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               SECOND AMENDMENT TO SECOND AMENDED
             AND RESTATED REVOLVING CREDIT AGREEMENT


     This SECOND AMENDMENT TO SECOND AMENDED AND RESTATED REVOLVING
CREDIT FACILITY dated as of October 14, 1996 (the "Second
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 (as amended,
the "Loan Agreement").

     B.     The Lender has been assigned the rights of NCFC under
the Loan Agreement and the documents related thereto pursuant to
the terms of an Agreement and Transfer Agreement.

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

     D.     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 Loan Agreement is amended as follows:

            1.  The first sentence of Section 3.09(b) is deleted in
its entirety and replaced with the following:

                "(b) Unused Fee.  In consideration of the Lender's
     commitment to make the Revolving Credit Loans hereunder, the
     Borrower agrees to pay an unused fee of one-eighth of one
     percent (1/8%) per annum (computed on the basis of the actual
     number of days elapsed in a year of 360 days) on the excess of
     the Committed Amount over the aggregate average principal
     amount of the Revolving Credit Loans outstanding during the
     applicable quarterly period."


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      2.  Section 8.01(j) is deleted in its entirety and replaced
with the following:

                "(j)  Restricted Payments.  Make any Restricted 
     Payment; provided, however, Borrower may (I) buy up to 15% of
     the Common Stock, $.02 par value, of the Borrower owned by the
     ML-Lee Acquisition Fund L.P. and certain affiliates of the
     Thomas H. Lee Company, in the event such shares are not
     purchased pursuant to the exercise of overallotment options
     granted to underwriters in a secondary offering of such stock;
     provided, however, that no more than $8,000,000.00 may be
     borrowed under this Loan Agreement to finance this transaction
     and (II) pay dividends or make payments to redeem, repurchase
     or otherwise acquire shares of its stock in an amount up to
     $3,839,000 plus (A) 50% of Borrower's net income during the
     period from January 1, 1996 through the end of the most
     recently completed fiscal quarter and (B) the total net cash
     proceeds received by the Borrower from the sale of its stock
     during such period less (C) the aggregate amount of cash
     dividends paid or cash payments (other than pursuant to clause
     (I) above) made to redeem, repurchase or otherwise acquire
     shares of its stock."

     A.  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.

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

     C.  This Second 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.


















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     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                          




























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