10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549
FORM 10-Q
(MARK ONE)
/ X /   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 29, 2012.
OR
/    /   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________________ to ____________________
Commission File Number: 1-14225
HNI Corporation (Exact name of registrant as specified in its charter)
Iowa (State or other jurisdiction of incorporation or organization)	42-0617510 (I.R.S. Employer Identification Number)
P. O. Box 1109, 408 East Second Street Muscatine, Iowa 52761-0071 (Address of principal executive offices)	52761-0071 (Zip Code)
Registrant's telephone number, including area code:  563/272-7400
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES       x                     NO     o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES       x                     NO     o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer      x                                                                                                      Accelerated filer       o Non-accelerated filer        o   (Do not check if a smaller reporting company)                    Smaller reporting company     o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).                                                             YES        o                   NO      x
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date.
Class Common Shares, $1 Par Value	Outstanding at September 29, 2012 45,148,538

HNI Corporation and SUBSIDIARIES
INDEX
PART I.    FINANCIAL INFORMATION
	Page
Item 1.    Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets - September 29, 2012, and December 31, 2011	3
Condensed Consolidated Statements of Comprehensive Income - Three Months Ended September 29, 2012, and October 1, 2011	5
Condensed Consolidated Statements of Comprehensive Income - Nine Months Ended September 29, 2012, and October 1, 2011	6
Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 29, 2012, and October 1, 2011	7
Notes to Condensed Consolidated Financial Statements	8
Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.    Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.    Controls and Procedures	21
PART II.    OTHER INFORMATION
Item 1.    Legal Proceedings	22
Item 1A. Risk Factors	22
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3.    Defaults Upon Senior Securities - None	-
Item 4.    Mine Safety Disclosures - Not Applicable	-
Item 5.    Other Information - None	-
Item 6.    Exhibits	22
SIGNATURES	23
EXHIBIT INDEX	24

2

PART I.     FINANCIAL INFORMATION

Item 1. Financial Statements

HNI Corporation and SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
	September 29, 2012		December 31, 2011
ASSETS	(In thousands)
CURRENT ASSETS
Cash and cash equivalents	$	49,265	$	72,812
Short-term investments	7,250		9,157
Receivables	247,297		204,036
Inventories (Note C)	104,879		101,873
Deferred income taxes	19,500		18,797
Prepaid expenses and other current assets	27,986		27,365
Total Current Assets	456,177		434,040
PROPERTY, PLANT, AND EQUIPMENT
Land and land improvements	26,936		23,197
Buildings	267,633		264,081
Machinery and equipment	464,753		468,926
Construction in progress	16,727		11,911
	776,049		768,115
Less accumulated depreciation	537,749		538,388
Net Property, Plant, and Equipment	238,300		229,727
GOODWILL	293,359		270,761
OTHER ASSETS	134,946		119,730
Total Assets	$	1,122,782	$	1,054,258

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

3

HNI Corporation and SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
	September 29, 2012		December 31, 2011
LIABILITIES AND  EQUITY	(In thousands, except share and per share value data)
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	401,122	$	358,290
Note payable and current maturities of long-term     debt and capital lease obligations	43,877		30,345
Current maturities of other long-term obligations	266		275
Total Current Liabilities	445,265		388,910
LONG-TERM DEBT	150,159		150,200
CAPITAL LEASE OBLIGATIONS	259		340
OTHER LONG-TERM LIABILITIES	56,814		52,716
DEFERRED INCOME TAXES	49,602		42,770
EQUITY
HNI Corporation shareholders' equity:
Capital Stock:
Preferred, $1 par value, authorized 2,000,000 shares, no shares outstanding	—		—
Common, $1 par value, authorized 200,000,000 shares, outstanding -
September 29, 2012 – 45,148,538 shares;
December 31, 2011 – 44,855,207 shares	45,149		44,855
Additional paid-in capital	24,315		24,277
Retained earnings	347,156		348,210
Accumulated other comprehensive income	3,422		1,715
Total HNI Corporation shareholders' equity	420,042		419,057
Noncontrolling interest	641		265
Total Equity	420,683		419,322
Total Liabilities and Equity	$	1,122,782	$	1,054,258

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

4

HNI Corporation and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
	Three Months Ended
	September 29, 2012			October 1, 2011
	(In thousands, except share and per share data)
Net sales	$	550,855		$	504,220
Cost of sales	359,519			324,825
Gross profit	191,336			179,395
Selling and administrative expenses	149,421			138,671
Restructuring and impairment	172			277
Operating income	41,743			40,447
Interest income	155			222
Interest expense	2,658			2,567
Income before income taxes	39,240			38,102
Income taxes	15,036			13,186
Net income	24,204			24,916
Less: Net (loss) attributable to the noncontrolling interest	(286		)	(31		)
Net income attributable to HNI Corporation	$	24,490		$	24,947
Net income attributable to HNI Corporation per common share – basic	$	0.54		$	0.56
Average number of common shares outstanding – basic	45,224,059			44,787,437
Net income attributable to HNI Corporation per common share – diluted	$	0.53		$	0.55
Average number of common shares outstanding – diluted	45,820,422			45,637,042
Cash dividends per common share	$	0.24		$	0.23
Other comprehensive income (loss), net of tax of 2012 $218; 2011 $(192)	1,661			(454		)
Comprehensive income	25,865			24,462
Less: Comprehensive income (loss) attributable to noncontrolling interest	(286		)	(31		)
Comprehensive income attributable to HNI Corporation	$	26,151		$	24,493

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

5

HNI Corporation and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
	Nine Months Ended
	September 29, 2012			October 1, 2011
	(In thousands, except share and per share data)
Net sales	$	1,476,467		$	1,333,181
Cost of sales	973,191			872,132
Gross profit	503,276			461,049
Selling and administrative expenses	444,610			407,281
Restructuring and impairment	1,361			2,130
Operating income	57,305			51,638
Interest income	610			465
Interest expense	8,181			9,189
Income before income taxes	49,734			42,914
Income taxes	18,785			15,192
Net income	30,949			27,722
Less: Net income (loss) attributable to the noncontrolling interest	(425		)	(127		)
Net income attributable to HNI Corporation	$	31,374		$	27,849
Net income attributable to HNI Corporation per common share – basic	$	0.69		$	0.62
Average number of common shares outstanding – basic	45,265,050			44,795,155
Net income attributable to HNI Corporation per common share – diluted	$	0.68		$	0.61
Average number of common shares outstanding – diluted	45,839,917			45,683,520
Cash dividends per common share	$	0.71		$	0.69
Other comprehensive income, net of tax of 2012 $117; 2011 $217	1,707			775
Comprehensive income	32,656			28,497
Less: Comprehensive income (loss) attributable to noncontrolling interest	(425		)	(127		)
Comprehensive income attributable to HNI Corporation	$	33,081		$	28,624

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

6

HNI Corporation and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
	Nine Months Ended
	September 29, 2012			October 1, 2011
	(In thousands)
Net Cash Flows From (To) Operating Activities:
Net income	$	30,949		$	27,722
Noncash items included in net income:
Depreciation and amortization	32,104			35,135
Other postretirement and post employment benefits	1,259			1,245
Stock-based compensation	5,039			5,210
Excess tax benefits from stock compensation	(4,156		)	(99		)
Deferred income taxes	6,288			7,412
Loss on sale, retirement and impairment of long-lived assets and intangibles	649			397
Stock issued to retirement plan	4,864			4,906
Other – net	1,506			(834		)
Net increase (decrease) in operating assets and liabilities	(391		)	(18,785		)
Increase (decrease) in other liabilities	2,725			4,663
Net cash flows from (to) operating activities	80,836			66,972
Net Cash Flows From (To) Investing Activities:
Capital expenditures	(27,297		)	(16,937		)
Proceeds from sale of property, plant and equipment	596			2,697
Capitalized software	(17,362		)	(3,257		)
Acquisition spending, net of cash acquired	(26,894		)	—
Purchase of investments	(4,752		)	(14,555		)
Sales or maturities of investments	3,962			5,857
Other – net	40			413
Net cash flows from (to) investing activities	(71,707		)	(25,782		)
Net Cash Flows From (To) Financing Activities:
Proceeds from sales of HNI Corporation common stock	4,610			2,607
Withholdings related to net share settlements of equity based awards	(5,995		)	—
Purchase of HNI Corporation common stock	(13,359		)	(10,000		)
Proceeds from long-term debt	105,000			5,455
Payments of note and long-term debt and other financing	(94,855		)	(5,973		)
Excess tax benefits from stock compensation	4,156			99
Dividends paid	(32,233		)	(30,940		)
Net cash flows from (to) financing activities	(32,676		)	(38,752		)
Net increase (decrease) in cash and cash equivalents	(23,547		)	2,438
Cash and cash equivalents at beginning of period	72,812			99,096
Cash and cash equivalents at end of period	$	49,265		$	101,534

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

7

HNI Corporation and SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

September 29, 2012

Note A.  Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  The December 31, 2011 consolidated balance sheet included in this Form 10-Q was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. An adjustment was made in the third quarter of 2012 to correct a second quarter freight over accrual of $0.9 million. This correction of the freight accrual (included in "Accounts payable and accrued expenses" in the Condensed Consolidated Balance Sheet) was determined to be immaterial to the current and prior period interim financial statements. Operating results for the nine-month period ended September 29, 2012 are not necessarily indicative of the results that may be expected for the fiscal year ending December 29, 2012.  For further information, refer to the consolidated financial statements and accompanying notes included in HNI Corporation's (the "Corporation") Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

Note B. Stock-Based Compensation

The Corporation measures stock-based compensation expense at grant date, based on the fair value of the award, and recognizes expense over the employee requisite service period.  For the three and nine months ended September 29, 2012, and October 1, 2011, the Corporation recognized $1.4 million and $5.0 million, and $1.8 million and $5.2 million, respectively, of stock-based compensation expense for the cost of stock options and time-based restricted stock units issued under the HNI Corporation 2007 Stock-Based Compensation Plan and shares issued under the HNI Corporation 2002 Members' Stock Purchase Plan.

At September 29, 2012, there was $9.3 million of unrecognized compensation cost related to nonvested stock-based compensation awards, which the Corporation expects to recognize over a weighted-average remaining service period of 1.3 years.

Note C.  Inventories

The Corporation values its inventory at the lower of cost or market with approximately 72% valued by the last-in, first-out ("LIFO") costing method.

(In thousands)	September 29, 2012			December 31, 2011
Finished products	$	61,859		$	65,136
Materials and work in process	68,920			62,638
LIFO allowance	(25,900		)	(25,901		)
	$	104,879		$	101,873

8

Note D.  Accumulated Other Comprehensive Income and Shareholders' Equity

The following table summarizes the components of accumulated other comprehensive income and the changes in accumulated other comprehensive income, net of tax, as applicable for the nine months ended September 29, 2012:

(In thousands)	Foreign Currency Translation Adjustment		Unrealized Gains on Marketable Securities		Pension Postretirement Liability			Derivative Financial Instruments			Accumulated Other Comprehensive Income
Balance at December 31, 2011	$	5,211	$	143	$	(3,583	)	$	(56	)	$	1,715
Year-to date change	1,500		93		241			(127		)	1,707
Balance at September 29, 2012	$	6,711	$	236	$	(3,342	)	$	(183	)	$	3,422

During the nine months ended September 29, 2012, the Corporation repurchased 528,000 shares of its common stock at a cost of approximately $13.4 million.  As of September 29, 2012, $122.4 million of the Corporation's Board of Directors' current repurchase authorization remained unspent.

During the nine months ended September 29, 2012, the Corporation paid dividends to shareholders of $0.71 per share.

Note E.  Earnings Per Share

The following table reconciles the numerators and denominators used in the calculation of basic and diluted earnings per share ("EPS"):

	Three Months Ended				Nine Months Ended
(In thousands, except per share data)	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
Numerators:
Numerator for both basic and diluted EPS attributable to HNI Corporation net income	$	24,490	$	24,947	$	31,374	$	27,849
Denominators:
Denominator for basic EPS weighted-average common shares outstanding	45,224		44,787		45,265		44,795
Potentially dilutive shares from stock-based compensation plans	596		850		575		889
Denominator for diluted EPS	45,820		45,637		45,840		45,684
Earnings per share – basic	$	0.54	$	0.56	$	0.69	$	0.62
Earnings per share – diluted	$	0.53	$	0.55	$	0.68	$	0.61

The weighted average common stock equivalents presented above do not include the effect of 1,762,597 and 1,762,597, and 2,210,257 and 1,815,085 of common stock equivalents for the three and nine months ended September 29, 2012 and October 1, 2011, respectively, because their inclusion would be anti-dilutive.

9

Note F.  Restructuring Reserve and Plant Closures

As a result of the Corporation's ongoing business simplification and cost reduction strategies, the Corporation has closed, consolidated and realigned a number of its office furniture facilities during the past few years. In connection with these closures, consolidations and realignments, the Corporation recorded $0.2 million and $1.8 million of charges during the three and nine months ended September 29, 2012 which included $0.2 million and $1.4 million of current period restructuring costs and $0.0 million and $0.4 million of accelerated depreciation recorded in cost of sales, respectively.

The following is a summary of changes in restructuring accruals during the nine months ended September 29, 2012.  

(In thousands)	Severance			Facility Exit Costs & Other			Total
Balance as of December 31, 2011	$	1,068		$	31		$	1,099
Restructuring charges	(43		)	1,404			1,361
Cash payments	(538		)	(1,435		)	(1,973		)
Balance as of September 29, 2012	$	487		$	—		$	487

Note G. Business Combinations

The Corporation completed the acquisition of 97.8% of the capital stock of BP Ergo Limited, a leading manufacturer and marketer of office furniture in India, on August 13, 2012 for a purchase price of approximately $25.5 million which included assumption of $4.2 million of short-term bank debt. BP Ergo goes to market through a national network of sales branches and dealers supported by two manufacturing locations. The Corporation is in the process of finalizing the allocation of the purchase price, with valuations and determination of working capital adjustments. The determination of fair value for the identifiable tangible and intangible assets acquired and liabilities assumed requires use of estimates and judgments. There are approximately $20.9 million of intangibles associated with this acquisition, which have all been currently classified as goodwill and will be reclassified based on final valuations.

The Corporation completed the acquisition of the pellet stove business of Dansons, Inc. on August 29, 2012 for a purchase price of approximately $1.5 million. There were approximately $1.4 million of intangible assets other than goodwill associated with this acquisition with estimated useful lives of eight years and amortization recorded based on the projected cash flow associated with the respective intangible assets’ existing relationship.

The results of the acquired businesses have been included in the Consolidated Financial Statements since the dates of acquisition and are not material to the results for the quarter ended September 29, 2012.

Note H. Goodwill and Other Intangible Assets

The table below summarizes amortizable definite-lived intangible assets as of September 29, 2012 and December 31, 2011, which are reflected in the "Other Assets" line item in the Corporation's Condensed Consolidated Balance Sheets:

(In thousands)	September 29, 2012		December 31, 2011
Patents	$	18,905	$	18,905
Customer relationships and other	104,252		102,825
Less: accumulated amortization	66,260		61,214
	$	56,897	$	60,516

Aggregate amortization expense for the nine months ended September 29, 2012 and October 1, 2011 was $5.0 million and $4.3 million, respectively.  Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five fiscal years is as follows:

10

(In millions)	2012		2013		2014		2015		2016
Amortization Expense	$	6.7	$	6.5	$	5.9	$	5.6	$	5.4

As events such as potential acquisitions, dispositions or impairments occur in the future, these amounts may change.

The Corporation also owns trademarks and trade names with a net carrying amount of $41.0 million.  The trademarks are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely.

The changes in the carrying amount of goodwill since December 31, 2011 are as follows by reporting segment:

(In thousands)	Office Furniture			Hearth Products			Total
Balance as of December 31, 2011
Goodwill	$	134,075		$	166,188		$	300,263
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	104,716			166,045			270,761
Goodwill acquired	22,598			—			22,598
Balance as of September 29, 2012
Goodwill	156,673			166,188			322,861
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	$	127,314		$	166,045		$	293,359

The Corporation evaluates its goodwill and indefinite-lived intangible assets for impairment on an annual basis during the fourth quarter, or whenever indicators of impairment exist. No indicators existed during the nine months ended September 29, 2012.  The Corporation estimates the fair value of its reporting units using various valuation techniques, with the primary technique being a discounted cash flow method.  This method employs assumptions that are market participant based. The increase in the office furniture segment relates to final purchase price allocations for an acquisition completed during the fourth quarter of 2011 as well as the BP Ergo acquisition completed in third quarter 2012. See Note G. Business Combinations footnote.

Note I.  Product Warranties

The Corporation issues certain warranty policies on its office furniture and hearth products that provide for repair or replacement of any covered product or component that fails during normal use because of a defect in design or workmanship. Reserves have been established for the various costs associated with the Corporation's warranty programs and are included in "Accounts payable and accrued expenses" in the Condensed Consolidated Balance Sheets.

A warranty reserve is determined by recording a specific reserve for known warranty issues and an additional reserve for unknown claims that are expected to be incurred based on historical claims experience.  Actual claims incurred could differ from the original estimates, requiring adjustments to the reserve.  Activity associated with warranty obligations was as follows during the periods noted:

	Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011
Balance at beginning of period	$	12,910		$	12,930
Accruals for warranties issued during period	9,846			10,471
Adjustments related to pre-existing warranties	845			(261		)
Settlements made during the period	(10,700		)	(10,906		)
Balance at end of period	$	12,901		$	12,234

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Note J.  Postretirement Health Care

The following table sets forth the components of net periodic benefit cost included in the Corporation's Condensed Consolidated Statements of Comprehensive Income for:

	Nine Months Ended
(In thousands)	September 29, 2012		October 1, 2011
Service cost	$	337	$	273
Interest cost	540		603
Amortization of transition obligation	381		381
Amortization of (gain)/loss	—		(12		)
Net periodic benefit cost	$	1,258	$	1,245

Note K.  Income Taxes

The provision for income taxes for continuing operations for the three months ended September 29, 2012 reflects an effective tax rate of 38.3 percent compared to 34.6 percent for the same period last year. The increase is due primarily to the research and development tax credit not being extended in 2012.

Note L.  Derivative Financial Instruments

The Corporation uses derivative financial instruments to reduce its exposure to adverse fluctuations in interest rates and diesel fuel prices.  On the date a derivative is entered into, the Corporation designates the derivative as (i) a fair value hedge, (ii) a cash flow hedge, (iii) a hedge of a net investment in a foreign operation or (iv) a risk management instrument not designated for hedge accounting.  The Corporation recognizes all derivatives on its Condensed Consolidated Balance Sheets at fair value.

Interest Rate Risk

In June 2008, the Corporation entered into an interest rate swap agreement, designated as a cash flow hedge, for purposes of managing its benchmark interest rate fluctuation risk.  Under the interest rate swap agreement, the Corporation paid a fixed rate of interest and received a variable rate of interest equal to the one-month London Interbank Offered Rate (LIBOR) as determined on the last day of each monthly settlement period on an aggregated notional principal amount of $50 million.  The net amount paid or received upon monthly settlements was recorded as an adjustment to interest expense, while the effective change in fair value was recorded as a component of accumulated other comprehensive income in the equity section of the Corporation's Condensed Consolidated Balance Sheets.  The interest rate swap agreement matured on May 27, 2011.

Diesel Fuel Risk

The Corporation uses independent freight carriers to deliver its products.  These carriers charge the Corporation a basic rate per mile that is subject to a mileage surcharge for diesel fuel price increases.  The Corporation enters into variable to fixed rate commodity swap agreements with two financial counterparties to manage fluctuations in fuel costs.  The Corporation hedges approximately 50% of its diesel fuel surcharge exposure for the next twelve months.  The Corporation uses the hedge agreements to mitigate the volatility of diesel fuel prices and related fuel surcharges, and not to speculate on the future price of diesel fuel.  The hedge agreements are designed to add stability to the Corporation's costs, enabling the Corporation to make pricing decisions and lessen the economic impact of abrupt changes in diesel fuel prices over the term of the contract.  The hedging instruments consist of a series of financially settled fixed forward contracts with expiration dates ranging up to twelve months.  The contracts have been designated as cash flow hedges of future diesel purchases, and as such, the net amount paid or received upon monthly settlements is recorded as an adjustment to freight expense, while the effective change in fair value is recorded as a component of accumulated other comprehensive income in the equity section of the Corporation's Condensed Consolidated Balance Sheets.

As of September 29, 2012, $0.2 million of deferred net losses, net of tax, included in equity ("Accumulated other comprehensive income" in the Corporation's Condensed Consolidated Balance Sheets) related to the diesel hedge agreements are expected to be reclassified to current earnings ("Selling and administrative expenses" in the Corporation's Condensed Consolidated Statements of Comprehensive Income) over the next twelve months.

12

The location and fair value of derivative instruments reported in the Corporation's Condensed Consolidated Balance Sheets are as follows (in thousands):

		Asset (Liability) Fair Value
	Balance Sheet Location	September 29, 2012			December 31, 2011
Diesel fuel swap	Accounts payable and accrued expenses	$	(407	)	$	(256	)
Diesel fuel swap	Prepaid expenses and other current assets	118			165
		$	(289	)	$	(91	)

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	520	Selling and administrative expenses	$	113	Selling and administrative expenses	—
Total	$	520		$	113		—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	(4	)	Selling and administrative expenses	$	194	Selling and administrative expenses	$	—
Total	$	(4	)		$	194		$	—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	—		Interest expense	$	—	None	$	—
Diesel fuel swap	(531		)	Selling and administrative expenses	246		Selling and administrative expenses	(2		)
Total	$	(531	)		$	246		$	(2	)

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The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)			Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	10	Interest expense	$	(898	)	None	$	—
Diesel fuel swap	191		Selling and administrative expenses	1,122			Selling and administrative expenses	(1		)
Total	$	201		$	224			$	(1	)

Note M.  Fair Value Measurements

For recognition purposes, on a recurring basis the Corporation is required to measure at fair value its marketable securities and derivative instruments.  The marketable securities were comprised of government securities, corporate bonds and money market funds. When available the Corporation uses quoted market prices to determine fair value and classifies such measurements within Level 1.  In some cases where market prices are not available, the Corporation makes use of observable market-based inputs (prices or quotes from published exchanges/indexes) to calculate fair value using the market approach, in which case the measurements are classified within Level 2.

Assets measured at fair value as of September 29, 2012 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,732		$	—	$	15,732		$	—
Corporate bonds	$	4,691		$	—	$	4,691		$	—
Derivative financial instruments	$	(289	)	$	—	$	(289	)	$	—

Assets measured at fair value as of December 31, 2011 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,863		$	—	$	15,863		$	—
Corporate bonds	$	3,751		$	—	$	3,751		$	—
Derivative financial instruments	$	(91	)	$	—	$	(91	)	$	—

In addition to the methods and assumptions the Corporation uses to record the fair value of financial instruments as discussed in the section above, it uses the following methods and assumptions to estimate the fair value of its financial instruments.

Cash and cash equivalents - Level 1

The carrying amount approximated fair value and includes money market funds.

Long-term debt (including current portion) - Level 2

The carrying value of the Corporation's outstanding variable-rate, long-term debt obligations at September 29, 2012 and December 31, 2011, the end of the Corporation's 2011 fiscal year, approximated the fair value.  The fair value of the Corporation's outstanding fixed-rate, long-term debt obligations is estimated based on discounted cash flow method to be $159 million at September 29, 2012 and $160 million at December 31, 2011, compared to the carrying value of $150 million.

14

Note N.  Commitments and Contingencies

The Corporation utilizes letters of credit in the amount of $14 million to back certain insurance policies and payment obligations.  The letters of credit reflect fair value as a condition of their underlying purpose and are subject to competitively determined fees.

The Corporation has contingent liabilities which have arisen in the ordinary course of its business, including liabilities relating to pending litigation, environmental remediation, taxes, and other claims.  It is the Corporation's opinion that liabilities, if any, resulting from these matters are not expected to have a material adverse effect on the Corporation's financial condition, cash flows or on the Corporation's quarterly or annual operating results when resolved in a future period.

Note O.  New Accounting Standards

In July 2012, the FASB issued accounting guidance intended to reduce the cost and complexity of the annual impairment test for indefinite-lived intangible assets other than goodwill by providing the option of performing a qualitative assessment to determine whether future impairment testing is necessary. This guidance will be effective December 30, 2012, the beginning of the Corporation's 2013 fiscal year, with early adoption allowed. The Corporation does not expect the adoption to have a material impact on its financial statements.

Note P.  Business Segment Information

Management views the Corporation as operating in two business segments: office furniture and hearth products with the former being the principal business segment.

The office furniture segment manufactures and markets a broad line of metal and wood office furniture which includes storage products, desks, credenzas, chairs, tables, bookcases, freestanding office partitions and panel systems and other related products.  The hearth products segment manufactures and markets a broad line of manufactured gas, electric, wood and biomass burning fireplaces, inserts, stoves, facings and accessories, principally for the home.

For purposes of segment reporting, intercompany sales transfers between segments are not material and operating profit is income before income taxes exclusive of certain unallocated corporate expenses.  These unallocated corporate expenses include the net cost of the Corporation's corporate operations, interest income and interest expense.  Management views interest income and expense as corporate financing costs rather than a business segment cost.  In addition, management applies one effective tax rate to its consolidated income before income taxes so income taxes are not reported or viewed internally on a segment basis.

The Corporation's primary market and capital investments are concentrated in the United States.

15

Reportable segment data reconciled to the Corporation's condensed consolidated financial statements for the three and nine month periods ended September 29, 2012, and October 1, 2011, is as follows:

	Three Months Ended						Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011			September 29, 2012			October 1, 2011
Net Sales:
Office Furniture	$	467,787		$	421,873		$	1,264,953		$	1,125,643
Hearth Products	83,068			82,347			211,514			207,538
	550,855			504,220			1,476,467			1,333,181
Operating Profit:
Office furniture
Operations before restructuring charges	$	38,605		$	41,776		$	69,707		$	69,161
Restructuring and impairment charges	(172		)	(277		)	(1,361		)	(1,711		)
Office furniture – net	38,433			41,499			68,346			67,450
Hearth products
Operations before restructuring charges	9,077			6,875			11,066			5,749
Restructuring and impairment charges	—			—			—			(419		)
Hearth products – net	9,077			6,875			11,066			5,330
Total operating profit	47,510			48,374			79,412			72,780
Unallocated corporate expense	(8,270		)	(10,272		)	(29,678		)	(29,866		)
Income before income taxes	$	39,240		$	38,102		$	49,734		$	42,914
Depreciation & Amortization Expense:
Office furniture	$	8,542		$	8,855		$	25,423		$	27,308
Hearth products	1,454			1,818			4,519			5,925
General corporate	751			700			2,162			1,902
	$	10,747		$	11,373		$	32,104		$	35,135
Capital Expenditures (including capitalized software):
Office furniture	$	10,206		$	4,578		$	25,206		$	15,812
Hearth products	519			975			1,472			1,980
General corporate	8,868			69			17,981			2,402
	$	19,593		$	5,622		$	44,659		$	20,194
							As of			As of
							September 29, 2012			October 1, 2011
Identifiable Assets:
Office furniture							$	725,763		$	618,588
Hearth products							272,951			282,168
General corporate							124,068			154,428
							$	1,122,782		$	1,055,184

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview

The Corporation has two reportable segments:  office furniture and hearth products.  The Corporation is the second largest office furniture manufacturer in the world and the nation's leading manufacturer and marketer of gas- and wood-burning fireplaces.  The Corporation utilizes its split and focus, decentralized business model to deliver value to its customers with its various brands and selling models.  The Corporation is focused on growing its existing businesses while seeking out and developing new opportunities for growth.

Net sales for the third quarter of fiscal 2012 increased 9.2 percent to $550.9 million when compared to the third quarter of fiscal 2011.  The increase was driven by new acquisitions in the office furniture segment and higher sales in the new construction channel of the hearth products segment.  Gross margins for the quarter decreased from prior year levels due to unfavorable mix, seasonal ramp up inefficiencies and the impact of acquisitions offset partially by better price realization and lower material costs.  Total selling and administrative expenses increased due to investments in growth initiatives and the impact of acquisitions. The Corporation completed the acquisition of BP Ergo, a leading manufacturer and marketer of office furniture in India, during the third quarter of 2012.

Results of Operations

The following table presents certain key highlights from the results of operations for the periods indicated:

	Three Months Ended						Nine Months Ended
(In thousands)	September 29, 2012		October 1, 2011		Percent Change		September 29, 2012		October 1, 2011		Percent Change
Net sales	$	550,855	$	504,220	9.2	%	$	1,476,467	$	1,333,181	10.7	%
Cost of sales	359,519		324,825		10.7	%	973,191		872,132		11.6	%
Gross profit	191,336		179,395		6.7	%	503,276		461,049		9.2	%
Selling and administrative expenses	149,421		138,671		7.8	%	444,610		407,281		9.2	%
Restructuring and impairment charges	172		277		(37.9	)%	1,361		2,130		(36.1	)%
Operating income	41,743		40,447		3.2	%	57,305		51,638		11.0	%
Interest expense, net	2,503		2,345		6.7	%	7,571		8,724		(13.2	)%
Income before income taxes	39,240		38,102		3.0	%	49,734		42,914		15.9	%
Income taxes	15,036		13,186		14.0	%	18,785		15,192		23.7	%
Net income	$	24,204	$	24,916	(2.9	)%	$	30,949	$	27,722	11.6	%

Consolidated net sales for the third quarter of 2012 increased 9.2 percent or $46.6 million compared to the same quarter last year. The increase was driven by new acquisitions in the office furniture segment and higher sales in the new construction channel of the hearth products segment. Acquisitions contributed $42.6 million of sales, or 8.5 percent sales growth to the third quarter of 2012.

Gross margin for the third quarter of 2012 decreased to 34.7 percent compared to 35.6 percent for the same quarter last year.  The decrease in gross margin was driven by unfavorable mix, seasonal ramp up inefficiencies and the impact of acquisitions offset partially by better price realization and lower material costs.  Third quarter 2012 included $0.2 million of accelerated depreciation and transition costs related to the closure and consolidation of office furniture manufacturing facilities compared to $0.3 million in the same period in the prior year.

Total selling and administrative expenses, including restructuring charges, as a percentage of net sales decreased to 27.2 percent compared to 27.6 percent for the same quarter last year. Benefits from sales leverage were partially offset by investments in growth initiatives and acquisition related transaction expenses.  Third quarter 2012 included $0.6 million of restructuring and transition charges associated with plant consolidations compared to $0.3 million in the same period in the prior year.

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The provision for income taxes for continuing operations for the three months ended September 29, 2012 reflect an effective tax rate of 38.3 percent compared to 34.6 percent for the same period last year. The increase is due primarily to the research and development tax credit not being extended in 2012. The 2012 estimated annual effective tax rate is expected to be 38 percent.

Net income attributable to HNI Corporation was $24.5 million or $0.53 per diluted share in the third quarter of 2012 compared to $24.9 million or $0.55 per diluted share in the third quarter of 2011.

For the first nine months of 2012, consolidated net sales increased $143.3 million, or 10.7 percent, to $1.5 billion compared to $1.3 billion for the first nine months of 2011. Gross margins decreased to 34.1 percent compared to 34.6 percent for the same period last year. Net income attributable to HNI Corporation was $31.4 million for the first nine months of 2012 compared to $27.8 million for the first nine months of 2011. Earnings per share increased to $0.68 per diluted share compared to $0.61 per diluted share for the same period last year.

Office Furniture

Third quarter 2012 sales for the office furniture segment increased 10.9 percent or $45.9 million to $467.8 million from $421.9 million for the same quarter last year. Acquisitions contributed $42.6 million of sales, or 10.1 percent sales growth to the third quarter of 2012. Organic growth was effectively flat across all channels of the office furniture segment. Third quarter 2012 operating profit prior to unallocated corporate expenses decreased 7.4 percent or $3.1 million to $38.4 million as a result of unfavorable mix, seasonal ramp up inefficiencies, investments in growth initiatives and higher restructuring and transition costs. These were partially offset by better price realization and lower material costs. Third quarter 2012 included $0.8 million of restructuring and transition costs compared to $0.5 million of restructuring and transition costs in third quarter 2011.

Net sales for the first nine months of 2012 increased 12.4 percent or $139.3 million to $1.3 billion compared to $1.1 billion for the same period in 2011. Acquisitions contributed $83.0 million of sales, or 7.4 percent sales growth for the first nine months of 2012. Organic growth was across all channels of the office furniture segment. Operating profit for the first nine months of 2012 increased 1.3 percent or $0.9 million to $68.3 million compared to $67.5 million for the same period in 2011.

Hearth Products

Third quarter 2012 net sales for the hearth products segment increased 0.9 percent or $0.7 million to $83.1 million from $82.3 million for the same quarter last year. The increase was driven by an increase in the new construction channel partially offset by a decrease in the remodel-retrofit channel.   Operating profit prior to unallocated corporate expenses increased $2.2 million to $9.1 million compared to $6.9 million in the prior year quarter due to higher price realization and lower material costs offset partially by investments in selling and growth initiatives. 

Net sales for the first nine months of 2012 increased 1.9 percent or $4.0 million to $211.5 million compared to $207.5 million for the same period in 2011. Operating profit for the first nine months of 2012 increased $5.7 million to $11.1 million compared to $5.3 million for the same period in 2011.

Liquidity and Capital Resources

Cash Flow – Operating Activities

Operating activities generated $80.8 million of cash in the first nine months of 2012 compared to $67.0 million in the first nine months of 2011.  Working capital performance resulted in a $0.4 million use of cash in the first nine months of the current fiscal year compared to a $18.8 million use of cash in the same period of the prior year driven primarily by sell through of existing inventory at a newly acquired subsidiary and change in sales momentum.   

Cash Flow – Investing Activities

Capital expenditures, including capitalized software, for the first nine months of fiscal 2012 were $44.7 million compared to $20.2 million in the same period of fiscal 2011 and were primarily for tooling and equipment for new products and the implementation of new integrated software systems to support business process transformation.  For the full year 2012, capital expenditures are expected to be approximately $55 to $60 million, primarily focused on new product development and related tooling and the business systems transformation project referred to above.

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The Corporation completed the acquisition of BP Ergo during the third quarter ended September 29, 2012 for a purchase price of approximately $25.5 million (including assumed indebtedness). The Corporation also completed the acquisition of the pellet stove business of Dansons, Inc. during the third quarter for a purchase price of approximately $1.5 million.

Cash Flow – Financing Activities

During the first nine months of fiscal 2012, net borrowings under the revolving credit facility peaked at $80 million. The net borrowings at the end of third quarter were $40 million and are classified as short-term as the Corporation expects to repay the borrowings within a year. The Corporation assumed $4.2 million of short-term bank debt with the acquisition of BP Ergo.

The Credit Agreement governing the Corporation's revolving credit facility contains a number of covenants, including covenants requiring maintenance of the following financial ratios as of the end of any fiscal quarter:

• a consolidated interest coverage ratio of not less than 4.0 to 1.0, based upon the ratio of (a) consolidated EBITDA (as defined in the Credit Agreement) for the last four fiscal quarters to (b) the sum of consolidated interest charges; and

• a consolidated leverage ratio of not greater than 3.0 to 1.0, based upon the ratio of (a) the quarter-end consolidated funded indebtedness (as defined in the Credit Agreement) to (b) consolidated EBITDA for the last four fiscal quarters; or

• a consolidated leverage ratio of not greater than 3.5 to 1.0, based upon the ratio of (a) the quarter-end consolidated funded indebtedness to (b) consolidated EBITDA for the last four fiscal quarters following any qualifying debt financed acquisition.

The note purchase agreement pertaining to the Corporation's Senior Notes also contains a number of covenants, including a covenant requiring maintenance of consolidated debt to consolidated EBITDA (as defined in the note purchase agreement) of not greater than 3.5 to 1.0, based upon the ratio of (a) the quarter-end consolidated funded indebtedness (as defined in the note purchase agreement) to (b) consolidated EBITDA for the last four fiscal quarters.

The revolving credit facility is the primary source of committed funding from which the Corporation finances its planned capital expenditures and strategic initiatives, such as acquisitions, repurchases of common stock and certain working capital needs.  Non-compliance with the various financial covenant ratios in the revolving credit facility or the Senior Notes could prevent the Corporation from being able to access further borrowings under the revolving credit facility, require immediate repayment of all amounts outstanding with respect to the revolving credit facility and Senior Notes and/or increase the cost of borrowing.

The most restrictive of the financial covenants is the consolidated leverage ratio requirement of 3.0 to 1.0 included in the Credit Agreement.  Under the Credit Agreement, adjusted EBITDA is defined as consolidated net income before interest expense, income taxes and depreciation and amortization of intangibles, as well as non-cash, nonrecurring charges and all non-cash items increasing net income.  At September 29, 2012, the Corporation was well below the maximum allowable ratio and was in compliance with all of the covenants and other restrictions in the Credit Agreement and the note purchase agreement.  The Corporation currently expects to remain in compliance over the next twelve months.

The Corporation's Board of Directors (the "Board") declared a regular quarterly cash dividend of $0.24 per share on the Corporation's common stock on August 7, 2012, to shareholders of record at the close of business on August 17, 2012. The dividend was paid on August 31, 2012.

During the nine months ended September 29, 2012, the Corporation repurchased 528,000 shares of common stock at a cost of approximately $13.4 million, or an average price of $25.30 per share.  As of September 29, 2012, approximately $122.4 million of the Board's current repurchase authorization remained unspent.

Cash, cash equivalents and short-term investments, coupled with cash from future operations, borrowing capacity under the existing facility and the ability to access capital markets, are expected to be adequate to fund operations and satisfy cash flow needs for at least the next twelve months.

Off-Balance Sheet Arrangements

The Corporation does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on the Corporation's financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

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Contractual Obligations

Contractual obligations associated with ongoing business and financing activities will result in cash payments in future periods.  A table summarizing the amounts and estimated timing of these future cash payments was provided in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2011.  During the first nine months of fiscal 2012, there were no material changes outside the ordinary course of business in the Corporation's contractual obligations or the estimated timing of the future cash payments.

Commitments and Contingencies

The Corporation is involved in various kinds of disputes and legal proceedings that have arisen in the ordinary course of business, including pending litigation, environmental remediation, taxes and other claims.  It is the Corporation's opinion, after consultation with legal counsel, that additional liabilities, if any, resulting from these matters are not expected to have a material adverse effect on the Corporation's financial condition, cash flows or on the Corporation's quarterly or annual operating results when resolved in a future period.

Critical Accounting Policies

The preparation of the financial statements requires the Corporation to make estimates and judgments that affect the reported amount of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.  The Corporation continually evaluates its accounting policies and estimates.  The Corporation bases its estimates on historical experience and on a variety of other assumptions believed by management to be reasonable in order to make judgments about the carrying value of assets and liabilities.  Actual results may differ from these estimates under different assumptions or conditions.  A summary of the more significant accounting policies that require the use of estimates and judgments in preparing the financial statements is provided in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2011.  During the first nine months of fiscal 2012, there were no material changes in the accounting policies and assumptions previously disclosed.

New Accounting Standards

For information pertaining to the Corporation's adoption of new accounting standards and any resulting impact to the Corporation's financial statements, please refer to Note O. New Accounting Standards of the Notes to the Condensed Consolidated Financial Statements, in Part 1, Item 1 of this Quarterly Report on Form 10-Q.

Looking Ahead

Despite near-term economic and political uncertainties, management remains positive about the office furniture and hearth products markets and the prospects for long-term profitable growth.  The Corporation continues its investments in selling, marketing and product initiatives to drive growth.  Management believes the Corporation is well positioned for growth.

The Corporation continues to focus on creating long-term shareholder value by growing its businesses through investment in building brands, product solutions and selling models, enhancing its strong member-owner culture and remaining focused on its long-standing continuous improvement programs to build best total cost and a lean enterprise.

Forward-Looking Statements

Statements in this report that are not strictly historical, including statements as to plans, outlook, objectives and future financial performance, are "forward-looking" statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Words, such as "anticipate," "believe," "could," "confident," "estimate," "expect," "forecast," "hope," "intend," "likely," "may," "plan," "possible," "potential," "predict," "project," "should," "will," "would" and variations of such words and similar expressions identify forward-looking statements.  Forward-looking statements involve known and unknown risks, which may cause the Corporation's actual results in the future to differ materially from expected results.  These risks include, without limitation:  the Corporation's ability to realize financial benefits from its (a) price increases, (b) cost containment and business simplification initiatives, (c) investments in strategic acquisitions, new products and brand building, (d) investments in distribution and rapid continuous improvement, (e) ability to maintain its effective tax rate, (f) repurchases of common stock and (g) consolidation and logistical realignment initiatives; uncertainty related to the availability of cash and credit, and the terms and interest rates on which credit would be available, to fund operations and future growth; lower than expected demand for the Corporation's products due to uncertain political and economic conditions, slow or negative growth rates in global and domestic economies and the protracted decline in the housing market; lower industry growth than expected; major disruptions at our key facilities or in the supply of any key raw materials, components or finished goods; competitive pricing pressure from foreign and

20

domestic competitors; higher than expected costs and lower than expected supplies of materials; higher costs for energy and fuel; changes in the mix of products sold and of customers purchasing; relationships with distribution channel partners, including the financial viability of distributors and dealers; restrictions imposed by the terms of the Corporation's revolving credit facility and note purchase agreement; currency fluctuations and other factors described in the Corporation's annual and quarterly reports filed with the Securities and Exchange Commission on Forms 10-K and 10-Q.  The Corporation undertakes no obligation to update, amend, or clarify forward-looking statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As of September 29, 2012, there were no material changes to the financial market risks that affect the quantitative and qualitative disclosures presented in Item 7A of the Corporation's Annual Report on Form 10-K for the year ended December 31, 2011.

Item 4. Controls and Procedures

Disclosure controls and procedures are designed to ensure information required to be disclosed by the Corporation in the reports it files or submits under the Securities Exchange Act of 1934 (the "Exchange Act") is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.  Disclosure controls and procedures are also designed to ensure that information is accumulated and communicated to management, including the chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of management, the chief executive officer and chief financial officer of the Corporation carried out an evaluation of the Corporation's disclosure controls and procedures pursuant to Exchange Act Rules 13a – 15(e) and 15d – 15(e).   As of September 29, 2012, based on this evaluation, the chief executive officer and chief financial officer have concluded these disclosure controls and procedures are effective.

Furthermore, there have been no changes in the Corporation's internal control over financial reporting during the fiscal quarter covered by this quarterly report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

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PART II.     OTHER INFORMATION

Item 1. Legal Proceedings

There are no new legal proceedings or material developments to report other than ordinary routine litigation incidental to the business.

Item 1A. Risk Factors

There have been no material changes from the risk factors disclosed in the "Risk Factors" section of the Corporation's Annual Report on Form 10-K for the year ended December 31, 2011.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities:

The following is a summary of share repurchase activity during the quarter ended September 29, 2012.

Period	(a) Total Number of Shares (or Units) Purchased (1)		(b) Average price Paid per Share or Unit		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet be Purchased Under the Plans or Programs
07/01/12 – 07/28/12	32,000	—	$	26.26	32,000	$	128,794,116
07/29/12 – 08/25/12	136,000		$	27.15	160,000	$	125,101,068
08/26/12 – 09/29/12	96,000		$	27.75	72,000	$	122,436,755
Total	264,000		27.26		264,000

(1) No shares were purchased outside of a publicly announced plan or program.

The Corporation repurchases shares under previously announced plans authorized by the Board as follows:

• Plan announced November 9, 2007, providing share repurchase authorization of $200,000,000 with no specific expiration date.

• No repurchase plans expired or were terminated during the third quarter of fiscal 2012, nor do any plans exist under which the Corporation does not intend to make further purchases.

Item 6. Exhibits

See Exhibit Index.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	HNI Corporation
Date: October 30, 2012	By:	/s/ Kurt A. Tjaden
		Kurt A. Tjaden
		Vice President and Chief Financial Officer

23

EXHIBIT INDEX
(10.1)	HNI Corporation 2007 Stock Based Compensation Plan as amended
(31.1)	Certification of the CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(31.2)	Certification of the CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(32.1)	Certification of CEO and CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following materials from HNI Corporation's Quarterly Report on Form 10-Q for the fiscal quarter ended September 29, 2012 formatted in XBRL (eXtensible Business Reporting Language) and furnished electronically herewith: (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Comprehensive Income; (iii) Condensed Consolidated Statements of Cash Flows; and (iv) Notes to Condensed Consolidated Financial Statements(a)

(a) Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files in Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

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EX-10.1

EXHIBIT 10.1

HNI CORPORATION

2007 STOCK-BASED COMPENSATION PLAN

TABLE OF CONTENTS

I. PURPOSES; EFFECT ON PRIOR PLANS

1.1Purpose

1.2Effect on Prior Plans

II. DEFINITIONS

III. ADMINISTRATION

3.1Power and Authority of the Committee

3.2Delegation

3.3Power and Authority of the Board

3.4Liability and Indemnification of the Plan Administrators

IV. ELIGIBILITY

V. SHARES AVAILABLE FOR AWARDS

5.1Shares Available

5.2Accounting for Awards

5.3Adjustments

5.4Award Limitations

VI. OPTIONS AND STOCK APPRECIATION RIGHTS

6.1Options

6.2Stock Appreciation Rights

VII. STOCK AWARDS

7.1Restricted Stock and Restricted Stock Units

7.2Deferred Share Units

7.3Performance Share Awards

7.4Stock Grant Awards

7.5Dividend Equivalents

VIII. GENERAL PROVISIONS GOVERNING AWARDS

8.1Consideration for Awards

8.2Awards Subject to Performance Measures

8.3Awards May Be Granted Separately or Together

8.4Forms of Payment under Awards

8.5Termination of Employment

8.6Limits on Transfer of Awards

8.7Restrictions; Securities Exchange Listing

8.8Tax Withholding

IX. AMENDMENT AND TERMINATION; CORRECTIONS

9.1Amendments to the Plan

9.2Amendments to Awards

9.3Correction of Defects, Omissions and Inconsistencies

X. CHANGE IN CONTROL

10.1Consequences of Change in Control

10.2Definition of Change in Control

XI. GENERAL PROVISIONS GOVERNING PLAN

11.1No Rights to Awards

11.2Rights as Stockholder

11.3Governing Law

11.4Award Agreements

11.5No Limit on Other Compensation Plans or Arrangements

11.6No Right to Employment

11.7Severability

11.8No Trust or Fund Created

11.9Securities Matters

11.10No Fractional Shares

11.11Headings

11.12Nontransferability

11.13No Other Agreements

11.14Incapacity

11.15Release

11.16Notices

11.17Successors

XII. EFFECTIVE DATE AND TERM OF PLAN

HNI CORPORATION

2007 STOCK-BASED COMPENSATION PLAN

HNI Corporation, an Iowa corporation (the “Corporation”), first adopted the HNI Corporation 2007 Stock-Based Compensation Plan (the “Plan”) on May 8, 2007. The Plan was amended and restated effective May 8, 2007 to comply with Section 409A of the Internal Revenue Code. The Plan was further amended effective as February 23, 2009. The Corporation hereby amends and restates the Plan, effective February 17, 2010; provided, however, that certain provisions of the Plan are subject to shareholder approval as described in Article 12.

I.PURPOSES; EFFECT ON PRIOR PLANS

1.1Purpose. The purpose of the Plan is to aid the Corporation in recruiting and retaining employees capable of assuring the future success of the Corporation through the grant of Awards of stock-based compensation. The Corporation expects that the Awards and opportunities for stock ownership in the Corporation will provide incentives to Plan participants to exert their best efforts for the success of the Corporation's business and thereby align the interests of Plan participants with those of the Corporation's stockholders. For purposes of the Plan, references to employment by the Corporation shall also mean employment by a Subsidiary.

1.2Effect on Prior Plans. From and after the date of stockholder approval of the Plan, no awards shall be granted under the Corporation's Stock-Based Compensation Plan, as amended, but all outstanding awards previously granted under that plan shall remain outstanding in accordance with their terms.

II.DEFINITIONS

In addition to other terms that may be defined elsewhere herein, wherever the following terms are used in this Plan with initial capital letters, they shall have the meanings specified below, unless the context clearly indicates otherwise.

(a)“Award” means an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Deferred Share Unit, Performance Share Award, Stock Grant Award, or Dividend Equivalent Award granted under the Plan.

(b)“Award Agreement” means any written agreement, contract or other instrument or document evidencing an Award granted under the Plan. Each Award Agreement shall be subject to the applicable terms and conditions of the Plan and any other terms and conditions (not inconsistent with the Plan) determined by the Committee.

(c)“Board” means the Board of Directors of the Corporation.

(d)“Change in Control” has the meaning set forth in Section 10.2 of the Plan.

(e)“Chief Executive Officer” means the Chief Executive Officer of the Corporation.

(f)“Code” means the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder.

(g)“Committee” means the Committee designated by the Board, consisting of two or more members of the Board, each of whom shall be: (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act; and (ii) an “outside director” within the meaning of Section 162(m) of the Code.

(h)“Corporation” means HNI Corporation, an Iowa corporation.

(i)“Deferred Share Unit” means a unit evidencing the right to receive a Share (or a cash payment equal to the Fair Market Value of a Share) at some future date.

(j)“Deferred Share Unit Award” means a right to receive Deferred Share Units granted under Section 7.2 of the Plan.

(k)“Disability or Disabled,” with respect to a Participant, means that the Participant satisfies the requirements to receive long-term disability benefits under the Corporation-sponsored group long-term disability plan in which the Participant participates without regard to any waiting periods, or that the Participant has been determined by the Social Security Administration to be eligible to receive Social Security disability benefits. A Participant shall not be considered to be Disabled unless the Participant furnishes proof of the Disability to the Corporation in such form and manner as the Corporation may require.

(l)“Dividend Equivalent” means a right granted under Section 7.5 of the Plan with respect to Restricted Stock, Restricted Stock Units, Performance Shares, Deferred Share Units or Stock Grant Awards to receive payment equivalent to the amount of any cash dividends paid by the Corporation to holders of Shares.

(m)“Eligible Employee” means any employee (including an officer) of the Corporation or a Subsidiary whom the Committee determines to be an Eligible Employee.

(n)“Exchange Act” means the Securities Exchange Act of 1934, as amended.

(o)“Fair Market Value” of a Share means the closing price of a Share as reported on the New York Stock Exchange on the date as of which such value is being determined, or, if there are no reported transactions for such date, on the next preceding date for which transactions were reported; provided, however, that if Fair Market Value for any date cannot be so determined, Fair Market Value shall be determined by the Committee by whatever means or method as the Committee, in the good faith exercise of its discretion, shall at such time deem reasonable and within the meaning of Code Section 409A and the regulations thereunder.

(p)“162(m) Employee” means a “covered employee” of the Corporation within the meaning of Section 162(m)(3), or any subsequent authority or any individual whom the Committee in its judgment determines is likely to be a “covered employee.”

(q)“Operating Unit” means either: (i) the Corporation as a whole; (ii) an individual Subsidiary, division, store, or other business unit of the Corporation; or (iii) a grouping of business units that employs the individuals that have been approved to participate in the Plan by the Board.

(r)“Option” means an option to purchase Shares granted under Section 6.1 of the Plan. All Options granted under the Plan shall be “non-statutory stock options,” meaning that they are not intended to satisfy the requirements set forth in Section 422 of the Code to be “incentive stock options.”

(s)“Participant” means an Eligible Employee who is designated by the Committee to be granted an Award under the Plan.

(t)“Performance Measure” means the criteria and objectives established by the Committee, which shall be satisfied or met as a condition to the exercisability, vesting or receipt of all or a portion of an Award. Notwithstanding the preceding sentence, in the case of a 162(m) Employee, the Performance Measure shall be based exclusively on one or more of the following corporate-wide or Subsidiary, division, or Operating Unit financial measures: (1) pre-tax profit or after-tax gross profit, (2) operating income, (3) operating profit, (4) earnings before interest, taxes, depreciation and amortization, (5) income before taxes, (6) net income, (7) revenue, (8) cash flow, (9) return on invested capital, (10) return on net assets, (11) pre-tax or after tax profit margin, (12) pre-tax or after-tax profit growth, (13) revenue growth, (14) stock price and (15) economic profit. In the sole discretion of the Committee, the Committee may amend or adjust the Performance Measures or other terms and conditions of an outstanding Award in recognition of unusual or nonrecurring events affecting the Corporation or its financial statements or changes in law or accounting principles.

Each goal described above may be expressed on an absolute or relative basis, may be based on or otherwise employ comparisons based on current internal targets, the past performance of the Corporation (including the performance of one or more Subsidiaries, divisions, or Operating Units) or the past or current performance of other companies, and in the case of earnings-based measures, may use or employ comparisons relating to capital (including, but limited to, the cost of capital), shareholders' equity and/or shares outstanding, or to assets or net assets.

(u)“Performance Share Award” means a right granted under Section 7.3 of the Plan to receive Shares contingent upon the attainment of specified Performance Measures.

(v)“Plan” means the HNI Corporation 2007 Stock-Based Compensation Plan, as set forth herein, and as may be amended or restated from time to time.

(w)“Restricted Stock” means Shares subject to forfeiture restrictions established by the Committee.

(x)“Restricted Stock Award” means a grant of Restricted Stock under Section 7.1 of the Plan.

(y)“Restricted Stock Unit” means a unit evidencing the right to receive a Share (or a cash payment equal to the Fair Market Value of a Share) at some future date subject to forfeiture restrictions established by the Committee.

(z)“Restricted Stock Unit Award” means a grant of Restricted Stock Units under Section 7.1 of the Plan.

(aa)“Retirement Eligible Date” means the date on which the Participant has either attained age 65, or age 55with ten years of service with the Corporation or a Subsidiary. The Chief Executive Officer or, with respect to the Chief Executive Officer if the Chief Executive Officer is a Participant, the Committee, in his, her or its discretion, may waive or reduce the ten-year service requirement with respect to a Participant. Notwithstanding the preceding sentence, in the case of an Award subject to Section 409A of the Code, any such waiver or reduction that could affect the timing of payment of a Participant's Award shall occur no later than the end of the calendar year preceding the year in which the Participant performs the services for which the Award is granted.

(ab)“Stock Appreciation Right” means a right to receive the appreciation in the value of a Share granted under Section 6.2 of the Plan.

(ac)“Stock Grant Award” means any right granted under Section 7.4 of the Plan.

(ad)“Share” means a share of common stock, par value of $1.00, of the Corporation or any other securities or property as may become subject to an Award pursuant to an adjustment made under Section 5.3 of the Plan.

(ae)“Subsidiary” means any corporation, joint venture, partnership, limited liability company, unincorporated association or other entity in which the Corporation has a direct or indirect ownership or other equity interest and directly or indirectly owns or controls 50 percent or more of the total combined voting or other decision‑making power.

III.ADMINISTRATION

3.1Power and Authority of the Committee. The Plan shall be administered by the Committee. Subject to the express provisions of the Plan and to applicable law, the Committee shall have full power and authority to: (a) designate Participants; (b) determine the type or types of Awards to be granted to each Participant; (c) determine the number of Shares to be covered by (or the method by which payments or other rights are to be calculated in connection with) each Award; (d) determine the terms and conditions of any Award or Award Agreement; (e) amend the terms and conditions of any Award or Award Agreement, provided, however, that, except as otherwise provided in Section 5.3 hereof, the Committee shall not reprice, adjust or amend the exercise price of Options or the grant price of Stock Appreciation Rights previously awarded to any Participant, whether through amendment, cancellation and replacement grant, or any other means; (f) accelerate the exercisability of any Award or the lapse of restrictions relating to any Award; (g) determine whether, to what extent, and under what circumstances Awards may be exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited or suspended; (h) determine whether, to what extent and under what circumstances cash or Shares payable to a Participant with respect to an Award shall be deferred either automatically or at the election of the holder of the Award or the Committee; (i) interpret and administer the Plan and any instrument or agreement, including any Award Agreement, relating to the Plan; (j) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (k) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan.

Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award or Award Agreement shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon any Participant, any holder or beneficiary of any Award or Award Agreement, and any employee of the Corporation or any Subsidiary. A majority of the Committee shall constitute a quorum. The acts of the Committee shall be either: (a) acts of a majority of the members of the Committee present at any meeting at which a quorum is present; or (b) acts approved in writing by a majority of the members of the Committee without a meeting.

3.2Delegation. The Committee may delegate some or all of its power and authority hereunder to the Chief Executive Officer or other executive officer of the Corporation as the Committee deems appropriate; provided, however, that the Committee may not delegate its power and authority with regard to: (a) the grant of an Award to any person who is a 162(m) Employee or who, in the Committee's judgment, is likely to be a 162(m) Employee at any time during the period an Award hereunder to such employee would be outstanding; or (b) the selection for participation in the Plan of an officer or other person subject to Section 16 of the Exchange Act or decisions concerning the timing, pricing or amount of an Award to such an officer or other person.

3.3Power and Authority of the Board. Notwithstanding anything to the contrary contained herein, the Board may, at any time and from time to time, without any further action of the Committee, exercise the powers and duties of the Committee under the Plan, unless the exercise of such powers and duties by the Board would cause the Plan to fail to comply with the requirements of Section 162(m) of the Code.

3.4Liability and Indemnification of Plan Administrators.No member of the Board or Committee, and neither the Chief Executive Officer nor any other executive officer to whom the Committee delegates any of its power and authority hereunder, shall be liable for any act, omission, interpretation, construction or determination made in connection with the Plan in good faith, and the members of the Board and the Committee and the Chief Executive Officer or other executive officer shall be entitled to indemnification and reimbursement by the Corporation in respect of any claim, loss, damage or expense (including attorneys' fees) arising therefrom to the full extent permitted by law, except as otherwise may be provided in the Corporation's Articles of Incorporation, Bylaws, and under any directors' and officers' liability insurance that may be in effect from time to time.

IV.ELIGIBILITY

Participants in the Plan shall consist of such Eligible Employees as the Committee in its sole discretion may select from time to time. The Committee's selection of an Eligible Employee to be a Participant with respect to any Award shall not require the Committee to select such Eligible Employee to receive any other Award at any time.

V.SHARES AVAILABLE FOR AWARDS

5.1Shares Available.Subject to adjustment as provided in Section 5.3, the total number of Shares available for all grants of Awards under the Plan shall be 5,000,000 Shares. Shares to be issued under the Plan will be authorized but unissued Shares or Shares that have been reacquired by the Corporation and designated as treasury shares. Shares that are subject to Awards that terminate, lapse or are cancelled or forfeited shall be available again for grant under the Plan. Shares that are tendered by a Participant or withheld by the Corporation as full or partial payment to the Corporation of the purchase or exercise price relating to an Award or to satisfy tax withholding obligations relating to an Award shall not be available for future grants under the Plan. In addition, if Stock Appreciation Rights are settled in Shares upon exercise, the aggregate number of Shares subject to the Award rather than the number of Shares actually issued upon exercise shall be counted against the number of Shares authorized under the Plan.

5.2Accounting for Awards.For purposes of this Article 5, if an Award entitles the holder thereof to receive or purchase Shares, the number of Shares covered by such Award or to which such Award relates shall be counted on the date of grant of such Award against the aggregate number of Shares available for granting Awards.

5.3Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of Shares or other securities of the Corporation, issuance of warrants or other rights to purchase Shares or other securities of the Corporation or other similar corporate transaction or event affects the Shares such that an adjustment is required to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of: (a) the number and type of Shares (or other securities or other property) that thereafter may be made the subject of Awards; (b) the number and type of Shares (or other securities or other property) subject to outstanding Awards; and (c) the purchase or exercise price with respect to any Award, provided such change is made in accordance with the requirements of Treas. Reg. § 1.409A-1(a)(5)(iii)(E)(4).

5.4Award Limitations.

(a)Plan Limitation on Restricted Stock, Restricted Stock Unit, Performance Share, Dividend Equivalent, Deferred Share Unit and Stock Grant Awards. No more than 2,000,000 Shares (subject to adjustment as provided in Section 5.3 of the Plan) shall be available under the Plan for issuance pursuant to Restricted Stock, Restricted Stock Unit, Performance Share, Dividend Equivalent, Deferred Share Unit and Stock Grant Awards; provided, however, that Shares subject to any such Awards that terminate, lapse or are cancelled or forfeited shall again be available for grants of Restricted Stock, Restricted Stock Units, Performance Share Awards, Dividend Equivalents, Deferred Share Unit Awards and Stock Grant Awards for purposes of this limitation on grants of such Awards.

(b)Section 162(m) Limitation for Certain Types of Awards. No Participant may be granted an Award or Awards under the Plan for more than 500,000 Shares (subject to adjustment as provided in Section 5.3 of the Plan) in the aggregate in any calendar year.

VI.OPTIONS AND STOCK APPRECIATION RIGHTS

6.1Options. The Committee may grant Options with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine:

(a)Exercise Price. The purchase price per Share purchasable under an Option shall be determined by the Committee and shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option; provided, however, that the Committee may designate a per share exercise price below Fair Market Value on the date of grant if the Option is granted in substitution for a stock option previously granted by an entity that is acquired by or merged with the Corporation or a Subsidiary and provided further than such substitution is made in accordance with the requirements of Treas. Reg. § 1.409A-1(a)(5)(iii)(E)(4).

(b)Option Term. The term of each Option shall be fixed by the Committee, but shall not be longer than ten years.

(c)Time, Method and Conditions of Exercise. The Committee shall determine the time or times at which an Option may be exercised in whole or in part including the applicable vesting period. The Committee shall also determine the method or methods by which, and the form or forms (including, without limitation, cash or Shares having a Fair Market Value on the exercise date equal to the applicable exercise price) in which, payment of the exercise price with respect thereto may be made or deemed to have been made.

6.2Stock Appreciation Rights. The Committee may grant Stock Appreciation Rights subject to the terms of the Plan and such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine including the applicable vesting period. A Stock Appreciation Right granted under the Plan shall confer on the holder thereof a right to receive upon exercise thereof the excess of: (a) the Fair Market Value of one Share on the date of exercise; over (b) the grant price of the Stock Appreciation Right as specified by the Committee, which price shall not be less than 100% of the Fair Market Value of the Share on the date of grant of the Stock Appreciation Right; provided, however, that the Committee may designate a per share grant price below Fair Market Value on the date of grant if the Stock Appreciation Right is granted in substitution for a stock appreciation right previously granted by an entity that is acquired by or merged with the Corporation or a Subsidiary and provided further than such substitution is made in accordance with the requirements of Treas. Reg. § 1.409A-1(a)(5)(iii)(E)(4). The term of the Stock Appreciation Right shall be fixed by the Committee, but shall not be longer than ten years.

VII.STOCK AWARDS

7.1Restricted Stock and Restricted Stock Units. The Committee may grant Awards of Restricted Stock and Restricted Stock Units with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine:

(a)Restrictions. Shares of Restricted Stock and Restricted Stock Units shall be subject to such restrictions as the Committee may impose (including, without limitation, satisfaction of Performance Measures or a performance period and a restriction on the right to vote a Share of Restricted Stock or the right to receive any dividend or other right or property with respect thereto), which restrictions may lapse separately or in combination at such time or times, in such installments or otherwise, as the Committee may deem appropriate. The minimum vesting period of such Awards subject to satisfaction of a Performance Measure shall be one year from the date of grant. The Committee shall determine the vesting period of such Awards subject solely to satisfaction of a performance period.

(b)Forfeiture. Subject to Sections 8.5 and 10.1, upon a Participant's termination of employment (in either case, as determined under criteria established by the Committee) during the applicable restriction period, all Shares of Restricted Stock and all Restricted Stock Units held by the Participant at such time shall be forfeited and reacquired by the Corporation.

(c)Issuance and Delivery of Shares. Any Restricted Stock granted under the Plan shall be issued at the time the Restricted Stock Award is granted and may be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of a stock certificate or certificates, which certificate or certificates shall be held by the Corporation. Such certificate or certificates shall be registered in the name of the Participant and shall bear an appropriate legend referring to the restrictions applicable to such Restricted Stock. Shares representing Restricted Stock that are no longer subject to restrictions shall be delivered to the Participant promptly after the applicable restrictions lapse or are waived.

No Shares shall be issued at the time an Award of Restricted Stock Units is granted. Rather, the Shares shall be issued and delivered to the holder of the Restricted Stock Units upon the lapse or waiver of the restrictions applicable to the Restricted Stock Units.

7.2Deferred Share Units. The Committee may grant Awards of Deferred Share Units subject to such terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine. All Deferred Share Units shall be subject to a deferral period of not less than one year, and may, in addition, be subject to such restrictions as the Committee may impose (including, without limitation, satisfaction of Performance Measures or a performance period), which restrictions may lapse separately or in combination at such time or times, in such installments or otherwise, as the Committee may deem appropriate. Deferred Share Units may be granted without additional consideration or in consideration of a payment by the Participant that is less than the Fair Market Value per Share at the date of grant. No Shares shall be issued at the time Deferred Share Units are granted. Rather, the Shares (or cash, as the case may be) shall be issued and delivered upon expiration of the deferral period relating to the Deferred Share Units (subject to the satisfaction of any applicable restrictions). Any Deferred Share Unit Award that is subject to Code Section 409A shall satisfy the requirements of Code Section 409A. The minimum vesting period of such Awards subject to satisfaction of a Performance Measure shall be one year from the date of grant. The minimum vesting period of such Awards subject solely to satisfaction of a performance period shall be three years from the date of grant.

7.3Performance Share Awards. The Committee may grant Performance Share Awards denominated in Shares that may be settled or payable in Shares (including, without limitation, Restricted Stock or Restricted Stock Units) or cash. Performance Share Awards shall be conditioned solely on the achievement of one or more Performance Measures specified by the Committee during such performance period as the Committee shall specify, but in no event shall the performance period be less than one year from the date of grant. Settlement or payment of a Performance Share Award shall be made upon satisfaction of the specified Performance Measures during the specified performance period.

7.4Stock Grant Awards. The Committee may grant Shares without restrictions thereon. Subject to the terms of the Plan, Stock Grant Awards may have such terms and conditions as the Committee shall determine.

7.5Dividend Equivalents. The Committee may grant Dividend Equivalents under which a Participant granted a Restricted Stock, Restricted Stock Unit, Performance Share, Deferred Share Unit or Stock Grant Award under this Article 7 shall be entitled to receive payment (in cash, Shares, other securities, other Awards or other property as determined in the discretion of the Committee) equivalent to the amount of any cash dividends paid by the Corporation to holders of Shares with respect to a number of Shares determined by the Committee. Subject to the terms of the Plan, such Dividend Equivalents may have such terms and conditions as the Committee shall determine. Notwithstanding the foregoing, with respect to Dividend Equivalents on Performance Share Awards, such Dividend Equivalents shall only be settled or paid when the underlying Performance Share Award is settled or paid pursuant to Section 7.3.

VIII.GENERAL PROVISIONS GOVERNING AWARDS

8.1Consideration for Awards. Awards may be granted for no cash consideration or for any cash or other consideration as may be determined by the Committee or required by applicable law.

8.2Awards Subject to Performance Measures. The Committee may, in its discretion, establish Performance Measures which shall be satisfied or met as a condition to the grant or exercisability of an Award or portion thereof. Subject to the terms of the Plan and any applicable Award Agreement, the Performance Measures to be achieved during any performance period, the length of any performance period, the amount of any Award granted, the amount of any payment or transfer to be made pursuant to any such Award, and any other terms and conditions applicable thereto shall be determined by the Committee.

Notwithstanding anything in the Plan to the contrary, in the case of a Participant who is a 162(m) Employee, a Performance Measure must be pre-established by the Committee, must be objective, and must state, in terms of an objective formula or standard, the method for computing the amount of compensation payable if the Performance Measure is attained. A Performance Measure is considered “pre-established” for purposes of this paragraph if it is established in writing by the Committee no later than 90 days after the commencement of a Performance Period, provided that the outcome is substantially uncertain at the time the Committee actually establishes the Performance Measure. However, in no event will a Performance Measure be considered to be pre-established if it is established after 25 percent of a Performance Period has elapsed. A Performance Measure is considered “objective” if a third party having knowledge of the relevant facts could determine whether the Performance Measure is met. A formula or standard is considered “objective” if a third party having knowledge of the relevant performance results could calculate the amount to be paid to the Participant. No Award to a 162(m) Employee based on the satisfaction of Performance Measures shall be paid unless and until the Committee has certified that the Performance Measures for the Performance Period have been satisfied.

8.3Awards May Be Granted Separately or Together. Awards may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with or in substitution for any other Award or any award granted under any other plan of the Corporation or any Subsidiary. Awards granted in addition to or in tandem with other Awards or in addition to or in tandem with awards granted under any other plan of the Corporation or any Subsidiary may be granted either at the same time as, or at a different time from, the grant of such other Awards or awards.

8.4Forms of Payment under Awards. Subject to the terms of the Plan and of any applicable Award Agreement, payments or transfers to be made by the Corporation or a Subsidiary upon the grant, exercise or payment of an Award may be made in such form or forms as the Committee shall determine (including, without limitation, cash, Shares, other securities, other Awards or other property, or any combination thereof), and may be made in a single payment or transfer, in installments or on a deferred basis, in each case in accordance with rules and procedures established by the Committee. Such rules and procedures may include, without limitation, provisions for the payment or crediting of reasonable interest on installment or deferred payments or the grant or crediting of Dividend Equivalents with respect to installment or deferred payments.

8.5Termination of Employment. Except as otherwise provided in this Section 8.5 and Section 10.1, all of the terms relating to the exercise, cancellation, forfeiture or other disposition of an Award granted under the Plan upon a termination of employment with the Corporation of the holder of an Award shall be determined by the Committee. Such determination shall be made at the time of the grant of such Award and shall be specified in the Award Agreement relating to the Award. Notwithstanding the foregoing, each Award granted under the Plan shall become fully exercisable and vested upon the Participant's death or Disability provided such Award had not then otherwise expired and the Participant is employed by the Corporation on the date of death or Disability. In addition thereto, in the case of an Award of an Option or Stock Appreciation Right, each such Award shall become fully exercisable and vested upon the Participant's Retirement Eligible Date, provided such Award had not then otherwise expired and the Participant is employed by the Corporation on the Retirement Eligible Date.

The Chief Executive Officer shall have discretion to accelerate the vesting of any Award not subject to Section 409A of the Code. Notwithstanding the preceding sentence, in the event the Chief Executive Officer is a Participant, for any Award granted to the Chief Executive Officer not Subject to Section 409A of the Code, only the Committee shall have discretion to accelerate the vesting of any such Award.

8.6Limits on Transfer of Awards. Except as otherwise provided by the Committee or the terms of the Plan, no Award and no right under any Award shall be transferable by a Participant other than by will or by the laws of descent and distribution. The Committee may establish procedures as it deems appropriate for a Participant to designate an individual, trust or other entity as beneficiary or beneficiaries to exercise the rights of the Participant and receive any property distributable with respect to any Award in the event of the Participant's death. The Committee, in its discretion and subject to such additional terms and conditions as it determines, may permit a Participant to transfer an Option to any “family member” (as such term is defined in the General Instructions to Form S-8 (or any successor to such Instructions or such Form) under the Securities Act of 1933, as amended) at any time that such Participant holds such Option, provided that: (a) such transfer may not be for value (i.e., the transferor may not receive any consideration therefor) and the family member may not make any subsequent transfer other than by will or by the laws of descent and distribution; (b) no such transfer shall be effective unless reasonable prior notice thereof has been delivered to the Corporation and such transfer is thereafter effected subject to the specific authorization of, and in accordance with any terms and conditions made applicable to by, the Committee or the Board; and (c) the transferee is subject to the same terms and conditions hereunder as the Participant. Each Award or right under an Award shall be exercisable during the Participant's lifetime only by the Participant (except as provided herein or in an Award Agreement or amendment thereto) or, if permissible under applicable law, by the Participant's guardian or legal representative. No Award or right under any Award may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable against the Corporation or any Subsidiary.

8.7Restrictions; Securities Exchange Listing. All Shares or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such restrictions as the Committee may deem advisable under the Plan, applicable federal or state securities laws and regulatory requirements, and the Committee may cause appropriate entries to be made or legends to be placed on the certificates for such Shares or other securities to reflect such restrictions. If the Shares or other securities are traded on a securities exchange, the Corporation shall not be required to deliver any Shares or other securities covered by an Award unless and until such Shares or other securities have been admitted for trading on such securities exchange.

8.8Tax Withholding. The Corporation may take such action as it deems appropriate to withhold or collect from a Participant the applicable federal, state, local or foreign payroll, withholding, income or other taxes that are required to be withheld or collected by the Corporation upon the grant, exercise, vesting or payment of an Award. The Committee may require the Corporation to withhold Shares having a Fair Market Value equal to the amount necessary to satisfy the Corporation's minimum statutory withholding requirements upon the grant, exercise, vesting or payment of an Award from Shares that otherwise would have been delivered to a Participant. The Committee may, subject to any terms and conditions that the Committee may adopt, permit a Participant to elect to pay all or a portion of the minimum statutory withholding taxes by: (a) having the Corporation withhold Shares otherwise to be delivered upon the grant, exercise, vesting (other than on vesting of Restricted Stock Units and Deferred Stock Units) or payment of an Award with a Fair Market Value equal to the amount of such taxes; (b) delivering to the Corporation Shares other than Shares issuable upon the grant, exercise, vesting or payment of an Award with a Fair Market Value equal to the amount of such taxes; or (c) paying cash. Any such election must be made on or before the date that the amount of tax to be withheld is determined.

IX.AMENDMENT AND TERMINATION; CORRECTIONS

9.1Amendments to the Plan. The Board may amend, alter, suspend, discontinue or terminate the Plan; provided, however, that, notwithstanding any other provision of the Plan or any Award Agreement, prior approval of the stockholders of the Corporation shall be required for any amendment to the Plan that:

(a)requires stockholder approval under the rules or regulations of the Securities and Exchange Commission, the New York Stock Exchange, any other securities exchange or the National Association of Securities Dealers, Inc. that are applicable to the Corporation;

(b)increases the number of Shares authorized under the Plan as specified in Section 5.1 the Plan;

(c)increases the number of Shares subject to the limitations contained in Section 5.4 of the Plan;

(d)permits repricing of Options or Stock Appreciation Rights which is prohibited by Section 3.1(e) of the Plan;

(e)permits the award of Options or Stock Appreciation Rights at a price less than 100% of the Fair Market Value of a Share on the date of grant of such Option or Stock Appreciation Right, contrary to the provisions of Sections 6.1(a) and 6.2 of the Plan; or

(f)would cause an exemption to Section 162(m) of the Code to become inapplicable with respect to the Plan.

9.2Amendments to Awards. Subject to the provisions of the Plan, the Committee may waive any conditions of or rights of the Corporation under any outstanding Award, prospectively or retroactively. Except as otherwise provided in the Plan, the Committee may amend, alter, suspend, discontinue or terminate any outstanding Award, prospectively or retroactively, but no such action may adversely affect the rights of the holder of such Award without the consent of the holder.

9.3Correction of Defects, Omissions and Inconsistencies. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any Award or Award Agreement in the manner and to the extent it shall deem desirable to implement or maintain the effectiveness of the Plan.

X.CHANGE IN CONTROL

10.1Consequences of Change in Control. Notwithstanding any provision in the Plan or any Award Agreement to the contrary:

(a)In the event of a Change in Control described in Section 10.2(c) or the approval by the holders of Shares of a plan of complete liquidation or dissolution of the Corporation, in connection with which the holders of Shares receive shares of common stock that are registered under Section 12 of the Exchange Act: (i) all outstanding Awards shall become immediately vested and all Options and Stock Appreciation Rights exercisable in full, with any applicable Performance Measures deemed satisfied at the maximum level; and (ii) there shall be substituted for each Share available under the Plan, whether or not then subject to an outstanding Award, the number and class of shares into which each outstanding Share shall be converted pursuant to such Change in Control. In the event of any such substitution, the purchase price per share in the case of an Option and the base price in the case of a Stock Appreciation Right shall be appropriately adjusted by the Committee, such adjustments to be made in the case of outstanding Options and Stock Appreciation Rights without an increase in the aggregate purchase price or base price.

(b)In the event of a Change in Control described in Section 10.2(a) or (b), or in the event of a Change in Control pursuant to Section 10.2(c) or the approval by the holders of Shares of a plan of complete liquidation or dissolution of the Corporation, in connection with which the holders of Shares receive consideration other than shares of common stock that are registered under Section 12 of the Exchange Act, the Committee in its discretion may require that each outstanding Award shall be surrendered to the Corporation by the holder thereof, and each such Award shall immediately be cancelled by the Corporation, and the holder shall receive, within ten days of the occurrence of a Change in Control pursuant to Section 10.2(a) or (b), below, or within ten days of the approval of the holders of Shares contemplated by Section 10.2(c) or complete liquidation or dissolution of the Corporation, a cash payment from the Corporation in an amount equal to: (i) in the case of an Option, the number of Shares subject to the Option, multiplied by the excess, if any, of the Fair Market Value of a Share on the date of the Change in Control, over the purchase price per Share subject to the Option; (ii) in the case of a Stock Appreciation Right, the number of Shares then subject to the Stock Appreciation Right, multiplied by the excess, if any, of the Fair Market Value of a Share on the date of the Change in Control, over the base price of the Stock Appreciation Right; (iii) in the case of a Restricted Stock Award, Restricted Stock Unit Award, Performance Share Award or Deferred Share Unit Award, the number of Shares then subject to such Award, multiplied by the Fair Market Value of a Share on the date of the Change in Control. In the event of a Change in Control, each tandem Stock Appreciation Right shall be surrendered by the holder thereof and shall be cancelled simultaneously with the cancellation of the related Option. The Corporation may, but is not required to, cooperate with any person who is subject to Section 16 of the Exchange Act to assure that any cash payment in accordance with the foregoing to such person is made in compliance with Section 16 and the rules and regulations thereunder.

(c)Notwithstanding anything in Section 10.1(b), if an amount becomes payable with respect to an Award upon a Change in Control pursuant to Section 10.1(b), the amount is subject to Section 409A of the Code, and the Change in Control does not constitute a “change in the ownership or effective control” or a “change in the ownership of a substantial portion of the assets” of the Corporation within the meaning of Section 409(a)(2)(A)(iv) of the Code (applying the minimum standards set forth in the accompanying Treasury Regulations for a change in control to occur), then the amount shall not be paid upon the Change in Control, but shall instead be paid at the earliest to occur of: (i) the Participant's “separation from service” with the Corporation, provided, that if the Participant is a “specified employee,” the payment date shall be the date that is six months after the date of the Participant's separation from service with the Corporation; (ii) when payment otherwise would have been made (absent Section 10.1(b)), provided the payment is made at a “time” or according to a “fixed schedule” consistent with Treas. Reg. 1.409A-3(a)(4); or (iii) the Participant's death. For purposes hereof, “separation from service” shall mean the Participant's separation from service with the Corporation and all of its affiliates, within the meaning of Section 409A(a)(2)(A)(i) of the Code and the regulations thereunder; and “specified employee” shall have the meaning set forth in the HNI Corporation Executive Deferred Compensation Plan.

10.2Definition of Change in Control. “Change in Control” shall mean:

(a)the acquisition by any individual, entity or group (with the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (i) the then outstanding Shares (the “Outstanding Corporation Common Stock”); or (ii) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Corporation, (B) any acquisition by the Corporation, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any corporation controlled by the Corporation, or (D) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 10.2; or

(b)individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Corporation's shareholders, was approved by a vote of a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(c)consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Business Combination”), in each case, unless following such Business Combination: (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, 50% or more of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Corporation or all or substantially all of the Corporation's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be; (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Corporation or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination; and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination.

XI.GENERAL PROVISIONS GOVERNING PLAN

11.1No Rights to Awards. No Eligible Employee, Participant or other person shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Eligible Employees, Participants or holders or beneficiaries of Awards under the Plan. The terms and conditions of Awards need not be the same with respect to any Participant or with respect to different Participants.

11.2Rights as Stockholder. No person shall have any right as a stockholder of the Corporation with respect to any Shares or other equity security of the Corporation which is subject to an Award hereunder unless and until such person becomes a stockholder of record with respect to such Shares or equity security.

11.3Governing Law. The Plan, each Award hereunder and the related Award Agreement, and all determinations made and actions taken pursuant thereto, to the extent not otherwise governed by the Code or the laws of the United States, shall be governed by the laws of the State of Iowa and construed in accordance therewith without giving effect to principles of conflicts of laws.

11.4Award Agreements. No Participant shall have rights under an Award granted to such Participant unless and until an Award Agreement shall have been duly executed on behalf of the Corporation and, if requested by the Corporation, signed by the Participant.

11.5No Limit on Other Compensation Plans or Arrangements. Nothing contained in the Plan shall prevent the Corporation or any Subsidiary from adopting or continuing in effect other or additional compensation plans or arrangements.

11.6No Right to Employment. The grant of an Award shall not be construed as giving a Participant the right to be retained as an employee of the Corporation or any Subsidiary, nor will it affect in any way the right of the Corporation or a Subsidiary to terminate a Participant's employment at any time, with or without cause. In addition, the Corporation or a Subsidiary may at any time dismiss a Participant from employment free from any liability or any claim under the Plan or any Award, unless otherwise expressly provided in the Plan or in any Award Agreement.

11.7Severability. If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the purpose or intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction or Award, and the remainder of the Plan or any such Award shall remain in full force and effect.

11.8No Trust or Fund Created. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Corporation or any Subsidiary and a Participant or any other person. To the extent that any person acquires a right to receive payments from the Corporation or a Subsidiary pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Corporation or the Subsidiary.

11.9Securities Matters. The Corporation shall not be required to deliver any Shares until the requirements of any federal or state securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Corporation to be applicable are satisfied.

11.10No Fractional Shares. No fractional shares of Stock shall be issued or delivered pursuant to the Plan. Any fractional share otherwise payable under the Plan shall be settled in the form of cash.

11.11Headings. Headings are given to the Articles, Sections and Subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.

11.12Nontransferability. Except as set forth in Section 8.6, no Award or other benefit payable at any time under the Plan will be subject in any manner to alienation, sale, transfer, assignment, pledge, levy, attachment, or encumbrance of any kind.

11.13No Other Agreements. The terms and conditions set forth herein constitute the entire understanding of the Corporation, the Subsidiaries and the Participants with respect to the matters addressed herein.

11.14Incapacity. In the event that any Participant is unable to care for his or her affairs because of illness or accident, any payment due may be paid to the Participant's spouse, parent, brother, sister, adult child or other person deemed by the Corporation to have incurred expenses for the care of the Participant, unless a duly qualified guardian or other legal representative has been appointed.

11.15Release. Any payment of benefits to or for the benefit of a Participant that is made in good faith by the Corporation in accordance with the Corporation's interpretation of its obligations hereunder, shall be in full satisfaction of all claims against the Corporation and all Subsidiaries for benefits under the Plan to the extent of such payment.

11.16Notices. Any notice permitted or required under the Plan shall be in writing and shall be hand-delivered or sent, postage prepaid, by first class mail, or by certified or registered mail with return receipt requested, to the Committee, if to the Corporation, or to the address last shown on the records of the Corporation, if to a Participant. Any such notice shall be effective as of the date of hand-delivery or mailing.

11.17Successors. All obligations of the Corporation under the Plan shall be binding upon and inure to the benefit of any successor to the Corporation, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and or assets of the Corporation.

XII.EFFECTIVE DATE AND TERM OF PLAN

The Plan originally became effective on May 8, 2007, the date it was approved by the shareholders of the Corporation at the Corporation's annual meeting of shareholders. Except as described below, the Plan, as amended and restated herein, shall become effective on February 17, 2010. The terms of the Plan, as amended and restated herein, apply to Awards granted on or after this date. Notwithstanding the foregoing, certain changes made to the Plan by this restatement are subject to, and dependent upon, shareholder approval. These changes are those made to the definition of “Performance Measures,” set forth in Article 2, Section (s) and to the Share limits set forth in Section 5.4. The changes to the definition of “Performance Measures” shall not apply until the shareholders of the Corporation approve these changes at their first annual meeting that occurs after February 17, 2010. Prior to that date, or if the shareholders do not to approve the changes, the terms of the Plan defining Performance Measures, as in effect prior to February 17, 2010, shall continue to apply. If the shareholders of the Corporation do not approve the increase in the Share limits, then the Share limits as in effect prior to February 17, 2010 shall continue to apply.

The Plan shall terminate at midnight on May 7, 2017, unless terminated before then by the Board. Awards may be granted under the Plan until the Plan terminates or until all Shares available for Awards under the Plan have been purchased or acquired. Notwithstanding the preceding sentence, the Plan shall remain in effect for purposes of administering outstanding Awards as long as the Awards are outstanding.

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

Sarbanes-Oxley Act Section 302

I, Stan A. Askren, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of HNI Corporation;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

    a.  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

    b.  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;    

    c.  evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

    d.  disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

    a.  all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

    b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: October 30, 2012	By:	/s/ Stan A. Askren
		Name:  Stan A. Askren
		Title:    Chairman, President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

Sarbanes-Oxley Act Section 302

I, Kurt A. Tjaden, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of HNI Corporation;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

    a.  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

    b.  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;    

    c.  evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

    d.  disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

    a.  all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

    b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: October 30, 2012	By:	/s/ Kurt A. Tjaden
		Name:  Kurt A. Tjaden
		Title:    Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Certification of CEO and CFO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of HNI Corporation (the "Corporation") for the quarterly period ended September 29, 2012, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Stan A. Askren, as Chairman, President and Chief Executive Officer of the Corporation, and Kurt A. Tjaden, as Vice President and Chief Financial Officer of the Corporation, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

1.  The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.  The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation as of the dates and for the periods expressed in the Report.

By:	/s/    Stan A. Askren
	Name:  Stan A. Askren
	Title:    Chairman, President and Chief Executive Officer
	Date: October 30, 2012

By:	/s/     Kurt A. Tjaden
	Name:   Kurt A. Tjaden
	Title:     Vice President and Chief Financial Officer
	Date: October 30, 2012

XML

Restructuring Reserve and Plant Closures (Details) (USD $)	3 Months Ended	9 Months Ended
	Sep. 29, 2012	Sep. 29, 2012
Restructuring Reserve [Roll Forward]
Balance as of December 31, 2011		$ 1,099,000
Restructuring charges		1,361,000
Cash payments		(1,973,000)
Balance as of September 29, 2012	487,000	487,000
Severance [Member]
Restructuring Reserve [Roll Forward]
Balance as of December 31, 2011		1,068,000
Restructuring charges		(43,000)
Cash payments		(538,000)
Balance as of September 29, 2012	487,000	487,000
Facility Exit Costs & Other [Member]
Restructuring Reserve [Roll Forward]
Balance as of December 31, 2011		31,000
Restructuring charges		1,404,000
Cash payments		(1,435,000)
Balance as of September 29, 2012	0	0
Office Furniture [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	200,000	1,800,000
Severance costs	200,000	1,400,000
Other restructuring costs	$ 0	$ 400,000

XML

Fair Value Measurements (Assets) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 29, 2012	Dec. 31, 2011
Assets Fair Value Disclosure [Abstract]
Derivative financial instruments	$ (289)	$ (91)
Fair Value, Measurements, Recurring [Member] | Fair Value as of Measurement Date [Member]
Assets Fair Value Disclosure [Abstract]
Derivative financial instruments	(289)	(91)
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Assets Fair Value Disclosure [Abstract]
Derivative financial instruments	0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Assets Fair Value Disclosure [Abstract]
Derivative financial instruments	(289)	(91)
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member]
Assets Fair Value Disclosure [Abstract]
Derivative financial instruments	0	0
Fair Value, Measurements, Recurring [Member] | Government Securities [Member] | Fair Value as of Measurement Date [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	15,732	15,863
Fair Value, Measurements, Recurring [Member] | Government Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	0	0
Fair Value, Measurements, Recurring [Member] | Government Securities [Member] | Significant Other Observable Inputs (Level 2) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	15,732	15,863
Fair Value, Measurements, Recurring [Member] | Government Securities [Member] | Significant Unobservable Inputs (Level 3) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	0	0
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Fair Value as of Measurement Date [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	4,691	3,751
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	0	0
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Significant Other Observable Inputs (Level 2) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	4,691	3,751
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Significant Unobservable Inputs (Level 3) [Member]
Assets Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value disclosure	$ 0	$ 0

XML

Derivative Financial Instruments (Balance Sheet Location) (Details) (USD $)			9 Months Ended
	Sep. 29, 2012	Dec. 31, 2011	Sep. 29, 2012 Diesel Fuel Swap [Member]	Sep. 29, 2012 Diesel Fuel Swap [Member] Accounts Payable and Accrued Expenses [Member]	Dec. 31, 2011 Diesel Fuel Swap [Member] Accounts Payable and Accrued Expenses [Member]	Sep. 29, 2012 Diesel Fuel Swap [Member] Prepaid Expenses and Other Current Assets [Member]	Dec. 31, 2011 Diesel Fuel Swap [Member] Prepaid Expenses and Other Current Assets [Member]	Sep. 29, 2012 Cash Flow Hedging [Member] Interest Rate Swap [Member]
Derivatives, Fair Value [Line Items]
Notional amount of derivatives								$ 50,000,000
Expected hedging percentage of diesel fuel requirements for next twelve months			50.00%
Deferred net losses, net of tax			200,000
Derivative, Fair Value, Net [Abstract]
Derivative, fair value, net	$ (289,000)	$ (91,000)		$ (407,000)	$ (256,000)	$ 118,000	$ 165,000

XML

Business Segment Information (Tables)

9 Months Ended

Sep. 29, 2012

Segment Reporting [Abstract]

Business Segment Information

Reportable segment data reconciled to the Corporation's condensed consolidated financial statements for the three and nine month periods ended September 29, 2012, and October 1, 2011, is as follows:

	Three Months Ended						Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011			September 29, 2012			October 1, 2011
Net Sales:
Office Furniture	$	467,787		$	421,873		$	1,264,953		$	1,125,643
Hearth Products	83,068			82,347			211,514			207,538
	550,855			504,220			1,476,467			1,333,181
Operating Profit:
Office furniture
Operations before restructuring charges	$	38,605		$	41,776		$	69,707		$	69,161
Restructuring and impairment charges	(172		)	(277		)	(1,361		)	(1,711		)
Office furniture – net	38,433			41,499			68,346			67,450
Hearth products
Operations before restructuring charges	9,077			6,875			11,066			5,749
Restructuring and impairment charges	—			—			—			(419		)
Hearth products – net	9,077			6,875			11,066			5,330
Total operating profit	47,510			48,374			79,412			72,780
Unallocated corporate expense	(8,270		)	(10,272		)	(29,678		)	(29,866		)
Income before income taxes	$	39,240		$	38,102		$	49,734		$	42,914
Depreciation & Amortization Expense:
Office furniture	$	8,542		$	8,855		$	25,423		$	27,308
Hearth products	1,454			1,818			4,519			5,925
General corporate	751			700			2,162			1,902
	$	10,747		$	11,373		$	32,104		$	35,135
Capital Expenditures (including capitalized software):
Office furniture	$	10,206		$	4,578		$	25,206		$	15,812
Hearth products	519			975			1,472			1,980
General corporate	8,868			69			17,981			2,402
	$	19,593		$	5,622		$	44,659		$	20,194
							As of			As of
							September 29, 2012			October 1, 2011
Identifiable Assets:
Office furniture							$	725,763		$	618,588
Hearth products							272,951			282,168
General corporate							124,068			154,428
							$	1,122,782		$	1,055,184

XML

Accumulated Other Comprehensive Income and Shareholders' Equity (Tables)

9 Months Ended

Sep. 29, 2012

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income Loss Table

The following table summarizes the components of accumulated other comprehensive income and the changes in accumulated other comprehensive income, net of tax, as applicable for the nine months ended September 29, 2012:

(In thousands)	Foreign Currency Translation Adjustment		Unrealized Gains on Marketable Securities		Pension Postretirement Liability			Derivative Financial Instruments			Accumulated Other Comprehensive Income
Balance at December 31, 2011	$	5,211	$	143	$	(3,583	)	$	(56	)	$	1,715
Year-to date change	1,500		93		241			(127		)	1,707
Balance at September 29, 2012	$	6,711	$	236	$	(3,342	)	$	(183	)	$	3,422

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Commitments and Contingencies (Details) (USD $) In Millions, unless otherwise specified	Sep. 29, 2012
Commitments and Contingencies Disclosure [Abstract]
Letters of credit used to back insurance policies and other obligations	$ 14

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Goodwill and Other Intangible Assets (Goodwill) (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 29, 2012
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 300,263
Accumulated impairment losses, beginning balance	(29,502)
Goodwill, beginning balance	270,761
Goodwill acquired	22,598
Goodwill, ending balance	322,861
Accumulated impairment losses, ending balance	(29,502)
Goodwill, ending balance	293,359
Office Furniture [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance	134,075
Accumulated impairment losses, beginning balance	(29,359)
Goodwill, beginning balance	104,716
Goodwill acquired	22,598
Goodwill, ending balance	156,673
Accumulated impairment losses, ending balance	(29,359)
Goodwill, ending balance	127,314
Hearth Products [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance	166,188
Accumulated impairment losses, beginning balance	(143)
Goodwill, beginning balance	166,045
Goodwill acquired	0
Goodwill, ending balance	166,188
Accumulated impairment losses, ending balance	(143)
Goodwill, ending balance	$ 166,045

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Accumulated Other Comprehensive Income and Shareholders' Equity (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			$ 1,715,000
Year-to date change	1,661,000	(454,000)	1,707,000	775,000
Balance at September 29, 2012	3,422,000		3,422,000
Treasury Stock [Abstract]
Stock repurchase program, remaining authorized repurchase amount			122,400,000
Cash dividends per common share	$ 0.24	$ 0.23	$ 0.71	$ 0.69
Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			1,715,000
Year-to date change			1,707,000
Balance at September 29, 2012	3,422,000		3,422,000
Foreign Currency Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			5,211,000
Year-to date change			1,500,000
Balance at September 29, 2012	6,711,000		6,711,000
Unrealized Gains on Marketable Securities [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			143,000
Year-to date change			93,000
Balance at September 29, 2012	236,000		236,000
Pension Postretirement Liability [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			(3,583,000)
Year-to date change			241,000
Balance at September 29, 2012	(3,342,000)		(3,342,000)
Derivative Financial Instruments [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at December 31, 2011			(56,000)
Year-to date change			(127,000)
Balance at September 29, 2012	(183,000)		(183,000)
Common Stock [Member]
Treasury Stock [Abstract]
Repurchased common stock, shares			528,000
Repurchased common stock, value			$ 13,400,000

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Derivative Financial Instruments (Effect of Derivatives on Income Statement) (Details) (Cash Flow Hedging [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)	$ 520	$ (531)	$ (4)	$ 201
Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)	113	246	194	224
Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	0	(2)	0	(1)
Diesel Fuel Swap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)	520	(531)	(4)	191
Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	0	(2)	0	(1)
Diesel Fuel Swap [Member] | Selling and Administrative Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)	113	246	194	1,122
Interest Rate Contract [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		0		10
Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)		0		0
Interest Rate Contract [Member] | Interest Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		$ 0		$ (898)

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Inventories

9 Months Ended

Sep. 29, 2012

Inventory Disclosure [Abstract]

Inventories

Inventories

The Corporation values its inventory at the lower of cost or market with approximately 72% valued by the last-in, first-out ("LIFO") costing method.

(In thousands)	September 29, 2012			December 31, 2011
Finished products	$	61,859		$	65,136
Materials and work in process	68,920			62,638
LIFO allowance	(25,900		)	(25,901		)
	$	104,879		$	101,873

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Product Warranties (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011
Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 12,910	$ 12,930
Accruals for warranties issued during period	9,846	10,471
Adjustments related to pre-existing warranties	845	(261)
Settlements made during the period	(10,700)	(10,906)
Balance at end of period	$ 12,901	$ 12,234

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Product Warranties (Tables)

9 Months Ended

Sep. 29, 2012

Product Warranties Disclosures [Abstract]

Schedule of Product Warranty Liability Table

Activity associated with warranty obligations was as follows during the periods noted:

	Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011
Balance at beginning of period	$	12,910		$	12,930
Accruals for warranties issued during period	9,846			10,471
Adjustments related to pre-existing warranties	845			(261		)
Settlements made during the period	(10,700		)	(10,906		)
Balance at end of period	$	12,901		$	12,234

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Goodwill and Other Intangible Assets(Tables)

9 Months Ended

Sep. 29, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets by Major Class

The table below summarizes amortizable definite-lived intangible assets as of September 29, 2012 and December 31, 2011, which are reflected in the "Other Assets" line item in the Corporation's Condensed Consolidated Balance Sheets:

(In thousands)	September 29, 2012		December 31, 2011
Patents	$	18,905	$	18,905
Customer relationships and other	104,252		102,825
Less: accumulated amortization	66,260		61,214
	$	56,897	$	60,516

Schedule of Expected Amortization Expense Table

Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five fiscal years is as follows:

(In millions)	2012		2013		2014		2015		2016
Amortization Expense	$	6.7	$	6.5	$	5.9	$	5.6	$	5.4

Schedule of Goodwill

The changes in the carrying amount of goodwill since December 31, 2011 are as follows by reporting segment:

(In thousands)	Office Furniture			Hearth Products			Total
Balance as of December 31, 2011
Goodwill	$	134,075		$	166,188		$	300,263
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	104,716			166,045			270,761
Goodwill acquired	22,598			—			22,598
Balance as of September 29, 2012
Goodwill	156,673			166,188			322,861
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	$	127,314		$	166,045		$	293,359

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Postretirement Health Care (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011
Compensation and Retirement Disclosure [Abstract]
Service cost	$ 337	$ 273
Interest cost	540	603
Amortization of transition obligation	381	381
Amortization of (gain)/loss	0	(12)
Net periodic benefit cost	$ 1,258	$ 1,245

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Postretirement Health Care (Tables)

9 Months Ended

Sep. 29, 2012

Compensation and Retirement Disclosure [Abstract]

Schedule of Defined Benefit Plans Disclosures

The following table sets forth the components of net periodic benefit cost included in the Corporation's Condensed Consolidated Statements of Comprehensive Income for:

	Nine Months Ended
(In thousands)	September 29, 2012		October 1, 2011
Service cost	$	337	$	273
Interest cost	540		603
Amortization of transition obligation	381		381
Amortization of (gain)/loss	—		(12		)
Net periodic benefit cost	$	1,258	$	1,245

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Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 29, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The location and fair value of derivative instruments reported in the Corporation's Condensed Consolidated Balance Sheets are as follows (in thousands):

		Asset (Liability) Fair Value
	Balance Sheet Location	September 29, 2012			December 31, 2011
Diesel fuel swap	Accounts payable and accrued expenses	$	(407	)	$	(256	)
Diesel fuel swap	Prepaid expenses and other current assets	118			165
		$	(289	)	$	(91	)

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	520	Selling and administrative expenses	$	113	Selling and administrative expenses	—
Total	$	520		$	113		—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	(4	)	Selling and administrative expenses	$	194	Selling and administrative expenses	$	—
Total	$	(4	)		$	194		$	—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	—		Interest expense	$	—	None	$	—
Diesel fuel swap	(531		)	Selling and administrative expenses	246		Selling and administrative expenses	(2		)
Total	$	(531	)		$	246		$	(2	)

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)			Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	10	Interest expense	$	(898	)	None	$	—
Diesel fuel swap	191		Selling and administrative expenses	1,122			Selling and administrative expenses	(1		)
Total	$	201		$	224			$	(1	)

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Stock-Based Compensation

9 Months Ended

Sep. 29, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Corporation measures stock-based compensation expense at grant date, based on the fair value of the award, and recognizes expense over the employee requisite service period.  For the three and nine months ended September 29, 2012, and October 1, 2011, the Corporation recognized $1.4 million and $5.0 million, and $1.8 million and $5.2 million, respectively, of stock-based compensation expense for the cost of stock options and time-based restricted stock units issued under the HNI Corporation 2007 Stock-Based Compensation Plan and shares issued under the HNI Corporation 2002 Members' Stock Purchase Plan.

At September 29, 2012, there was $9.3 million of unrecognized compensation cost related to nonvested stock-based compensation awards, which the Corporation expects to recognize over a weighted-average remaining service period of 1.3 years.

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 29, 2012

Fair Value Disclosures [Abstract]

Fair Value Assets and Liabilities Measured on Recurring and Nonrecurring Basis

Assets measured at fair value as of September 29, 2012 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,732		$	—	$	15,732		$	—
Corporate bonds	$	4,691		$	—	$	4,691		$	—
Derivative financial instruments	$	(289	)	$	—	$	(289	)	$	—

Assets measured at fair value as of December 31, 2011 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,863		$	—	$	15,863		$	—
Corporate bonds	$	3,751		$	—	$	3,751		$	—
Derivative financial instruments	$	(91	)	$	—	$	(91	)	$	—

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Business Combinations (Details) (USD $) In Millions, unless otherwise specified	0 Months Ended
	Aug. 13, 2012 BP Ergo Limited [Member]	Aug. 29, 2012 Dansons, Inc. [Member] Years
Business Acquisition [Line Items]
Acquisition of common stock, percentage	97.80%
Cash paid for acquisition	$ 25.5	$ 1.5
Included assumption of short-term debt	4.2
Goodwill amount	20.9
Intangible assets, other than goodwill, amount		$ 1.4
Intangible asset, estimated useful lives (in years)		8

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Sep. 29, 2012	Dec. 31, 2011
CURRENT ASSETS
Cash and cash equivalents	$ 49,265	$ 72,812
Short-term Investments	7,250	9,157
Receivables	247,297	204,036
Inventories (Note C)	104,879	101,873
Deferred income taxes	19,500	18,797
Prepaid expenses and other current assets	27,986	27,365
Total Current Assets	456,177	434,040
PROPERTY, PLANT, AND EQUIPMENT
Land and land improvements	26,936	23,197
Buildings	267,633	264,081
Machinery and equipment	464,753	468,926
Construction in progress	16,727	11,911
Property plant and equipment, at cost	776,049	768,115
Less accumulated depreciation	537,749	538,388
Net Property, Plant, and Equipment	238,300	229,727
GOODWILL	293,359	270,761
OTHER ASSETS	134,946	119,730
Total Assets	1,122,782	1,054,258
CURRENT LIABILITIES
Accounts payable and accrued expenses	401,122	358,290
Note payable and current maturities of long-term debt and capital lease obligations	43,877	30,345
Current maturities of other long-term obligations	266	275
Total Current Liabilities	445,265	388,910
LONG-TERM DEBT	150,159	150,200
CAPITAL LEASE OBLIGATIONS	259	340
OTHER LONG-TERM LIABILITIES	56,814	52,716
DEFERRED INCOME TAXES	49,602	42,770
Capital Stock:
Preferred, $1 par value, authorized 2,000,000 shares, no shares outstanding	0	0
Common, $1 par value, authorized 200,000,000 shares, outstanding - September 29, 2012 - 45,148,538 shares; December 31, 2011 – 44,855,207 shares	45,149	44,855
Additional paid-in capital	24,315	24,277
Retained earnings	347,156	348,210
Accumulated other comprehensive income	3,422	1,715
Total HNI Corporation shareholders' equity	420,042	419,057
Noncontrolling interest	641	265
Total Equity	420,683	419,322
Total Liabilities and Equity	$ 1,122,782	$ 1,054,258

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Income Taxes (Details)	3 Months Ended
	Sep. 29, 2012	Oct. 01, 2011
Income Tax Disclosure [Abstract]
Effective income tax rate	38.30%	34.60%

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011
Net Cash Flows From (To) Operating Activities:
Net income	$ 30,949	$ 27,722
Noncash items included in net income:
Depreciation and amortization	32,104	35,135
Other postretirement and post employment benefits	1,259	1,245
Stock-based compensation	5,039	5,210
Excess tax benefits from stock compensation	(4,156)	(99)
Deferred income taxes	6,288	7,412
Loss on sale, retirement and impairment of long-lived assets and intangibles	649	397
Stock issued to retirement plan	4,864	4,906
Other – net	1,506	(834)
Net increase (decrease) in operating assets and liabiities	(391)	(18,785)
Increase (decrease) in other liabilities	2,725	4,663
Net cash flows from (to) operating activities	80,836	66,972
Net Cash Flows From (To) Investing Activities:
Capital expenditures	(27,297)	(16,937)
Proceeds from sale of property, plant, and equipment	596	2,697
Capitalized software	(17,362)	(3,257)
Acquisition spending, net of cash acquired	(26,894)	0
Purchase of investments	(4,752)	(14,555)
Sales or maturities of investments	3,962	5,857
Other - net	40	413
Net cash flows from (to) investing activities	(71,707)	(25,782)
Net Cash Flows From (To) Financing Activities:
Proceeds from sales of HNI Corporation common stock	4,610	2,607
Withholdings related to net share settlements of equity based awards	(5,995)	0
Purchase of HNI Corporation common stock	(13,359)	(10,000)
Proceeds from long-term debt	105,000	5,455
Payments of note and long-term debt and other financing	(94,855)	(5,973)
Excess tax benefits from stock compensation	4,156	99
Dividends paid	(32,233)	(30,940)
Net cash flows from (to) financing activities	(32,676)	(38,752)
Net increase (decrease) in cash and cash equivalents	(23,547)	2,438
Cash and cash equivalents at beginning of period	72,812	99,096
Cash and cash equivalents at end of period	$ 49,265	$ 101,534

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Stock-Based Compensation (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based compensation expense	$ 1.4	$ 1.8	$ 5.0	$ 5.2
Unrecognized compensation cost	$ 9.3		$ 9.3
Remaining requisite service period for unrecognized compensation cost (in years)			1.3

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Business Segment Information

9 Months Ended

Sep. 29, 2012

Segment Reporting [Abstract]

Business Segment Information

Business Segment Information

Management views the Corporation as operating in two business segments: office furniture and hearth products with the former being the principal business segment.

The office furniture segment manufactures and markets a broad line of metal and wood office furniture which includes storage products, desks, credenzas, chairs, tables, bookcases, freestanding office partitions and panel systems and other related products.  The hearth products segment manufactures and markets a broad line of manufactured gas, electric, wood and biomass burning fireplaces, inserts, stoves, facings and accessories, principally for the home.

For purposes of segment reporting, intercompany sales transfers between segments are not material and operating profit is income before income taxes exclusive of certain unallocated corporate expenses.  These unallocated corporate expenses include the net cost of the Corporation's corporate operations, interest income and interest expense.  Management views interest income and expense as corporate financing costs rather than a business segment cost.  In addition, management applies one effective tax rate to its consolidated income before income taxes so income taxes are not reported or viewed internally on a segment basis.

The Corporation's primary market and capital investments are concentrated in the United States.

Reportable segment data reconciled to the Corporation's condensed consolidated financial statements for the three and nine month periods ended September 29, 2012, and October 1, 2011, is as follows:

	Three Months Ended						Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011			September 29, 2012			October 1, 2011
Net Sales:
Office Furniture	$	467,787		$	421,873		$	1,264,953		$	1,125,643
Hearth Products	83,068			82,347			211,514			207,538
	550,855			504,220			1,476,467			1,333,181
Operating Profit:
Office furniture
Operations before restructuring charges	$	38,605		$	41,776		$	69,707		$	69,161
Restructuring and impairment charges	(172		)	(277		)	(1,361		)	(1,711		)
Office furniture – net	38,433			41,499			68,346			67,450
Hearth products
Operations before restructuring charges	9,077			6,875			11,066			5,749
Restructuring and impairment charges	—			—			—			(419		)
Hearth products – net	9,077			6,875			11,066			5,330
Total operating profit	47,510			48,374			79,412			72,780
Unallocated corporate expense	(8,270		)	(10,272		)	(29,678		)	(29,866		)
Income before income taxes	$	39,240		$	38,102		$	49,734		$	42,914
Depreciation & Amortization Expense:
Office furniture	$	8,542		$	8,855		$	25,423		$	27,308
Hearth products	1,454			1,818			4,519			5,925
General corporate	751			700			2,162			1,902
	$	10,747		$	11,373		$	32,104		$	35,135
Capital Expenditures (including capitalized software):
Office furniture	$	10,206		$	4,578		$	25,206		$	15,812
Hearth products	519			975			1,472			1,980
General corporate	8,868			69			17,981			2,402
	$	19,593		$	5,622		$	44,659		$	20,194
							As of			As of
							September 29, 2012			October 1, 2011
Identifiable Assets:
Office furniture							$	725,763		$	618,588
Hearth products							272,951			282,168
General corporate							124,068			154,428
							$	1,122,782		$	1,055,184

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Inventories (Details) (USD $) In Thousands, unless otherwise specified	Sep. 29, 2012	Dec. 31, 2011
Inventory Disclosure [Abstract]
Percentage of LIFO Inventory	72.00%
Inventory, Net [Abstract]
Finished products	$ 61,859	$ 65,136
Materials and work in process	68,920	62,638
LIFO allowance	(25,900)	(25,901)
Inventories	$ 104,879	$ 101,873

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Inventories (Tables)

9 Months Ended

Sep. 29, 2012

Inventory Disclosure [Abstract]

Schedule Of Inventory Current Table

The Corporation values its inventory at the lower of cost or market with approximately 72% valued by the last-in, first-out ("LIFO") costing method.

(In thousands)	September 29, 2012			December 31, 2011
Finished products	$	61,859		$	65,136
Materials and work in process	68,920			62,638
LIFO allowance	(25,900		)	(25,901		)
	$	104,879		$	101,873

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Basis of Presentation

9 Months Ended

Sep. 29, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  The December 31, 2011 consolidated balance sheet included in this Form 10-Q was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. An adjustment was made in the third quarter of 2012 to correct a second quarter freight over accrual of $0.9 million. This correction of the freight accrual (included in "Accounts payable and accrued expenses" in the Condensed Consolidated Balance Sheet) was determined to be immaterial to the current and prior period interim financial statements. Operating results for the nine-month period ended September 29, 2012 are not necessarily indicative of the results that may be expected for the fiscal year ending December 29, 2012.  For further information, refer to the consolidated financial statements and accompanying notes included in HNI Corporation's (the "Corporation") Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 29, 2012	Dec. 31, 2011
Statement of Financial Position [Abstract]
Preferred Stock, Par Value (per share)	$ 1	$ 1
Preferred Stock, Shares Authorized	2,000,000	2,000,000
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value (per share)	$ 1	$ 1
Common Stock, Shares Authorized	200,000,000	200,000,000
Common Stock, Shares Outstanding	45,148,538	44,855,207

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Income Taxes

9 Months Ended

Sep. 29, 2012

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for income taxes for continuing operations for the three months ended September 29, 2012 reflects an effective tax rate of 38.3 percent compared to 34.6 percent for the same period last year. The increase is due primarily to the research and development tax credit not being extended in 2012.

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DOCUMENT AND ENTITY INFORMATION Document	9 Months Ended
	Sep. 29, 2012
Document Information [Line Items]
Entity Registrant Name	HNI CORP
Entity Central Index Key	0000048287
Document Type	10-Q
Document Period End Date	Sep. 29, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-29
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	45,148,538

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Derivative Financial Instruments

9 Months Ended

Sep. 29, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

The Corporation uses derivative financial instruments to reduce its exposure to adverse fluctuations in interest rates and diesel fuel prices.  On the date a derivative is entered into, the Corporation designates the derivative as (i) a fair value hedge, (ii) a cash flow hedge, (iii) a hedge of a net investment in a foreign operation or (iv) a risk management instrument not designated for hedge accounting.  The Corporation recognizes all derivatives on its Condensed Consolidated Balance Sheets at fair value.

Interest Rate Risk

In June 2008, the Corporation entered into an interest rate swap agreement, designated as a cash flow hedge, for purposes of managing its benchmark interest rate fluctuation risk.  Under the interest rate swap agreement, the Corporation paid a fixed rate of interest and received a variable rate of interest equal to the one-month London Interbank Offered Rate (LIBOR) as determined on the last day of each monthly settlement period on an aggregated notional principal amount of $50 million.  The net amount paid or received upon monthly settlements was recorded as an adjustment to interest expense, while the effective change in fair value was recorded as a component of accumulated other comprehensive income in the equity section of the Corporation's Condensed Consolidated Balance Sheets.  The interest rate swap agreement matured on May 27, 2011.

Diesel Fuel Risk

The Corporation uses independent freight carriers to deliver its products.  These carriers charge the Corporation a basic rate per mile that is subject to a mileage surcharge for diesel fuel price increases.  The Corporation enters into variable to fixed rate commodity swap agreements with two financial counterparties to manage fluctuations in fuel costs.  The Corporation hedges approximately 50% of its diesel fuel surcharge exposure for the next twelve months.  The Corporation uses the hedge agreements to mitigate the volatility of diesel fuel prices and related fuel surcharges, and not to speculate on the future price of diesel fuel.  The hedge agreements are designed to add stability to the Corporation's costs, enabling the Corporation to make pricing decisions and lessen the economic impact of abrupt changes in diesel fuel prices over the term of the contract.  The hedging instruments consist of a series of financially settled fixed forward contracts with expiration dates ranging up to twelve months.  The contracts have been designated as cash flow hedges of future diesel purchases, and as such, the net amount paid or received upon monthly settlements is recorded as an adjustment to freight expense, while the effective change in fair value is recorded as a component of accumulated other comprehensive income in the equity section of the Corporation's Condensed Consolidated Balance Sheets.

As of September 29, 2012, $0.2 million of deferred net losses, net of tax, included in equity ("Accumulated other comprehensive income" in the Corporation's Condensed Consolidated Balance Sheets) related to the diesel hedge agreements are expected to be reclassified to current earnings ("Selling and administrative expenses" in the Corporation's Condensed Consolidated Statements of Comprehensive Income) over the next twelve months.

The location and fair value of derivative instruments reported in the Corporation's Condensed Consolidated Balance Sheets are as follows (in thousands):

		Asset (Liability) Fair Value
	Balance Sheet Location	September 29, 2012			December 31, 2011
Diesel fuel swap	Accounts payable and accrued expenses	$	(407	)	$	(256	)
Diesel fuel swap	Prepaid expenses and other current assets	118			165
		$	(289	)	$	(91	)

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	520	Selling and administrative expenses	$	113	Selling and administrative expenses	—
Total	$	520		$	113		—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended September 29, 2012 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Diesel fuel swap	$	(4	)	Selling and administrative expenses	$	194	Selling and administrative expenses	$	—
Total	$	(4	)		$	194		$	—

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the three months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)			Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)		Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	—		Interest expense	$	—	None	$	—
Diesel fuel swap	(531		)	Selling and administrative expenses	246		Selling and administrative expenses	(2		)
Total	$	(531	)		$	246		$	(2	)

The effect of derivative instruments on the Corporation's Condensed Consolidated Statements of Comprehensive Income for the nine months ended October 1, 2011 was as follows (in thousands):

Derivatives in Cash Flow Hedge Relationship	Before-tax Gain (Loss) Recognized in AOCI on Derivative (Effective Portion)		Locations of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)	Before-Tax Gain (Loss) Reclassified from AOCI Into Income (Effective Portion)			Locations of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
Interest rate swap	$	10	Interest expense	$	(898	)	None	$	—
Diesel fuel swap	191		Selling and administrative expenses	1,122			Selling and administrative expenses	(1		)
Total	$	201		$	224			$	(1	)

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Income Statement [Abstract]
Net sales	$ 550,855	$ 504,220	$ 1,476,467	$ 1,333,181
Cost of sales	359,519	324,825	973,191	872,132
Gross profit	191,336	179,395	503,276	461,049
Selling and administrative expenses	149,421	138,671	444,610	407,281
Restructuring and impairment	172	277	1,361	2,130
Operating income	41,743	40,447	57,305	51,638
Interest income	155	222	610	465
Interest expense	2,658	2,567	8,181	9,189
Income before income taxes	39,240	38,102	49,734	42,914
Income taxes	15,036	13,186	18,785	15,192
Net income	24,204	24,916	30,949	27,722
Less: Net (loss) attributable to the noncontrolling interest	(286)	(31)	(425)	(127)
Net income attributable to HNI Corporation	24,490	24,947	31,374	27,849
Net income attributable to HNI Corporation per common share - basic	$ 0.54	$ 0.56	$ 0.69	$ 0.62
Average number of common shares outstanding - basic	45,224,059	44,787,437	45,265,050	44,795,155
Net income attributable to HNI Corporation per common share - diluted	$ 0.53	$ 0.55	$ 0.68	$ 0.61
Average number of common shares outstanding - diluted	45,820,422	45,637,042	45,839,917	45,683,520
Cash dividends per common share	$ 0.24	$ 0.23	$ 0.71	$ 0.69
Other comprehensive income (loss), net of tax	1,661	(454)	1,707	775
Comprehensive income	25,865	24,462	32,656	28,497
Less: Comprehensive income (loss) attributable to noncontrolling interest	(286)	(31)	(425)	(127)
Comprehensive income attributable to HNI Corporation	$ 26,151	$ 24,493	$ 33,081	$ 28,624

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Restructuring Reserve And Plant Closures

9 Months Ended

Sep. 29, 2012

Restructuring and Related Activities [Abstract]

Restructuring Reserve and Plant Closures

Restructuring Reserve and Plant Closures

As a result of the Corporation's ongoing business simplification and cost reduction strategies, the Corporation has closed, consolidated and realigned a number of its office furniture facilities during the past few years. In connection with these closures, consolidations and realignments, the Corporation recorded $0.2 million and $1.8 million of charges during the three and nine months ended September 29, 2012 which included $0.2 million and $1.4 million of current period restructuring costs and $0.0 million and $0.4 million of accelerated depreciation recorded in cost of sales, respectively.

The following is a summary of changes in restructuring accruals during the nine months ended September 29, 2012.  

(In thousands)	Severance			Facility Exit Costs & Other			Total
Balance as of December 31, 2011	$	1,068		$	31		$	1,099
Restructuring charges	(43		)	1,404			1,361
Cash payments	(538		)	(1,435		)	(1,973		)
Balance as of September 29, 2012	$	487		$	—		$	487

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Earnings Per Share

9 Months Ended

Sep. 29, 2012

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

The following table reconciles the numerators and denominators used in the calculation of basic and diluted earnings per share ("EPS"):

	Three Months Ended				Nine Months Ended
(In thousands, except per share data)	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
Numerators:
Numerator for both basic and diluted EPS attributable to HNI Corporation net income	$	24,490	$	24,947	$	31,374	$	27,849
Denominators:
Denominator for basic EPS weighted-average common shares outstanding	45,224		44,787		45,265		44,795
Potentially dilutive shares from stock-based compensation plans	596		850		575		889
Denominator for diluted EPS	45,820		45,637		45,840		45,684
Earnings per share – basic	$	0.54	$	0.56	$	0.69	$	0.62
Earnings per share – diluted	$	0.53	$	0.55	$	0.68	$	0.61

The weighted average common stock equivalents presented above do not include the effect of 1,762,597 and 1,762,597, and 2,210,257 and 1,815,085 of common stock equivalents for the three and nine months ended September 29, 2012 and October 1, 2011, respectively, because their inclusion would be anti-dilutive.

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Basis of Presentation (Policies)

9 Months Ended

Sep. 29, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Share-based Compensation, Option and Incentive Plans

The Corporation measures stock-based compensation expense at grant date, based on the fair value of the award, and recognizes expense over the employee requisite service period.

Inventory

The Corporation values its inventory at the lower of cost or market with approximately 72% valued by the last-in, first-out ("LIFO") costing method.

Goodwill

The Corporation evaluates its goodwill and indefinite-lived intangible assets for impairment on an annual basis during the fourth quarter, or whenever indicators of impairment exist. No indicators existed during the nine months ended September 29, 2012.  The Corporation estimates the fair value of its reporting units using various valuation techniques, with the primary technique being a discounted cash flow method.  This method employs assumptions that are market participant based. The increase in the office furniture segment relates to final purchase price allocations for an acquisition completed during the fourth quarter of 2011 as well as the BP Ergo acquisition completed in third quarter 2012. See Note G. Business Combinations footnote.

Product Warranty

The Corporation issues certain warranty policies on its office furniture and hearth products that provide for repair or replacement of any covered product or component that fails during normal use because of a defect in design or workmanship. Reserves have been established for the various costs associated with the Corporation's warranty programs and are included in "Accounts payable and accrued expenses" in the Condensed Consolidated Balance Sheets.

A warranty reserve is determined by recording a specific reserve for known warranty issues and an additional reserve for unknown claims that are expected to be incurred based on historical claims experience.  Actual claims incurred could differ from the original estimates, requiring adjustments to the reserve.  

Derivatives

The Corporation uses derivative financial instruments to reduce its exposure to adverse fluctuations in interest rates and diesel fuel prices.  On the date a derivative is entered into, the Corporation designates the derivative as (i) a fair value hedge, (ii) a cash flow hedge, (iii) a hedge of a net investment in a foreign operation or (iv) a risk management instrument not designated for hedge accounting.  The Corporation recognizes all derivatives on its Condensed Consolidated Balance Sheets at fair value.

Fair Value of Financial Instruments

For recognition purposes, on a recurring basis the Corporation is required to measure at fair value its marketable securities and derivative instruments.  The marketable securities were comprised of government securities, corporate bonds and money market funds. When available the Corporation uses quoted market prices to determine fair value and classifies such measurements within Level 1.  In some cases where market prices are not available, the Corporation makes use of observable market-based inputs (prices or quotes from published exchanges/indexes) to calculate fair value using the market approach, in which case the measurements are classified within Level 2.

Segment Reporting

Management views the Corporation as operating in two business segments: office furniture and hearth products with the former being the principal business segment.

The office furniture segment manufactures and markets a broad line of metal and wood office furniture which includes storage products, desks, credenzas, chairs, tables, bookcases, freestanding office partitions and panel systems and other related products.  The hearth products segment manufactures and markets a broad line of manufactured gas, electric, wood and biomass burning fireplaces, inserts, stoves, facings and accessories, principally for the home.

For purposes of segment reporting, intercompany sales transfers between segments are not material and operating profit is income before income taxes exclusive of certain unallocated corporate expenses.  These unallocated corporate expenses include the net cost of the Corporation's corporate operations, interest income and interest expense.  Management views interest income and expense as corporate financing costs rather than a business segment cost.  In addition, management applies one effective tax rate to its consolidated income before income taxes so income taxes are not reported or viewed internally on a segment basis.

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Fair Value Measurements

9 Months Ended

Sep. 29, 2012

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

For recognition purposes, on a recurring basis the Corporation is required to measure at fair value its marketable securities and derivative instruments.  The marketable securities were comprised of government securities, corporate bonds and money market funds. When available the Corporation uses quoted market prices to determine fair value and classifies such measurements within Level 1.  In some cases where market prices are not available, the Corporation makes use of observable market-based inputs (prices or quotes from published exchanges/indexes) to calculate fair value using the market approach, in which case the measurements are classified within Level 2.

Assets measured at fair value as of September 29, 2012 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,732		$	—	$	15,732		$	—
Corporate bonds	$	4,691		$	—	$	4,691		$	—
Derivative financial instruments	$	(289	)	$	—	$	(289	)	$	—

Assets measured at fair value as of December 31, 2011 were as follows:

(In thousands)	Fair value as of measurement date			Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Government securities	$	15,863		$	—	$	15,863		$	—
Corporate bonds	$	3,751		$	—	$	3,751		$	—
Derivative financial instruments	$	(91	)	$	—	$	(91	)	$	—

In addition to the methods and assumptions the Corporation uses to record the fair value of financial instruments as discussed in the section above, it uses the following methods and assumptions to estimate the fair value of its financial instruments.

Cash and cash equivalents - Level 1

The carrying amount approximated fair value and includes money market funds.

Long-term debt (including current portion) - Level 2

The carrying value of the Corporation's outstanding variable-rate, long-term debt obligations at September 29, 2012 and December 31, 2011, the end of the Corporation's 2011 fiscal year, approximated the fair value.  The fair value of the Corporation's outstanding fixed-rate, long-term debt obligations is estimated based on discounted cash flow method to be $159 million at September 29, 2012 and $160 million at December 31, 2011, compared to the carrying value of $150 million.

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Product Warranties

9 Months Ended

Sep. 29, 2012

Product Warranties Disclosures [Abstract]

Product Warranties

Product Warranties

The Corporation issues certain warranty policies on its office furniture and hearth products that provide for repair or replacement of any covered product or component that fails during normal use because of a defect in design or workmanship. Reserves have been established for the various costs associated with the Corporation's warranty programs and are included in "Accounts payable and accrued expenses" in the Condensed Consolidated Balance Sheets.

A warranty reserve is determined by recording a specific reserve for known warranty issues and an additional reserve for unknown claims that are expected to be incurred based on historical claims experience.  Actual claims incurred could differ from the original estimates, requiring adjustments to the reserve.  Activity associated with warranty obligations was as follows during the periods noted:

	Nine Months Ended
(In thousands)	September 29, 2012			October 1, 2011
Balance at beginning of period	$	12,910		$	12,930
Accruals for warranties issued during period	9,846			10,471
Adjustments related to pre-existing warranties	845			(261		)
Settlements made during the period	(10,700		)	(10,906		)
Balance at end of period	$	12,901		$	12,234

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Business Combinations

9 Months Ended

Sep. 29, 2012

Business Combinations [Abstract]

Business Combinations

Business Combinations

The Corporation completed the acquisition of 97.8% of the capital stock of BP Ergo Limited, a leading manufacturer and marketer of office furniture in India, on August 13, 2012 for a purchase price of approximately $25.5 million which included assumption of $4.2 million of short-term bank debt. BP Ergo goes to market through a national network of sales branches and dealers supported by two manufacturing locations. The Corporation is in the process of finalizing the allocation of the purchase price, with valuations and determination of working capital adjustments. The determination of fair value for the identifiable tangible and intangible assets acquired and liabilities assumed requires use of estimates and judgments. There are approximately $20.9 million of intangibles associated with this acquisition, which have all been currently classified as goodwill and will be reclassified based on final valuations.

The Corporation completed the acquisition of the pellet stove business of Dansons, Inc. on August 29, 2012 for a purchase price of approximately $1.5 million. There were approximately $1.4 million of intangible assets other than goodwill associated with this acquisition with estimated useful lives of eight years and amortization recorded based on the projected cash flow associated with the respective intangible assets’ existing relationship.

The results of the acquired businesses have been included in the Consolidated Financial Statements since the dates of acquisition and are not material to the results for the quarter ended September 29, 2012.

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Goodwill and Other Intangible Assets

9 Months Ended

Sep. 29, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The table below summarizes amortizable definite-lived intangible assets as of September 29, 2012 and December 31, 2011, which are reflected in the "Other Assets" line item in the Corporation's Condensed Consolidated Balance Sheets:

(In thousands)	September 29, 2012		December 31, 2011
Patents	$	18,905	$	18,905
Customer relationships and other	104,252		102,825
Less: accumulated amortization	66,260		61,214
	$	56,897	$	60,516

Aggregate amortization expense for the nine months ended September 29, 2012 and October 1, 2011 was $5.0 million and $4.3 million, respectively.  Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five fiscal years is as follows:

(In millions)	2012		2013		2014		2015		2016
Amortization Expense	$	6.7	$	6.5	$	5.9	$	5.6	$	5.4

As events such as potential acquisitions, dispositions or impairments occur in the future, these amounts may change.

The Corporation also owns trademarks and trade names with a net carrying amount of $41.0 million.  The trademarks are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely.

The changes in the carrying amount of goodwill since December 31, 2011 are as follows by reporting segment:

(In thousands)	Office Furniture			Hearth Products			Total
Balance as of December 31, 2011
Goodwill	$	134,075		$	166,188		$	300,263
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	104,716			166,045			270,761
Goodwill acquired	22,598			—			22,598
Balance as of September 29, 2012
Goodwill	156,673			166,188			322,861
Accumulated impairment losses	(29,359		)	(143		)	(29,502		)
	$	127,314		$	166,045		$	293,359

The Corporation evaluates its goodwill and indefinite-lived intangible assets for impairment on an annual basis during the fourth quarter, or whenever indicators of impairment exist. No indicators existed during the nine months ended September 29, 2012.  The Corporation estimates the fair value of its reporting units using various valuation techniques, with the primary technique being a discounted cash flow method.  This method employs assumptions that are market participant based. The increase in the office furniture segment relates to final purchase price allocations for an acquisition completed during the fourth quarter of 2011 as well as the BP Ergo acquisition completed in third quarter 2012. See Note G. Business Combinations footnote.

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Postretirement Health Care

9 Months Ended

Sep. 29, 2012

Compensation and Retirement Disclosure [Abstract]

Postretirement Health Care

Postretirement Health Care

The following table sets forth the components of net periodic benefit cost included in the Corporation's Condensed Consolidated Statements of Comprehensive Income for:

	Nine Months Ended
(In thousands)	September 29, 2012		October 1, 2011
Service cost	$	337	$	273
Interest cost	540		603
Amortization of transition obligation	381		381
Amortization of (gain)/loss	—		(12		)
Net periodic benefit cost	$	1,258	$	1,245

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Basis of Presentation (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Sep. 29, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounting adjustment, change in freight accrual	$ 0.9

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Business Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012 Segment	Oct. 01, 2011	Dec. 31, 2011
Segment Reporting Information [Line Items]
Number of business segments			2
Net sales	$ 550,855	$ 504,220	$ 1,476,467	$ 1,333,181
Income before income taxes	39,240	38,102	49,734	42,914
Depreciation and amortization expense	10,747	11,373	32,104	35,135
Capital expenditures	19,593	5,622	44,659	20,194
Identifiable assets	1,122,782	1,055,184	1,122,782	1,055,184	1,054,258
Operating Segments [Member]
Segment Reporting Information [Line Items]
Total operating profit	47,510	48,374	79,412	72,780
Office Furniture [Member]
Segment Reporting Information [Line Items]
Net sales	467,787	421,873	1,264,953	1,125,643
Operations before restructuring charges	38,605	41,776	69,707	69,161
Restructuring and impairment charges	(172)	(277)	(1,361)	(1,711)
Total operating profit	38,433	41,499	68,346	67,450
Depreciation and amortization expense	8,542	8,855	25,423	27,308
Capital expenditures	10,206	4,578	25,206	15,812
Identifiable assets	725,763	618,588	725,763	618,588
Hearth Products [Member]
Segment Reporting Information [Line Items]
Net sales	83,068	82,347	211,514	207,538
Operations before restructuring charges	9,077	6,875	11,066	5,749
Restructuring and impairment charges	0	0	0	(419)
Total operating profit	9,077	6,875	11,066	5,330
Depreciation and amortization expense	1,454	1,818	4,519	5,925
Capital expenditures	519	975	1,472	1,980
Identifiable assets	272,951	282,168	272,951	282,168
Unallocated Amount to Segment [Member]
Segment Reporting Information [Line Items]
Unallocated corporate expense	(8,270)	(10,272)	(29,678)	(29,866)
Depreciation and amortization expense	751	700	2,162	1,902
Capital expenditures	8,868	69	17,981	2,402
Identifiable assets	$ 124,068	$ 154,428	$ 124,068	$ 154,428

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New Accounting Standards

9 Months Ended

Sep. 29, 2012

Accounting Changes and Error Corrections [Abstract]

New Accounting Standards

New Accounting Standards

In July 2012, the FASB issued accounting guidance intended to reduce the cost and complexity of the annual impairment test for indefinite-lived intangible assets other than goodwill by providing the option of performing a qualitative assessment to determine whether future impairment testing is necessary. This guidance will be effective December 30, 2012, the beginning of the Corporation's 2013 fiscal year, with early adoption allowed. The Corporation does not expect the adoption to have a material impact on its financial statements.

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Earnings Per Share (Tables)

9 Months Ended

Sep. 29, 2012

Earnings Per Share [Abstract]

Schedule of Earnings Per Share Basic and Diluted Table

The following table reconciles the numerators and denominators used in the calculation of basic and diluted earnings per share ("EPS"):

	Three Months Ended				Nine Months Ended
(In thousands, except per share data)	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
Numerators:
Numerator for both basic and diluted EPS attributable to HNI Corporation net income	$	24,490	$	24,947	$	31,374	$	27,849
Denominators:
Denominator for basic EPS weighted-average common shares outstanding	45,224		44,787		45,265		44,795
Potentially dilutive shares from stock-based compensation plans	596		850		575		889
Denominator for diluted EPS	45,820		45,637		45,840		45,684
Earnings per share – basic	$	0.54	$	0.56	$	0.69	$	0.62
Earnings per share – diluted	$	0.53	$	0.55	$	0.68	$	0.61

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Fair Value Measurements (Long-term Debt) (Details) (USD $)	Sep. 29, 2012	Dec. 31, 2011
Debt Instrument [Line Items]
Long-term debt	$ 150,159,000	$ 150,200,000
Fixed Rate Debt Instruments [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	159,000,000	160,000,000
Long-term debt	$ 150,000,000	$ 150,000,000

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Goodwill and Other Intangible Assets (Other Intangible Assets) (Details) (USD $)	9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Dec. 31, 2011
Finite-Lived Intangible Assets, Net [Abstract]
Less: accumulated amortization	$ 66,260,000		$ 61,214,000
Finite-lived intangible assets, net	56,897,000		60,516,000
Finite-Lived Intangible Assets [Abstract]
Agregated amortization expense	5,000,000	4,300,000
Finite-Lived Intangible Assets, Future Amortization Expense [Abstract]
2012	6,700,000
2013	6,500,000
2014	5,900,000
2015	5,600,000
2016	5,400,000
Trademarks and Trade Names [Member]
Indefinite-Lived Intangible Assets (Excluding Goodwill) [Abstract]
Indefinite-lived intangible assets (excluding goodwill)	41,000,000
Patents [Member]
Finite-Lived Intangible Assets, Net [Abstract]
Finite-lived intangible assets, gross	18,905,000		18,905,000
Customer Relationships [Member]
Finite-Lived Intangible Assets, Net [Abstract]
Finite-lived intangible assets, gross	$ 104,252,000		$ 102,825,000

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Income Statement [Abstract]
Other comprehensive income (loss), tax	$ 218	$ (192)	$ 117	$ 217

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Accumulated Other Comprehensive Income and Shareholders' Equity

9 Months Ended

Sep. 29, 2012

Equity [Abstract]

Accumulated Other Comprehensive Income and Shareholders' Equity

Accumulated Other Comprehensive Income and Shareholders' Equity

The following table summarizes the components of accumulated other comprehensive income and the changes in accumulated other comprehensive income, net of tax, as applicable for the nine months ended September 29, 2012:

(In thousands)	Foreign Currency Translation Adjustment		Unrealized Gains on Marketable Securities		Pension Postretirement Liability			Derivative Financial Instruments			Accumulated Other Comprehensive Income
Balance at December 31, 2011	$	5,211	$	143	$	(3,583	)	$	(56	)	$	1,715
Year-to date change	1,500		93		241			(127		)	1,707
Balance at September 29, 2012	$	6,711	$	236	$	(3,342	)	$	(183	)	$	3,422

During the nine months ended September 29, 2012, the Corporation repurchased 528,000 shares of its common stock at a cost of approximately $13.4 million.  As of September 29, 2012, $122.4 million of the Corporation's Board of Directors' current repurchase authorization remained unspent.

During the nine months ended September 29, 2012, the Corporation paid dividends to shareholders of $0.71 per share.

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Restructuring Reserve and Plant Closures (Tables)

9 Months Ended

Sep. 29, 2012

Restructuring and Related Activities [Abstract]

Schedule of Restructuring Reserve by Type of Cost

The following is a summary of changes in restructuring accruals during the nine months ended September 29, 2012.  

(In thousands)	Severance			Facility Exit Costs & Other			Total
Balance as of December 31, 2011	$	1,068		$	31		$	1,099
Restructuring charges	(43		)	1,404			1,361
Cash payments	(538		)	(1,435		)	(1,973		)
Balance as of September 29, 2012	$	487		$	—		$	487

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Earnings Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 29, 2012	Oct. 01, 2011	Sep. 29, 2012	Oct. 01, 2011
Numerators:
Numerator for both basic and diluted EPS attributable to HNI Corporation net income	$ 24,490	$ 24,947	$ 31,374	$ 27,849
Denominators:
Denominator for basic EPS weighted-average common shares outstanding	45,224,059	44,787,437	45,265,050	44,795,155
Potentially dilutive shares from stock-based compensation plans	596,000	850,000	575,000	889,000
Denominator for diluted EPS	45,820,422	45,637,042	45,839,917	45,683,520
Earnings per share - basic	$ 0.54	$ 0.56	$ 0.69	$ 0.62
Earnings per share - diluted	$ 0.53	$ 0.55	$ 0.68	$ 0.61
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Antidilutive securities excluded from computation of earnings per share	1,762,597	2,210,257	1,762,597	1,815,085

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Commitments and Contingencies

9 Months Ended

Sep. 29, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Corporation utilizes letters of credit in the amount of $14 million to back certain insurance policies and payment obligations.  The letters of credit reflect fair value as a condition of their underlying purpose and are subject to competitively determined fees.

The Corporation has contingent liabilities which have arisen in the ordinary course of its business, including liabilities relating to pending litigation, environmental remediation, taxes, and other claims.  It is the Corporation's opinion that liabilities, if any, resulting from these matters are not expected to have a material adverse effect on the Corporation's financial condition, cash flows or on the Corporation's quarterly or annual operating results when resolved in a future period.