EXHIBIT 10.4

                              LADD FURNITURE, INC.

                         1998 MANAGEMENT INCENTIVE PLAN

                                 PLAN HIGHLIGHTS


1. Incentive payments based on financial performance and individual performance
as follows:

                  For Corporate Participants
                           o  achievement of PBTDA targets
                           o  achievement of individual objectives

                  For Operating Group and Company Participants
                           o  achievement of PBTDA targets
                           o  LADD PBTDA targets
                           o  achievement of individual objectives

2.       No individual objective incentive payments will be made to any
         individual if the operating unit to which the individual is assigned
         does not achieve minimum PBTDA targets. Incentive payment expense will
         be accrued in results before calculation of profit.

3.       Maximum incentives range from 20% to 120% of January 1, 1998 base
         salary. Incentive payments are based on achieving performance criteria
         established by senior management and approved by the Board of
         Directors.

4.       Program includes $50,000 discretionary incentive pool for extraordinary
         performance by LADD employees not covered by the Management Incentive
         Plan.

5.       Incentives earned in 1998 will be paid in cash after completion of
         annual audit (not later than March 31, 1999).

6.       In the event of a transfer of a participant during the fiscal year to
         an operating unit other than the unit in which originally a Plan
         participant, an appropriate adjustment will be made in Incentive Plan
         eligibility pro-rata for the time worked in each unit.

7.       In the event of a promotion of a participant within the same operating
         unit, an appropriate adjustment will be made in Incentive Plan
         eligibility pro-rata. In the event of a demotion which would place
         participants in a position substantially different from that in which
         they were nominated as a participant, an appropriate adjustment may be
         made as to the amount of incentive payment for which they are eligible
         as determined by the Compensation Committee of the Board of Directors.

8.       Participants will forfeit all income from plan if employment is
         terminated prior to January 1, 1999 for any reason other than death,
         disability or retirement (over age 55).

9.       The 1998 Management Incentive Plan only applies to fiscal year 1998.