholder
at any time before the voting of the proxy.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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Directors,</font></div>
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Sherwood<br>&#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;&#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><font size="+0"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Secretary</font></font></div>
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2008</font></div><br>
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</font></div>
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</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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</font></div>
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Furniture Corporation</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 11pt; FONT-FAMILY: Arial Narrow">440
East Commonwealth Boulevard</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 11pt; FONT-FAMILY: Arial Narrow">Martinsville,
Virginia&#160;&#160;24112</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">PROXY
STATEMENT</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">ANNUAL
MEETING OF SHAREHOLDERS</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">June
30, 2008</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The enclosed
proxy is solicited by and on behalf of the Board of Directors of Hooker
Furniture Corporation (the &#8220;Company&#8221;) for use at the Annual Meeting of
Shareholders to be held on Thursday, June 30, 2008, at 2:00 p.m., at the
Company&#8217;s corporate offices at 440 East Commonwealth Boulevard, Martinsville,
Virginia, and any adjournment of the meeting. The matters to be considered and
acted upon at the meeting are described in the notice of the meeting and this
proxy statement. This proxy statement and the related form of proxy are being
mailed on or about June 3, 2008 to all holders of record on May 15, 2008 of the
Company&#8217;s common stock, no par value (the &#8220;Common Stock&#8221;). Shares of the Common
Stock represented in person or by proxy will be voted as described in this proxy
statement or as otherwise specified by the shareholder. Any proxy given by a
shareholder may be revoked by that shareholder at any time before the voting of
the proxy by:</font></div>
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            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">delivering
      a written notice to the Secretary of the
  Company;</font></div>
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          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
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              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">executing
      and delivering a later-dated proxy;
or</font></div>
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          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">attending
      the meeting and voting in person.</font></div>
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          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The cost of
preparing, assembling and mailing the proxy, this proxy statement, and any other
material enclosed, and all clerical and other expenses of solicitations will be
borne by the Company. In addition to the solicitation of proxies by use of the
mails, directors, officers, and employees of the Company may solicit proxies by
telephone or personal interview. The Company also will request brokerage houses
and other custodians, nominees, and fiduciaries to forward soliciting material
to the beneficial owners of Common Stock held of record by those parties and
will reimburse those parties for their expenses in forwarding soliciting
material.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Voting
Rights</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">On May 15,
2008, the record date for the Annual Meeting, there were 11,508,437 shares of
Common Stock outstanding and entitled to vote. Each share of Common Stock
entitles the holder of that share to one vote.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Voting
Procedures</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Votes will be
tabulated by one or more Inspectors of Elections. A majority of the total votes
entitled to be cast on matters to be considered at the Annual Meeting
constitutes a quorum. If a share is represented for any purpose at the Annual
Meeting, it is deemed to be present for quorum purposes and for all other
matters as well. Abstentions and shares held of record by a broker or its
nominee (&#8220;broker shares&#8221;) that are voted on any matter are included in
determining the number of votes present or represented at the Annual Meeting.
However, broker shares that are not voted on any matter at the Annual Meeting
will not be included in determining whether a quorum is present at the
meeting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In the
election of directors, the six nominees receiving the greatest number of votes
cast in the election of directors will be elected. Votes that are withheld and
broker shares that are not voted in the election of directors will not be
included in determining the number of votes cast on the election of directors
and, therefore, will have no effect on the election of directors. Actions on all
other matters to come before the meeting will be approved if the votes cast in
favor of the action exceed the votes cast</font></div>
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        </div>
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        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">against it.
Abstentions and broker shares that are not voted are not considered cast either
for or against a matter and, therefore, will have no effect on the outcome of
that matter.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Voting
of Shares Held in Employee Stock Ownership Plan</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Participants
in the Company&#8217;s employee stock ownership plan will receive a form to use to
provide voting instructions to GreatBanc Trust Company, the trustee for the
ESOP, for the shares of Common Stock held on each participant&#8217;s behalf by the
ESOP trustee. The share amounts on the form will reflect the shares in the
participant&#8217;s plan account. Voting instructions should be returned, properly
executed, in the envelope provided. The ESOP trustee will vote in accordance
with a participant&#8217;s instructions. If an ESOP participant does not return voting
instructions, the ESOP trustee will vote the shares in its
discretion.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">ELECTION
OF DIRECTORS</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
proposes the election of Paul B. Toms, Jr., W. Christopher Beeler, Jr., John L.
Gregory, III, Mark F.<font style="DISPLAY: inline; FONT-FAMILY: Arial Narrow">&#160;</font>Schreiber, David
G. Sweet and Henry G. Williamson, Jr. to hold office until the next Annual
Meeting of Shareholders is held and their successors are elected.&#160;&#160;All
nominees listed were previously elected directors by the shareholders and have
consented to being named as nominees for election at the Annual Meeting. The
Board of Directors of the Company presently consists of six directors whose
terms expire at the time of the 2008 Annual Meeting upon election of their
successors.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The shares
represented by proxies will be voted as specified by the shareholder. If the
shareholder does not specify his or her choice, the shares will be voted in
favor of the election of the nominees listed on the proxy card, except that if
any nominee should not continue to be available for election, those proxies will
be voted for the election of such other person as the Board of Directors may
recommend. As of the date of this proxy statement, the Board of Directors has no
reason to believe that any of the nominees named below will be unable or
unwilling to serve.&#160;&#160;Certain information regarding each nominee
follows.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Paul B. Toms, Jr.</font>, 54, has
been a Director since 1993. Mr. Toms has been Chairman and Chief Executive
Officer since December 2000 and President since November 1, 2006. Mr. Toms was
President and Chief Operating Officer from December 1999 to December 2000,
Executive Vice President-Marketing from 1994 to December 1999, Senior Vice
President-Sales &amp; Marketing from 1993 to 1994, and Vice President-Sales from
1987 to 1993. Mr. Toms joined the Company in 1983.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">W. Christopher Beeler, Jr.</font>,
56, has been a Director since 1993. He is the Chairman, President and Chief
Executive Officer of Virginia Mirror Company, Inc. and Virginia Glass Products
Corporation, both of which manufacture and fabricate architectural glass
products. Mr. Beeler is Chairman of the Nominating and Corporate Governance
Committee and a member of the Audit Committee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">John L. Gregory, III</font>, 61, has
been a Director since 1988. He is a shareholder, officer and director of the law
firm of Young, Haskins, Mann, Gregory, McGarry &amp; Wall, P.C. Mr. Gregory is
Chairman of the Compensation Committee and a member of the Nominating and
Corporate Governance Committee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Mark F. Schreiber</font>, 66, has
been a Director since 2004. He is the retired President and Chief Operating
Officer of Houston-based furniture retailer Star Furniture. He held that
position from 1995 until his retirement in early 2003. Mr. Schreiber is a member
of the Audit Committee and the Compensation Committee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">David G. Sweet</font>, 61, has been a
Director since March 1, 2006. He is the retired Vice President of The North
Face, a designer and marketer of outdoor apparel and a division of VF
Corporation. He held that position from 2002 until his retirement in December
2004. He served as Vice President of VF Outdoor &#8211; Europe from 2000 to 2002.
Before 2000, Mr. Sweet held various management positions during his 26-year
career with VF Corporation. Mr. Sweet is a member of the Audit Committee and the
Nominating and Corporate Governance Committee.</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">2</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Henry G. Williamson, Jr.</font>, 60,
has been a Director since 2004. He is the retired Chief Operating Officer of
BB&amp;T Corporation and Branch Banking and Trust Company of North Carolina,
South Carolina and Virginia. He held that position from 1989 until his
retirement in June 2004. Mr. Williamson is also the Chairman of the Board of
both Williamson Corporation of North Carolina (doing business as Carolina
Staffing Specialist), a temporary staffing business, and Williamson Media
Corporation, which is involved in web-based commerce. Mr. Williamson is Chairman
of the Audit Committee and a member of the Compensation Committee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">BOARD
AND BOARD COMMITTEE INFORMATION</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Board of
Directors held six meetings during the fiscal year ended February 3, 2008
(&#8220;fiscal 2008&#8221;). The Board has established a Nominating and Corporate Governance
Committee, a Compensation Committee and an Audit Committee. The Compensation
Committee met four times, the Audit Committee met six times and the Nominating
and Corporate Governance Committee met two times in fiscal 2008. Each incumbent
director attended at least 75% of the total fiscal 2008 Board meetings and
committee meetings held during the period that he was a member of the Board or
those committees. Each of the following directors and director nominees is
independent as defined by applicable NASDAQ listing standards: W. Christopher
Beeler,&#160;Jr., John L. Gregory, III, Mark F. Schreiber, David G. Sweet and
Henry G. Williamson, Jr. It is the Company&#8217;s policy that each of the directors
is expected to attend the Company&#8217;s annual shareholder meetings. All of the
Company&#8217;s six directors attended the 2007 Annual Meeting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Nominating
and Corporate Governance Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Nominating and Corporate Governance Committee, which presently consists of
Messrs. Beeler&#160;(Chairman), Gregory and Sweet:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">identifies
      individuals qualified to become Board
members;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">selects,
      or recommends that the Board select, nominees to the Board and each
      committee;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">assists
      the Board with respect to corporate governance matters applicable to the
      Company; and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">assists
      the Board in senior management succession
  planning.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Board of
Directors has adopted a written charter for the Nominating and Corporate
Governance Committee, a current copy of which is available on the Company&#8217;s Web
site at <font style="DISPLAY: inline; TEXT-DECORATION: underline">www.hookerfurniture.com</font>.
Each member of the Committee is independent as defined by applicable NASDAQ
listing standards.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Nominating and Corporate Governance Committee is responsible for:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">evaluating
      and making recommendations to the Board regarding the size and composition
      of the Board;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">developing
      and recommending criteria for the selection of individuals to be
      considered as candidates for election to the Board;
  and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">identifying,
      investigating and recommending prospective director
      candidates.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Candidates
for director nominees will be assessed in the context of the current composition
of the Board, the operating requirements of the Company and the long-term
interests of shareholders. The Committee has not established a set of specific,
minimum qualifications for director candidates, but in conducting its
assessment, the Committee will consider such factors as it deems appropriate
given the current needs of the Board and the Company. In the case of incumbent
directors, the Committee will review each director&#8217;s overall service to the
Company during his or her term in deciding whether to renominate the
director.</font></div>
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      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">3</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Procedures
for Shareholder Recommendations of Director Nominees</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
will consider a director candidate recommended by a shareholder for the 2009
Annual Meeting if the recommendation is submitted in writing to the Secretary of
the Company in accordance with the Company&#8217;s bylaws and is received at the
Company&#8217;s principal executive offices on or before January 29, 2009. The
recommendation must include the candidate&#8217;s name and address, a description of
the candidate&#8217;s qualifications for serving as a director and the following
information:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">the
      name and address of the shareholder making the
    recommendation;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">a
      representation that the shareholder is a record holder of the Company&#8217;s
      Common Stock entitled to vote at the meeting and, if necessary, would
      appear in person or by proxy at the meeting to nominate the person or
      persons recommended;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">a
      description of all arrangements or understandings between the shareholder
      and the nominee and any other person or persons (naming such person or
      persons) pursuant to which the nomination or nominations are to be made by
      the shareholder;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">information
      regarding the director candidate that would be required to be included in
      a proxy statement filed under the proxy rules of the Securities and
      Exchange Commission, if the candidate were to be nominated by the Board of
      Directors;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">information
      concerning the director candidate&#8217;s independence as defined by applicable
      NASDAQ listing standards; and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">the
      consent of the director candidate to serve as a director of the Company if
      nominated and elected.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Nominating and Corporate Governance Committee may refuse to consider the
recommendation of any person not made in compliance with this
procedure.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Compensation
Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Compensation Committee presently includes Messrs. Gregory (Chairman), Schreiber
and Williamson. The Committee reviews and makes determinations with regard to
the compensation for the Company&#8217;s executives, including the Chief Executive
Officer, the Chief Financial Officer and each of the Company&#8217;s executive
officers. No member of the Compensation Committee may be a current employee of
the Company. Each member of the Compensation Committee is independent as defined
by applicable NASDAQ listing standards. The Board of Directors has adopted a
written charter for the Compensation Committee, a current copy of which is
available on the Company&#8217;s Web site at <font style="DISPLAY: inline; TEXT-DECORATION: underline">www.hookerfurniture.com</font>.
The Report of the Compensation Committee can be found on page 6.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Audit
Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Audit
Committee, which presently consists of Messrs. Williamson (Chairman), Beeler,
Schreiber and Sweet:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">approves
      the appointment of an independent registered public accounting firm to
      audit the Company&#8217;s financial statements and internal control over
      financial reporting;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">reviews
      and approves the scope, purpose and type of audit and non-audit services
      to be performed by the independent registered public accounting firm;
      and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">oversees
      the accounting and financial reporting processes of the Company and the
      integrated audit of the Company&#8217;s annual financial statements and internal
      control over financial reporting.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Board of
Directors has adopted a written charter for the Audit Committee, a current copy
of which is available on the Company&#8217;s Web site at <font style="DISPLAY: inline; TEXT-DECORATION: underline">www.hookerfurniture.com</font>.
Each member of the Audit</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">4</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
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    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Committee is
independent as defined by applicable NASDAQ listing standards. The Company&#8217;s
Board of Directors has determined that each of Messrs. Williamson and Beeler is
an &#8220;audit committee financial expert&#8221; for purposes of the SEC&#8217;s rules. The
Report of the Audit Committee can be found on page 6.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Director
Compensation</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Nominating and Corporate Governance Committee is responsible for recommending
director compensation to the Board of Directors.&#160;&#160;The non-employee
director compensation arrangements discussed below were recommended by the
Nominating and Corporate Governance Committee and approved by the Board of
Directors. The following table sets forth non-employee director compensation for
fiscal 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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Director Compensation</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div align="left">
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          <tr>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Name</font></font></div>
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      Cash&#160;(1)($)</font></font></font></div>
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            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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      ($)</font></font></div>
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            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="64%">
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      Christopher Beeler,
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            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">31,500</font></div>
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            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%">
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            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">47,248</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="64%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">John L.
      Gregory,
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            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">27,000</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">13,494</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">40,494</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="64%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Mark F.
      Schreiber&#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></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">28,500</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">14,255</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">42,755</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="64%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">David
      G.
      Sweet&#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></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">28,500</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">14,255</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">42,755</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="64%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      G. Williamson,
      Jr.&#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></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">33,000</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">16,494</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">49,494</font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td colspan="12" nowrap valign="bottom">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Includes
      annual retainer fees and committee and committee chair fees paid in
      January 2007.</font></div>
            </td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
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      to the 2005 Stock Incentive Plan, each of the Company&#8217;s non-employee
      directors received<br>an award of restricted Common Stock on January 16,
      2007. These shares had a grant date fair value<br>of $15.23 per share and
      will vest, with no transfer restrictions, on January 16,
      2010.</font></font></td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Compensation
for the Company&#8217;s non-employee directors is set on a calendar-year basis. For
the 2007 calendar year, non-employee directors received an annual cash retainer
of $18,000, plus $7,500 for serving on the Audit Committee and $3,000 for
serving on each of the Compensation and Nominating and Corporate Governance
Committees. The Chair of the Audit Committee received an additional $4,500, and
the Chairs of the Compensation and Nominating and Corporate Governance
Committees each received an additional $3,000.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Non-employee
directors also receive an annual grant of restricted stock each January under
the Company&#8217;s 2005 Stock Incentive Plan. The number of shares of restricted
stock awarded to each non-employee director each year is determined by dividing
fifty percent of the total annual fees payable to that director for that
calendar year by the fair market value of the Company&#8217;s Common Stock on the
award date, and rounding to the nearest whole share. The restricted stock
becomes fully vested, and the restrictions applicable to the restricted stock
lapse, on the third anniversary of the grant date, or if earlier, when the
director dies or is disabled, the Annual Shareholders Meeting following the
director&#8217;s reaching age 75, or a change in control of the Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">For the 2008
calendar year, non-employee directors will receive an annual cash retainer of
$20,000, plus $8,500 for serving on the Audit Committee and $4,000 for serving
on each of the Compensation and Nominating and Corporate Governance Committees.
The Chairs of the Audit Committee, Compensation Committee and Nominating and
Corporate Governance Committees will each receive an additional $5,000, $4,000
and $3,000, respectively.&#160;&#160;In addition, each non-employee director
will receive a grant of restricted stock under the Company&#8217;s 2005 Stock
Incentive Plan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Directors are
reimbursed for reasonable expenses incurred in connection with attending board
and committee meetings or performing their duties as directors. Mr. Toms
receives no additional compensation for Board or committee meetings
attended.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">5</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">REPORT
OF THE AUDIT COMMITTEE</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Audit
Committee oversees the Company&#8217;s financial reporting process on behalf of the
Board of Directors. Management has the primary responsibility for the financial
statements and the reporting process, including internal control over financial
reporting. In fulfilling its oversight responsibilities, the Committee reviewed
and discussed the audited financial statements for the fiscal year ended
February 3, 2008 with management, including a discussion of the quality and
acceptability of accounting principles, the reasonableness of significant
judgments, and the clarity of disclosures in the financial
statements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
discussed with the independent registered public accounting firm, who is
responsible for expressing an opinion on conformity of those audited financial
statements with U.S. generally accepted accounting principles, the firm&#8217;s
judgment as to the quality and acceptability of the Company&#8217;s accounting
principles and such other matters as are required to be discussed with the
independent registered public accounting firm under the standards of the Public
Company Accounting Oversight Board. In addition, the Committee has discussed
with the independent registered public accounting firm the firm&#8217;s independence
from management and the Company, including the matters in the written
disclosures and letter from the independent registered public accounting firm to
the Committee required by Independence Standards Board Standard No. 1. The
Committee has also considered whether the provision of non-audit related
services by the independent registered public accounting firm is compatible with
maintaining the firm&#8217;s independence and found it to be acceptable.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
met with the Company&#8217;s independent registered public accounting firm, with and
without management present, and discussed the overall scope and results of their
audits, their evaluation of the Company&#8217;s internal control over financial
reporting and the overall quality of the Company&#8217;s financial
reporting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In reliance
on the reviews and discussions referred to above, the Committee recommended to
the Board of Directors that the audited financial statements be included in the
Company&#8217;s Annual Report on Form&#160;10-K for the fiscal year ended February 3,
2008 for filing with the Securities and Exchange Commission.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Henry G.
Williamson, Jr., Chairman</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">W.
Christopher Beeler, Jr.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mark F.
Schreiber</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">David G.
Sweet</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">REPORT
OF THE COMPENSATION COMMITTEE</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Compensation Committee is composed exclusively of non-employee, independent
directors. The Board of Directors delegated to the Committee the responsibility
to develop and implement general principles for compensating the Company&#8217;s Chief
Executive Officer and the other members of the Company&#8217;s executive leadership
team. The Committee also is responsible for administering certain Company
compensation plans and for exercising general oversight over the Company&#8217;s
executive compensation practices. The Committee meets at scheduled times
throughout the year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
has reviewed, and discussed with management, the Compensation Discussion and
Analysis that appears under &#8220;Executive Compensation&#8221; below. Based on that
review, and the Committee&#8217;s discussions with management, the Committee
recommended to the Board of Directors that the Compensation Discussion and
Analysis be included in this proxy statement.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">John L.
Gregory, III, Chairman</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mark F.
Schreiber</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 235pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Henry G.
Williamson, Jr.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">6</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">EXECUTIVE
COMPENSATION</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Compensation
Discussion and Analysis</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Objectives
of the Executive Compensation Program</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The primary
objectives of the Company&#8217;s executive compensation program are to:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">attract
      and retain highly qualified executives who will contribute significantly
      to the success of the Company and its shareholders;
  and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">motivate
      those executives to achieve the Company&#8217;s financial and business goals and
      to meet their own, individual performance
  objectives.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company&#8217;s
executive compensation program uses several elements to achieve these
objectives.&#160;&#160;The primary elements of the program are base salary, an
annual cash incentive, supplemental retirement income, life insurance benefits
and, beginning with the 2009 fiscal year, a long-term incentive compensation
program.&#160;&#160;Executives earn compensation over three separate
timeframes:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Annual
      compensation</font>.&#160;&#160;Base salaries are set for each calendar
      year based on Company performance and the individual executive&#8217;s
      performance over the preceding calendar year.&#160;&#160;The annual cash
      incentive is determined based on the Company&#8217;s financial performance
      during the fiscal year, and may be adjusted upward or downward within
      certain established limits based on an evaluation of the executive&#8217;s
      individual performance during that fiscal
year.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Longer-term
      compensation.&#160;&#160;</font>The long-term incentive compensation
      program is designed to reward executives if the Company achieves specific
      performance goals over multi-year periods.&#160;&#160;The amounts payable
      to executives under the program vary based on the extent to which those
      goals are achieved or surpassed.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Full career
      compensation.&#160;&#160;</font>Supplemental retirement income and life
      insurance benefits are linked to an executive&#8217;s continued employment with
      the Company to a specified age.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Structuring
the program to provide compensation over these separate timeframes is intended
to promote the objectives described above, and to encourage executives to
appropriately consider both the short-term and long-term interests of the
Company and its shareholders.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Operation
of the Executive Compensation Program</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Role of the
Compensation Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Compensation Committee of the Board (&#8220;the Committee&#8221;) oversees the Company&#8217;s
executive compensation program.&#160;&#160;The Committee makes decisions
regarding the compensation of the Company&#8217;s &#8220;named executive officers,&#8221; which
typically consist of the Chief Executive Officer, the Chief Financial Officer
and the three other most highly compensated executive officers of the
Company.&#160;&#160;The named executive officers for fiscal 2008 are listed in
the &#8220;Summary Compensation Table&#8221; on page 15.&#160;&#160;The Committee also
determines the compensation of the other executive officers of the
Company.&#160;&#160;More information concerning the composition of the Committee
and its authority and responsibilities is described under &#8220;Compensation
Committee&#8221; on page 4.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
is assisted by the Company&#8217;s senior management, an outside compensation
consulting firm and outside legal counsel, as necessary.&#160;&#160;The
Committee has retained Longnecker &amp; Associates, an independent compensation
consulting firm, to provide benchmarking data and to advise the Committee on
various items related to executive compensation, such as compensation trends and
methods for aligning pay to the attainment of performance goals.&#160;&#160;The
Committee&#8217;s use of competitive pay</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">7</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">data provided
by the compensation consulting firm to set compensation for the 2008 fiscal year
is described below.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
compensation consulting firm reports directly to the Chairman of the Committee,
and the Committee approves the scope of the compensation consulting firm&#8217;s work
and fees.&#160;&#160;The compensation consulting firm participates in meetings
with the Committee at its request, including executive sessions during which
Company management is not present.&#160;&#160;The compensation consulting firm
does not perform any other work for the Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
typically meets three or four times each year.&#160;&#160;During the 2008 fiscal
year it met four times<font style="DISPLAY: inline; FONT-WEIGHT: bold">.</font>&#160;&#160;The Committee
invites the Chief Executive Officer and the Chief Financial Officer to attend
meetings when their input is deemed relevant or necessary.&#160;&#160;A portion
of each meeting is generally held in executive session, as the Committee deems
appropriate.&#160;&#160;The Committee Chairman reports the Committee&#8217;s decisions
on executive compensation to the Board.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Role of
Management</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Chief
Executive Officer makes recommendations to the Committee concerning annual base
salaries and annual cash incentive opportunities for the other named executive
officers and executive officers.&#160;&#160;Decisions regarding compensation for
other employees are made by the Chief Executive Officer in consultation with
other members of senior management.&#160;&#160;Management assists the Committee
in administering various elements of the Company&#8217;s executive compensation
program.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Use of
Competitive Pay Data</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">As noted
above, the Committee has retained the compensation consulting firm to provide
data concerning compensation levels and practices of other companies that the
Company competes with for executive talent. In December 2006, the compensation
consulting firm performed a comparative assessment of the Company&#8217;s executive
compensation program against a combination of published compensation data for
the Company&#8217;s industry as well as the executive compensation programs of a
specific peer group of companies.&#160;&#160;The Committee considered the
assessment, along with certain other factors, for purposes of setting and
approving executive compensation for the 2008 fiscal year, which began January
29, 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The industry
data used in the assessment was drawn from published compensation surveys for
companies in the upholstered household furniture and furniture manufacturing
industry with annual revenue levels similar to the Company&#8217;s.&#160;&#160;The
peer group was composed of industry competitors with annual revenues and market
capitalizations substantially similar to the Company&#8217;s. The companies in the
peer group were:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Bassett
      Furniture Industries</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Flexsteel
      Industries, Inc</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Stanley
      Furniture Company</font></div>
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    <div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Virco
      Mfg. Corporation</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
believes that this peer group is representative of the companies with which the
Company most directly competes for executive talent.&#160;&#160;The Committee
monitors the composition of the peer group to ensure that it is comprised of
companies that are close to the Company&#8217;s size and market capitalization and are
representative of its competitors for executive talent.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The peer
group information and the published industry data were weighted equally in
performing the assessment.&#160;&#160;Based on this information and data, the
assessment concluded that the total base salary</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">8</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">and annual
incentives paid to the named executive officers in prior years were comparable
in the aggregate to the midpoint of the base salaries and annual incentives paid
by members of the peer group to their similarly situated
executives.&#160;&#160;These amounts ranged from a low of 67% of the peer group
midpoint for Mr. Toms, to a high of 131% of the peer group
midpoint.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
assessment also concluded that the total direct compensation (the sum of base
salary,&#160; annual incentives and long term incentives) paid to the Company&#8217;s
named executive officers was substantially below the midpoint for named
executive officers of the peer group.&#160;&#160;The reason for this difference
was primarily due to the absence of a long-term incentive compensation element
in the Company&#8217;s overall executive compensation program.&#160;&#160;The
assessment compared only the amount of the annual incentives paid by the peer
group and did not compare the relative performance of the Company with that of
the peer group members.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Executive
Compensation Decisions for Fiscal 2008</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">For the 2008
fiscal year, the elements of compensation for the named executive officers
were:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
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              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">base
      salary;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
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            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">an
      annual cash incentive;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
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          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">supplemental
      retirement income;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">a life
      insurance program; and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">other
      benefits generally available to full-time employees of the
      Company</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In addition,
the Company has implemented a long-term performance incentive beginning in the
2009 fiscal year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
has entered an employment agreement with Mr. Cole.&#160;&#160;The employment
agreement provides for potential payments upon termination of employment, as
well as certain payments and benefits during the executive&#8217;s
employment.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Each of the
elements of the executive compensation program, including Mr. Cole&#8217;s employment
agreement and the recently implemented long-term performance incentive, is
discussed below.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Base
Salary</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
reviews the salaries of the Company&#8217;s executive officers
annually.&#160;&#160;The Committee set base salary levels for the named
executive officers for the 2008 calendar year based on the competitive pay data
described above, as well as each officer&#8217;s individual management
responsibilities, leadership qualities, experience and contributions to the
Company.&#160;&#160;After considering this information, as well as the other
elements of executive compensation available for each named executive officer,
the Committee approved a 3% cost-of-living increase in the annual base salaries
for all named executive officers.&#160;&#160;The increase was designed to
maintain salaries at a level that would generally be in line with the rate of
inflation.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
also approved an additional 10% increase in Mr. Ryder&#8217;s base
salary.&#160;&#160;This increase was approved:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">to
      reward Mr. Ryder for his contributions to the Company for the prior fiscal
      year as well as the interim two-month transition period ended January 28,
      2007, which included his role in successfully obtaining regulatory
      approval of the termination of the Company&#8217;s
  employee</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">9</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div>&#160;</div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">stock
      ownership plan and substantial involvement in the successful completion of
      certain acquisitions and divestitures during the year;
  and</font></div>
            </td>
          </tr>
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: symbol, serif">&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
      </table>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">to
      recognize a substantial increase in his level of management responsibility
      following the retirement in fiscal year 2006 of another senior executive
      officer.</font></font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Pursuant to
the terms of his employment agreement, as further described below, Mr. Cole
receives an annual base salary that is consistent with the base salaries of the
other executive officers and is determined by the Committee based on Mr. Cole&#8217;s
management responsibilities.&#160;&#160;Mr. Cole&#8217;s base salary is subject to
review annually, at the same time as the base salaries of the other executive
officers.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Annual Cash
Incentive</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The fiscal
2008 annual cash incentive for the named executive officers, other than Mr.
Cole, was determined using a two-step process:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">First,
      the Committee approved a base incentive for each named executive officer
      that is equal to a specified percentage of the Company&#8217;s total annual
      pre-tax earnings above a threshold amount;
and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
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          <tr valign="top">
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              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Second,
      the Committee assigned a range for each executive by which the Committee
      in its discretion could increase or decrease the executive&#8217;s base
      incentive depending on his individual performance for the
      year.&#160;&#160;This is referred to below as the executive&#8217;s &#8220;individual
      performance adjustment factor.&#8221;</font></div>
            </td>
          </tr>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
has adopted certain guidelines for administering the annual incentive
program.&#160;&#160;Generally, an executive must remain employed to the last day
of the fiscal year to be eligible to receive a payment under the
program.&#160;&#160;However, executives who terminate employment during the last
quarter of the fiscal year due to death or disability, or after attaining age 55
and completing 10 years of service, are entitled to receive the same payment
that they would have been paid under the program had they remained employed to
the end of the fiscal year.&#160;&#160;Executives who terminate employment for
such reasons in the second or third quarter of the fiscal year are entitled to
receive 50% or 75%, respectively, of what they would have been paid had they
remained employed to the end of the fiscal year.&#160;&#160;The guidelines
establish procedures for the Committee to review and approve bonus
determinations after the Chief Executive Officer and Chief Financial Officer
confirm the total annual pre-tax earnings for the fiscal year and the extent to
which any other conditions under the program have been met for that fiscal
year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">As in past
years, the Committee used pre-tax earnings above a specified threshold amount as
the performance objective for measuring whether the executive would be paid an
annual cash incentive and for determining the amount of that incentive
payment.&#160;&#160;The Committee believes that linking a portion of each named
executives&#8217; pay to the Company&#8217;s annual earnings creates an effective incentive
for executives to achieve a high level of earnings each year.&#160;&#160;The
Committee also believes that annual pre-tax earnings is an appropriate objective
for measuring the amount of the annual incentive because executive officers&#8217;
management decisions and their implementation of those decisions directly affect
this measure of Company performance.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The pre-tax
earnings threshold for the 2008 fiscal year was set at $12.5 million, which
represented a 25% increase over the threshold used for fiscal year
2006.&#160;&#160;The Committee determined that this increase was appropriate to
reflect the reduction in compensation expense and corresponding increase in
pre-tax earnings expected in fiscal 2008, which was primarily the result of
termination of the Company&#8217;s employee stock ownership plan in January
2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
retains discretion to make adjustments to the Company&#8217;s GAAP pre-tax earnings
for purposes of the annual incentive program when necessary or appropriate in
the Committee&#8217;s judgment to address extraordinary expenses or gains during the
year that are outside the executives&#8217; control or that,</font></div>
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        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">10</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        <div id="GLHDR" style="WIDTH: 100%" align="right">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">if not taken
into account, might give the executives a disincentive to pursue the longer-term
interests of the Company and its shareholders.&#160;&#160;No such adjustments
were made for the 2008 fiscal year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
approved a specific base incentive for each named executive that correlated in
the Committee&#8217;s view of his respective level of management responsibilities and
potential to affect the financial performance of the Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Since the
base incentives were determined as a percentage of pre-tax earnings over the
threshold amount rather than, for example, as a percentage of each named
executive&#8217;s base salary, there was, in theory, no limit on the amount of the
annual incentive an executive could earn.&#160;&#160;The Committee believes that
this structure maximizes each named executive&#8217;s incentive to increase the
Company&#8217;s earnings each year and is balanced by the risk of non-payment if the
Company fails to exceed the minimum earnings threshold approved by the Committee
for the year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The base
incentives for each of the named executive officers for the 2008 fiscal year,
expressed as a percentage of the Company&#8217;s pre-tax earnings in excess of the
$12.5 million dollar threshold set by the Committee, were as
follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">% of
      Pre-tax Earnings Above<br><font style="DISPLAY: inline; TEXT-DECORATION: underline">$12.5 Million
      Threshold</font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms,
      Jr.&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.75%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry
      Ryder&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.65%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P.
      Spece&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.60%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T.
      Harm&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.50%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long,
      Jr.&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.50%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">C.
      Scott
      Young&#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;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0.65%</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The pre-tax
earnings threshold was increased by $2.5 million over the threshold for the 2006
fiscal year.&#160;&#160;In addition, the base incentive percentages remained the
same as for fiscal year 2006 for all of the named executives listed above,
except for Mr. Ryder.&#160;&#160;The Committee approved an increase to Mr.
Ryder&#8217;s base incentive from 0.60% to 0.65% because of his specific contributions
for fiscal year 2006 and the transition period ended January 28, 2007 (as
described above in the discussion regarding base salary) and because of his
increased level of management responsibilities.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The second
step of the incentive setting process, which the Committee implemented for the
first time in the 2008 fiscal year, was to assign a range by which the Committee
at its discretion could increase or decrease each executive&#8217;s base incentive
depending on his individual performance for the year.&#160;&#160;The Committee
believes that adjusting the base incentive to account for attainment of
individual performance goals enables the Committee to more specifically
recognize individual performance that impacts the Company&#8217;s financial
performance.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
individual performance adjustment factor approved for Mr. Toms was plus or minus
up to 25% of his base incentive, depending on whether or not Mr. Toms achieved
his individual goals.&#160;&#160;For the remaining executive officers, the
individual performance adjustment factor was plus or minus up to 12.5% of the
base incentive.&#160;&#160;The Committee believes that the larger potential
adjustment in the Chief Executive Officer&#8217;s annual incentive opportunity
appropriately reflects the greater potential impact his individual performance
can have on the performance of the Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr. Toms
established his individual goals for the 2008 fiscal year, which he believed
were integral to achieving the Company&#8217;s financial and business objectives for
the year.&#160;&#160;Mr. Toms reviewed these performance goals with the
Committee, which is responsible for evaluating Mr. Toms&#8217; performance, as well as
the Company&#8217;s overall performance, for compensation setting
purposes.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Each of the
other named executives developed his own individual performance goals for fiscal
2008, which Mr. Toms reviewed and approved after consultation with the
executives.&#160;&#160;Mr. Toms has the primary responsibility for evaluating
the other named executives&#8217; performance and making recommendations to the
Committee regarding adjustments to annual incentive compensation based
on</font></div>
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        </div>
      </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">11</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">his
evaluation.&#160;&#160;The Committee makes the final decision regarding any
individual performance adjustment for the other named executives.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Based on its
evaluation, the Committee approved a positive performance adjustment of 12.5%
for Mr. Toms.&#160;&#160;This was one-half of the maximum positive individual
adjustment factor that the Committee established for Mr. Toms at the beginning
of fiscal 2008.&#160;&#160;The positive adjustment was approved because Mr. Toms
generally achieved his goals for the year, including successful completion of
certain strategic acquisitions and divestitures.&#160;&#160;The Committee also
took into account Mr. Toms&#8217; successful leadership of the Company during a
challenging economic environment for furniture manufacturers.&#160;&#160;The
Committee consulted with Mr. Toms during its review, but Mr. Toms did not
participate in the final decision concerning the amount of his annual cash
incentive.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Based on Mr.
Toms&#8217; recommendations and its own evaluations, the Committee approved a positive
performance adjustment of 12.5% for Mr. Ryder, which was the maximum possible
positive adjustment, and a 5% positive performance adjustment for Mr.
Spece.&#160;&#160;No adjustments, either positive or negative, were approved for
any of the other named executive officers.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr. Cole is
eligible for a different annual incentive opportunity under the terms of his
employment agreement, further discussed below.&#160;&#160;Mr. Cole&#8217;s annual
incentive opportunity ranges from 20% to 40% of his annual base
salary.&#160;&#160;Mr. Cole&#8217;s annual incentive opportunity, including the
applicable performance criteria and the ultimate amount of the payment, if any,
in a particular year are determined by the Chief Executive Officer or the
Committee, as determined by the Committee in its discretion.&#160;&#160;For the
2008 fiscal year, the Committee, based on a recommendation from Mr. Toms,
approved an incentive payment of $70,000 to Mr. Cole.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Long-Term
Performance Incentive Beginning in Fiscal 2009</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">During fiscal
year 2008, the Committee developed a long-term performance compensation element
for the executive compensation program, which was implemented for the first time
for fiscal year 2009.&#160;&#160;Although the Company has maintained a
shareholder-approved Stock Incentive Plan since March&#160;1, 2005, the
Committee has not previously granted any incentive awards to executives under
the plan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">As noted
above, the Committee&#8217;s compensation consulting firm has advised the Committee
that the total direct compensation for the named executive officers is
substantially below the midpoint of total direct compensation for similarly
situated executives in the peer group companies because of the absence of a
long-term incentive element.&#160;&#160;The Committee decided to add a long-term
incentive element to the Company&#8217;s executive compensation program to complement
the existing components of the Company&#8217;s executive compensation
program.&#160;&#160;The Committee determined that such a program would create
incentives for attainment of the Company&#8217;s longer-term financial goals, better
align the executives&#8217; interests with those of the Company&#8217;s shareholders and
help attract new executive talent and retain existing executive
talent.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Accordingly,
early in fiscal year 2009, the Committee awarded two<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>performance grants under
the Stock Incentive Plan to each named executive officer, other than Mr. Young,
and to certain other senior executives.&#160;&#160;The performance grant
entitles the executive to receive a payout amount that equals his &#8220;target
amount&#8221; increased or decreased by a percentage determined based on the Company&#8217;s
cumulative earnings per share (&#8220;EPS&#8221;) and average annual return on equity
(&#8220;ROE&#8221;) for a specified performance period.&#160;&#160;Each participant&#8217;s target
amount is expressed as a percentage of his base salary for the current calendar
year.&#160;&#160;The performance period for the first performance grant is the
two fiscal year period ending January 31, 2010 and the performance period for
the second performance grant is the three fiscal year period ending January 30,
2011.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">If the
Company&#8217;s cumulative EPS and average annual ROE for the respective performance
period do not meet the target levels for each performance grant but do meet
specified minimum threshold levels, the payout amount under the performance
grant would be reduced to a lower percentage of the target</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
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      </div>
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    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">amount based
on the Company&#8217;s actual performance. If the Company&#8217;s cumulative EPS and average
annual ROE both equal the minimum threshold levels, the payout amount would
equal 50% of the participant&#8217;s target amount. If the Company&#8217;s cumulative EPS
and average annual ROE exceed the designated target levels, the payout amount
would be increased to a higher percentage of the target amount based on the
actual level of performance, up to 150% of the target amount.&#160;&#160;The
payout amount, if any, under each performance grant will be paid in cash, shares
of the Company&#8217;s Common Stock or both, at the discretion of the Compensation
Committee.&#160;&#160;No more than $500,000 may be paid to any executive officer
under a performance award.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
believes that performance objectives based on a combination of cumulative EPS
and average annual ROE will help balance the emphasis in the annual incentive
plan on maximizing pre-tax earnings with a concern for the impact of operational
decisions on longer-term shareholder return.&#160;&#160;The use of a combination
of two performance objectives is designed to offset the potential effects of
certain transactions that might disproportionately impact one objective or the
other and to ensure that payments under the plan correlate with true growth in
shareholder value.&#160;&#160;In computing cumulative EPS and average annual
ROE, the impact of significant share repurchase activity or significant
acquisitions and divestitures of businesses will be disregarded because taking
those events into account might give the executives a disincentive to pursue the
longer-term interests of the Company and its shareholders.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In most
cases, an executive must remain employed through the end of the performance
period to be paid any amount under his performance grant.&#160;&#160;However, if
an executive&#8217;s employment is terminated due to death or disability and he
otherwise would have been entitled to a payment had he in fact remained employed
to that date, he will be entitled to a pro-rated cash payment at the end of the
performance period.&#160;&#160;If the Company undergoes a change in control
during the performance period and subsequently (a) the executive&#8217;s employment is
involuntarily terminated other than for &#8220;cause&#8221; or (b) he terminates employment
for &#8220;good reason&#8221; before the earlier of the end of the performance period or the
first anniversary of the change in control, the executive will be paid a lump
sum cash payment equal to his target amount.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Committee&#8217;s compensation consulting firm has reviewed the amounts payable under
the performance grants if the target performance levels are met and has advised
the Committee that the target amounts payable to the named executive officers
are reasonable and in line with peer company information.&#160;&#160;In making
this determination, the consulting firm considered total compensation of each
named executive officer.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Employment
Agreement with Mr. Cole</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In fiscal
year 2008 the Committee approved a three-year employment agreement between the
Company and Mr. Cole, who joined the Company in June 2007.&#160;&#160;None of
the other named executive officers have employment or severance agreements with
the Company.&#160;&#160;The decision to enter into an employment agreement with
Mr. Cole was motivated by the desire to attract and retain Mr. Cole for a
specified period because of his expertise in the upholstery
business.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr. Cole is
entitled to receive specified payments upon his death or disability before July
16, 2010 and post-termination payments for a limited time following his
termination of employment under certain circumstances, including his termination
by the Company other than for cause before or after July 16,
2010.&#160;&#160;These post-termination payment terms are intended to preserve
the benefits of the agreement for Mr. Cole if his employment is terminated
before July 16, 2010 due to events outside of his control.&#160;&#160;The
amounts payable upon his involuntary termination other than for cause after July
16, 2010 are intended to replace, in part, other executive compensation program
components, such as supplemental retirement income, which Mr. Cole is not
entitled to receive. See &#8220;Potential Payments upon Termination or
Change-in-Control&#8221; on page 17 for more information about the post-termination
payment terms of Mr. Cole&#8217;s employment agreement.</font></div>
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      </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">13</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Supplemental
Retirement Income</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The named
executive officers, other than Mr. Cole and Mr. Young, and certain other senior
executives participate in the Company&#8217;s Supplemental Retirement Income Plan
(&#8220;SRIP&#8221;).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The SRIP is
an unfunded plan that provides a monthly supplemental retirement benefit equal
to 40% of the executive&#8217;s average monthly base salary (plus bonuses) for the 60
consecutive month period preceding his termination of employment.&#160;&#160;The
benefit is paid for 15 years following an executive&#8217;s retirement.&#160;&#160;The
objective of the plan is to retain talented executives for the balance of their
careers.&#160;&#160;As a general matter, an executive is not entitled to receive
any benefit under the SRIP unless he remains continuously employed with the
Company to age 60.&#160;&#160;At age 60, the executive becomes vested in 75% of
his accrued benefits and then in 5% increments each following year until he
becomes 100% vested at age 65, assuming the executive remains continuously
employed.&#160;&#160;For competitive reasons, Mr. Spece&#8217;s SRIP benefit vests in
its entirety if he remains employed with the Company to age 60.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">In addition,
each participant&#8217;s benefit in the SRIP will become fully vested, regardless of
age, and the present value of those benefits will be paid in a lump sum upon a
change in control of the Company.&#160;&#160;The Committee believes that this
provision further enhances retention by providing assurance to executives that
the benefits promised under the SRIP will be paid if the Company comes under new
ownership or control.&#160;&#160;The amounts that the named executive officers
have accumulated thus far under the SRIP and certain additional information
concerning the SRIP is contained in the &#8220;Pension Benefits&#8221; table on page 16 and
&#8220;Potential Payments upon Termination or Change-in-Control&#8221; on page
17.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Executive
Life Insurance Program</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
also maintains an executive life insurance program for the named executive
officers, other than Mr. Cole and Mr. Young.&#160;&#160;Like the SRIP, the life
insurance program is designed to retain executives through their careers by
providing life insurance coverage through age 65, under which the executive may
designate a death beneficiary.&#160;&#160;The death benefit is $1.5 million if
the executive dies on or before his 60th
birthday, and $1 million if he dies after his 60th
birthday but on or before his 65th
birthday. This coverage terminates immediately once the executive reaches age 65
or if the executive leaves the Company for any reason other than death before
reaching age 65.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Other
Benefits</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
maintains a tax-qualified Section 401(k) savings plan for all of its eligible
employees, including the named executive officers.&#160;&#160;The plan provides
for Company matching contributions, which are fully-vested upon
contribution.&#160;&#160;The Company&#8217;s other benefit plans include health care
and dental insurance, group life insurance, disability insurance and tuition
assistance. The named executive officers participate in the plans on the same
basis as other eligible employees.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company&#8217;s
employee stock ownership plan was terminated on January 27, 2007, prior to the
start of the 2008 fiscal year.&#160;&#160;Unallocated shares of Company stock
held in the ESOP following its termination were allocated in a uniform manner to
the accounts of the ESOP participants, including the named executives, during
the 2008 fiscal year in accordance with the terms of the ESOP and the
requirements of the Internal Revenue Code.&#160;&#160;Because the ESOP was a
tax-qualified plan in which a broad group of the Company&#8217;s employees were
eligible to participate, the Committee did not take into account the additional
share allocation within the ESOP in setting or approving executive compensation
levels for fiscal year 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Tax
Implications of Executive Compensation</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Section
162(m) of the Internal Revenue Code limits deductibility of compensation in
excess of $1&#160;million paid to the Company&#8217;s Chief Executive Officer and to
each of the other three highest paid executive officers (not including the
Company&#8217;s principal financial officer) unless this compensation qualifies as
&#8220;performance-based.&#8221;&#160;&#160;Under the applicable tax regulations, taxable
compensation payable</font></div>
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        </div>
      </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">14</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
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        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">under the
long-term incentive grants that the Committee awarded this year should qualify
as performance-based.&#160;&#160;The Company expects that other awards that the
Committee may make in the future under the Company&#8217;s shareholder-approved Stock
Incentive Plan will also qualify as performance-based.&#160;&#160;However, the
Committee is not precluded from making payments or granting awards to retain and
motivate key executives that do not qualify for tax deductibility under section
162(m).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Other
Matters</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Committee
has not adopted Company stock ownership requirements or guidelines because
executives have traditionally had a substantial portion of their retirement
benefits invested in Company stock through the ESOP and because the Committee
has not awarded stock-based compensation outside the ESOP.&#160;&#160;The
Committee may consider adopting such policies in the future.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Summary
Compensation Table</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table sets forth the compensation for services in all capacities to the Company
for the fiscal year ended February 3, 2008 of:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">any
      person who served as the Company&#8217;s principal executive officer or
      principal financial officer during fiscal
2008;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">the
      next three most highly compensated executive officers of the Company who
      were serving as executive officers at the end of fiscal 2008;
      and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">two
      additional officers who served as executive officers of the Company during
      fiscal 2008, but who were not executive officers at the end of fiscal
      2008.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Each of these
individuals is referred to as a &#8220;named executive officer&#8221; and collectively they
are referred to as the &#8220;named executive officers.&#8221;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
      <div align="left">
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="bottom" width="17%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Name
      and Principal Position</font></div>
              </td>
              <td valign="bottom" width="5%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Year</font></div>
              </td>
              <td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Salary</font></div>
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
              <td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Bonus
      (1)</font></div>
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
              <td valign="bottom" width="9%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Non-Equity
      Incentive Plan Compensation (2)</font></div>
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
              <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Change
      in Pension Value and Non- Qualified Deferred Compensation Earnings
      (3)</font></div>
                <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
              <td valign="bottom" width="8%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">All
      Other Compensation (4)</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
              <td valign="bottom" width="8%" style="BORDER-BOTTOM: black 0.5pt solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Total</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">($)</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr., Chairman, President and CEO</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$299,405</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$18,756</font></div>
              </td>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$149,968</font></div>
              </td>
              <td align="left" valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$114,006</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$158,073</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$740,208</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder, Executive Vice President &#8211; Finance and Administration and
      CFO</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;259,762</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;16,257</font></div>
              </td>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;129,972</font></div>
              </td>
              <td align="left" valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;195,588</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;332,218</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;933,797</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Alan D.
      Cole, Executive Vice President &#8211; Upholstery (5)</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">145,116</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;70,000</font></div>
              </td>
              <td valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      &#160;4,468</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">219,584</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece, Executive Vice President &#8211; Merchandising and
    Design</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">241,601</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      5,999</font></div>
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              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;119,974</font></div>
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              <td align="left" valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;175,211</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">194,915</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">737,700</font></div>
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            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm, Senior Vice President &#8211; Sales</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">215,630</font></div>
              </td>
              <td valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      99,979</font></div>
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              <td align="left" valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;127,732</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">195,911</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">639,252</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long, Jr., Senior Vice President &#8211; Merchandising and
    Design</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">194,884</font></div>
              </td>
              <td valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      99,979</font></div>
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              <td align="left" valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;&#160;97,249</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">332,514</font></div>
              </td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">724,626</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">C.
      Scott Young, Senior Vice President &#8211; Merchandising and Product Development
      &#8211; Bradington-Young, LLC (6)</font></div>
              </td>
              <td valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">2008</font></div>
              </td>
              <td align="left" valign="top" width="7%">
                <div style="TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">259,049</font></div>
              </td>
              <td valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;129,972</font></div>
              </td>
              <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      85,923</font></div>
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              <td align="left" valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">474,944</font></div>
              </td>
            </tr>
        </table>
      </div>_____________</div>
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      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(1)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">For
      Messrs. Toms, Ryder and Spece, this amount is the individual performance
      portion of the amount paid under the annual cash incentive plan. For Mr.
      Cole, this amount is the annual bonus under his employment agreement. For
      discussion regarding the terms of the annual cash incentive plan see
      &#8220;Compensation Discussion and Analysis,&#8221; which begins on page
      7.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">15</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(2)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Represents
      the base incentive portion of the amount paid under the annual cash
      incentive plan. For discussion regarding the terms of the annual cash
      incentive plan see &#8220;Compensation Discussion and Analysis,&#8221; which begins on
      page 7.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(3)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Represents
      the change in the present value of the accumulated benefit under the
      Supplemental Retirement Income Plan during the most recent fiscal
      year.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(4)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">All
      Other Compensation for fiscal 2008 includes premiums paid for insurance
      polices that support the executive life insurance program and
      contributions to the Company&#8217;s employee stock ownership
    plan:</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="2" nowrap valign="bottom">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">ELIP</font></font></div>
            </td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="2" nowrap valign="bottom">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; FONT-STYLE: normal; TEXT-DECORATION: underline">ESOP</font></font></div>
            </td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">28,515</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">126,714</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">15,819</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">312,700</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">21,799</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">169,490</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">42,185</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">149,572</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">12,617</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">315,748</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">C.
      Scott Young</font></div>
            </td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">68,923</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 20pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The ESOP
contributions include annual share allocations under the plan for fiscal 2008
and shares allocated to plan participants in connection with the termination of
the ESOP at the end of fiscal 2007. The number of shares allocated to a plan
participant upon termination of the ESOP was based on the participant&#8217;s plan
account balance, which was primarily a reflection of the participant&#8217;s years of
service with the Company.</font></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(5)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
      Company has entered a three-year employment agreement with Mr. Cole that
      expires July 16, 2010. In addition to provisions addressing Mr. Cole&#8217;s
      salary, annual bonus and payments to be made to him upon his death,
      disability or termination of employment, the agreement also includes
      customary provisions addressing the treatment of confidential information,
      non-competition with the Company&#8217;s upholstery business and
      non-solicitation of customers, vendors, suppliers and employees. For
      additional discussion regarding the terms of Mr. Cole&#8217;s agreement see
      &#8220;Compensation Discussion and Analysis,&#8221; which begins on page 7 and
      &#8220;Potential Payments upon Termination or Change-in-Control,&#8221; which begins
      on page 17.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(6)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Young served as the President and Chief Executive Officer of
      Bradington-Young through January 31,
2008.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Grants
of Plan-Based Awards</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table sets forth information concerning individual grants of plan-based awards
made during the fiscal 2008 to the named executive officers.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="bottom" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Name</font></font></div>
            </td>
            <td valign="bottom" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Estimated
      Possible Payouts Under Non-Equity Incentive Plan Awards</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Target
      (1)($)</font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr.</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$149,968</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">129,972</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">119,974</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">99,979</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long, Jr.</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">99,979</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="42%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">C.
      Scott Young</font></div>
            </td>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">129,972</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" colspan="2" valign="top" width="67%" style="PADDING-LEFT: 0pt">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)&#160;
      Represents the base incentive portion of amounts actually paid for fiscal
      2008 under the annual cash incentive plan, which were based on the amount
      by which the Company&#8217;s pre-tax income exceeded $12.5 million in fiscal
      2008. These amounts are reported under &#8220;Non-Equity Incentive Plan
      Compensation&#8221; in the Summary Compensation Table. For additional discussion
      regarding the annual cash incentive plan, see &#8220;Compensation Discussion and
      Analysis,&#8221; which begins on page 7.</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="2" valign="top" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Pension
Benefits</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="bottom" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Name</font></font></div>
            </td>
            <td valign="bottom" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Plan</font></div>
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Name</font></font></div>
            </td>
            <td valign="bottom" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Present
      Value of</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Accumulated Benefit
      ($) (1)</font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr.</font></div>
            </td>
            <td valign="top" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">SRIP</font></div>
            </td>
            <td align="left" valign="top" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$392,071</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder</font></div>
            </td>
            <td valign="top" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">SRIP</font></div>
            </td>
            <td align="left" valign="top" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">672,634</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece</font></div>
            </td>
            <td valign="top" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">SRIP</font></div>
            </td>
            <td align="left" valign="top" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">719,557</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm</font></div>
            </td>
            <td valign="top" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">SRIP</font></div>
            </td>
            <td align="left" valign="top" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">439,274</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="40%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long, Jr.</font></div>
            </td>
            <td valign="top" width="6%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">SRIP</font></div>
            </td>
            <td align="left" valign="top" width="20%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">334,441</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="67%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Assumes
      a discount rate of 5.75%, based on the Moody's Aa Composite Bond Rate for
      January 2008 (rounded to the nearest 25 basis points), and a 4% annual
      increase in monthly base salary plus bonus through the normal retirement
      date for each executive.</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
          </tr>
      </table>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">16</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
provides a supplemental retirement income plan (&#8220;SRIP&#8221;) for Messrs. Toms, Ryder,
Spece, Harm and Long, as well as certain other executives of the Company. This
plan provides a monthly supplemental retirement benefit equal to 40% of the
executive&#8217;s final average monthly compensation, payable for a 15-year period
following the executive&#8217;s termination of employment. Final average monthly
compensation means the average monthly base salary and any bonuses paid to the
executive during the five-year period before his termination of employment with
the Company. An executive becomes vested in 75% of the monthly supplemental
benefit if the executive remains continuously employed with the Company until
reaching age 60, and is vested in additional 5% increments for each subsequent
year that the executive remains continuously employed with the Company.
Executives who remain continuously employed to age 65 become fully vested in
their monthly supplemental benefit. However, Mr. Spece will become fully vested
if he remains continuously employed until he reaches age 60. Mr. Ryder, age 60,
is eligible for early retirement at 75% of his monthly supplemental benefit. The
monthly retirement benefit for each participant in the plan, regardless of age,
will become fully vested and the present value of all plan benefits will be paid
to participants in a lump sum upon a change in control of the Company (as
defined in the plan). Additional discussion regarding the SRIP can be found
under &#8220;Compensation Discussion and Analysis&#8221; above.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Potential
Payments upon Termination or Change-in-Control</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Supplemental
Retirement Income Plan</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Upon a
change-in-control of the Company each SRIP participant, regardless of age, will
become fully vested and receive the present value of his plan benefit in a lump
sum. A &#8220;change-in-control&#8221; includes, subject to certain exceptions:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">acquisition,
      other than from the Company, of 40% of the outstanding shares, or 40% of
      the combined voting power, of the Company&#8217;s Common
  Stock;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">individuals
      who constitute the incumbent Board, and any director whose election or
      nomination for election is approved by a majority of the incumbent Board,
      ceasing to constitute at least a majority of the
  Board;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">approval
      by the Company&#8217;s shareholders of a reorganization, merger or consolidation
      if the owners of the Company&#8217;s Common Stock immediately before the
      transaction do not own more than 50% of the outstanding shares of common
      stock and the combined voting power of the outstanding voting securities
      of the corporation resulting from the transaction;
  or</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">approval
      by the Company&#8217;s shareholders of a complete liquidation or dissolution of
      the Company or a sale or other disposition of all or substantially all of
      the Company&#8217;s assets.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The benefits
that each participating named executive officer could receive under the SRIP are
described further under &#8220;Pension Benefits&#8221; above.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table provides the estimated payment each named executive officer would have
received under the SRIP if a change-in-control had occurred on the last day of
fiscal 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Change-in-Control &#8211;
      SRIP (1)</font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="45%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr.</font></div>
            </td>
            <td align="left" valign="middle" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$2,791,611</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="45%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder</font></div>
            </td>
            <td align="left" valign="middle" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;1,843,243</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="45%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece</font></div>
            </td>
            <td align="left" valign="middle" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;1,774,645</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="45%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm</font></div>
            </td>
            <td align="left" valign="middle" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;1,682,713</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="45%">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long</font></div>
            </td>
            <td align="left" valign="middle" width="22%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;1,719,236</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="2" valign="middle" width="67%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Calculated
      based on historical average salary and bonus amounts for the five-year
      period ended February 3, 2008 and assuming a discount rate equal to 120%
      of the short-term (3.71%), mid-term (4.78%) or long-term (5.29%)
      applicable federal rate for the month of January 2008 depending on the
      number of years remaining to the participant&#8217;s retirement at age
      65.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">17</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">If a SRIP
participant were to die while employed by the Company and before payment of his
vested benefit begins, his beneficiary will receive a death benefit equal to the
participant&#8217;s vested benefit, which would be paid in 180 equal monthly payments.
At the end of fiscal 2008, Mr. Ryder, age 60, was the only named executive
officer who had a vested benefit under the SRIP. Mr. Ryder was vested in 75% of
his SRIP benefit at that date. If Mr. Ryder had died on the last day of fiscal
2008 his beneficiary would have been entitled to receive 180 monthly payments in
the amount of $8,278.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Executive
Life Insurance Program</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Under the
Company&#8217;s executive life insurance program, the death benefit is $1.5 million if
the executive dies on or before his 60th
birthday, and $1&#160;million if he dies after his 60th
birthday but on or before his 65th
birthday. The beneficiary for each of Messrs. Toms, Spece, Harm and Long would
have received a lump sum payment of $1.5 million, and the beneficiary for Mr.
Ryder would have received $1&#160;million, if, in each case, he had died on the
last day of fiscal 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-STYLE: italic; FONT-FAMILY: Arial Narrow">Alan
Cole Employment Agreement</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr. Cole
would receive payments under his employment agreement in connection with his
death and upon termination of his employment without cause. If Mr. Cole were to
die during the term of his agreement he would receive his salary and bonus,
prorated through the date of his death. If Mr. Cole is terminated without
cause:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">during
      the term of his agreement, he would receive, while living, (1) his then
      current salary for 12&#160;months and (2) an annual bonus for 12 months or
      the remaining term of the agreement, whichever is shorter;
    or</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">after
      July 16, 2010, when his agreement expires, he would receive, while living,
      his then current salary for 12
months.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">For purposes
of Mr. Cole&#8217;s agreement, &#8220;cause&#8221; means:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">fraud,
      dishonesty, theft, embezzlement or misconduct injurious to the Company or
      any of its affiliates;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">conviction
      of, or entry of a plea of guilty or <font style="DISPLAY: inline; FONT-STYLE: italic">nolo contendere</font> to, a
      crime that constitutes a felony or other crime involving moral
      turpitude;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">competition
      with the Company or any of its
affiliates;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">unauthorized
      use of any trade secrets of the Company or any of its affiliates or
      confidential information (as defined in the
  agreement);</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">violation
      of any policy, code or standard of ethics generally applicable to the
      Company&#8217;s employees;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">a
      material breach of fiduciary duties owed to the
  Company;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">excessive
      and unexcused absenteeism unrelated to a disability;
  or,</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">after
      written notice and a reasonable opportunity to cure, gross neglect of
      assigned duties.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr. Cole
would not receive any post-termination payments, other than his salary through
the termination date, upon termination for cause.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">18</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table provides estimates of the aggregate payments that Mr. Cole would receive
under his employment agreement upon his death and termination without cause
assuming, in each case, that the triggering event had occurred on the last day
of fiscal 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="47%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Death</font></font></div>
            </td>
            <td valign="bottom" width="12%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="TEXT-DECORATION: underline">Termination <font style="DISPLAY: inline; TEXT-DECORATION: underline">Without&#160;Cause</font></font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Alan D.
      Cole
      (1)&#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;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
            </td>
            <td valign="top" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$70,000</font></div>
            </td>
            <td valign="top" width="12%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$344,560</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="67%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">All
      amounts are calculated based on Mr. Cole&#8217;s annual salary of $274,560 as of
      the last day of fiscal 2008 and his bonus for fiscal 2008, which was
      $70,000.</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">EQUITY
COMPENSATION PLAN INFORMATION</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table summarizes information about the Company&#8217;s equity compensation plans as of
February 3, 2008:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="bottom" width="17%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Plan
      Category</font></font></div>
            </td>
            <td valign="bottom" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Number
      of securities to be issued upon exercise of outstanding options, warrants
      and rights</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></font></div>
            </td>
            <td valign="bottom" width="19%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Weighted-average
      exercise price of outstanding options, warrants and rights</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></font></div>
            </td>
            <td valign="bottom" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Number
      of securities remaining available for future issuance under equity
      compensation plans (excluding securities reflected in column
      (a))</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="17%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Equity
      compensation plans approved by security holders (1)</font></div>
            </td>
            <td valign="middle" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0</font></div>
            </td>
            <td valign="middle" width="19%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">N/A</font></div>
            </td>
            <td valign="middle" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">736,723</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="17%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Equity
      compensation plans not approved by security holders</font></div>
            </td>
            <td valign="middle" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">None</font></div>
            </td>
            <td valign="middle" width="19%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">None</font></div>
            </td>
            <td valign="middle" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">None</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="17%">
              <div style="DISPLAY: block; MARGIN-LEFT: 30pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Total</font></div>
            </td>
            <td valign="middle" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">0</font></div>
            </td>
            <td valign="middle" width="19%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">N/A</font></div>
            </td>
            <td valign="middle" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">736,723</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top">
            <td style="WIDTH: 13.7pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">&#160;
      </font></div>
            </td>
            <td>
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">___________</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top">
            <td style="WIDTH: 40pt">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(1)</font></div>
            </td>
            <td>
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Shares
      allocable to incentive awards granted under the Company&#8217;s 2005 Stock
      Incentive Plan that expire, are forfeited, lapse or otherwise terminate or
      are cancelled will be added to the shares available for incentive awards
      under the plan.&#160;&#160;Any shares covered by a stock appreciation
      right will be counted as used only to the extent shares are actually
      issued to a participant when the stock appreciation right is
      exercised.&#160;&#160;In addition, any shares retained by the Company in
      satisfaction of a participant&#8217;s obligation to pay applicable withholding
      taxes with respect to any incentive award and any shares of Common Stock
      covered by an incentive award that is settled in cash will be added to the
      shares available for incentive awards under the
  plan.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">On January 2,
2003, the Company, through its wholly owned subsidiary B-Y Acquisition LLC,
acquired substantially all of the assets of Bradington-Young, LLC, a North
Carolina-based manufacturer of upscale leather reclining chairs, executive desk
chairs and motion and stationary upholstery in the upper-medium to high-end
price niches (&#8220;Bradington-Young NC&#8221;). Following the acquisition, B-Y Acquisition
LLC changed its name to Bradington-Young, LLC (&#8220;Bradington-Young VA&#8221;). C. Scott
Young, an owner and manager of Bradington-Young NC, served as the President and
Chief Executive Officer of Bradington-Young VA through January 31, 2008 and was
deemed to be an executive officer of the Company. In addition, Craig S. Young
and Clark S. Young, Mr. Young&#8217;s brothers, were also owners of Bradington-Young
NC. Craig S. Young now serves as Senior Vice President of Sales of
Bradington-Young VA and received $251,288 in salary and bonus for fiscal 2008.
Clark S. Young serves as an independent commissioned sales representative for
the Company on the same terms as the Company&#8217;s other independent commissioned
sales representatives. He earned $424,150 in commissions in fiscal
2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company&#8217;s
Audit Committee is responsible under its charter for reviewing and approving any
related party transactions. For this purpose a &#8220;related party transaction&#8221;
includes any transaction, arrangement or relationship in which an executive
officer, director, director nominee or 5% shareholder of the Company, or their
immediate family members, has a direct or indirect material interest that would
be required to be disclosed in the Company&#8217;s proxy statement under applicable
rules of the Securities and Exchange Commission. The relationships between the
Company and the brothers of C. Scott Young described in the previous paragraph
were originally entered in January 2003, in connection with the</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">19</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">acquisition
of the assets of Bradington-Young NC, which pre-dated the Audit Committee&#8217;s
responsibility for reviewing and approving related party
transactions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
Securities Exchange Act of 1934 requires the Company&#8217;s executive officers and
directors, and any persons owning more than 10% of the Common Stock, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission. Based solely on its review of the copies it has received of the
Forms 3, 4 and 5 filed during or with respect to the fiscal year ended February
3, 2008, and written representations from the Company&#8217;s directors and executive
officers and certain other reporting persons that no Forms&#160;5 were required
to be filed by those persons for that fiscal year, the Company believes that all
executive officers, directors and 10% shareholders complied with those filing
requirements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table sets forth information with respect to the beneficial ownership of the
Company&#8217;s Common Stock as of May 15, 2008 by:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">each
      shareholder known by the Company to be the beneficial owner of more than
      5% of its outstanding Common Stock;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">each
      director and director nominee;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">each
      named executive officer; and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">all
      directors and executive officers as a
group.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="bottom">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Name</font></font></div>
            </td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="2" nowrap valign="bottom">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Amount
      and Nature Of<br><font style="DISPLAY: inline; TEXT-DECORATION: underline">Beneficial
      Ownership</font></font></div>
            </td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="2" nowrap valign="bottom">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Percent</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Of
      Class</font></font></div>
            </td>
            <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Hooker
      Furniture Corporation Employee Stock Ownership Plan Trust
    (1)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">1,707,968</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(1)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">14.8</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">%</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Franklin
      Resources, Inc. (2)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">1,861,400</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(2)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">16.2</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">NWQ
      Investment Management Company, LLC (3)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">1,401,825</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(3)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">12.2</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paradigm
      Capital Management, Inc. (4)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">716,093</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(4)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 5.65pt"></font>6.2</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Barclays
      Global Investors, NA (5)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">637,152</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(5)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 5.65pt"></font>5.5</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Paul B.
      Toms, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">329,542</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(6)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 5.65pt"></font>2.9</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">E.
      Larry Ryder</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">42,286</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(7)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      P. Long, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">39,447</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(8)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Michael
      P. Spece</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">18,497</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(9)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">W.
      Christopher Beeler, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 15.25pt"></font>18,018</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Raymond
      T. Harm</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">16,099</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(10)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Henry
      G. Williamson, Jr.</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">6,617</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(11)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">C.
      Scott Young</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">6,366</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(12)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">John L.
      Gregory, III</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 22.1pt"></font>5,184</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Mark F.
      Schreiber</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 22.1pt"></font>3,446</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">David
      G. Sweet</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">1,765</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(13)</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">*</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Alan D.
      Cole</font></div>
            </td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="bottom" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 10pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">All
      directors and executive officers as a group (11 persons)</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">441,454</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(14)</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font id="TAB1" style="MARGIN-LEFT: 5.65pt"></font>3.8</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">%</font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">*&#160;&#160;&#160;&#160;&#160;&#160;Less
than one percent.</font></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(1)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
      principal business address for GreatBanc Trust Company, the trustee (the
      &#8220;ESOP Trustee&#8221;) of the Hooker Furniture Corporation Employee Stock
      Ownership Plan Trust (the &#8220;ESOP Trust&#8221;), is 1301 West 22nd
      Street, Suite&#160;800, Oak Brook, Illinois 60523. The Company terminated
      the ESOP effective January 26, 2007. The 1,707,968 shares of Common Stock
      held by the ESOP Trust have been allocated to plan participants&#8217;
      accounts.&#160;&#160;Those shares will be voted by the ESOP Trustee in
      accordance with the directions of the participants, unless
    no</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">20</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">directions
      are received. The ESOP Trustee has disposition power with respect to
      shares owned by the ESOP Trust; however, the ESOP Trustee may dispose of
      ESOP shares only at the direction of a committee appointed by the Company.
      That committee consists of the following officers of the Company: Paul B.
      Toms,&#160;Jr., E. Larry Ryder and Anne Jacobsen (Director-Human
      Resources).</font></font></td>
          </tr>
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">(2)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">The
      beneficial ownership information for Franklin Resources, Inc. is based
      upon a Schedule 13G/A filed with the SEC on February 5, 2008. Franklin
      Resources, its subsidiary Franklin Advisory Services, LLC, and Charles B.
      Johnson and Rupert H. Johnson, Jr. (holders of more than 10% of the common
      stock of Franklin Resources), reported holdings of the Company&#8217;s Common
      Stock beneficially owned by one or more open or closed-end investment
      companies or other managed accounts that are investment management clients
      of subsidiaries of Franklin Resources. Franklin Resources reported that
      Franklin Advisory Services, LLC has sole voting power for 1,815,400 shares
      and sole disposition power for all 1,861,400 shares. The principal
      business address of Franklin Resources, Inc. is One Franklin Parkway, San
      Mateo, California 94403-1906.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(3)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
      beneficial ownership information for NWQ Investment Management Company,
      LLC is based upon a Schedule 13G/A filed with the SEC on February 14,
      2008. The Schedule 13G/A indicates that NWQ Investment Management Company
      has sole disposition power with respect to all 1,401,825 of such shares
      and sole voting power with respect to 1,209,925 of such shares. The
      principal business address of NWQ Investment Management Company is 2049
      Century Park East, 16th
      Floor, Los Angeles, California
90067.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(4)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
      beneficial ownership information for Paradigm Capital Management, Inc. is
      based upon a Schedule 13G/A filed with the SEC on February 14, 2008. The
      Schedule 13G/A indicates that Paradigm Capital Management has sole voting
      and disposition power with respect to all 716,093 of such shares and that
      all such shares are owned by advisory clients of Paradigm Capital
      Management. The principal business address of Paradigm Capital Management
      is Nine Elk Street, Albany, New York
12207.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(5)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
      beneficial ownership information for Barclays Global Investors, NA is
      based upon a Schedule 13G filed with the SEC on February 5, 2008. Barclays
      Global Investors indicated that it, along with certain of its affiliates,
      holds the shares in trust accounts for the economic benefit of the
      beneficiaries of those accounts. The Schedule 13G indicates that Barclays
      Global Investors and its affiliates have sole voting power with respect to
      585,603 of the shares and sole dispositive power with respect to all
      637,152 of them. The principal business address of Barclays Global
      Investors is 45 Fremont Street, San Francisco, California
      94105.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(6)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Toms has sole voting and disposition power with respect to 56,440 shares
      and shared voting and disposition power with respect to 252,968 shares.
      Mr. Toms also has sole voting power with respect to 20,134 shares held by
      the ESOP Trust. Mr. Toms also may be deemed to share disposition power
      with respect to the shares held by the ESOP Trust (see note (1)
      above).</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(7)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Ryder has sole voting and disposition power with respect to 6,600 shares
      and sole voting power with respect to 35,686 shares held by the ESOP
      Trust. Mr. Ryder also may be deemed to share disposition power with
      respect to the shares held by the ESOP Trust (see note (1)
      above).</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(8)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Long has: sole voting and disposition power with respect to 1,612 shares;
      sole voting power with respect to 36,073 shares held by the ESOP Trust;
      and shared voting and disposition power with respect to 1,762
      shares.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(9)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Spece has sole voting power with respect to 18,497 shares held by the ESOP
      Trust.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(10)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Harm has sole voting power with respect to 16,099 shares held by the ESOP
      Trust.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(11)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Williamson has sole voting and disposition power with respect to 3,117
      shares and shared voting and disposition power with respect to 3,500
      shares.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(12)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Young has sole voting power with respect to 6,366 shares held by the ESOP
      Trust.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(13)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Mr.
      Sweet has sole voting and disposition power with respect to 1,765 shares
      and shared voting and disposition power with respect to 800
      shares.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 20pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(14)&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Messrs.
      Toms and Ryder, each of whom is an executive officer, may be deemed to
      share disposition power with respect to the shares held by the ESOP Trust
      (see note (1) above).</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">21</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Audit
Committee of the Board of Directors has selected the firm of KPMG LLP (&#8220;KPMG&#8221;)
as the Company&#8217;s independent registered public accounting firm for the fiscal
year ending February 1, 2009. KPMG has served as the Company&#8217;s independent
registered public accounting firm since fiscal 2003.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Representatives
of KPMG are expected to be present at the Annual Meeting. They will have the
opportunity to make a statement if they desire to do so and are expected to be
available to respond to appropriate questions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Principal
Accountant Fees and Services</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The following
table presents fees billed to the Company by KPMG for the:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 75pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">fiscal
      year ended February&#160;3, 2008,</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 75pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">two-month
      transition period ended January 28, 2007;
and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 75pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">fiscal
      year ended November 30, 2006.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="bottom" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="3" nowrap valign="bottom" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Fiscal</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">2008</font></font></div>
            </td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="2" nowrap valign="bottom" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Two-Month</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Transition</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Period</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">2007</font></font></div>
            </td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td colspan="3" nowrap valign="bottom" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Fiscal</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; TEXT-DECORATION: underline">2006</font></font></div>
            </td>
          </tr>
          <tr>
            <td valign="bottom" width="67%">
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      Fees</font></div>
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            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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            <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">640,000</font></td>
            <td align="left" nowrap valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="9%">
              <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">109,000</font></div>
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            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">$</font></td>
            <td align="right" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">633,000</font></td>
            <td align="left" nowrap valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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          <tr>
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      Fees</font></div>
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            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">74,000</font></td>
            <td align="left" nowrap valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">12,000</font></td>
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          <tr>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Tax
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            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">56,000</font></td>
            <td align="left" nowrap valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">12,000</font></td>
            <td align="left" nowrap valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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          <tr>
            <td valign="bottom" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">All
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            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">None</font></td>
            <td align="left" nowrap valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">None&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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          <tr>
            <td valign="bottom" width="67%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;
      </font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="right" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
            <td align="left" nowrap valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">&#160;</font></td>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-STYLE: italic">Audit Fees</font> include KPMG&#8217;s
fees for audit services, including the audits of the Company&#8217;s annual financial
statements and internal control over financial reporting, review of the
Company&#8217;s quarterly financial statements included in its Forms 10-Q and review
of SEC filings.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-STYLE: italic">Audit-Related Fees</font> include
fees billed by KPMG during the periods reported for audit-related services not
otherwise reported in the preceding paragraph. For fiscal 2008, audit-related
matters included the adoption of new accounting pronouncements, acquisitions and
the ESOP termination.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-STYLE: italic">Tax Fees</font> include fees billed
by KPMG for federal, state and international tax planning and compliance
services and advice. For fiscal 2008, tax matters included consulting in
connection with an IRS audit and international tax planning.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Audit
Committee Preapproval of Audit and Non-Audit Services</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Audit
Committee is required to preapprove all audit and permitted non-audit services
provided by KPMG, the Company&#8217;s auditing firm. The Audit Committee has
authorized the Committee Chair to preapprove those services between meetings of
the Committee up to $15,000 during any fiscal quarter and $50,000 during any
fiscal year. The Committee Chair must report any preapproval to the Committee at
its next meeting. Less than 1% of aggregate audit-related fees and tax fees were
approved by the Committee pursuant to the <font style="DISPLAY: inline; FONT-STYLE: italic">de&#160;minimus</font> waiver of the
pre-approval requirement set forth in Regulation&#160;S-X
2.01(c)(7)(i)(C).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">OTHER
BUSINESS</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Management
knows of no other business that will be presented for consideration at the
Annual Meeting, but should any other matters be brought before the meeting, it
is intended that the persons named in the accompanying proxy will vote that
proxy at their discretion.</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">22</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">ADDITIONAL
INFORMATION</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Shareholder
Proposals for 2009 Annual Meeting</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The Company
plans to hold the 2009 Annual Meeting on June 4, 2009. All proposals submitted
by shareholders for presentation at the 2009 Annual Meeting must comply with the
Securities and Exchange Commission&#8217;s rules regarding shareholder proposals. In
addition, the Company&#8217;s Bylaws (Article II, Section&#160;1) provide that for
business to be properly brought before an Annual Meeting by a shareholder, in
addition to other applicable requirements, the shareholder must give timely
written notice to the Secretary at the principal office of the Company. To
submit business at the 2009 Annual Meeting, the notice must be received no later
than February 3, 2009. The shareholder&#8217;s notice must include:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
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      name and address of the shareholder, as they appear on the Company&#8217;s stock
      transfer books;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
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            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
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      number of shares of stock of the Company beneficially owned by the
      shareholder;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
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      representation that the shareholder is a record holder at the time the
      notice is given and intends to appear in person or by proxy at the meeting
      to present the business specified in the
notice;</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
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      description of the business desired to be brought before the meeting,
      including the complete text of any resolutions to be presented and the
      reasons for wanting to conduct such business;
  and</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">
          <tr valign="top">
            <td align="right" style="WIDTH: 55pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 9pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">any
      interest that the shareholder may have in such
  business.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The proxies
for the 2009 Annual Meeting will have discretionary authority to vote on any
matter that properly comes before the meeting if the shareholder has not
provided written notice before April 19, 2009.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">A proposal
that any shareholder desires to have included in the proxy statement for the
2009 Annual Meeting of shareholders must be received by the Company no later
than February 3, 2009.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Shareholder
Communications</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">Shareholders
may send written communications to the Board of Directors c/o Secretary, Hooker
Furniture Corporation, P.O. Box 4708, Martinsville, Virginia
24115-4708.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 20pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font id="TAB1" style="MARGIN-LEFT: 216.1pt"></font>By Order of the Board of
Directors,</font></div>
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Sherwood<br>&#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;&#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;
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2008</font></div>
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PROXY</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">HOOKER
FURNITURE CORPORATION</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">For
the Annual Meeting of Shareholders called for June 30, 2008</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
undersigned hereby appoints Paul B. Toms, Jr. and E. Larry Ryder, or either of
them, the attorneys, agents and proxies of the undersigned, with full power of
substitution, to vote all the shares of common stock of Hooker Furniture
Corporation that the undersigned is entitled to vote at the Annual Meeting of
Shareholders of the Company to be held at the Company&#8217;s corporate offices at 440
East Commonwealth Boulevard, Martinsville, Virginia, on June 30, 2008 at
2:00&#160;P.M., and all adjournments thereof, with all the powers the
undersigned would possess if then and there personally
present.&#160;&#160;Without limiting the general authorization and power hereby
given, the above proxies are directed to vote as instructed on the matters
below:</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(1) Election
of Directors</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 15pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font><font style="DISPLAY: inline; FONT-SIZE: 9pt"><font style="DISPLAY: inline;" face="Wingdings">o</font></font>&#160;</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold">FOR</font> all nominees listed
below&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
<font style="FONT-SIZE: 9pt;" face="Wingdings">o</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold">WITHHOLD AUTHORITY</font> to vote for
all<br>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;(except
as indicated otherwise <font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">below)&#160;&#160;&#160;</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;nominees
listed <font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">below</font><br>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font>&#160;<font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</font></div>
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Jr., W. Christopher Beeler, Jr., John L. Gregory, III, Mark F. Schreiber, David
G. Sweet and Henry G. Williamson, Jr.</font></div>
    </div>
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    <div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow"><font style="DISPLAY: inline; FONT-WEIGHT: bold">INSTRUCTIONS:</font>&#160;&#160;To
withhold authority to vote for any individual nominee, write such nominee&#8217;s name
in the space provided below.</font></div>
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    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">______________________________________________________________________________________________________________________________</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(2) In their
discretion the proxies are authorized to vote upon such other matters as may
come before the meeting or any adjournment thereof.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 40pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">All as more
particularly described in the Company&#8217;s Proxy Statement for the Annual Meeting
of Shareholders to be held on June 30, 2008, receipt of which is hereby
acknowledged.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">&#160;(Continued
and to be dated and signed on reverse side)</font></div><br>
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</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">(continued
from reverse side)</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">THIS
PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED
SHAREHOLDER.&#160;&#160;IF NO CHOICE IS SPECIFIED BY THE SHAREHOLDER, THIS PROXY
WILL BE VOTED &#8220;FOR&#8221; ALL PORTIONS OF ITEM (1) AND IN THE PROXIES&#8217; DISCRETION ON
ANY OTHER MATTERS COMING BEFORE THE MEETING.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: Arial Narrow">The
undersigned hereby revokes any proxy or proxies heretofore given to vote upon or
act with respect to such stock and hereby ratifies and confirms all that said
proxies, their substitutes or any of them may lawfully do by virtue
hereof.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div align="center">
      <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td width="25%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td width="25%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td width="33%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Please
      date this Proxy Card and sign your name exactly as it appears
      hereon.&#160;&#160;Where there is more than one owner, each should
      sign.&#160;&#160;When signing as an attorney, administrator, executor,
      guardian or trustee, please add your title as such.&#160;&#160;If executed
      by a corporation, this Proxy Card should be signed by a duly authorized
      officer.&#160;&#160;If executed by a partnership, please sign in
      partnership name by authorized persons.</font></div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Dated&#160;,
      ________________________________________2008<br>__________________________________________________<br>__________________________________________________</font></div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 9pt; FONT-FAMILY: arial narrow">Please
      promptly mark, sign, date and mail this Proxy Card in the enclosed
      envelope.&#160;&#160;No postage is
  required.</font></div>
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