THE LIMITED SPACE OF THE LA-Z-BOY SHOWCASE SHOPPES SIMPLY

wasn't enough. The solution - a network of La-Z-Boy superstores. The new "La-Z-Boy Furniture Galleries", as they were called, each featured fully decorated room vignettes in four major galleries - a Living Room Gallery, a Family Room Gallery, a Leather Gallery and a Chair Gallery.

Yes, the world that fell in love with the La-Z-Boy recliner could now find that same comfort and quality in furniture for practically any room. La-Z-Boy set out to tell the world "We Make The Rooms That Make A Home". Lending a hand - actually a couple of paws - to the effort were two mischievous raccoons named Wendall and Al.

Introduced in 1996, these loveable spokes-animals rose to commercial stardom by showing off the expanded La-Z-Boy product line and dispelling the "common misconception among raccoons" - and consumers - that La-Z-Boy only made recliners.

BUT DON'T THINK FOR A MINUTE THAT LA-Z-BOY ABANDONED

the chair that made it famous. No way! As the world telecommuted, tangled itself in the web of the Internet, and traveled the information super highway, demand increased for furnishings that offered both comfort and convenience

La-Z-Boy responded with chairs that did pretty much anything you could imagine - rock, swivel, glide and lift. Today, there are even designs that feature storage units, massage and heat functions, built-in phones, laptop computer modem hook-ups and thermo- electric compartments to keep your drinks cool!

What will they think of next?

NO MATTER WHAT COMES NEXT, YOU CAN BE SURE IT WILL BE MADE

with the same comfort and quality that has always been built into La-Z-Boy products. To ensure that every product earns the right to carry the La-Z-Boy name, the company operates an on-site test lab at its headquarters in Monroe.

The only accredited testing facility in the residential furniture industry, the La-Z-Boy Test Lab ensures that every new product meets the stringent quality requirements that have made La-Z-Boy the most trusted name in furniture.

SOMETIMES REAL PEOPLE ARE BROUGHT IN AND BELIEVE IT OR NOT

paid to sit down on the job. Now, you may think that sitting and reclining all day sounds like an easy job, but quite frankly, it can be a challenge- testers often say the toughest part of their job is keeping themselves from falling asleep - which some have done and were subsequently let go.

Today, no matter where you go, there's a good chance La-Z-Boy will be there too. No longer solely a chair company, La-Z-Boy has grown into a multi-dimensional organization offering a wide range of products. In addition to those developed by La-Z-Boy, many of the company's new offerings are a result of an aggressive acquisition strategy.

By obtaining furniture companies like Hammary, Kincaid, England/Corsair, Centurion, Sam Moore, Bauhaus USA and others, La-Z-Boy has gained access to new market niches and new customers. La-Z-Boy also is a growing force in the business and healthcare furniture markets through its Business Furniture Group.

WITH ALL THIS DIVERSITY, THE NAME LA-Z-BOY CHAIR COMPANY

no longer accurately represented the company. That's why, in 1996, shareholders voted to change the name to La-Z-Boy Incorporated.

The next year brought both celebration and sorrow to the people of La-Z-Boy. The entire company shared in the excitement when La-Z-Boy exceeded $1 billion in annual sales. No one was more proud than Charles T. Knabusch who had seen the company grow from a small family-run operation into one of the largest furniture manufacturers in the world.

Sadly, in October 1997, Charles died suddenly, leaving behind the legacy of innovation, quality and hard work started by his father and Edwin Shoemaker.

GUIDED BY THIS LEGACY, LA-Z-BOY CONTINUES TO OUTPERFORM

the industry in many ways, most notably in the popularity of its product offerings and the diversity of its distribution network, which includes independent furniture dealers, regional and national chains, along with its proprietary La-Z-Boy in-store gallery network and La-Z-Boy Furniture Galleries stores. In the years to come, La-Z Boy will continue to strive toward its goal of bringing La-Z-Boy comfort and quality to as many people as possible by introducing exciting new furniture styles and expanding its distribution - both domestically and abroad.

Currently, La-Z-Boy products are manufactured and distributed under license in many major international countries, including England, Germany, Italy, Japan, Mexico, New Zealand and South Africa. Additionally, the company is opening new international retail locations each year. Already, there is a strong and growing network of La-Z-Boy Furniture Galleries stores throughout Canada. And recently, the company opened the first La-Z-Boy Furniture Galleries outside of North America - in Madrid, Spain. Soon, the whole world will be able to enjoy the unparalleled comfort of La-Z-Boy furniture.

THE LITTLE FURNITURE COMPANY STARTED IN A GARAGE BY "THE TWO EDS"

has grown into the nation's largest manufacturer of upholstered furniture and the world's leading producer of reclining chairs - selling twice as many recliners as its closest competitor. And the company has no plans to kick its feet up and relax.

But don't expect the company to stray too far from its roots. Growth and success in the future will continue to be driven by the same values that made the first chair possible - a passion for innovation and a dedication to producing quality, comfortable furniture.