ALP NON-COMPETE AGREEMENT 12-14-05


    Exhibit
      10.1

    


    NON-COMPETITION
      AGREEMENT

    


    


    THIS
      AGREEMENT,
      made as of December 14, 2005, between Albert L. Prillaman (the “Former
      Executive”) and STANLEY FURNITURE COMPANY, INC., a Delaware corporation (the
“Company”).

    WHEREAS,
      the
      Company desires to preserve its competitive status in the industry and to
      protect the future of the Company by obtaining a covenant not to compete from
      the Former Executive who served as chairman of the Company until April 2005,
      and
      the Former Executive is willing to enter into an agreement to such end upon
      the
      terms and conditions set forth in this Agreement. In consideration of the
      foregoing and the mutual agreements herein contained, the parties agree as
      follows:

    1.  Term.
      The term of this
      Agreement (the “Term”) shall commence on the date hereof and end on December 31,
      2008.

    2.  Consideration.
      The Company shall
      pay the Former Executive $250,000 promptly after the date hereof as
      consideration for the covenants contained herein.

    3.  Restrictive
      Covenants.

    (a)  Non-competition
      Restriction.
      During the Term,
      the Former Executive shall not directly or indirectly manage, operate, control,
      be employed by, participate in, invest in or be connected in any manner with
      the
      management, operation, ownership or control of any business or venture which
      is
      in competition in the United States with the business of the Company, provided
      that nothing herein shall prohibit the Former Executive from owning securities
      of the Company or up to 5% of the outstanding voting securities of any issuer
      which is listed on the New York or American Stock Exchange or as to which
      trading is reported or quoted on the NASDAQ System. 

    (b)  Non-solicitation
      Agreement.
      During the Term,
      the Former Executive shall not directly or indirectly hire or employ in any
      capacity or solicit the employment of or offer employment to or entice away
      or
      in any other manner persuade or attempt to persuade any person employed by
      the
      Company or any of its subsidiaries to leave the employ of any of them.


    (c)  Specific
      Enforcement.
      It is agreed and
      understood by the parties hereto that, in view of the nature of the business
      of
      the Company, the restrictions in subsections (a) and (b) above are reasonable
      and necessary to protect the legitimate interests of the Company, monetary
      damages alone are not an adequate remedy for any breach of such provisions,
      and
      any violation thereof would result in irreparable injuries to the Company.
      The
      Former Executive therefore acknowledges that, in the event of his violation
      of
      any of such restrictions, the Company shall be entitled to obtain from any
      court
      of competent jurisdiction preliminary and permanent injunctive relief as well
      as
      damages and an equitable accounting of all earnings, profits and other benefits
      arising from such violation, which rights shall be cumulative and in addition
      to
      any other rights or remedies to which the Company may be entitled.

    (d)  Severability
      and
      Extension.
      If the period of
      time or the area specified in subsection (a) above is determined to be
      unreasonable in any proceeding, such period shall be reduced by such number
      of
      months or the area shall be reduced by the elimination of such portion thereof,
      or both, so that such restrictions may be enforced for such time and in such
      area as is determined to be reasonable. If the Former Executive violates any
      of
      the restrictions contained in subsection (a) above, the restrictive period
      shall
      not run in favor of the Former Executive from the time of the commencement
      of
      any such violation until such time as such violation shall cease.

    4.  Notice.
      All notices,
      requests, demands and other communications hereunder shall be in writing and
      shall be effective upon the mailing thereof by registered or certified mail,
      postage prepaid, and addressed as set forth below:

    (a)  If
      to the
      Company:

    


    Stanley
      Furniture
      Company, Inc.

    1641
      Fairystone
      Park Highway

    Stanleytown,
      Virginia 24168

    


    Attention:
      Chairman
      and Chief Executive Officer

    


    (b)  If
      to the Former
      Executive:

     

    Albert
      L.
      Prillaman

    10
      Gracefield Road

    Hilton
      Head Island,
      SC 29928

    


    Any
      party may
      change the address to which notices are to be addressed by giving the other
      party written notice in the manner herein set forth.

    5.  Waiver
      of
      Breach.
      Waiver by either
      party of a breach of any provision of this Agreement by the other shall not
      operate as a waiver of any subsequent breach by such other party.

    6.  Entire
      Agreement.
      This Agreement
      contains the entire agreement of the parties in this matter and supersedes
      any
      other agreement, oral or written, concerning the subject matter hereof. It
      may
      be changed only by an agreement in writing signed by both parties
      hereto.

    7.  Governing
      Law.
      This Agreement
      shall be governed by the laws of the Commonwealth of Virginia.

    8.   Benefit.
      This Agreement
      shall be binding upon and inure to the benefit of and shall be enforceable
      by
      and against the Company, its successors and assigns, and the Former Executive,
      his heirs, beneficiaries and legal representatives.

     

    IN
      WITNESS WHEREOF, the Former Executive and the Company have executed this
      Agreement as of the day and year above written.

    


    
      	
                                                                                                  
                STANLEY FURNITURE COMPANY, INC.

            
	 	 
	 	 
	
                                                 By:

            	/s/
              Jeffrey R. Scheffer   
	 	Jeffrey R.
              Scheffer
	 	Chairman and Chief
              Executive Officer
	 	 
	 	/s/ Albert L.
              Prillaman
	 	Albert
              L.
              Prillaman