RHODES INC, S-8, 1995-08-07

RHODES INC
S-8, 1995-08-07
FURNITURE STORES

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<PAGE> 1

As filed with the Securities and Exchange Commission on August 7, 1995
REGISTRATION NO. ________
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------

RHODES, INC.
(Exact Name of Registrant as Specified in Charter)

GEORGIA 58-0536190
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)

4370 PEACHTREE ROAD
ATLANTA, GEORGIA 30319
(404) 264-4600
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)

RHODES, INC. EMPLOYEES' SAVINGS PLAN
(Full Title of Plan)

JOEL H. DUGAN
SENIOR VICE PRESIDENT
FINANCE AND ADMINISTRATION
4370 PEACHTREE ROAD
ATLANTA, GEORGIA 30319
(404) 264-4600
(Name, address, including zip code, and telephone
number, including area code, of agent for service)

COPIES TO:
E. WILLIAM BATES, II
KING & SPALDING
120 WEST 45TH STREET
NEW YORK, NEW YORK 10036
(212) 556-2100

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=======================================================================================================
Title of Each Proposed Proposed
Class of Amount Maximum Maximum Amount of
Securities to to be Offering Price Aggregate Registration
be Registered Registered Per Share(1) Offering Price Fee
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
without par value(2) 50,000 shares $10.50 $525,000 $181.03

-------------------------------------------------------------------------------------------------------
</TABLE>

(1) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(h) of the Securities Act of 1933, based upon
the average of the high and low reported sales price of the
Registrant's common stock on the New York Stock Exchange.
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this registration statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the employee benefit plan
described herein.
<PAGE> 2

Part I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Item 1. Plan Information.

Item 2. Registration Information and Employee Plan Annual Information.

Part II.

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Certain Documents by Reference.

The following documents filed by Rhodes, Inc. (the "Company or
the "Registrant") with the Securities and Exchange Commission are hereby
incorporated by reference into this Registration Statement:

(1) The Company's Annual Report on Form 10-K for the fiscal year
ended February 28, 1995;

(2) The Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended May 31, 1995; and

(3) The description of the Company's common stock, without par
value, contained in the Form 8-A Registration Statement filed
under the Exchange Act (File No. 1-9308), including any
amendment or report filed for the purposes of updating such
description.

All documents filed by the Company subsequent to the date of
this Registration Statement pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Exchange Act and prior to the filing of a post-effective amendment which
indicates that all securities offered hereunder have been sold or which
deregisters all such securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of such documents.

Item 4. Description of Securities.

Inapplicable.

Item 5. Interest of Named Experts and Counsel.

Inapplicable.

Item 6. Indemnification of Directors and Officers.

Incorporated by reference to Item 6 of the Registrant's
Registration Statement on Form S-8 (File No. 33-53969).

-1-
<PAGE> 3

Item 7. Exemptions from Registration Claimed.

Inapplicable.

Item 8. Exhibits.

Exhibit Description
------- -----------

4.1 Restated and Amended Articles of
Incorporation of Registrant
(incorporated by reference to
Exhibit 3.1 to the Registrant's
Registration Statement on Form S-1
(File No. 33-60962)).

4.2 Amended Bylaws of Registrant
(incorporated by reference to
Exhibit 3.2 to the Registrant's
Registration Statement on Form S-1
(File No. 33-60962)).

5.1 Opinion of King & Spalding.

23.1 Consent of Arthur Andersen LLP

23.2 Consent of King & Spalding (included
in Exhibit 5.1).

99.1 Rhodes, Inc. Employees' Savings
Plan, as amended.

The Registrant will submit or has submitted the Rhodes, Inc.
Employees' Savings Plan and any amendments thereto to the Internal Revenue
Service ("IRS") in a timely manner and has made or will make all changes
required by the IRS in order to qualify the Plan.

Experts

The consolidated financial statements and schedules
incorporated by reference in this Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are incorporated by reference herein in
reliance upon the authority of said firm as experts in giving said reports.
Future consolidated financial statements of the Company and the reports thereon
of Arthur Andersen LLP also will be incorporated by reference in this
Registration Statement in reliance upon the authority of that firm as experts
in giving those reports to the extent said firm has audited those financial
statements and consented to the use of their reports thereon.

Item 9. Undertakings.

(a) The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
Registration Statement:

(A) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;

(B) To reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the Registration
Statement; and

-2-
<PAGE> 4
(C) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;

provided, however, that paragraphs (a)(1)(A)
and (a)(1)(B) do not apply if the
Registration Statement is on Form S-3 or Form
S-8, and the information required to be
included in a post-effective amendment by
those paragraphs is contained in periodic
reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.

(2) That for purposes of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new Registration
Statement relating to the securities offered therein,
and the offering of such securities at that time
shall be deemed to be the initial bona fide offering
thereof.

(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.

(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's Annual Report
pursuant to Section 13(a) or 15(d) of the Securities Exchange
Act of 1934 (and, where applicable, each filing of an employee
benefit plan's Annual Report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by
reference in the Registration Statement shall be deemed to be
a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.

(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it
is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.

-3-
<PAGE> 5

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing this Registration Statement on
Form S-8 and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Atlanta,
State of Georgia on the 24th day of July, 1995.

RHODES, INC.

By: /s/ Irwin L. Lowenstein
-------------------------------------
Irwin L. Lowenstein
Chairman of the Board of
Directors

Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant, as administrator of the Rhodes, Inc. Employees' Savings Plan,
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Atlanta, State of
Georgia, on the 24th day of July, 1995.

RHODES, INC. EMPLOYEES' SAVINGS PLAN

By: RHODES, INC.

By: /s/ Joel H. Dugan
--------------------------------
Joel H. Dugan, Senior
Vice President, Finance
and Administration

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Irwin L. Lowenstein and Joel H. Dugan
and each of them, his or her true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for such persons and in his or
her name, place and stead, in any and all capacities, to sign any and all
amendments to this Registration Statement, and to file the same with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and to perform each
and every act and thing requisite or necessary to be done in and about the
premises, as fully and to all intents and purposes as he or she might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, and any of them, or their substitutes, may lawfully do or cause to
be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following persons
in the capacity indicated on the 24th day of July, 1995.
<PAGE> 6
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Irwin L. Lowenstein Chairman of the Board of Directors (Principal
------------------------------------------------- Executive Officer)
Irwin L. Lowenstein

/s/ Joel T. Lanham President (Principal Operating
------------------------------------------------- Officer)
Joel T. Lanham

/s/ Joel H. Dugan Senior Vice President, Finance and
------------------------------------------------- Administration (Principal Financial Officer)
Joel H. Dugan

/s/ Barbara W. Snow Vice President and Corporate Controller
------------------------------------------------- (Principal Accounting Officer)
Barbara W. Snow

/s/ Holcombe T. Green, Jr. Director
-------------------------------------------------
Holcombe T. Green, Jr.

/s/ James R. Kuse Director
-------------------------------------------------
James R. Kuse

/s/ Don L. Chapman Director
-------------------------------------------------
Don L. Chapman

/s/ James V. Napier Director
-------------------------------------------------
James V. Napier
</TABLE>
<PAGE> 7
EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit Description Page No.
------- ----------- --------
<S> <C> <C>
4.1 Restated and Amended Articles of N/A
Incorporation of Registrant
(incorporated by reference to
Exhibit 3.1 to the Registrant's
Registration Statement on Form S-1
(File No. 33-60962)).

4.2 Amended Bylaws of Registrant N/A
(incorporated by reference to
Exhibit 3.2 to the Registrant's
Registration Statement on Form S-1
(File No. 33-60962)).

5.1 Opinion of King & Spalding.

23.1 Consent of Arthur Andersen LLP

23.2 Consent of King & Spalding (included
in Exhibit 5.1)

99.1 Rhodes, Inc. Employees' Savings Plan,
as amended.
</TABLE>

<PAGE> 1
EXHIBIT 5.1

Opinion of King & Spalding

<PAGE> 2
EXHIBIT 5.1
KING & SPALDING
191 PEACHTREE STREET
ATLANTA, GEORGIA
30303-1763

August 7, 1995

Rhodes, Inc.
4370 Peachtree Road
Atlanta, Georgia 30319

Re: Rhodes, Inc. -- Form S-8 Registration Statement

Gentlemen:

We have acted as counsel for Rhodes, Inc., a Georgia corporation (the
"Company"), in connection with the preparation of the Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission. The Registration Statement relates to (i) 50,000 shares
of the Company's common stock, without par value ("Common Stock"), to be issued
pursuant to the operation of the Rhodes, Inc. Employees' Savings Plan (the
"Employees' Savings Plan") and (ii) an indeterminate amount of interests which
may be offered by the Company pursuant to the operation of the Employees'
Savings Plan (the "Interests").

As such counsel, we have examined and relied upon such records,
documents, certificates and other instruments as in our judgment are necessary
or appropriate to form the basis for the opinion hereinafter set forth. In all
such examinations, we have assumed the genuineness of signatures on original
documents and the conformity to such original documents of all copies submitted
to us as certified, conformed or photographic copies, and as to certificates of
public officials, we have assumed the same to have been properly given and to
be accurate.

This opinion is limited in all respects to the federal laws of the
United States of America and the corporate law of the State of Georgia, and no
opinion is expressed with respect to the laws of any other jurisdiction or any
effect which such laws may have on the opinions expressed herein. This opinion
is limited to the matters stated herein, and no opinion is implied or may be
inferred beyond the matters expressly stated herein.

Based upon the foregoing and subject to the limitations,
qualifications and assumptions set forth herein, we are of the opinion that:

<PAGE> 3
Rhodes, Inc.
August 7, 1995
Page 2
______________

1. The shares of Common Stock which are to be issued from time to
time pursuant to the operation of the Employees' Savings Plan have been duly
authorized and will be, when issued pursuant to the terms and conditions of
such plan, validly issued, fully paid and nonassessable; and

2. The Interests which are to be issued from time to time pursuant
to the operation of the Employees' Savings Plan, to the extent they constitute
securities under the Securities Act of 1933, as amended, have been duly
authorized and will be, when issued pursuant to the terms and conditions of
such plan, validly issued, fully paid and nonassessable.

We consent to the filing of this opinion as an Exhibit to the
Registration Statement.

Very truly yours,

/s/ KING & SPALDING
-------------------
KING & SPALDING

<PAGE> 1
EXHIBIT 23.1

Consent of Arthur Andersen LLP

<PAGE> 2
EXHIBIT 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our reports dated April 21, 1995
included in Rhodes, Inc.'s Annual Report on Form 10-K for the fiscal year ended
February 28, 1995 and to all references to our firm included in this
Registration Statement.

Arthur Andersen LLP
Atlanta, Georgia
August 7, 1995

<PAGE> 1
EXHIBIT 99.1

Rhodes, Inc. Employees' Savings Plan

<PAGE> 2

RHODES, INC. EMPLOYEES' SAVINGS PLAN

(AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1989)

<PAGE> 3

RHODES, INC. EMPLOYEES' SAVINGS PLAN
TABLE OF CONTENTS

Article 1
INTRODUCTION

Article 2
DEFINITIONS

ARTICLE 3
PARTICIPATION

<TABLE>
<S> <C> <C>
3.01 Participation . . . . . . . . . . . . . . . . . . . 13
3.02 Participation and Rehire . . . . . . . . . . . . . 13
3.03 No Contract for Employment . . . . . . . . . . . . 14

Article 4
CONTRIBUTIONS

4.01 Regular Contributions . . . . . . . . . . . . . . . 15
4.02 Additional Contributions . . . . . . . . . . . . . 15
4.03 Voluntary Suspension and Resumption of Participant
Contributions . . . . . . . . . . . . . . . . 16
4.04 Employer Contributions . . . . . . . . . . . . . . 16
4.05 Payment of Contributions . . . . . . . . . . . . . 17
4.06 Maximum Additions to Accounts . . . . . . . . . . . 17
4.07 Rollover Contributions . . . . . . . . . . . . . . 18
4.08 Contributions Prohibited . . . . . . . . . . . . . 19
4.09 Special Nondiscrimination Rules . . . . . . . . . . 20

Article 5
ACCOUNTS AND ALLOCATIONS

5.01 Participant's Account . . . . . . . . . . . . . . . 22
5.02 Investment Directives . . . . . . . . . . . . . . . 22
5.03 Valuation; Valued . . . . . . . . . . . . . . . . . 24
5.04 Errors . . . . . . . . . . . . . . . . . . . . . . 24
5.05 Allocations Do Not Affect Vesting . . . . . . . . . 25

Article 6
VESTING AND DISTRIBUTION

6.01 Vesting . . . . . . . . . . . . . . . . . . . . . . 26
6.02 Distribution . . . . . . . . . . . . . . . . . . . 27
6.03 Disposition of Forfeitures . . . . . . . . . . . . 27
6.04 Commencement of Distribution . . . . . . . . . . . 30
6.05 Methods of Distribution . . . . . . . . . . . . . . 30
6.06 Withdrawal of Accounts . . . . . . . . . . . . . . 33
6.07 Payment to Minors and Incapacitated Persons . . . . 35
6.08 Application for Benefits . . . . . . . . . . . . . 35
6.09 Designation of Beneficiary . . . . . . . . . . . . 36
</TABLE>

i
<PAGE> 4

Article 7
ADMINISTRATION OF THE PLAN

<TABLE>
<S> <C> <C>
7.01 Named Fiduciaries . . . . . . . . . . . . . . . . . 38
7.02 Board of Directors . . . . . . . . . . . . . . . . 38
7.03 Trustee . . . . . . . . . . . . . . . . . . . . . 39
7.04 Committee . . . . . . . . . . . . . . . . . . . . 39
7.05 Standard of Fiduciary Duty . . . . . . . . . . . . 42
7.06 Claims Procedure . . . . . . . . . . . . . . . . . 43

Article 8
AMENDMENT AND TERMINATION

8.01 Right to Amend . . . . . . . . . . . . . . . . . . 45
8.02 Termination and Discontinuance of Contributions . . 46
8.03 IRS Approval of Termination . . . . . . . . . . . . 46

Article 9
MISCELLANEOUS

9.01 Headings . . . . . . . . . . . . . . . . . . . . . 48
9.02 Action by Employer . . . . . . . . . . . . . . . . 48
9.03 Spendthrift Clause . . . . . . . . . . . . . . . . 48
9.04 Discrimination . . . . . . . . . . . . . . . . . . 50
9.05 Release . . . . . . . . . . . . . . . . . . . . . . 50
9.06 Unclaimed Payments . . . . . . . . . . . . . . . . 51
9.07 Notice of Proceeding and Effect of Judgment . . . . 51
9.08 Severability . . . . . . . . . . . . . . . . . . . 51
9.09 Compliance with Applicable Laws . . . . . . . . . . 52
9.10 Agent for Service of Process . . . . . . . . . . . 52
9.11 Merger . . . . . . . . . . . . . . . . . . . . . . 52
9.12 Governing Law . . . . . . . . . . . . . . . . . . . 52

Article 10
QUALIFICATION AND RETURN OF CONTRIBUTIONS

10.01 Initial Qualification. . . . . . . . . . . . . . . 53
10.02 Mistake of Fact. . . . . . . . . . . . . . . . . . 53

Article 11
TOP-HEAVY PROVISIONS

11.01 Applicability . . . . . . . . . . . . . . . . . . . 55
11.02 Definitions . . . . . . . . . . . . . . . . . . . . 55
11.03 Minimum Allocation . . . . . . . . . . . . . . . . 58
11.04 Minimum Vesting . . . . . . . . . . . . . . . . . . 59
11.05 Compensation Limitation . . . . . . . . . . . . . . 60
11.06 Impact on Code Section 415 Limitations . . . . . . 60
11.07 Modification of Transition Rule for Defined
Contribution Fraction . . . . . . . . . . . . . . 60
11.08 No Duplication of Benefits . . . . . . . . . . . . 61
</TABLE>

ii
<PAGE> 5

RHODES, INC.
EMPLOYEES' SAVINGS PLAN

Article 1
INTRODUCTION

1.01 Rhodes, Inc., a corporation duly organized and existing under the laws
of the State of Georgia, established the Rhodes, Inc. Employees'
Savings Plan (the "Plan"), effective November 1, 1980, to provide
employees with a qualified savings incentive plan in order to save
money on a tax advantaged basis in accordance with Sections 401 and
501 of the Internal Revenue Code of 1986 and other requirements of law
relating to qualified employee plans and trusts. Rhodes, Inc. now
wishes to amend and restate the Plan in its entirety to comply with
the requirements of the Tax Reform Act of 1986, subsequent
legislation, and various regulations and rulings issued thereafter by
government agencies.

1.02 The purpose of this Plan (which includes the related Trust) is to
provide the benefits of a qualified savings incentive plan for the
exclusive benefit of the Participants or their Beneficiaries. This
Plan shall be administered and interpreted in accordance with such
purpose.

1.03 The effective date of this Restatement shall be January 1, 1989.

1
<PAGE> 6

Article 2
DEFINITIONS

Certain terms of this Plan have defined meanings which are set forth in this
Article and which shall govern unless the context in which they are used
clearly indicates that some other meaning is intended.

2.01 Account shall mean the total Account established and maintained by the
Committee for each Participant, which shall be a record of each
Participant's interest, if any, in the Fund. Each Account shall be
comprised of the subaccounts described in Section 5.01.

2.02 Act shall mean Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as the same may be amended from time to time.

2.03 Affiliate shall mean (a) any corporation which is a member of the same
controlled group of corporations (within the meaning of Code Section
414(b)), as is an Employer; (b) any other trade or business (whether
or not incorporated) under common control, within the meaning of Code
Section 414(c), with an Employer; (c) any other corporation,
partnership or other organization which is a member of an affiliated
service group, within the meaning of Code Section 414(m), with an
Employer; and (d) any other entity required to be aggregated with an
Employer pursuant to regulations under Code Section 414(o).

2
<PAGE> 7

2.04 Authorized Leave of Absence shall mean any absence authorized by an
Employer under that Employer's standard personnel practices provided
that all Participants under similar circumstances are treated alike in
the granting of such Authorized Leaves of Absence and provided further
that the Participant returns to employment with the Employer within
the period of Authorized Leave of Absence. An absence due to service
in the Armed Forces of the United States shall be considered an
Authorized Leave of Absence provided that the absence is caused by war
or other emergency, or provided that the Participant is required to
serve under the laws of conscription in time of peace, and further
provided that the Participant returns to employment with an Employer
within the period provided by law. A period of Authorized Leave of
Absence shall not be considered a "break in service". A Participant on
Authorized Leave of Absence who does not become an Employee when such
Authorized Leave has expired will normally be considered to have
incurred a Termination of Employment as of the beginning date of such
Authorized Leave of Absence.

2.05 Beneficiary shall mean as defined in Section 6.09.

2.06 Board shall mean the Board of Directors of the Company.

2.07 Break in Service shall mean a Plan Year in which an Employee has 500
or fewer Hours of Service.

3
<PAGE> 8

2.08 Code shall mean the Internal Revenue Code of 1986, as amended.

2.09 Committee shall mean the Committee appointed by the Board under
Article 7 to administer the Plan. The term Committee is
interchangeable with the term "PLAN Administrator." (See 2.33).

2.10 Company shall mean Rhodes, Inc., a Georgia corporation, and its
successors.

2.11 Compensation shall mean the W-2 earnings of each Participant paid by
the Employer during any Plan Year to the extent it does not exceed
$200,000, which amount shall be adjusted for changes in the cost of
living as provided in regulations issued by the Secretary of the
Treasury. Compensation does not include deferred compensation, stock
options, and other amounts which receive special tax benefits.
Notwithstanding the above:

(a) for all purposes under the Plan except Section 4.06,
Compensation shall include any amount contributed by an
Employer on behalf of a Participant pursuant to a salary
reduction agreement which is not includable in the gross
income of the Participant under Code Sections 125, 402(a)(8)
and 402(h);

(b) for purposes of Section 4.06 and Article 11, Compensation
shall include bonuses; and

(c) for purposes of applying the $200,000 limit, as adjusted,
with respect to Article 4, Code Section 414(q)(6) shall apply,
except that the term "family" therein shall include only a
Participant's spouse and any of a Participant's lineal
descendants who have not attained age 19 before the close of
the Plan Year.

2.12 Contributions - See Sections 2.18, 2.29, and 2.40.

4
<PAGE> 9

2.13 Distribution shall mean payment from the Plan to or for the benefit of
a Participant as described in Article 6.

2.14 Early Retirement shall mean as defined in the Rhodes, Inc. Employees'
Pension Plan.

2.15 Effective Date shall mean November 1, 1980.

2.16 Employee shall mean (a) any person engaged in rendering personal
services to and under the control or supervision of an Employer or an
Affiliate and who is receiving compensation for such services,
including any person on Authorized Leave of Absence, and (b) a leased
employee within the meaning of Code Section 414(n)(2).
Notwithstanding the above, the term "Employee" shall not mean any
person who is covered by a collective bargaining agreement between a
union and an Employer, provided that retirement benefits were the
subject of good faith bargaining, unless the collective bargaining
agreement provides for participation in the Plan.

2.17 Employer shall mean the Company and/or Participating Employer and any
successors or assigns of the Company or any Participating Employer.

2.18 Employer Contributions - See Section 4.04.

2.19 Entry Date shall mean January 1, April 1, July 1 and October 1 of each
Plan Year.

2.20 Fiduciary shall mean any party named as a Fiduciary in Article 7 of
the Plan.

2.21 Forfeiture - See Section 6.03.

5
<PAGE> 10

2.22 Fund shall mean the assets held and administered by the Trustee in
accordance with the Plan and Trust Agreement.

2.23 Highly Compensated Employee shall mean an Employee who meets the
definition of Highly Compensated Employee in Code Section 414(q) for a
Plan Year.

2.24 Hour of Service shall mean:

(a) Each hour for which an Employee is paid, or entitled to
payment, for performance of duties for an Employer.

(b) Each hour for which an Employee is paid, or entitled to
payment, by an Employer on account of a period of time during
which no duties are performed (irrespective of whether the
employment relationship is terminated) due to vacation,
holiday, illness, incapacity, layoff, jury duty, military
duty, or Authorized Leave of Absence; provided that in no
event shall an Employee receive credit for more than 501 Hours
of Service for any single continuous period during which no
duties are performed.

(d) The following rules shall apply in determination of whether an
Employee completes an Hour of Service:

1. The same hours shall not be credited under
subparagraphs 2.22(a), (b), or (c), as the case may
be, and this sub-paragraph (d);

2. The rules relating to determining Hours of Service
for reasons other than the performance of duties and
for crediting Hours of Service to particular periods
of Continuous Employment shall be those rules stated
in Department of Labor Regulations Title 29, Chapter
XXV, Subchapter C, Part 2530, Sections 200b-2(b) and
200b-2(c), respectively.

(e) Hours of Service will be credited for employment with other
members of an affiliated service group (under Section 414(m)
of the Code), a controlled group of corporations (under
Section 414(b) of the Code) or a group of trades or businesses
under

6
<PAGE> 11

common control (under Section 414(c) of the Code) of which the
Employer is a member.

(f) Solely for the purpose of determining whether a Break in
Service has occurred in a computation period for participation
and vesting purposes, an individual who is absent from work
for maternity or paternity reasons shall receive credit for
the Hours of Service which would otherwise have been credited
to such individual but for such absence, or, in any case in
which such hours cannot be determined, eight Hours of Service
per day of such absence. For purposes of this Section, an
absence from work for maternity or paternity reasons means an
absence 1) by reason of the pregnancy of the individual, 2) by
reason of the birth of a child of the individual, 3) by reason
of the placement of a child with the individual in connection
with the adoption of such child by such individual, or 4) for
purposes of caring for such child for a period beginning
immediately following such birth or placement. The Hours of
Service credited under this Section shall be credited 1) in
the computation period in which the absence begins if the
crediting is necessary to prevent a Break in Service in that
period, or 2) in all other cases, in the following computation
period. An Employee must submit written evidence of the reason
he or she is absent from work in order to receive credit for
hours of Service pursuant to this Section 2.24(f).

2.25 Matching Contribution shall mean an Employer Contribution pursuant to
Article 4.

2.26 Matching and Participant Contribution Percentage shall mean for Highly
Compensated Employees who are Participants for a Plan Year and for all
other Participants for a Plan Year the average in each group of the
ratios, calculated separately for each Participant, of (a) the total
Matching Contributions and Participant Contributions allocated to his
accounts for the Plan Year; to (b) his Compensation for the Plan Year.

7
<PAGE> 12

2.27 Normal Retirement Date shall mean the later of the date a Participant
reaches age sixty-five (65) or completes five (5) Years of Service.

2.28 Participant shall mean an Employee who participates in the Plan as
provided in Article 3.

2.29 Participant Contribution shall mean contributions made by a
Participant under Sections 4.01, 4.02, and 4.07.

2.30 Participating Employer shall mean the Company, an Affiliate, or any
other designated company which adopts this Plan and agrees to be
governed by its terms and provisions. Upon the adoption of this Plan
by a Participating Employer, its Employees shall be considered as
Employees for all purposes under the provisions of this Plan effective
as of the date of adoption, or as of such earlier date as is specified
in the resolution of adoption. Service of an Employee with any
Participating Employer shall be considered as service for all purposes
of this Plan effective from the date of adoption of this Plan, or such
earlier date as is specified in the resolution of adoption. No
Participating Employer shall be permitted to become a Participating
Employer without the express consent of the Company. If any
Participating Employer ceases to participate hereunder, the Plan shall
be considered terminated only as to such Participating Employer and
its Employees. The term Employer and

8
<PAGE> 13

Employee herein shall include, respectively, Participating Employers
and Employees.

2.31 Permanent Disability shall be evidenced by receipt by the Committee,
in a form satisfactory to it, of notification that the Participant is
entitled to receive disability income benefits under the Social
Security Act based on permanent and total disability.

2.32 Plan shall mean the Rhodes, Inc. Employees' Savings Plan as set forth
in this document (Plan Agreement), together with any subsequent
amendments hereto.

2.33 Plan Administrator or Administrator shall mean the Committee appointed
by the Board pursuant to Article 7 to administer the Plan. All
references in the Plan to the Administrator shall be deemed to apply
to the Committee and vice versa. The Committee so appointed is hereby
designated as the "Administrator" of the Plan within the meaning of
Section 3(16) of the Act. (See 2.08).

2.34 Plan Agreement is this document.

2.35 Plan Year shall mean the annual period from January 1, through the
following December 31.

2.36 Postponed Retirement Date shall mean any date beyond a Participant's
Normal Retirement Date on which a Participant retires.

2.37 Qualified, as used in "qualified plan" or "qualified trust," shall
mean a plan and trust which are entitled

9
<PAGE> 14

to the tax benefits provided respectively by Sections 401
and 501 and related provisions of the Code.

2.38 Qualified Matching Contributions shall mean Matching Contributions
which are immediately nonforfeitable when made, and which may not be
distributed except upon one of the events described under Code Section
401(k)(2)(B) and the underlying regulations.

2.39 Retirement shall mean the Termination of Employment of a Participant
on his Early, Normal, or Postponed Retirement Date.

2.40 Rollover Contributions - See Section 4.07.

2.41 Termination of Employment shall mean that a Participant has ceased to
be employed by the Employer for any of the following reasons: (i)
voluntary resignation from service of the Employer; or (ii) discharge
from the service of the Employer by the Employer; or (iii) Retirement;
or (iv) death; or (v) Permanent Disability; provided, however, that a
Participant who ceases to be actively employed by reason of Authorized
Leave of Absence shall not be considered as having a Termination of
Employment

2.42 Trust or Trust Agreement shall mean the Agreement of Trust and
amendments thereto entered into between the Employer and the Trustee
which governs the creation and administration of the Fund.

10
<PAGE> 15

2.43 Trustee shall mean the persons, corporation, association, or a
combination of them acting as Trustee under the Trust Agreement.

2.44 Valuation Date shall mean the last day of each quarter, and any other
date determined in the Committee's discretion.

2.45 Vesting - See Section 6.01.

2.46 Year of Service shall mean each Plan Year during which an Employee:
(a) prior to January 1, 1989, was credited with a Year of Service as
defined in the Plan document effective during that period, (b) for
Plan Years between January 1, 1989 and December 31, 1991, was credited
with a Year of Service calculated under the elapsed time rules set
forth in Treasury Regulation Section 1.410(a)-(7), and (c) for Plan
Years commencing on or after January 1, 1992, completes 1,000 or more
Hours of Service for the Employer.

2.47 A defined term, such as "Retirement," will normally govern the
definitions of derivatives therefrom, such as "Retire," even though
such derivatives are not specifically defined and even if they are or
are not initially capitalized. The masculine gender, where appearing
in the Plan, shall be deemed to include the feminine gender, unless
the context clearly indicates to the contrary. Singular and plural
nouns and pronouns shall be interchangeable as the factual context may
allow

11
<PAGE> 16

or require. The words "hereof," "herein," "hereunder," and other
similar compounds of the word "here," shall mean and refer to the
entire Plan and not to any particular provision or section.

12
<PAGE> 17

ARTICLE 3

PARTICIPATION

3.01 Participation.

(a) On the Effective Date, all Employees who (i) were Employees on
November 1, 1979 and (ii) had 1,000 or more Hours of Service
during the year beginning November 1, 1979 and ending October
31, 1980, shall be immediately eligible to participate in the
Plan. Any such Employee who failed to complete 1,000 or more
Hours of Service during the year beginning November 1, 1979
and ending October 31, 1980 shall be eligible to participate
on the earliest Entry Date following any twelve (12)
consecutive months in which such Participant has 1,000 Hours
of Service.

(b) Each Employee hired after November 1, 1979, shall be eligible
to participate on the Entry Date next following the completion
of any twelve (12) consecutive months of employment during
which such Employee has 1,000 or more Hours of Service.

(c) An Employee who becomes eligible to participate may become a
Participant (i) by completing and signing such forms as the
Committee prescribes whereby the Employee agrees to make
Participant Contributions as required under Article 4 hereof,
and (ii) by actually making Participant Contributions.
Participation in this Plan shall be completely voluntary. Any
Employee may decline to participate in this Plan.

(d) Any eligible Employee who does not become a Participant on the
first Entry Date after he becomes eligible, may become a
Participant on any subsequent Entry Date.

3.02 Participation and Rehire.

(a) Participation in the Plan may continue at the discretion of
the Participant until the Participant has a Termination of
Employment. Any Participant who has a Termination of
Employment shall cease to be a Participant and any benefits
hereunder shall thereafter be governed by the provisions of
Article 6.

13
<PAGE> 18

(b) A former Employee who was not yet a Participant or a former
Participant who did not have any non-forfeitable right to any
portion of his Employer Account at the time of his termination
of Employment will be considered a new Employee for
eligibility purposes if the number of consecutive one-year
Breaks in Service equals or exceeds the greater of five or the
aggregate number of Years of Service before such Breaks in
Service. Such aggregate number of Years of Service will not
include any Years of Service which may be disregarded under
the preceding sentence by reason of prior Breaks in Service.
If such former Participant's Years of Service before
termination of Employment may not be disregarded pursuant to
the preceding sentences, such former Participant shall
participate immediately upon reemployment. If the service of a
former Employee who was not yet a Participant may not be
disregarded pursuant to the preceding sentences, such former
Employee, upon reemployment, will become a Participant upon
satisfaction of the eligibility requirements of this Plan
taking into account the Employee's service prior to his
separation from service, and shall become a Participant
immediately upon reemployment if as of his date of
reemployment the Employee has satisfied the requirements for
eligibility to participate and the entry date as of which the
Employee would have entered the Plan (had he not left service)
occurred during the period that the Employee was absent from
service.

3.03 No Contract for Employment. Participation in the Plan shall not give
any Participant the right to be retained in the Employer's employ, nor
shall any Employee, upon dismissal from or voluntary termination of
his employment, have any right or interest in the Fund, except as
herein provided.

14
<PAGE> 19

Article 4

CONTRIBUTIONS

4.01 Regular Contributions. Except during periods of suspension of
Participant Contributions described in Section 4.03, a Participant
shall make regular contributions to the Plan (Regular Contributions),
which will be matched by the Employer to the extent provided in
Section 4.04. A Participant may elect to contribute as Regular
Contributions each pay period during a Plan Year any one of the
following percentages of his W-2 Earnings: 1%, 2%, 3%, 4%, 5% or 6%
(Rate, Rates). The Participant Contribution shall be made through
payroll deductions by properly completing the form prescribed by the
Committee prior to entering the Plan. The Participant may change his
Rate of Regular Contributions on any January 1 and July 1. The
Committee must receive written notice of such election to contribute
or to change the Rate of Contribution at least thirty (30) days prior
to its effective date.

4.02 Additional Contributions. Any Participant who has elected to make
Regular Contributions at a Rate of 6% of W-2 Earnings may also make
Additional Contributions of 1%, 2%, 3%, 4%, 5% or 6% of W-2 Earnings
which will not be matched by the Employer and which will be known as
Additional Contributions. Additional Contributions shall be made in
accordance with the same terms and conditions

15
<PAGE> 20

as are set forth in Section 4.01 with respect to Regular Contributions.

4.03 Voluntary Suspension and Resumption of Participant Contributions.

(a) Voluntary Suspension of Contributions.
A Participant may voluntarily suspend his Participant
Contributions by filing a form prescribed by the Committee for
this purpose. The effective date of a suspension of
Participant Contributions must coincide with the first day of
a normal pay period for which payroll deductions are made.
The election to suspend Participant Contributions must be
filed with the Committee or its designee at least fifteen (15)
days prior to the effective date of the suspension.
A Participant who elects to suspend his Participant
Contributions may not elect to resume contributions until six
(6) months after the suspension of contributions has become
effective.

(b) Resumption of Contributions.
A Participant who has suspended his Participant Contributions
may elect on a form prescribed by the Committee to resume
Participant Contributions at any time following the expiration
of six (6) months since the date his contributions were
suspended. The effective date of a resumption of Participant
Contributions must coincide with the first day of a normal pay
period for which payroll deductions are made. The election to
resume Participant Contributions must be filed with the
Committee or its designee at least fifteen (15) days prior to
the effective date of the resumption of contributions.

4.04 Employer Contributions. The Employer shall make Contributions to the
Plan only from its current or accumulated profits and only in an
amount equal to fifty percent (50%) of its Participants' Regular
Contributions to the Plan. The Employer Contributions shall be made in
whole or in part in cash or in property acceptable to the Trustee to
the fair market value thereof on the date

16
<PAGE> 21

of receipt thereof by the Trustee. Except as provided in Section 6.03,
all Employer Contributions shall be irrevocable, shall never inure to
the benefit of the Employer, and shall be transferred to the Trustee
to be used only in accordance with the provisions of the Plan; and
neither such Contributions, nor the Net Results therefrom, shall be
used for, or diverted to, purposes other than the exclusive benefit of
the Participants or their Beneficiaries under the Plan, and
contingently for defraying reasonable expenses of administering the
Plan.

4.05 Payment of Contributions. Participant Regular and Additional
Contributions, and Employer Contributions shall be paid to the Trustee
as promptly as possible after the end of each regular pay period, and
Rollover Contributions shall be paid to the Trustee when received.
Until any Participant Regular and Additional Contributions are paid
over to the Trustee, they shall be held by the Employer in trust for
the exclusive benefit of Participants and their Beneficiaries pursuant
to the terms of the Plan and Trust Agreement, and the Employer shall
maintain such withheld amounts in a separate account in the name of
the Plan until they are so paid over.

4.06 Maximum Additions to Accounts.
Notwithstanding any other provision of this Plan, if the total
allocations to a Participant's accounts with

17
<PAGE> 22

respect to a Plan Year exceed the maximum annual addition that can be
made on behalf of a Participant for a Plan Year in accordance with
Code Section 415(c)(2) and the regulations thereunder (when considered
in combination with any allocations or benefits he or she accrued
under any other qualified retirement plan of an Employer or any
Affiliate), and if the requirements of Codes Section 415 cannot be met
by reducing that allocation or benefit in accordance with the terms of
that other plan, then the allocations under this Plan shall be reduced
so that the Participant's allocations meet such requirements.

4.07 Rollover Contributions. Without regard to the limitations on
Contributions set forth in this Article 4, a Participant shall, if the
Committee consents, be permitted during any Plan Year to make Rollover
Contributions, provided such:

(i) was received by the Participant from a qualified plan
maintained by a previous employer of the Participant
and qualifies as a rollover amount within the meaning
of Section 402(a)(5) of the Code, or

(ii) was received by the Participant from an individual
retirement account or individual retirement annuity,
and qualifies as a rollover amount within the meaning
of Section 408(d)(3)(A)(ii) of the Code.

Rollover Contributions shall be accounted for by the Committee in a
Rollover Account for the Participant in accordance with Section 5.01.
Rollover Accounts are Vested as provided in Section 6.01 and are non-

18
<PAGE> 23
forfeitable. Such amounts shall be distributed to the Participant upon
his Termination of Employment in the manner provided in Article 6. The
Participant is solely responsible for determining that a Rollover
Contribution qualifies as such under the Code, as to which neither the
Company, the Employer, the Board, the Committee, the Administrator,
nor the Trustee (Parties) has any responsibility whatsoever, and
further, as to which the Participant shall hold harmless and indemnify
the Parties on an appropriate form. Rollover Contributions shall be
paid to the Trustee as provided in Section 4.05. Notwithstanding the
foregoing, with respect to any Participant, the Plan shall not accept
after December 31, 1984, any direct or indirect trustee-to-trustee
transfer from a defined benefit plan, money purchase pension plan
(including a target benefit plan), stock bonus plan or profit sharing
plan which provided for a life annuity form of payment to the
Participant. This paragraph shall in no event preclude the Plan from
accepting a Rollover Contribution which is not a trustee-to-trustee
transfer and which does not fall within the limitations described in
the preceding sentence.

4.08 Contributions Prohibited. No Contributions may be made to an Account:

(a) that is held for Distribution; or

(b) that is held in Suspense under Section 6.03; or

19
<PAGE> 24
(c) from which Contributions are Suspended under Section 4.03.

4.09 Special Nondiscrimination Rules

(a) The Committee shall be responsible for monitoring the Plan's
compliance with the limitations of this Section and shall have
the power to take all steps it deems necessary or appropriate
to ensure compliance. The Committee shall take such action
pursuant to nondiscriminatory procedures consistently applied.

(b) In addition to any other limitations set forth in the Plan,
Matching Contributions and Participant Contributions for each
Plan Year must satisfy one of the following tests:

1. The Matching and Participant Contribution Percentage
for Highly Compensated Employees must not exceed 125%
of the Matching and Participant Contribution
Percentage for all other Participants; or

2. The Matching and Participant Contribution Percentage
for Highly Compensated Employees must not exceed the
lesser of (i) 200% of the Matching and Participant
Contribution Percentage for all other Participants;
or (ii) the Matching and Participant Contribution
Percentage for all other Participants plus two
percentage points.

The Employer may designate any Matching Contributions as
Qualified Matching Contributions for purposes of computing the
Matching and Participant Contribution Percentage. In applying
the above tests, the Committee shall comply with any
regulations promulgated by the Secretary of the Treasury which
prevent or restrict the use of the test contained in (2)
above.

(c) If the Matching Contributions and Participant Contributions on
behalf of or by Highly Compensated Employees exceed the amount
permitted under this Section for any given Plan Year, then,
before the close of the Plan Year following the Plan Year for
which the excess aggregate contributions were made, the amount
of the excess aggregate contributions for the Plan Year and
any income allocable to such contributions shall be
distributed or, if the excess aggregate contributions are
forfeitable, forfeited.

20
<PAGE> 25
Payment of the excess aggregate contributions shall be made
without regard to any other provision in the Plan. "Excess
aggregate contributions" means the excess of (1) the aggregate
amount of the Matching Contributions and Participant
Contributions made on behalf of or by Highly Compensated
Employees for the Plan Year, over (2) the maximum amount of
the contributions permitted under this Section, determined by
reducing contributions made on behalf of Highly Compensated
Employees in order of their Matching and Participant
Contribution Percentages beginning with the highest of such
percentages. Distribution or forfeiture of excess aggregate
contributions for any Plan Year shall be made to Highly
Compensated Employees on the basis of the respective portions
of the excess aggregate contributions attributable to each
Highly Compensated Employee. Forfeitures of excess aggregate
contributions may not be allocated to Participants whose
contributions are hereby reduced.

21
<PAGE> 26
Article 5

ACCOUNTS AND ALLOCATIONS

5.01 Participant's Account.

The Committee shall establish and maintain a separate Account for each
Participant. Such Account shall be credited with the Participant's
Contributions and the Participant's portion of net income earned on,
expenses and charges against, and the appreciation and/or depreciation
of the Investment Funds to which the Participant's Account is
Allocated (Net Results). The Account of each Participant shall be
comprised of the following sub-accounts to the extent appropriate
under the circumstances:

(a) One sub-account (Regular Account) shall reflect the
Participant's Regular Contributions and the Participant's Net
Results therefrom.

(b) One sub-account (Additional Account) shall reflect the
Participant's Additional Contributions and the Participant's
Net Results therefrom.

(c) One sub-account (Employer Account) shall be the total amount
in the Participant's Account and the Participant's Net Results
therefrom less amounts credited to the Regular, Additional,
and Rollover Accounts and the Participant's Net Results
therefrom.

(d) One sub-account (Rollover Account) shall reflect Rollover
Contributions and the Participant's Net Results therefrom.

5.02 Investment Directives.

Each Participant shall direct, in an Investment Directive, on a form
provided by the Committee, the

22
<PAGE> 27
allocation or reallocation (Allocation, Allocate) of his Account
(which includes the Employer Account) among the Investment Funds
described below and in the Trust Agreement, subject to the following
limitations:

(a) Not less than twenty-five (25%) of an Account shall be
Allocated to any Investment Fund.

(b) One hundred percent (100%) of an Account may be Allocated to
Investment Fund A.

(d) Allocation shall be in increments of twenty-five (25%) of an
Account.

An Investment Directive may be made by the Participant initially and
on any January 1 or July 1 with thirty (30) days written notice to the
Committee. The Investment Directive Allocates the Participant's future
Contributions, and, subject to such rules as the Committee prescribes,
may also Allocate all amounts previously credited to the Participant's
Account or may leave the prior Allocation unchanged.

An Account shall be fully invested in Fund A if a Participant fails to
make an Investment Directive in the manner established by the
Committee.

The Investment Funds are as follows:

Fund A ("the Short Term Income Fund") investment policy is to
invest the income-producing assets, normally maturing within
one year of purchase. The fund shall be primarily invested in
government securities, commercial paper (publicly traded or
privately placed), money market certificates, and other debt
securities.

23
<PAGE> 28
Fund B Reserved.

Fund C (the "Common Stock Fund") investment policy has as its
objectives long-term growth of capital through investment
primarily in common stocks. In Fund C, reserves of cash
equivalents may be established for defensive purposes or to
take advantage of special buying opportunities. In the
discretion of the Trustee, Fund C may be invested in a mutual
fund having the same investment objective.

5.03 Valuation; Valued. On each Valuation Date, the Committee shall develop
and credit to each Account, including those identified in Section
4.08, the Net Results since the preceding Valuation Date, and
establish and record a new Account balance for each Participant based
on fair market value on the close of business as of such date. The
Participant's share of Net Results of each Investment Fund since the
preceding Valuation Date shall be credited to the Participant's
Account on the next subsequent Valuation Date based on fair market
value of the assets in each Investment Fund as of the Valuation Date.
Periodically, as determined by the Committee, statements of Account
will be sent to Participants.

5.04 Errors. Where an inaccuracy is discovered in a Participant's Account,
the Participant will neither gain nor lose thereby. The Committee
shall make appropriate corrective adjustments to the Account as of the
end of the Plan Year in which the inaccuracy is discovered. If such
correction does not cure the inaccuracy from its inception, then
curative additions to an Account shall

24
<PAGE> 29
be treated as an expense of the Fund; and curative subtractions from
an Account shall be treated as a forfeiture as outlined in Section
6.03.

5.05 Allocations Do Not Affect Vesting. The fact that an Allocation has
been made shall not operate to Vest in any Participant any right or
interest in or to any specific assets of the Fund except as herein
provided.

25
<PAGE> 30
Article 6

VESTING AND DISTRIBUTION

6.01 Vesting shall mean Participant ownership in:

(a) Regular, Additional, and Rollover Accounts. A Participant is
100% Vested in these Accounts at all times Valued as of the
last Valuation Date, plus Contributions thereto since such
Valuation Date and such amounts are non-forfeitable.

(b) Employer Account. Each Participant who has at least one (1)
Hour of Service after December 31, 1988, shall become 100%
Vested after attaining five (5) Years of Service (subject to
the application of subparagraph (d) below), determined as of
the last Valuation Date. For such Participants, the following
Vesting Schedule shall apply:

<TABLE>
<CAPTION>
Vesting Schedule
----------------

Years of Service Vested Percentage
---------------- -----------------
<S> <C>
Less than 5 0%
5 or more 100%
</TABLE>

Each Participant who had an Hour of Service on or before
December 31, 1988, shall be 100% Vested in his Employer
Account as of two (2) years prior to the last Valuation Date,
plus the Net Results therefrom, collectively Valued as of such
Valuation Date. Notwithstanding the above, a Participant who
terminates employment because of Retirement, Permanent
Disability or Death shall be 100% Vested in his Employer
Account through the last Valuation Date, plus Contributions
thereto through the Date of Retirement, Permanent Disability
or Death.

(d) Limitation. In the event that a Plan amendment directly or
indirectly changes the vesting schedule, the vested percentage
of each Participant in his Account accumulated to the date
when the amendment is adopted shall not be reduced as a result
of the amendment. In addition, any Participant with at least
three (3) Years of Service may irrevocably elect within one
year of that amendment to remain under the pre-amendment
vesting schedule with

26
<PAGE> 31
respect to all benefits accrued both before and after the
amendment.

6.02 Distribution.

Upon Termination of Employment of a Participant who is not vested in
any portion of his Account, the Participant shall be paid the vested
portion of his Account (which shall be 0%) and the Participant shall
immediately forfeit the unvested portion of his Account. Otherwise,
upon Termination of Employment, the Vested amount of the Participant's
Account shall be Distributed to the Participant in the manner
hereinafter provided and the unvested portion of a Participant's
Employer Account shall be subject to forfeiture as provided in Section
6.03.

6.03 Disposition of Forfeitures. The non-vested portion of a Participant's
Employer Account shall be forfeited as of the last day of the Plan
Year in which a Participant separates from service with the Employer,
provided that if such Participant returns to service with the Employer
before incurring five consecutive one-year Breaks in Service, the
amount that was previously forfeited (unadjusted by any subsequent
gains and losses) will be added to his Account upon his return (such
restored amount shall become vested under the provisions of Section
6.01(b) except that the period of absence shall be disregarded in
applying the rule stated therein); and provided further that, if the
Participant received a

27
<PAGE> 32
cash-out distribution prior to his return to service, the non-vested
amount that was forfeited shall be credited to his account only if the
Participant repays to the Plan the amount that was previously cashed
out by him prior to incurring five consecutive Breaks in Service. The
restoration required by this Section may be derived, at the discretion
of the Committee, from Employer contributions, Forfeitures and/or
earnings of the Plan. If an Employee ceases to perform Services for
the Employer under circumstances for which Hours of Service either
will or may be credited following the date the Employee ceases to
perform services (for example, where applicable, due to a maternity or
paternity leave, a leave of absence for a stated period or a period of
layoff), a separation from service shall not occur for purposes of
forfeiture of the non-vested portion of a Participant's Employer's
Contribution Account until the earlier of (1) the date a cash-out of
the Participant's vested Account is paid to him, or (2) the date on
which Hours of Service no longer are credited to the Employee, or, if
applicable, the date on which the Employee's failure to return to
service with the Employer results in cancellation of Hours of Service
that would have otherwise been credited to the Participant.

Any Forfeiture incurred pursuant to the terms of this Section shall
reduce Employer Contributions required for

28
<PAGE> 33
the Plan Year in which the Forfeiture occurs or for any succeeding
Plan Year, unless and to extent that said Forfeitures are used, in the
discretion of the Committee as described above, to restore the
forfeited Accounts of former Participants who are reemployed prior to
incurring five consecutive Breaks in Service. Distributions at
Termination of Employment and on account of Retirement, Permanent
Disability, or Death shall be made in the manner described in (a),
(b), (c), or (d) of Section 6.05, as elected by the Participant in
writing prior to the Participant's Death on such forms as the
Committee prescribes, and if the Participant fails to elect a Method
of Distribution, Distribution shall be made in such Method as the
personal representative of the Participant's estate elects in writing
prior to the day that Distribution must commence herein, and if the
personal representative fails or refuses to elect a Method of
Distribution, Distribution shall be made in cash in a lump sum. The
Committee shall inform a Participant on request of the Commencement
Date and Method of Distribution and decisions so communicated in
writing to the Participant shall not be changed except with the
Participant's written approval. Except to the extent the Committee
shall direct payments to Participants and Beneficiaries to be made out
of funds withheld from Compensation of Participants as provided

29
<PAGE> 34
in the Trust Agreement, the Committee shall issue written directions
to the Trustee as to the Commencement Date and the Method of
Distribution for each Participant or Beneficiary.

6.04 Commencement of Distribution.

In the event that a Participant or Beneficiary becomes entitled to
Distribution by reason of any of the events described in this Article
6, the payment of benefits shall commence as promptly as possible,
provided that Commencement of Distribution shall be no later than
sixty (60) days after the end of the Plan Year in which such an event
occurs. Notwithstanding the foregoing, if the amount of the payment
required to commence on a date cannot be ascertained by that date,
payment shall commence retroactively to the date and shall commence no
later than sixty (60) days after the earliest date on which the amount
of payment can be ascertained under the Plan.

6.05 Methods of Distribution.

The Methods of Distribution are:

(a) Payment monthly, quarterly, semi-annually, or annually of
substantially equal amounts over a period not to exceed ten
(10) years. In the discretion of the Committee, the
Participant's Account held for Distribution under this method,
may be allocated to Fund A or may be used to purchase a
commercial annuity contract providing for installment payments
over the period selected;

(b) Wholly in cash in a lump sum;

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<PAGE> 35
If the Vested Amount of a Participant's Account is less than $3,500,
the Committee may elect to distribute the Participant's entire account
upon his termination of Employment. If the Vested Amount of a
terminated Participant's Account exceeds $3,500, or if benefits have
commenced being paid to the Participant, benefits may not be cashed to
the Participant without the Participant's consent prior to the
Participant's attainment of Normal Retirement Age. On or after the
Participant's attainment of Normal Retirement Age, benefits will be
paid to a Participant as promptly as possible after the Participant
becomes entitled to a distribution by reason of any of the events
described in this Article 6.

The following restrictions shall apply to distributions under this
Section:

(i) In no event shall distribution be made to a
Participant in the form of a life annuity.

(ii) Distributions under this Section shall not extend
beyond a period which exceeds the life expectancy of
the Participant.

(iii) Minimum Amounts to be Distributed: If the
Participant's entire interest is to be distributed in
other than a lump sum, then the amount to be
distributed each year must be at least an amount
equal to the quotient obtained by dividing the
Participant's entire interest by the life expectancy
of the Participant. Life expectancy is computed by
the use of the return multiples contained in Section
1.72-9 of the Income Tax Regulations. For purposes of
this computation, a Participant's life expectancy may
be recalculated no more frequently than

31
<PAGE> 36
annually. Furthermore, the actuarial value of
anticipated payments to the Participant must exceed
the actuarial value of payments to be made to the
Participant's Beneficiary, determined as of the date
payment of benefits commences.

(iv) Distribution to Participants must commence, no later
than the first day of April following the calendar
year in which such individual attains age 70 1/2.

(v) Distributions to a Participant who is Non-Five
Percent Owner and who attained 70 1/2 before January
1, 1988 must commence no later than the first day of
April following the calendar year in which the later
of termination of Employment or age 70 1/2 occurs.

(vi) If the Participant dies after distribution of his
interest has commenced, the remaining portion of such
interest will continue to be distributed at least as
rapidly as under the method of distribution being
used prior to the Participant's death.

(vii) If the Participant dies before distribution of his
interest commences, the Participant's entire interest
will be distributed no later than five (5) years
after the Participant's death except to the extent
that an election is made to receive distributions in
accordance with (a) or (b) below. Said election shall
be made by the Participant in writing on forms
furnished by the Committee.

(a) If any portion of the Participant's interest is
payable to a designated Beneficiary, distributions
may be made in substantially equal installments over
the shorter of ten (10) years or the life expectancy
of the designated Beneficiary, commencing no later
than one (1) year after the Participant's death;

(b) If the designated Beneficiary is the Participant's
surviving spouse, the date distributions are required
to begin in

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<PAGE> 37
accordance with (a) above shall not be earlier than
the date on which the Participant would have attained
age 70 1/2, and, if the spouse dies before payments
begin, subsequent distributions shall be made as if
the spouse had been the Participant.

(viii) For purposes of (vii) above, payments will be
calculated by use of the return multiples specified
in Section 1.72-9 of the Income Tax Regulations. Life
expectancy of a surviving spouse may be recalculated
annually; however, in the case of any other
designated Beneficiary, such life expectancy will be
calculated at the time payment first commences
without further recalculation.

(ix) For purposes of (vi), (vii) and (viii) above, any
amount paid to a child of the Participant will be
treated as if it had been paid to the surviving
spouse if the amount becomes payable to the surviving
spouse when the child reaches the age of majority.

6.06 Withdrawal of Accounts.

Upon the application of any Participant, the Committee, in accordance
with its uniform, non-discriminatory policy, may direct the Trustee to
permit such Participant to make a withdrawal from his Account.
Additional Accounts must be withdrawn before Regular Accounts may be
withdrawn. The Participants' have the following withdrawal options:

(a) The Participant may elect to withdraw any portion or all of
his Vested Additional Account. If this option is elected, the
Participant will suffer no penalty.

(b) If the Vested Additional Account is fully withdrawn by the
Participant, the Participant may then elect to withdraw any
portion or all of the Participant's

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<PAGE> 38
Vested Regular Account. Under this option, neither the
Participant nor the Employer for the Account of the
Participant can make Contributions for a period of six (6)
months after such withdrawal.

(c) The Participant may elect options (a) and (b) simultaneously;
in which event, neither the Participant nor the Employer for
the Participant's Account can make Contributions for a period
of six (6) months after the withdrawals.

(d) Only if option (c) is elected by the Participant may the
Participant also withdraw the Participant's Vested amount in
the Employer's Account. Withdrawal may not be made of matching
contributions allocated to the Employer's Account within the
last twenty-four (24) months. However, if the Participant has
completed at least five (5) Years of Service, the entire
Employer Account can be withdrawn. In the event of this
option, neither the Participant nor the Employer, for the
Account of the Participant, may make Contributions for a
period of twelve (12) months from the date of such withdrawal.

A Participant may make one (1) withdrawal per calendar year after a
fifteen (15) day notice.

A Participant whose contributions are required to be suspended for a
period of six (6) or twelve (12) months pursuant to sub-section (b),
(c) or (d) may elect on a form prescribed by the Committee to resume
Participant Contributions at any time following the expiration of such
suspension period. The effective date of a resumption of Participant
Contributions must coincide with the first day of a normal pay period
for which payroll deductions are made. The election to resume
Participant Contributions must be filed with the Committee or its
designee at least fifteen (15) days

34
<PAGE> 39
prior to the effective date of the resumption of contributions.

6.07 Payment to Minors and Incapacitated Persons.

In the event a Distribution hereunder is payable to a minor or to any
person who, in the judgment of the Committee, is incapable of making
proper disposition thereof, such payment shall be made for the benefit
of such minor or such person in any of the following ways as the
Committee, in its sole discretion, shall determine:

(a) By payment to the legal representative of such minor or such
person;

(b) By payment directly to such minor or such person;

(c) By payment in discharge of bills incurred by or for the
benefit of such minor or such person. The Trustee shall make
such payments as directed by the Committee without the
necessary intervention of any guardian or like fiduciary, and
without any obligation to require bond or to see to the
further application of such payment. Any payment so made shall
be in complete discharge of the Plan's obligation to the
Participant or his Beneficiary.

6.08 Application for Benefits.

The Committee may require a Participant or Beneficiary to complete and
file with the Committee certain forms as a condition precedent to
Distribution. The Committee may rely upon all such information given
to it, including the Participant's current mailing address. It is the
responsibility of Participants or Beneficiaries to keep the Committee
informed of their current mailing addresses.

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<PAGE> 40
6.09 Designation of Beneficiary.

The Beneficiary is the person or trust that a Participant designated
most recently in writing to the Committee; provided, however, that if
the Participant has failed to make a designation, no person designated
is alive, no trust has been established, or no successor Beneficiary
has been designated who is alive, "Beneficiary" means (a) the
Participant's spouse, or (b) if no spouse is alive, the Participant's
surviving children, or (c) if no children are alive, the Participant's
parent or parents, or (d) if no parent is alive, the legal
representative of the deceased Participant's estate. Notwithstanding
the preceding sentence, the spouse of a married Participant shall be
his or her Beneficiary unless that spouse has consented in writing to
the designation by the Participant of some other person or trust and
the spouse's consent acknowledges the effect of the designation and is
witnessed by a notary public. A Participant may change his or her
designation of beneficiary at any time. However, a Participant may not
change his or her designation (other than to name the spouse as his or
her Beneficiary) without further consent of the spouse under the terms
of the preceding sentence unless the spouse's consent permits
designation of another person or trust without further spousal consent
and acknowledges that the spouse has the right to limit

36
<PAGE> 41
consent to a specific beneficiary and that the spouse voluntarily
relinquishes this right. The spouse's consent shall not be required,
however, if the Participant establishes to the satisfaction of the
Committee that the spouse cannot be located or if the Participant
produces an order from a court of competent jurisdiction determining
that he or she is legally separated or has been abandoned (within the
meaning of local law), unless a "qualified domestic relations order",
as defined in Code Section 414(p), provides otherwise, or unless such
other circumstances exist as the Secretary of Treasury may prescribe.
If the spouse is legally incompetent to give consent, consent by the
spouse's legal guardian shall be deemed consent by the spouse.

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<PAGE> 42

Article 7

ADMINISTRATION OF THE PLAN

7.01 Named Fiduciaries.

The following parties are named as Fiduciaries of the Plan and shall
have the authority to control and manage the operation and
administration of the Plan:

(i) the Employer;

(ii) the Board;

(iii) the Committee.

The Trustee is also named as a Fiduciary.

The Fiduciaries shall have only the powers and duties expressly
assigned to them in the Plan Agreement and/or Trust Agreement and
shall have no other powers and duties in respect to the Plan;
provided, however, that if a power or duty is not expressly assigned
to a specific Named Fiduciary, the power or duty shall be that of the
Employer. No Fiduciary shall have any liability for, or responsibility
to inquire into, the acts and omissions of any other Fiduciary in the
exercise of powers or the discharge of duties assigned to such other
Fiduciary under the Plan.

7.02 Board of Directors.

(a) The Board shall have the following powers and duties with
respect to the Plan:

(1) to cause the Employer to make Contributions to the
Plan as required in the Plan Agreement on the basis
permitted under Section 302 of the Act;

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<PAGE> 43
(2) to appoint and remove the individuals, banks, or
other entities who serve as Trustee, and the members
of the Committee as provided herein; and

(3) to amend any or all of the provisions of the Plan and
to terminate the Plan in whole or in part pursuant to
the procedures provided hereunder.

(b) The Board shall have no other responsibilities with respect to
the Plan.

7.03 Trustee.

The Trustee shall exercise all of the powers and duties assigned to
the Trustee as set forth in the Trust Agreement. The Trustee shall
have no other responsibilities with respect to the Plan.

7.04 Committee.

(a) A Committee of not less than three (3) individuals shall be
appointed by and serve at the pleasure of the Board to
administer the Plan. Any Participant while also an Employee,
or any officer or director of the Employer while serving in
that capacity, shall be eligible to be appointed and to serve
as a member of the Committee and all members shall serve as
such without compensation. The Board shall have the right to
remove any member of the Committee at any time. A member may
resign at any time by written notice to the Committee and the
Board. If a vacancy in the Committee should occur, a successor
shall be appointed by the Board. The Committee shall by
written notice keep the Trustee notified of current membership
of the Committee, its officers and agents. The Committee shall
furnish the Trustee a certified signature card for each member
of the Committee and for all purposes hereunder, the Trustee
shall be conclusively entitled to rely upon such certified
signatures.

(b) The Board shall appoint a Chairman and a Secretary from among
the members of the Committee. All resolutions, determinations,
and other actions shall be by a majority vote of all members
of the Committee. The Committee may appoint such agents,

39
<PAGE> 44
who need not be members of the Committee, as it deems
necessary for the effective performance of its duties, and may
delegate to such agents such powers and duties, whether
ministerial or discretionary, as the Committee deems expedient
or appropriate. The compensation of such agents shall be fixed
by the Committee; provided, however, that in no event shall
compensation be paid if such payment violates the provisions
of Section 408 of the Act and is not exempted from such
prohibitions by Section 408 of the Act.

(c) The Committee shall have complete control of the
administration of the Plan with all powers necessary to enable
it to properly carry out the provisions of the Plan. In
particular, the Committee shall have the sole and exclusive
discretion, authority and responsibility for administering,
construing and interpreting the provisions of the Plan and
making all determinations thereunder. In establishing the
Committee's discretion, authority and responsibility, it is
the intent of the Company to grant the Committee the broadest
possible powers to interpret and administer the Plan so that
judicial or other review of Committee decisions is limited to
the extent allowed by law and so that maximum deference is
given to all Committee decisions under or relating to the
Plan.

In addition to all implied powers and responsibilities
necessary to carry out the objectives of the Plan and to
comply with the requirements of the Act, the Committee shall
have the following specific powers and responsibilities:

(1) to construe the Plan and to determine all questions
arising in the administration, interpretation, and
operation of the Plan;

(2) to decide all questions relating to the eligibility
of Employees to participate in the benefits of the
Plan;

(3) to determine the benefits of the Plan to which any
Participant or Beneficiary may be entitled;

(4) to keep records of all acts and determinations of the
Committee, and to keep all such records, books of
accounts, data and other documents as may be
necessary for the proper administration of the Plan;

40
<PAGE> 45
(5) to prepare and distribute to all Participants or
their Beneficiaries information concerning the Plan
and their rights under the Plan, including, but not
limited to, all information which is required to be
distributed by the Act, the regulations thereunder,
or by any other applicable law;

(6) to file with the Secretary of Labor such reports and
additional documents as may be required by the Act
and regulations issued thereunder, including, but not
limited to, a summary plan description, summary
annual report, annual reports, terminal reports, and
supplementary reports;

(7) to file with the Secretary of the Treasury all
reports and information required to be filed by the
Code, the Act, and regulations issued under each; and

(8) to do all things necessary to operate and administer
the Plan in accordance with its provisions and in
compliance with applicable provisions of law.

(9) In addition to the foregoing, the Committee shall
have the authority to modify, from time to time, the
Plan under which Participants may file elections
relating to election of Regular and Additional
Contributions, election of investment Funds and
election to receive Plan distributions. The
provisions of this Plan relating to the deadlines and
procedures for making such elections shall be subject
to and superseded by any resolution of the Committee
to establish alternative deadlines and procedures,
and such action by the Committee shall not require
amendment of the Plan.

(10) To enable the Committee to perform its functions, the
Employer shall supply full and timely information of
all matters relating to the compensation and length
of service of all Participants, their retirement,
death or other cause of Termination of Employment,
and such other pertinent facts as the Committee may
require. The Committee shall advise the Trustee of
such facts and issue to the Trustee such instructions
as may be required by the Trustee in the
administration of the Trust. The Committee and the
Employer shall be

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<PAGE> 46
entitled to rely upon all certificates and reports
made by a Certified Public Accountant selected or
approved by the Employer. The Committee, the Employer
and its officers, and the Trustee shall be fully
protected in respect of any action suffered by them
in good faith in reliance upon the advice or opinion
of any accountant or attorney, and all action so
taken or suffered shall be conclusive upon each of
them and upon all other persons interested in the
Plan.

7.05 Standard of Fiduciary Duty.

Any Fiduciary, or any person designated by a Fiduciary to carry out
fiduciary responsibilities with respect to the Plan, shall discharge
his duties solely in the interests of the Participants or
Beneficiaries for the exclusive purpose of providing them with
benefits and defraying the reasonable expenses of administering the
Plan. Any Fiduciary shall discharge his duties with the care, skill,
prudence, and diligence under the circumstances then prevailing that a
prudent man acting in like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character and with
like aims. Any Fiduciary shall discharge his duties in accordance with
the documents and instruments governing the Plan insofar as such
documents and instruments are consistent with the provisions of the
Act. Notwithstanding any other provisions of the Plan, no Fiduciary
shall be authorized to engage in any transaction which is prohibited
by Sections 408 and

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<PAGE> 47
2003(a) of the Act or Section 4975 of the Code in the performance of
its duties hereunder.

7.06 Claims Procedure.

Any Participant or Beneficiary (hereinafter referred to as "Claimant")
may file a claim for benefits under the Plan by submitting to the
Committee a written statement describing the nature of the claim and
requesting a determination of its validity under the terms of the
Plan. Within ninety (90) days after receipt of such an application,
the Committee shall notify the applicant of its decision. If special
circumstances require an extension of time, the Committee shall notify
the applicant of such circumstances within ninety (90) days after
receipt of the application, and the Committee shall thereafter notify
the claimant of its decision within 180 days after receipt of the
application. If the application is denied in whole or in part, the
Committee's notice of denial shall be in writing and shall state:

(a) the specific reasons for denial with specific reference to
pertinent Plan provisions upon which the denial was based;

(b) a description of any additional materials or information
necessary for the applicant to perfect his or her claim and an
explanation of why the materials or information are necessary;
and

During the sixty-day period following an applicant's receipt of notice
of denial of his or her application for

43
<PAGE> 48
benefits, the applicant or his or her duly authorized representative
may review pertinent documents and within sixty (60) days submit a
written request to the Committee for review of the denial.

An applicant submitting a request for review shall be allowed to
submit issues and comments in writing to the Committee. The Committee
shall afford an applicant who requests a hearing a full and fair
review of the decision denying the application and may, in its sole
discretion, hold a hearing to review any or all issues raised by the
applicant, which hearing shall take place within thirty (30) days of
the date of the applicant's request. Within sixty (60) days after
receipt of the request for review, the Committee shall issue a written
decision to the applicant. If special circumstances, such as the need
to hold a hearing, require an extension of time, the Committee shall
issue a written decision no later than 120 days after receipt of the
request for review. The Committee's decision shall include specific
reasons for the decision, written in a manner calculated to be
understood by the applicant, and contain specific references to the
pertinent Plan provisions upon which the decision is based.

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<PAGE> 49
Article 8

AMENDMENT AND TERMINATION

8.01 Right to Amend.

The Employer intends for the Plan to be permanent so long as the
corporation exists; however, it reserves the right to change its
future matching percentage or temporarily suspend its Contributions or
to modify, alter, or amend this Plan or the Trust Agreement, from time
to time, to any extent that it may deem advisable, including, but not
limited to, any amendment deemed necessary to insure the continued
qualification of the Plan under Section 401(a) of the Code or to
insure compliance with the Act; provided, however, that the Employer
shall not have the authority to amend this Agreement in any manner
which will:

(a) Permit any part of the Fund (other than as is provided in
Section 6.03 and such part as is required to pay taxes and
administrative expenses) to be used for or diverted to
purposes other than for the exclusive benefit of the
Participants or their Beneficiaries;

(b) Cause or permit any portion of the Funds to revert to or
become the property of the Employer except as provided in
Article 10;

No amendment to the Plan shall decrease a Participant's Account
balance or eliminate an optional form of distribution, except as
permitted by Treasury Regulations.

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<PAGE> 50
8.02 Termination and Discontinuance of Contributions.

The Employer shall have the right at any time to terminate this Plan
or to discontinue permanently its Contributions hereunder (hereinafter
referred to as "Plan Termination"). Upon Plan Termination, all
Participants' Accounts shall become fully vested and non-forfeitable.
In such event, the Committee shall direct the Trustee with reference
to the disposition of the Fund, after payment of any expenses properly
chargeable against the Fund. At the option of the Committee, the
Committee may direct the Trustee to continue to hold the Fund in Trust
and distribute the Accounts of Participants in the manner provided in
Section 6, or in the alternative, may direct the Trustee to
immediately distribute all amounts held in Trust to the Participants
or Beneficiaries in proportion to the Accounts of such Participants as
of the date of such Termination. In the event that this Plan is
partially terminated, then the provisions of this Section 8.02 shall
apply, but solely with respect to the Participants and Beneficiaries
affected by the partial termination.

8.03 IRS Approval of Termination.

The Trustee shall not be required to make any Distribution from this
Plan in the event of complete or partial termination until the
authorized officials of the Internal Revenue Service shall have
determined that there

46
<PAGE> 51
will be no liability against the Trustee by reason of such
Distribution.

47
<PAGE> 52
Article 9

MISCELLANEOUS

9.01 Headings.

The headings and sub-headings in this Plan have been inserted for
convenience of reference only and are to be ignored in any
construction of the provisions hereof.

9.02 Action by Employer.

Any action by an Employer under this Plan shall be by resolution of
the Board of Directors, or by any person or persons duly authorized by
resolution of said Board to take such action.

9.03 Spendthrift Clause.

To the extent permitted by law, none of the benefits, payments,
proceeds, or distribution under this Plan shall be subject to the
claim of any creditor of any Participant or Beneficiary, and none of
them shall have any right to alienate, commute, anticipate, or assign
any of the benefits, payments, proceeds, or distributions under this
Plan except to the extent expressly provided herein to the contrary.
If any Participant shall attempt to dispose of the benefits provided
for him hereunder, or to dispose of the right to receive such
benefits, or in the event there should be an effort to seize such
benefits or the right to receive such benefits by attachment,
execution, or other legal or equitable process, such right to benefits
shall pass and be

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<PAGE> 53
transferred, at the discretion of the Plan Administrator, to such one
or more as may be appointed by the Plan Administrator from among the
Beneficiaries, if any theretofore designated by the Participant, the
spouse, the children, or other dependents of the Participant, in such
shares as the Committee may appoint. Any appointment so made by the
Committee may be revoked by it at any time and further appointment
made by it which may include the Participant.

The preceding sentences shall also apply to the creation, assignment
or recognition of a right to any benefit payable with respect to a
Participant pursuant to a domestic relations order, unless such order
is determined to be a "qualified domestic relations order," as defined
in Section 414(p) of the Code. A domestic relations order which was
entered before January 1, 1985, shall be treated as a "qualified
domestic relations order" if payment of benefits pursuant to the order
has commenced as of such date. The Committee may, in its sole
discretion, choose to treat as a "qualified domestic relations order"
a domestic relations order entered before January 1, 1985, pursuant to
which the payment of benefits has not commenced as of said date, even
though the order does not satisfy the requirements of Section 414(p)
of the Code.

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<PAGE> 54
9.04 Discrimination.

The Employer, the Committee, the Trustee, and all other persons
involved in the administration and operation of the Plan shall
administer and operate the Plan and the Trust in a uniform and
consistent manner with respect to all Participants similarly situated
and shall not permit discrimination in favor of Highly Compensated
Employees.

9.05 Release.

Any payment to a Participant or Beneficiary, or to their legal
representatives, in accordance with the provisions of this Plan, shall
to the extent thereof be in full satisfaction of all claims hereunder
against the Trustee, Plan Administrator, Committee, and the Employer,
any of whom may require such Participant, Beneficiary, or legal
representative, as a condition precedent to such payment, to execute a
receipt and release therefor in such form as shall be determined by
the Trustee, Plan Administrator, the Committee, or the Employer, as
the case may be. Any person having any claim for any benefit under the
Plan shall look solely to the assets of the Trust Fund for
satisfaction. In no event will the Trustee or the Employer or any of
the Employer's officers or employees, or its Board be liable in their
individual capacities to any person whomsoever for the payment of
benefits under the provisions of the Plan.

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<PAGE> 55
9.06 Unclaimed Payments

Whenever the Committee cannot locate any person to or for the benefit
of whom such payments are to be made within a reasonable time after
payments are to commence, and after making a reasonable effort to
locate such person, the Committee may deposit the amount to paid in a
savings account of a bank or a savings or loan association to be held
in the name of such person, subject, however, to any applicable
escheat laws.

9.07 Notice of Proceeding and Effect of Judgment

In any application, proceeding or action in any Court, only the
Employer and the Trustee shall be necessary parties, and no
Participant or other person having any interest in the Fund shall be
entitled to any notice or service of process except as required by
law. Any judgment or decree entered on account of such application,
proceeding or action shall be binding and conclusive on all persons
claiming under the Fund or this Plan.

9.08 Severability

If any provisions of the Plan are held illegal or invalid for any
reason, such illegality or invalidity shall not affect the remaining
parts of this Plan, and this Plan shall be construed in force as if
the illegal or invalid provisions were not included.

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<PAGE> 56
9.09 Compliance with Applicable Laws.

The Employer, through the Plan Administrator, shall interpret and
administer the Plan in such manner that the Plan and Trust shall
remain in compliance with the Code, with the Act, and all other
applicable laws, regulations, and rulings.

9.10 Agent for Service of Process.

The agent for service of process of this Plan shall be the person
listed from time to time in the current records of the Secretary of
State of Georgia as the agent for the service of process for the
Employer.

9.11 Merger.

In the event of any merger or consolidation of the Plan with any other
plan, or the transfer of assets or liabilities by the Plan to another
plan, each Participant must be entitled to receive (assuming that the
Plan would terminate) a benefit immediately after the merger,
consolidation or transfer which is equal to or greater than the
benefit such Participant would have been entitled to receive
immediately before the merger, consolidation or transfer (assuming
that the Plan had then terminated).

9.12 Governing Law.

The Plan shall be construed in accordance with the laws of the State
of Georgia to the extent that such laws are not preempted by Federal
law.

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<PAGE> 57
Article 10

QUALIFICATION AND RETURN OF CONTRIBUTIONS

10.01 Initial Qualification.

If this restated Plan and Trust Agreement fail to receive initial
approval of the Internal Revenue Service as a qualified plan and
trust, then notwithstanding any other provision in this Plan, within
one (1) year after the date of denial of qualification (a) the
contribution of an Employer after payment of all expenses will be
returned to such Employer free of the Plan and Trust Agreement, (b)
contributions made by a Participant shall be returned to the
Participant who made the contributions, and (c) the Plan and Trust
Agreement shall thereupon terminate.

10.02 Mistake of Fact.

To the extent permitted by the Code and other applicable laws and
regulations thereunder, and upon an Employer's request, a contribution
which was made by reason of a mistake of fact, or which was
conditioned upon the deductibility of the contribution under Code
Section 404, shall be returned to the Employer within one (1) year
after the payment of the contribution, or the disallowance of the
deduction (to the extent disallowed), whichever is applicable. The
amount to be returned to the Employer shall be the excess of the
contribution above the amount that would have been contributed had the

53
<PAGE> 58
mistake of fact or the mistake in determining the deduction not
occurred, less any net loss attributable to the excess. Any net income
attributable to the excess shall not be returned to the Employer. No
return of any portion of the excess shall be made to the Employer if
the return would cause the balance in a Participant's Eligible
Accounts to be less than the balance which would have existed had the
mistaken contribution not been made.

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<PAGE> 59
Article 11

TOP-HEAVY PROVISIONS

11.01 Applicability.

If the Plan is or becomes a Top-Heavy Plan in any Plan Year beginning
after December 31, 1983, the provisions of this Article 10 shall be
controlling and shall supersede any conflicting provisions in the
Plan. This Article shall be interpreted in accordance with Section 416
of the Code and the regulations thereunder.

11.02 Definitions.

For the purposes of this Article 10, the following terms shall have
the following meanings:

(a) "Benefit Amount" shall mean, with respect to a defined
contribution plan, (i) the sum of the amounts credited, as of
the Determination Date, to the individual's account plus (ii)
the aggregate amount distributed within the five (5) year
period ending on the Determination Date. With respect to a
defined benefit plan, "Benefit Amount" shall mean (i) the
present value of an individual's normal retirement benefit
determined as of such plan's Valuation Date, plus (ii) the
aggregate among of distributions made to such individual
within the five (5) year period ending on the Determination
Date of such plan (except to the extent already included on
the Valuation Date of such plan).

(b) "Compensation" shall mean the W-2 earnings of each Participant
paid by the Employer during the Plan Year.

(d) "Key Employee" shall mean any Employee or former Employee (and
the beneficiaries of any such Employee) who at any time during
the Plan Year containing the Determination Date or during the
four (4) preceding Plan Years is: (i) an officer of the

55
<PAGE> 60
Employer having an annual Compensation greater than 150
percent of the dollar limit in effect under Code Section
415(c)(1)(A), (ii) an owner (or considered as owner under Code
Section 318) of one of the ten (10) largest interests in the
Employer having an annual Compensation greater than the dollar
limit in effect under Code Section 415(c)(1)(A), (iii) a five
percent (5%) owner of the Employer or (iv) a one percent (1%)
owner of the Employer who has an annual Compensation of more
than $150,000.

For purposes of (1) above, no more than fifty (50) Employees
(or, if lesser, the greater of three (3) Employees or ten
percent (10%) of all Employees) shall be treated as officers.
For purposes of (ii) above, if two (2) Employees have the
same interest in the Employer, the Employee having the
greater annual Compensation from the Employer shall be
treated as having a larger interest. The determination of
who is a Key Employee will be made in accordance with Section
416(i) of the Code and the regulations thereunder.

(e) "Non-Key Employee" shall mean an Employee who is not a Key
Employee.

(f) "Permissive Aggregation Group" shall mean the Required
Aggregation Group plus any other plan or plans of the Employer
which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the requirements
of Sections 401(a)(4) and 410 of the Code.

(g) "Required Aggregation Group" shall mean a group of plans
maintained by the Employer comprised of (i) each qualified
plan of the Employer in which at least one Key Employee
participates and (ii) any other qualified plan of the Employer
which enables a plan described in (i) above to meet the
requirements of Sections 401(a)(4) or 410 of the Code.

(h) "Super Top-Heavy Plan" shall mean a plan as to which, for any
Plan Year beginning after December 31, 1983, any of the
following conditions exists:

(i) The Top-Heavy Ratio for the Plan exceeds ninety
percent (90%) and the Plan is not part of a Required
Aggregation Group or Permissive Aggregation Group;

(ii) The Plan is part of a Required Aggregation Group but
not part of a Permissive

<PAGE> 61
Aggregation Group and the Top-Heavy Ratio for the
group of plans exceeds ninety percent (90%); or

(iii) The plan is part of a Required Aggregation Group and
a Permissive Aggregation Group and the Top-Heavy
Ratio for the Permissive Aggregation Group exceeds
ninety percent (90%).

(i) "Top-Heavy Plan" shall mean a plan as to which, for any Plan
Year beginning after December 31, 1983, any of the following
conditions exists:

(i) The Top-Heavy Ratio for the Plan exceeds sixty
percent (60%) and the plan is not part of a Required
Aggregation Group or Permissive Aggregation Group;

(ii) The plan is part of a Required Aggregation Group but
not part of a Permissive Aggregation Group and the
Top-Heavy Ratio for the group of plans exceeds sixty
percent (60%); or

(iii) The Plan is part of a required Aggregation Group and
a Permissive Aggregation Group and the Top-Heavy
Ratio for the Permissive Aggregation Group exceeds
sixty percent (60%).

(j) "Top-Heavy Ratio" shall mean the ratio, as of the
Determination Date, of the sum of the Benefit Amounts of all
Key Employees to the sum of the Benefit Amounts of all
Participants. The calculation of this ratio, and the extent to
which distributions, rollovers and transfers are taken into
account will be made in accordance with Section 416 of the
Code and the regulations thereunder. When aggregating plans,
the value of account balances and accrued benefits will be
calculated with reference to the Determination Dates that fall
within the same calendar year. For purposes of determining the
Top-Heavy Ratio of a Required Aggregation Group, the Benefit
Amount of any individual shall also include any distributions
made within the five (5) year period ending on the
Determination Date under a terminated plan which, if it had
not been terminated, would have been included in the Required
Aggregation Group. For Plan Years beginning after December
31, 1984, the Benefit Amount of any individual who has
received

57
<PAGE> 62
no compensation from any Employer maintaining the Plan at any
time during the five (5) year period ending on the
Determination Date shall not be taken into account when
computing this ratio.

(k) "Valuation Date" means, with respect to a defined benefit
plan, the date used for determining plan costs maintained by
the Employer for minimum funding purposes which falls within
the twelve (12) month period ending on the Determination Date.

11.03 Minimum Allocation.

(a) Except as otherwise provided in sub-sections (c) and (d)
below, the Employer Contributions and Forfeitures allocated on
behalf of any Participant who is not a Key Employee and who is
employed by the Employer on the last day of the Plan Year
shall not be less than the lesser of: (i) three percent (3%)
of such Participant's Compensation or (ii) that percentage of
Compensation equal to the largest percentage of Employer
Contributions and Forfeitures (as a percentage of the first
$200,000 of the Key Employee's Compensation) allocated on
behalf of any Key Employee of that Plan Year.

The minimum allocation shall be made even though, under other
Plan provisions, the Participant would not otherwise be
entitled to an allocation, or would receive a lesser
allocation for the year, because of (i) the Participant's
failure to complete 1,000 Hours of Service, (ii) the
Participant's failure to make mandatory contributions to the
Plan, or (iii) Compensation less than a stated amount.

(b) In determining whether the Employer has satisfied the minimum
allocation requirements of this Section, contributions or
benefits provided under the Social Security Act shall not be
taken into account. In addition, for Plan Years beginning
before January 1, 1985, Employer Contributions attributable to
a salary reduction or similar arrangement shall not be taken
into account; for Plan Years beginning after December 31,
1984, Employer Contributions attributable to a salary
reduction or similar arrangement shall be taken into account
for purposes of this Section 10.03.

(c) The minimum allocation requirement in sub-section (a) above
shall not apply to any Participant who was not employed by the
Employer on the last day of the Plan Year.

58
<PAGE> 63

(d) The minimum allocation requirement in sub-section (a) above
shall not apply to any Participant to the extent that the
Participant is covered under any other plan or plans of the
Employer which provides that the minimum allocation or benefit
requirement applicable to Top-Heavy Plans will be met in the
other plan or plans.

11.04 Minimum Vesting.

(a) A Participant shall be fully vested in all Employer
Contributions and forfeitures allocated to his Account upon
his completion of three (3) Years of Service. For this
purpose, the term "Year of Service" shall mean any Plan Year
in which the Participant completes at least 1,000 Hours of
Service with an Employer.

The above vesting schedule applies to all benefits within the
meaning of Section 411(a)(7) of the Code including benefits
accrued before the effective date of Section 416 of the Code
and benefits accrued before the Plan became a Top-Heavy Plan.
However, this schedule does not apply to the account balances
of any Employee who does not complete an Hour of Service after
the Plan has initially become Top-Heavy.

(b) The minimum allocation required under Section 10.03 shall not
be subject to forfeiture on account of the withdrawal of any
mandatory contributions by the Participant or by reason of the
reemployment of a retired Employee.

(c) If the Plan becomes Top-Heavy and subsequently ceases to be
such, with the result that the vesting schedule provided in
sub-section (a) is no longer in effect, a Participant's vested
percentage in his Accrued Benefit shall not be reduced. In
such event, a Participant with five (5) or more Years of
Service may elect in writing to have his vested percentage in
future Employer allocations determined in accordance with the
vesting schedule provided in sub-section (a). Such election
must be made within sixty (60) days after notification by the
Committee that the vesting schedule has changed by reason of
the Plan ceasing to be a Top-Heavy Plan. With respect to
Participants with less than five (5) Years of Service, such
vesting schedule shall apply only to benefits accrued as of
the last day of the last Plan Year in which the Plan was a
Top-Heavy Plan.

59
<PAGE> 64
11.05 Compensation Limitation.

For any Plan Year in which the Plan is Top-Heavy, only the first
$200,000 (or such larger amount as may be prescribed by the Secretary
of the Treasury or his delegate) of a Participant's Compensation shall
be taken into account for purposes of allocating Employer
Contributions and Forfeitures under the Plan.

11.06 Impact on Code Section 415 Limitations.

Sections 4.06(a)(iii) and 4.06(a)(iv) of the Plan (relating to the
combined plan fractions) shall be read by substituting "100 percent"
for "125 percent" wherever it appears therein. This substitution shall
not, however, have the effect of reducing any benefit accrued under a
defined benefit plan prior to the first day of the Plan Year in which
this provision becomes applicable. However, if the Plan is not Super
Top-Heavy, the foregoing provision shall not apply if Section 10.03(a)
were applied by substituting "four percent (4%)" for "three percent
(3%)."

11.07 Modification of Transition Rule for Defined Contribution Fraction.

If the Committee has elected to use the Code Section 415(e)(6)
transition rule provided in Section 4.06(a)(iv) of the Plan, the last
paragraph of Section 4.06(a)(iv) shall be read by substituting
"$41,500" for "51,875" in the numerator of the transition fraction.
However, if the Plan is not Super Top-Heavy, the foregoing provision

60
<PAGE> 65
shall not apply if Section 10.03(a) were applied by substituting "four
percent (4%)" for "three percent (3%)."

11.08 No Duplication of Benefits.

If the Employer also maintains a defined benefit plan and both plans
become Top-Heavy Plans, the minimum benefit requirements of Code
Section 416 will not be required to be met under both plans with
respect to Employees who are participants in both plans. Thus, if both
plans are Top-Heavy Plans, the minimum benefit requirements contained
in Code Section 416 will, with respect to such Participants, be
satisfied by providing the minimum required benefit under the defined
benefit plan.

IN WITNESS WHEREOF, the Rhodes, Inc. Employees' Savings Plan is executed this
__________ day of ___________________, 1991.

RHODES, INC.

ATTEST: BY:
--------------------------- ------------------------------
As Its President

(CORPORATE SEAL)

61
<PAGE> 66
FIRST AMENDMENT TO THE
RHODES, INC. EMPLOYEES' SAVINGS PLAN

Section 2.23 of the Plan shall be amended by adding at its end
the following:

"Specifically, a Highly Compensated Employee includes each
Employee who performs service during the determination year and is
described in one or more of the following groups:

(a) An Employee who is a 5% owner, as defined in Code Section
416(i)(1)(A)(iii), at any time during the determination year
or the look-back year;

(b) An Employee who received Compensation in excess of $75,000
(indexed in accordance with Code Section 415(d)) during the
look-back year;

(c) An Employee who receives Compensation in excess of $50,000
(indexed in accordance with Code Section 415(d)) during the
look-back year and is a member of the top-paid group for the
look-back year;

(d) An Employee who is an officer, within the meaning of Code
Section 416(i), during the look-back year and who receives
Compensation in the look-back year greater than 50% of the
dollar limitation in effect under Code Section 415(b)(1)(A)
for the calendar year in which the look-back year begins; or

(e) An Employee who is both described in (b), (c), or (d)
immediately above as modified to substitute the determination
year for the look-back year, and one of the 100 Employees who
receive the most Compensation from the Employer during the
determination year.

The "determination year" calculation is made on the basis of the
applicable year of the Plan for which a determination is being made
and the look-back calculation is made on the basis of the twelve-month
period immediately preceding such year. The "top-paid" group consists
of the top 20% of Employees ranked on the basis of Compensation
received during the year, excluding Employees described in Code
Section 414(q)(8) and Treasury Regulation Section 1.414(q)-1T(Q&A
9(b)).
<PAGE> 67
Finally, the number of officers is limited to 50 (or, if lesser, the
greater of 3 Employees or 10% of Employees), excluding those employees
who may be excluded in determining the top-paid group."

Section 4.09 of the Plan shall be amended by adding at its end
the following new Section 4.09(d):

"(d) In applying the above tests, the Matching and Participant
Contribution Percentage for a Plan Year shall be calculated
for all Employees eligible to participate in the Plan,
regardless of whether they actually participate.

In determining the Matching and Participant Contribution
Percentage of a Highly Compensated Employee who is either a 5%
owner of the Company or one of the 10 most highly compensated
Employees, all contributions by or on behalf of family members
of the Highly Compensated Employee, along with their
Compensation, are combined. The family group includes the
Highly Compensated Employee and his or her spouse and lineal
ascendants and descendants (and spouses of such lineal
ascendants and descendants). Excess aggregate contributions
of such a Highly Compensated Employee shall be determined and
reduced in accordance with Treasury Regulation Section
1.401(m)1(e)(2)(iii)."

Section 6.05 of the Plan shall be amended by adding after
Section 6.05(c) a new Section 6.05(d) as follows:

"(d) (1) Notwithstanding any provision of the Plan to the contrary
that would otherwise limit a distributee's election under this
Section, a distributee may elect, at the time and in the manner
prescribed by the Committee, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.

(2) Definitions:

(A) Eligible rollover distribution. An eligible rollover
distribution is any distribution after January 1,
1993 of all or any portion of the balance to the
credit of the distributee, except that an eligible
rollover distribution does not include: any
distribution that is one of a series of substantially
equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of
the distributee or the joint

-2-
<PAGE> 68
lives (or joint life expectancies) of the distributee
and the distributee's Beneficiary, or for a specified
period of ten years or more; any distribution to the
extent such distribution is required under Code
Section 401(a)(9); and the portion of any
distribution that is not includible in gross income
(determined without regard to the exclusion for net
unrealized appreciation with respect to employer
securities).

(B) Eligible retirement plan. An eligible retirement plan
is an individual retirement account described in Code
Section 408(a), an individual retirement annuity
described in Code Section 408(b), an annuity plan
described in Code Section 403(a), or a qualified
trust described in Code Section 401(a), that accepts
the distributee's eligible rollover distribution.
However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible
retirement plan is an individual retirement account
or individual retirement annuity.

(C) Distributee. A distributee includes an Employee or
former Employee. In addition, the Employee's or
former Employee's surviving spouse and the Employee's
or former Employee's spouse or former spouse who is
the alternate payee under a qualified domestic
relations order, as defined in Code Section 414(p),
are distributees with regard to the interest of the
spouse or former spouse.

(D) Direct Rollover. A direct rollover is a payment by
the Plan to the eligible retirement plan specified by
the distributee."

-3-
<PAGE> 69
IN WITNESS WHEREOF, the Sponsoring Employer has caused this First
Amendment to be executed as of the 4th day of February, 1994.

RHODES, INC.

BY:
-------------------------------

Title: Senior Vice President
---------------------------

ATTEST:

BY: /s/ Jack Hurst
----------------------------

TITLE: Senior Vice President
-------------------------

[CORPORATE SEAL]
<PAGE> 70
SECOND AMENDMENT TO THE
RHODES, INC. EMPLOYEES' SAVINGS PLAN

THIS SECOND AMENDMENT is hereby made by Rhodes, Inc., a
corporation organized and existing under the laws of the State of Georgia (the
"Sponsoring Employer").

W I T N E S S E T H :

WHEREAS, the Sponsoring Employer maintains the Rhodes, Inc.
Employees' Savings Plan (the "Plan"); and

WHEREAS, the Sponsoring Employer now desires to add a company
stock fund as an investment option in the Plan and to make certain other
amendments as necessary and required by law; and

WHEREAS, the Board of Directors of the Sponsoring Employer has
duly approved and authorized this amendment to the Plan;

NOW, THEREFORE, the Sponsoring Employer does hereby amend the
Plan, effective January 1, 1994, as follows:

A new subsection (d) shall be added to the end of Section 2.11
which shall read as follows:

"(d) In addition to the other applicable limitations set forth
in the Plan, and notwithstanding any other provision of the
Plan to the contrary, for Plan Years beginning on or after
January 1, 1994, the annual Compensation of each Employee
taken into account under the Plan shall not exceed the OBRA
'93 annual compensation limit. The OBRA '93 annual
compensation limit is $150,000, as adjusted by the
Commissioner for increases in the cost of living in accordance
with section
<PAGE> 71
401(a)(17)(B) of the Code. The cost-of-living adjustment in
effect for a calendar year applies to any period, not
exceeding 12 months, over which Compensation is determined
(determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the
OBRA '93 annual compensation limit will be multiplied by a
fraction, the numerator of which is the number of months in
the determination period, and the denominator of which is 12.

For Plan Years beginning on or after January 1, 1994, any
reference in this Plan to the limitation under section
401(a)(17) of the Code shall mean the OBRA '93 annual
compensation limit set forth in this provision.

If Compensation for any prior determination period is taken
into account in determining an Employee's benefits accruing in
the current Plan Year, the Compensation for that prior
determination period is subject to the OBRA '93 annual
compensation limit in effect for that prior determination
period. For this purpose, for determination periods beginning
before the first day of the first Plan Year beginning on or
after January 1, 1994, the OBRA '93 annual compensation limit
is $150,000."

The first sentence of Section 5.02 is hereby deleted and
replaced with the following new sentence:

"Each Participant shall direct, on an Investment Directive
form provided by the Committee, the allocation or reallocation
of his Account (which includes the Employer Account) among the
Investment Funds described below and in the Trust Agreement,
subject to the following limitations:

(a) No less than twenty-five percent (25%) of an Account
shall be Allocated to any Investment Fund.
<PAGE> 72
(b) One hundred percent (100%) of an Account may be
Allocated to Investment Fund A.

(d) No more than seventy-five percent (75%) of an Account
may be Allocated to Fund C.

(e) Allocations shall be in increments of twenty-five
percent (25%) of an Account."

The paragraph entitled "Fund B" at the end of Section 5.02 is
hereby deleted and replaced with the following new paragraph:

"Fund B (the "Company Stock Fund") invested exclusively in the
common stock of the Company. Fund B shall be available for
investment only upon express authorization by the Company's
Board of Directors.

A new paragraph shall be added to the end of Section 6.06
which shall read as follows:

"Unless otherwise directed, any withdrawals made under this
Section 6.06 shall come from all other Investment Funds in
which a Participant has invested a portion of his or her
Account before any funds may be withdrawn from the Company
Stock Fund."
<PAGE> 73
5.

A new sentence shall be added between the first and second
sentences of Section 11.03(a) which shall read as follows:

"For Plan Years beginning on or after January 1, 1994, the
applicable percentage set forth in the preceding sentence
shall be a percentage of the first $150,000 of the Key
Employee's Compensation."

A new sentence shall be added at the end of Section 11.05
which shall read as follows:

"For Plan Years beginning on or after January 1, 1994, only
the first $150,000 (or such larger amount as may be prescribed
by the Commissioner of Revenue or his delegate) of a
Participant's Compensation shall be taken into account in
Top-Heavy Plan Years for purposes of allocating Employer
Contributions and Forfeitures under the Plan."

Except as specifically provided herein, the Plan shall remain
in full force and effect as prior to this Second Amendment.
<PAGE> 74
THIRD AMENDMENT TO THE
RHODES, INC. EMPLOYEES' SAVINGS PLAN

Section 2.10 of the Plan shall be redesignated as Section
2.10(a).

Section 2.10 of the Plan shall be amended by adding Sections
2.10(b) through (d) as follows:

"(b) In addition to the other applicable limitations set forth in
the Plan, and notwithstanding any other provision of the Plan
to the contrary, for Plan Years beginning on or after January
1, 1994, the annual compensation of each Employee taken into
account under the Plan shall not exceed the OBRA '93 annual
compensation limit. The OBRA '93 annual compensation limit is
$150,000, as adjusted by the Commissioner for increases in the
cost of living in accordance with Section 401(a)(17)(B) of the
Code. The cost-of-living adjustment in effect for a calendar
year applies to any period, not exceeding 12 months, over
which compensation is determined (determination period)
beginning in such calendar year. If a determination period
consists of fewer than 12 months, the OBRA '93 annual
compensation limit will be multiplied by a fraction, the
numerator of which is the number of months in the
determination period, and the denominator of which is 12.

(c) For Plan Years beginning on or after January 1, 1994, any
reference in this Plan to the limitation under Section
401(a)(17) of the Code shall mean the OBRA '93 annual
compensation limit set forth in this provision.

(d) If compensation for any prior determination period is taken
into account in determining an Employee's benefits accruing in
the current Plan Year, the compensation for that prior
determination period is subject to the OBRA '93 annual
compensation limit in effect for that prior determination
period. For this purpose, for determination periods beginning
before the first day of the first Plan Year beginning on or
after January 1, 1994, the OBRA '93 annual compensation limit
is $150,000."
<PAGE> 75
Except as specifically provided herein, the Plan shall remain
in full force and effect as prior to this Third Amendment.

IN WITNESS WHEREOF, the Sponsoring Employer has caused this
Third Amendment to be executed as of the 18th day of November, 1994.

RHODES, INC.

By:
------------------------------

Title: Senior Vice President
---------------------------

ATTEST:

/s/ Jack Hurst
--------------------------------

Title: Senior Vice President
-------------------------

[CORPORATE SEAL]