SEVENTH AMENDMENT TO SECOND AMENDED
                     AND RESTATED REVOLVING CREDIT AGREEMENT


         THIS SEVENTH AMENDMENT TO SECOND AMENDED AND RESTATED  REVOLVING CREDIT
FACILITY dated as of March 31, 2000 (the "Seventh Amendment") is by and between

         STANLEY FURNITURE COMPANY, INC., a Delaware corporation
           (the "Borrower"); and

         NATIONAL  BANK OF CANADA,  a Canadian  chartered  bank (the "Lender" or
           "NBC").

RECITALS

         A. National Canada Finance Corp., a Delaware corporation ("NCFC"), and
the Lender made a certain credit facility available to the Borrower pursuant to
the terms and conditions contained in that certain Second Amended and Restated
Revolving Credit Agreement dated as of February 15, 1994 among the Borrower,
NCFC and the Lender, as amended by a First Amendment to Second Amended and
Restated Credit Agreement dated as of August 21, 1995, a Second Amendment to
Second Amended and Restated Credit Agreement dated as of October 14, 1996, a
Third Amendment to Second Amended and Restated Credit Agreement dated as of
June 24, 1997, a Fourth Amendment to Second Amended and Restated Revolving
Credit Agreement dated as of February 24, 1998, a Fifth Amendment to Second
Amended and Restated Revolving Credit Agreement dated as of March 10, 1999 and
a Sixth Amendment to Second Amended and Restated Revolving Credit Agreement
dated as of March 30, 2000 (as amended, the "Loan Agreement").

         B. The Borrower has requested that the Lender make certain changes to
the Loan Agreement.

         C. The Lender has agreed to make these changes to the Loan Agreement as
set forth herein.

         NOW, THEREFORE, the Borrower and the Lender hereby agree as follows:

         A. The Committed  Amount is increased from  $25,000,000 to $35,000,000.
Therefore the references to $25,000,000 in Sections 2.01(a), 2.01(b) and 2.03 of
the Loan Agreement are hereby changed to $35,000,000.  In addition, the Borrower
agrees to execute a new  Revolving  Credit Note in the form  attached  hereto as
Exhibit A-1 in replacement  and  substitution of the existing  Revolving  Credit
Note.

         B. The Borrower represents and warrants that, as of the date hereof, it
is not in default of the terms of the Loan Agreement,  as amended hereby, or any
of the  other  documents  executed  between  the  Borrower  and  the  Lender  in
connection therewith.

         C. This Seventh Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original.

         D. This Seventh  Amendment and the Loan  Agreement,  as amended hereby,
shall be  deemed to be  contracts  made  under,  and for all  purposes  shall be
construed in accordance with the laws of the State of North Carolina.


<PAGE>


         IN WITNESS  WHEREOF,  the parties  hereto have  executed or caused this
instrument to be executed under seal as of the day and year first above written.

                                              STANLEY FURNITURE COMPANY, INC.
ATTEST

By                                            By


Title                                         Title


         (CORPORATE SEAL)



                                              NATIONAL BANK OF CANADA


                                              By

                                              Title

                                              By

                                              Title


<PAGE>


                                   EXHIBIT A-1

                    SEVENTH AMENDED, RESTATED AND SUBSTITUTED

                                REVOLVING CREDIT

                                 PROMISSORY NOTE

$35,000,000                                                       March 31, 2000
                                                       Charlotte, North Carolina

FOR VALUE RECEIVED, STANLEY FURNITURE COMPANY, INC. (formerly known as Stanley
Interiors Corporation), a Delaware corporation (the "Borrower") hereby promises
to pay to the order of

NATIONAL BANK OF CANADA, a Canadian chartered bank (the "Lender") at its offices
in Charlotte, North Carolina (or at such other place or places as the Lender may
designate) the principal sum of up to

THIRTY-FIVE MILLION DOLLARS ($35,000,000.00) under the terms and conditions of a
certain  Second  Amended and  Restated  Revolving  Credit  Facility  dated as of
February 15, 1994,  by and among the  Borrower,  the Lender and National  Canada
Finance  Corp.,  as such  Loan  Agreement  has  been or may be  restated  and/or
modified  from time to time  thereafter  and  hereafter  (as amended,  the "Loan
Agreement").  The defined  terms in the Loan  Agreement are used herein with the
same meaning.  All of the terms,  conditions and covenants of the Loan Agreement
are expressly made a part of this promissory note (the "Revolving  Credit Note")
by referenced in the same manner and with the same effect as if set forth herein
at length  and any  holder of this  Revolving  Credit  Note is  entitled  to the
benefits of and remedies provided in the Loan Agreement and any other agreements
by and between the Borrower and the Lender.

The  Borrower  may  borrow and  reborrow  under this  Revolving  Credit  Note in
accordance with the terms of Article II of the Loan  Agreement.  The outstanding
balance  hereof  shall  be due and  payable  in full on the  termination  of the
Commitment as provided in Article II of the Loan Agreement, or upon such earlier
date as may be required by the terms of the Loan Agreement.

The Revolving  Credit Note shall bear interest on the  outstanding  balance from
time to time at the rates as provided in Article II of the Loan  Agreement.  The
outstanding  balance hereof shall be due and payable in full on the  termination
of the Commitment as provided in Article II of the Loan Agreement,  or upon such
earlier date as may be required by the terms of the Loan Agreement.

If payment of all sums due hereunder is accelerated  under the terms of the Loan
Agreement or under the terms of the other Loan Documents  between the Lender and
the  Borrower,  the then  remaining  principal  amount  and  accrued  but unpaid
interest  shall bear  interest at the rate  provided  for in Section 4.01 of the
Loan  Agreement  until  such  principal  and  interest  have  been paid in full.
Further, in the event of such acceleration,  this Revolving Credit Note, and all
other  indebtedness of the Borrower to the Lender,  shall become immediately due
and payable, without presentation, demand, protest or notice of any kind, all of
which are hereby waived by the Borrower.

In the event this  Revolving  Credit  Note is not paid when due at any stated or
accelerated  maturity,  the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys' fees.

This  Revolving  Credit  Note is an  amendment  to, and is in  substitution  and
replacement of, that certain sixth amended,  restated and substituted  revolving
credit  promissory note dated as of February 15, 1994 in the original  principal
amount of  $25,000,000  executed  by the  Borrower  in favor of the Lender  (the
"Replaced Note").

IN WITNESS  WHEREOF,  the Borrower has executed this Revolving Credit Note under
seal as of the day and year first above written.

                                          STANLEY FURNITURE COMPANY, INC.


ATTEST:

By:___________________________            By:___________________________________

Title_________________________            Title_________________________________
              (Corporate Seal)