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UNITED STATES


SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities
Exchange Act of 1934

(Amendment (Amendment No.  )

Filed by the Registrantxþ
Filed by a Party other than the Registrant¨o

Check the appropriate box:

¨oPreliminary Proxy Statement

¨oConfidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)14a-6(e)(2))

xþDefinitive Proxy Statement

¨oDefinitive Additional Materials

¨oSoliciting Material underPursuant to §240.14a-12

Stanley Furniture Company, Inc.

(Name of registrantRegistrant as specified in its charter)

Specified In Its Charter)

(Name of person(s) filing proxy statement,Person(s) Filing Proxy Statement, if other than the registrant)

Registrant)

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xþNo fee required.

¨oFee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

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¨
oCheck box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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TABLE OF CONTENTS

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
VOTING RIGHTS
ELECTION OF DIRECTORS
CORPORATE GOVERNANCE
DIRECTOR COMPENSATION FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
GRANTS OF PLAN—BASED AWARDS
OUTSTANDING EQUITY AWARDS
PENSION BENEFITS
NONQUALIFIED DEFERRED COMPENSATION
ADVISORY VOTE ON EXECUTIVE COMPENSATION (SAY-ON-PAY)
ADVISORY VOTE ON THE FREQUENCY OF SAY-ON-PAY VOTES (SAY-ON-FREQUENCY)
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
INDEPENDENT PUBLIC AUDITORS
AUDIT COMMITTEE REPORT
OTHER BUSINESS
ADDITIONAL INFORMATION

Stanley Furniture Company, Inc.


1641 Fairystone Park Highway


Stanleytown, Virginia 24168

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To be held April 29, 2010

27, 2011

NOTICE IS HEREBY GIVENthat the Annual Meeting of Stockholders of Stanley Furniture Company, Inc. will be held at our corporate headquarters, 1641 Fairystone Park Highway, Stanleytown, Virginia, on Thursday,Wednesday, April 29, 2010,27, 2011, at 11:00 A.M., for the following purposes:

(1) To elect two directors to serve a three-year term on our board of directors;

(2) To transact such other business as may properly be brought before the meeting or any adjournment thereof.

(1)To elect two directors to serve a three-year term on our board of directors;
(2)To consider and act on an advisory vote regarding the approval of compensation paid to certain executive officers;
(3)To consider and act on an advisory vote regarding the frequency of stockholder approval of the compensation paid to certain executive officers; and
(4)To transact such other business as may properly be brought before the meeting or any adjournment thereof.
The stockholders of record of our common stock at the close of business on March 3, 20104, 2011 are entitled to notice of and to vote at this Annual Meeting or any adjournment thereof.

Even if you plan to attend the meeting in person, we request that you mark, date, sign and return your proxy in the enclosed self-addressed envelope as soon as possible so that your shares may be certain of being represented and voted at the meeting. You may also vote by phone or on the Internet by following the instructions on the proxy card. Any proxy given by a stockholder may be revoked by that stockholder at any time prior to the voting of the proxy.

By Order of the Board of Directors,
 Douglas I. Payne
 
Micah S. Goldstein
Secretary

March 15, 201018, 2011

Stanley Furniture Company, Inc.


1641 Fairystone Park Highway


Stanleytown, Virginia 24168

PROXY STATEMENT

ANNUAL MEETING OF STOCKHOLDERS


April 29, 2010

27, 2011

The enclosed proxy is solicited by and on behalf of the board of directors of Stanley Furniture Company, Inc. for use at the Annual Meeting of Stockholders to be held on Thursday,Wednesday, April 29, 2010,27, 2011, at 11:00 A.M., at our corporate headquarters, 1641 Fairystone Park Highway, Stanleytown, Virginia, and any adjournment thereof. The matters to be considered and acted upon at this meeting are described in the foregoing notice of the meeting and this proxy statement. This proxy statement and the related form of proxy are being mailed on or about March 15, 201018, 2011 to all holders of record of our common stock on March 3, 2010.4, 2011. Shares of our common stock represented in person or by proxy will be voted as hereinafter described or as otherwise specified by the stockholder. Any proxy given by a stockholder may be revoked by such stockholder at any time prior to the voting of the proxy by delivering a written notice to our Secretary, executing and delivering a later-dated proxy or attending the meeting and voting in person.

We will bear the cost of preparing, assembling and mailing the proxy, this proxy statement, and other material enclosed, and all clerical and other expenses of solicitations. In addition to the solicitation of proxies by use of the mails, our directors, officers and employees may solicit proxies by telephone, telegram, e-mail, personal interview or other means. We will also request brokerage houses and other custodians, nominees and fiduciaries to forward soliciting material to the beneficial owners of our common stock held of record by those parties and will reimburse those parties for their expenses in forwarding soliciting material.

VOTING RIGHTS

On March 3,4, 2010, there were 10,329,84714,342,347 shares of our common stock outstanding and entitled to vote. Each share entitles the holder thereof to one vote.

ELECTION OF DIRECTORS

Our board of directors presently consists of six directors who are divided into three classes with staggered terms. The terms of Messrs. Thomas L. MillnerRobert G. Culp, III and Glenn PrillamanT. Scott McIlhenny, Jr. expire at the time of the 20102011 Annual Meeting of Stockholders. We propose the reelection of Messrs. MillnerCulp and Glenn PrillamanMcIlhenny for a three-year term each expiring at the time of the 20132014 Annual Meeting. Mr. Millner has advised us that he anticipates resigning as a director at the end of 2010. In this event, the board of directors would elect a new director to fill the vacancy in accordance with our bylaws.

The shares represented by proxies will be voted as specified by the stockholder. If the stockholder does not specify a choice, the shares will be voted in favor of the election of the nominees listed on the proxy card, except that in the event these nominees should not continue to be available for election, the proxies will be voted for the election of such other persons as our board of directors may recommend. As of the date of this proxy statement, our board of directors has no reason to believe that the nominees named below will be unable or unwilling to serve.

Our board and corporate governance and nominating committee in considering its recommendation of the nominees for election at the 20102011 Annual Meeting, as well as in making its previous recommendation of our other directors, focused primarily on the information discussed in each of the director’s individual biographies set forth below. In particular, with regard to Messrs. Culp, HaleyDascoli and Millner,Haley, our board and corporate governance and nominating committee considered their strong background in the manufacturing sector, which for Messrs. MillnerDascoli and Haley includes prior experience in furniture manufacturing. With respect to Mr. McIlhenny, our board and corporate governance and nominating committee considered his familiarity with the furniture industry through his previous service in various capacities with the publisher ofFurniture/Today. With respect to Mr. Dascoli, our board and corporate governance and nominating committee considered his financial experience as a chief financial officer in both the furniture industry and in his current position with a division of VF Corporation. Our board and corporate governance and nominating committee also considered the many years of experience with our company represented by Mr. Albert Prillaman, our former chairman, and Mr. Glenn Prillaman, our president and chief executive officer.

Nominees for Election for Three-Year Terms Ending 20132014

Thomas L. MillnerRobert G. Culp, III, 56,64, has been a director since July 1999. Mr. Culp has been chairman of the board of Culp, Inc., a marketer of upholstery fabrics for furniture and mattress ticking for bedding, since 1990 and served as chief executive officer of Culp, Inc. until May 2007. Mr. Culp is also a director of Old Dominion Freight Line, Inc.
T. Scott McIlhenny, Jr.,63, has been a director since April 1998.1997. Mr. Millner has been Chief Executive Officer and President and directorMcIlhenny is a principal of Cabela’s Incorporated, a multi-channel retailerNorthstar Travel Media LLC (“Northstar”), the former travel publishing division of hunting, fishing and camping gear, since April 2009. Mr. Millner was chief executive officer of Remington Arms Company, Inc. (“Remington”), a manufacturer of sporting good products for the hunting, shooting sports and fishing markets, from April 1999 to March 2009 and a director of Remington from June 1994 until March 2009. From December 2008 until March 2009, Mr. Millner also served as chief executive officer of Freedom Group of Companies, a holding company which directly or indirectly owns Remington and related companies (of which Mr. Milner also served as chief executive officer)Cahners Business Information (now Reed Business Information). Mr. MillnerMcIlhenny served as president of Remington from May 1994 to May 2007 and as chief operating officer of RemingtonNorthstar from September 2001 until November 2005. Mr. McIlhenny was group vice president of Cahners Travel Group, a publisher of materials for the hospitality and travel industries and a division of Cahners Business Information (“Cahners”), from December 1999 until September 2001. Mr. McIlhenny’s previous experience included serving in various capacities with Communications/Today, LTD. (acquired by Cahners in 1988), the publisher ofFurniture/Today, including senior vice president, group publisher.
Directors Whose Terms Do Not Expire this Year
D. Paul Dascoli, 50, has been a director since December 2010 and his present term will end in 2013. He has been Vice President and Chief Financial Officer of VF Jeanswear Limited Partnership, a division of VF Corporation, a global leader in branded lifestyle apparel since October 2006. Previously, Mr. Dascoli was employed by Thomasville Furniture Industries, Inc. as Executive Vice President from 2003 through September 2006 and as Senior Vice President, Finance & Administration/Chief Financial Officer from 1998 through 2003, and as Vice President and Chief Financial Officer from 1996 to 1998.
Michael P. Haley,60, has been a director since April 2003 and his present term will expire in 2012. Mr. Haley was elected to serve as chairman of board of directors beginning January 2011. Mr. Haley has served as an advisor to Fenway Partners, LLC, a private equity investment firm, since April 2006 and as managing director of its affiliate, Fenway Resources, since March 2008. Mr. Haley served as Executive Chairman of Coach America, a provider of passenger ground transportation services, from August 2007 to May 2010. Mr. Haley is a director of Ply Gem Industries, a producer of window, door and siding products for the residential construction industry. Mr. Haley held the position of president and CEO of MW Manufacturers Inc., a Ply Gem subsidiary, from June 2001 until January 2005 and served as its chairman from January 2005 until June 2005. From May 1994 to April 1999.May 2001, Mr. Haley was President of American of Martinsville, a manufacturer of commercial contract furniture and a subsidiary of LADD Furniture, Inc. During this time, he also served as executive vice president of LADD Furniture, Inc. From 19871988 to May 1994, Mr. Millner served as chief executive officer andHaley was president of The Pilliod Cabinet Company. From 1984 to 1987,Loewenstein Furniture Group. Mr. Millner served as General ManagerHaley is also a director of the Armstrong Furniture Division of Thomasville Furniture Industries. From 1977 to 1984,LifePoint Hospitals, Inc. and American National Bankshares, Inc. Mr. Millner served in various sales and sales management positions with Thomasville Furniture Industries and Broyhill Furniture Industries. Mr. Millner formerlyHaley previously served as a director of Lazy Days’ R.V. Center, Inc.Province Healthcare Company.

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Albert L. Prillaman, 65, has been a director since March 1986 and his present term will expire in 2012. Mr. Prillaman served as chairman of our board of directors from April 2008 through December 2010 and as chief executive officer from September 2008 until February 2010. Mr. Prillaman previously served as chairman from September 1988 until April 2005. From April 2005 until September 2008, he served as lead director. He also served as our chief executive officer from December 1985 until December 2002 and president from December 1985 until April 2001. Prior thereto, Mr. Prillaman had served as one of our vice presidents and president of the Stanley Furniture division of our predecessor since 1983, and in various executive and other capacities with the Stanley Furniture division of our predecessors since 1969. He is the father of Glenn Prillaman, our president and chief executive officer.
Glenn Prillaman, 38,39, has been a director since February 2010.2010 and his present term will expire in 2013. Mr. Glenn Prillaman has been President and Chief Executive Officer since February 2010. Mr. Prillaman was President and Chief Operating Officer from August 2009 until February 2010. He was our Executive Vice President — Marketing and Sales from September 2008 until August 2009. He held the position of Senior Vice President — Marketing and Sales since September 2006 and was our Senior Vice President — Marketing/Sales — Young America® from August 2003 to September 2006. Mr. Prillaman held various management positions in product development from June 1999 to August 2003. He is the son of Albert L. Prillaman, chairmana member of our board of directors.

Directors Whose Terms Do Not Expire this Year

Robert G. Culp, III, 63, has been a director since July 1999 and his present term will expire in 2011. Mr. Culp has been chairman of the board of Culp, Inc., a marketer of upholstery fabrics for furniture and mattress ticking for bedding, since 1990 and served as chief executive officer of Culp, Inc. until May 2007. Mr. Culp is also a director of Old Dominion Freight Line, Inc.

Michael P. Haley, 59, has been a director since April 2003 and his present term will expire in 2012. Mr. Haley has been Executive Chairman of Coach America, a provider of passenger ground transportation services, since August 2007. Mr. Haley is a director of Ply Gem Industries, a producer of window, door and siding products for the residential construction industry. Mr. Haley held the position of president and CEO of MW Manufacturers Inc., a Ply Gem subsidiary, from June 2001 until January 2005 and served as its chairman from January 2005 until June 2005. From May 1994 to May 2001, Mr. Haley was President of American of Martinsville, a manufacturer of commercial contract furniture and a subsidiary of LADD Furniture, Inc. During this time, he also served as executive vice president of LADD Furniture, Inc. From 1988 to 1994, Mr. Haley was president of Loewenstein Furniture Group. Mr. Haley is also a director of LifePoint Hospitals, Inc. and American National Bankshares, Inc. Mr. Haley previously served as a director of Province Healthcare Company.

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T. Scott McIlhenny, Jr., 62, has been a director since April 1997 and his present term will expire in 2011. Mr. McIlhenny is a principal of Northstar Travel Media LLC (“Northstar”), the former travel publishing division of Cahners Business Information (now Reed Business Information). Mr. McIlhenny served as chief operating officer of Northstar from September 2001 until November 2005. Mr. McIlhenny was group vice president of Cahners Travel Group, a publisher of materials for the hospitality and travel industries and a division of Cahners Business Information (“Cahners”), from December 1999 until September 2001. Mr. McIlhenny’s previous experience included serving in various capacities with Communications/Today, LTD. (acquired by Cahners in 1988), the publisher ofFurniture/Today, including senior vice president, group publisher.

Albert L. Prillaman, 64, has been a director since March 1986 and his present term will expire in 2012. Mr. Prillaman was elected to serve as chairman of our board of directors in April 2008 and as chief executive officer in September 2008. Mr. Prillaman previously served as chairman from September 1988 until April 2005. From April 2005 until September 2008 he served as lead director. He also served as our chief executive officer from December 1985 until December 2002 and president from December 1985 until April 2001. Prior thereto, Mr. Prillaman had served as one of our vice presidents and president of the Stanley Furniture division of our predecessor since 1983, and in various executive and other capacities with the Stanley Furniture division of our predecessors since 1969. He is the father of Glenn Prillaman, our president and chief executive officer.

 

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CORPORATE GOVERNANCE

Board and Board Committee Information

Our board of directors has determined that all directors are “independent directors” as that term is defined in the listing standards of The NASDAQ Stock Market, with the exception of Mr. Albert Prillaman and Mr. Glenn Prillaman who are employees.

The full board of directors met seven times during 2009.2010. Each incumbent director attended at least 75% of the total 20092010 board meetings and committee meetings held during periods that he was a member of the board or such committees. Our board of directors has adopted a policy that all directors should attend the Annual Meeting of Stockholders. All current directors, except Mr. Millner,Dascoli who was not a director at the time, attended the 20092010 Annual Meeting of Stockholders.

Our board of directors currently has three standing committees: an audit committee, a compensation and benefits committee and a corporate governance and nominating committee. Each of these committees has a written charter, current copies of which can be found at our website, www.stanleyfurniture.com.

Audit Committee. The audit committee presently consists of Messrs. Millner,Dascoli, Culp, Haley and McIlhenny. Our board has determined that all of the members of the Audit Committee meet the current independence and experience requirements contained in the listing standards of The NASDAQ Stock Market. Our board has also determined that Messrs. Millner,Dascoli, Culp and Haley are “audit committee financial experts” as that term is defined in regulations promulgated by the Securities and Exchange Commission. The primary purpose of the audit committee is to assist our board in fulfilling its responsibilities to oversee management’s conduct of our financial reporting process, including internal control over financial reporting. The audit committee also serves as direct liaison with our independent public accountants and is responsible for the selection or discharge of our accountants. The audit committee met fiveseven times in 2009.

2010.

Compensation and Benefits Committee. The compensation and benefits committee, presently consisting of Messrs. McIlhenny, Culp, HaleyDascoli and Millner,Haley, establishes salaries of executive officers and incentive compensation for our officers and employees. The compensation and benefits committee has not delegated its authority to any other person. The compensation and benefits committee administers our 2000 Incentive Compensation Plan and 2008 Incentive Compensation Plan and has authority under the 2008 Incentive Compensation Plan to select employees to receive incentive awards and to determine for each employee the nature of the incentive award and the terms and conditions of each incentive award. Our board of directors has the same responsibilities with regard to incentive awards for non-employee directors. All of the members of the compensation and benefits committee are “independent directors” as that term is defined in the listing standards of The NASDAQ Stock Market. The compensation and benefits committee met fiveseven times during 2009.2010. Additional information on the compensation and benefits committee’s process and procedures can be found under the heading “Executive Compensation—Compensation Discussion and Analysis.”

Corporate Governance and Nominating Committee. The corporate governance and nominating committee, presently consisting of Messrs. Haley, Culp, McIlhennyDascoli and Millner,McIlhenny, makes recommendations of nominations for directors and considers any stockholder nominations for director made in accordance with our bylaws. The corporate governance and nominating committee is also responsible for recommending corporate governance policies and for making recommendations on director compensation. All of the members of the corporate governance and nominating committee are “independent directors” as that term is defined in the listing standards of The NASDAQ Stock Market. The corporate governance and nominating committee met twothree times during 2009.

2010.

 

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The corporate governance and nominating committee does not have a formal policy with respect to diversity; however, our corporate governance and nominating committee, as well as our board, in recommending director nominees seeks a board composed of individuals who represent a mix of backgrounds, skills and experience in order to enhance the board’s deliberations and discussions.

Board Leadership Structure

Our board does not have a policy on whether or not the roles of chief executive officer and chairman of the board should be separate and, if they are to be separate, whether the chairman of the board should be selected from the non-employee directors or be an employee. Our board believes that it should be free to make a choice from time to time in any manner that is in the best interests of our company and stockholders.

We currently have separate individuals serving as Our current chairman of ouris an independent, non-employee director. The board of directors and as chief executive officer. From September 2009 until February 2010,believes that at the current chairman oftime this structure is best for the company as it allows our board also served as chief executive officer. Under the current structure, the chairman focuses on strategic matters, while the chief executive officer is responsible forto focus on the company’s strategy, business and operations, while enabling our day-to-day management direction.

While ourchairman to assist with board hasmatters and serve as a liaison between the board and the company’s management. The board also believes that this leadership structure aids in the past designated a lead director (Albert Prillaman from April 2005 until April 2008), it does not currently have a lead director designated in viewboard’s oversight of the small size of the board.

risk and strengthens risk management.

Risk Management

Our board has an active role, as a whole and also through the auditits committee, in overseeing management of our risks. We undertake at least annually a risk assessment to identify and evaluate risks and to develop plans to manage them effectively. This assessment is reviewed with the audit committee. In addition, ourOur board and audit committee also regularly review information regarding our strategy, financial position and operations, as well as risks associated with each.

In addition, the compensation and benefits committee is responsible for oversight of potential risks related to compensation programs and policies.

Director Compensation

Our

In view of the Company’s financial condition, as part of its annual review of director compensation, our board of directors has approved arevised its policy for compensation of non-employee directors providingeffective April 29, 2010 to provide that:

(i) each non-employee director receives

(i)the annual cash compensation received by each non-employee director be reduced from $30,000 to $15,000, and
(ii)the annual stock option grant received by each non-employee director be reduced from a grant to acquire a number of shares with a fair value of $30,000 to a grant to acquire a number of shares with a fair value of $15,000. (The annual grant is made as of the Annual Meeting of Stockholders and is fully vested on the date of grant.)
Non-employee directors received cash compensation inbefore April 2010 at the amountprevious rate of $30,000

(ii) per year. Mr. Haley does not receive any additional compensation for serving as chairman of the dateour board of the Annual Meeting of Stockholders, each non-employee director receives an annual stock option grant, which is fully vested on the date of grant, to acquire a number of shares with a fair value of $30,000.

directors. The corporate governance and nominating committee reviews director compensation annually and, as part of that process, has for review publicly available director compensation information about other comparable companies in the furniture industry. Our board of directors approves director compensation.

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The following table sets forth information concerning the compensation of directors for the year ended December 31, 2009.

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2010.

DIRECTOR COMPENSATION


FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009

Name

  Fees
Earned or
Paid in
Cash ($)		  Option
Awards ($)
(1) (2)		  Total ($)

ROBERT G. CULP, III

  30,000  30,000  60,000

MICHAEL P. HALEY

  30,000  30,000  60,000

T. SCOTT MCILHENNY

  30,000  30,000  60,000

THOMAS L. MILLNER

  30,000  30,000  60,000

2010
             
  Fees       
  Earned or  Option    
  Paid in  Awards ($)    
Name Cash ($)  (1) (2)  Total ($) 
             
ROBERT G. CULP, III  18,750   15,000   33,750 
D. PAUL DASCOLI  1,063   —   1,063 
MICHAEL P. HALEY  18,750   15,000   33,750 
T. SCOTT MCILHENNY  18,750   15,000   33,750 
THOMAS L. MILLNER  18,750   15,000   33,750 
(1)The number of stock options (shares) outstanding at December 31, 20092010 for each of our directors in the above table is as follows:

Robert G. Culp, III

 32,04335,149

D. Paul Dascoli

—
Michael P. Haley

 36,04339,149

T. Scott McIlhenny

 46,04343,149

Thomas L. Millner

 46,04343,149

(2)Each of our directors listed in the table received an option award for 10,4573,106 shares of our common stock at an exercise price of $8.64$10.01 per share.

Nominations for Director

Our bylaws provide that a stockholder entitled to vote in the election of directors may nominate one or more persons for election as a director only if advance written notice is given. Written notice of such stockholder’s intent to make such nomination must be received by our secretary or deposited in the U.S. mail, postage prepaid, to our secretary not later than 120 days in advance of the anniversary date of our proxy statement for the previous year’s Annual Meeting. Any stockholder wishing to nominate one or more persons as director must submit the following information in writing:

(i) the name and address of the stockholder who intends to make the nomination;

(ii) a representation that the stockholder is entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice;

(iii) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which any nomination is to be made by the stockholder;

(iv) such other information regarding each nominee as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission, had the nominee been nominated by our board of directors; and

(v) the consent of each proposed nominee to serve as one of our directors if so elected.

(i)the name and address of the stockholder who intends to make the nomination;
(ii)a representation that the stockholder is entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice;
(iii)a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which any nomination is to be made by the stockholder;
(iv)such other information regarding each nominee as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission, had the nominee been nominated by our board of directors; and
(v)the consent of each proposed nominee to serve as one of our directors if so elected.
The chairman of the meeting may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedure.

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By requiring advance notice of stockholder nominations, this bylaw affords the corporate governance and nominating committee and our board of directors the opportunity to consider the qualifications of the proposed nominees and, to the extent deemed necessary or desirable by the board, to inform stockholders about these qualifications. The bylaw does not give our board of directors any power to approve or disapprove a stockholder’s nomination for election of directors. However, it may have

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the effect of precluding a contest for the election if its procedures are not followed, and therefore may discourage or deter a stockholder from conducting a solicitation of proxies to elect the stockholder’s own slate of directors.

Stockholder Communications

Our board welcomes communications from stockholders and has adopted a procedure for receiving and addressing them. Stockholders may send written communications to the entire board or to individual directors by addressing them to Corporate Secretary, Stanley Furniture Company, 1641 Fairystone Park Highway, Stanleytown, Virginia 24168.

Review of Transactions with Related Persons

Under our code of conduct and audit committee charter, the audit committee must approve any transaction involving related persons which requires disclosure in our proxy statement under applicable rules of the Securities and Exchange Commission. Under the audit committee charter, the audit committee is responsible for reviewing these transactions and has the power to approve or disapprove these transactions.

One of our independent sales representatives, Charles Harrison, is the son-in-law of Albert Prillaman, our former chairman and director, and the brother-in-law of Glenn Prillaman, our president and chief executive officer. Mr. Harrison is compensated on a commission basis at the same rate as our other independent sales representatives and his compensation for 20092010 was approximately $150,000.$137,000. Our audit committee has approved this related party transaction. There were no other related party transactions in 2009.

2010.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

The Securities Exchange Act of 1934 requires our executive officers and directors, and any persons owning more than 10% of our common stock, to file certain reports of ownership and changes in ownership with the Securities and Exchange Commission. Based solely on our review of the copies of the Forms 3, 4 and 5 we have received, and written representations from certain reporting persons that no Forms 5 were required to be filed by those persons, we believe that all executive officers, directors and 10% stockholders complied with these filing requirements.

requirements, other than Michael P. Haley who filed a late Form 4 reporting a sale of shares of common stock.

 

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EXECUTIVE COMPENSATION

Compensation and Benefits Committee Report

The compensation and benefits committee of our board of directors has reviewed and discussed with our management the Compensation Discussion and Analysis that follows this report. Based on that review and the discussions with management, the compensation and benefits committee recommended to our board of directors that the Compensation Discussion and Analysis be included in this proxy statement.

Compensation and Benefits Committee Members

T. Scott McIlhenny, Jr. Chairman


Robert G. Culp, III


D. Paul Dascoli
Michael P. Haley

Thomas L. Millner

Compensation Discussion and Analysis

IntroductionExecutive Summary

We have a simpleintend our straight-forward executive compensation program which is intended to provide appropriate compensation that is strongly tied to our financial results. The program has only three major components: salary, annual bonus and stock options. The program provides executives with a significant amount ofopportunity for variable compensation dependent on our performance.

The principles of our executive compensation program are reflected in its variable compensation components: annual bonus and stock options. The compensation program’s overall objective is to enable us to obtain and retain the services of highly-skilled executives.executives who can perform multiple roles in our lean management team.

For the 2010 fiscal year, we adapted elements of the program to reflect changes in our business and transitions in our executive team. In connection with hiring a new chief operating officer and chief financial officer, Micah Goldstein, we made adjustments in our previous compensation practices by including a limited severance benefit and providing a one-time bonus based on retention. We also added another performance factor to our fiscal 2010 annual bonus program in addition to earnings before interest and taxes (EBIT).
Overview of Compensation Program
A principle of our executive compensation program is emphasis on variable compensation components: annual bonus and stock options. The program seeks to enhance our profitabilityperformance and value to stockholders by aligning closely the financial interests of our executives with those of our stockholders. This alignment is created by strongly linking compensation to the achievement of important financial goals. Our ability to reach the financial goals is largely dependent on the success of our strategic activities. At the executive level, we measure success in these strategic activities solelyprincipally by the effect on our financial performance.

The compensation program reflects that we operate with a small team of executives. Our chairman,Other than Mr. Albert Prillaman devotes his time largely towho focused on major corporate strategy. Our otherstrategic policy as Chairman (and CEO until February 2010), our named executive officers are each given significant and extensive responsibilities which encompass both our strategic policy and direct day-to-day activities in sales, finance, customer communications, product development, marketing, manufacturing and other similar activities. As explained below, the compensation program conditions significant portions of management pay on the achievement of annual (for bonuses) and/or long-term (for stock options) financial performance goals.

The compensation packages for executives are designed to promote team work by using the samecorporate-level performance goals as a factor for the annual bonus for all executives eligible for a bonus.most executives. The individual initiative and achievement of an executive is reflected in the level of salary and bonus potential. However, the primary evaluation of individual performance is made in the decision to retain the services of the executive. If an individual executive is not performing to expectations, the executive is not retained.

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Types of Compensation That We Pay Executives

Our compensation program has only three principal elements: salary,

Salary, annual bonus, and stock options.options are the principal elements of the compensation program. The remaining compensation paid through employee benefits and perquisites is not significant in amount or as a percentage of any executive’s compensation.

Salary. We recognize that paying a reasonable cash salary is necessary to enable us to obtain and retain services of highly-skilled executives. A reasonable salary is a component of a well-rounded compensation program. Mr. Albert Prillaman, our chairman and, during 2009 our CEO, had agreed to a lower salary with the larger component of his compensation being stock options.

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Annual Bonus. We believe that an annual cash bonus opportunity provides a means to measure and, if appropriate, reward elements of corporate performance that are closely related to the efforts of executives with operational responsibilities. Under the Summary Compensation Table following this section, the annual bonus is reported in the column labeled “Non-Equity Incentive Plan Compensation” rather than in the “Bonus” column. This reporting reflects that theThe annual cash bonus has preestablished non-discretionary goals that determine whether any amount will be paid.

Because our salaries alone would not be sufficient to reach a reasonable level ofis set by the compensation committee, including potential cash compensation, we believe it is appropriateamounts and necessary to make bonus payments in cash on an annual basis when earned. performance measures and goals.

We choose to pay bonuses in cash rather than stock because we anticipate that executives wouldwill use this payment to supplement their salaries. Also, if the annual bonus were paid in stock, the total compensation package would be overweighted in stock. The annual bonus as a percentage of an executive’s total potential cash compensation generally increases with the level and responsibilities of the executive. At his request, Mr. Albert Prillaman was not eligible for an annual bonus while serving as our CEO.

Long-term Incentive –— Stock Options. We grant stock options to provide a long-term incentive compensation program that is based on our stock through the grant of stock options.stock. For stockholders, the long-term value of our stock is the most important aspect of our performance. The price of our stock is the principal factor in stockholder value over time. Under the stock option program, we do not provide dividend equivalents on stock options before exercise. So the value of a stock option is tied directly and solely to increases in the market price of our stock.

We believe that stock-based incentives through stock options ensure that our top officers have a continuing stake in our long-term success. Our current policy is to grant stock option awards primarily to executive officers and key employees.

Employee Benefits and Perquisites. Our executives participate in all of the same employee benefit programs as other employees. The executives participate in these programs on the same basis as other employees. These programs are a tax-qualified 401(k) retirement plan, health and dental insurance, life insurance, disability insurance, and travel accident insurance. We provide a limited number of perquisites for executive officers which are below the threshold for reporting on the Summary Compensation Table following this section.

Determining the Amount of Each Type of Compensation

Roles in Setting Compensation. Mr. Albert Prillaman, as chairman andOur chief executive officer in 2009, mademakes recommendations to the compensation committee with respect to the compensation of executives (including the named executive officers)officers (other than himself) and of other than himself. Our current CEO, Mr. Glenn Prillaman, is expected to follow the same process in future years.executives. These recommendations involve salary, bonus potential and stock option grants. The compensation committee reviews and in some cases revises, as appropriate, the salary and bonus potential recommendations for these executives. The compensation committee makes the determination about all stock option grants. The compensation committee makes an independent determination with respect to the compensation for our chairman and our chief executive officer.

Timing of Compensation Decisions. Compensation decisions, including decisions on stock option awards, generally have been made at a compensation committee meeting held in connection with the December board meeting at which the next year’s business plan is reviewed and approved. The decisions on salaries and bonuses at that December meeting take effect on the following January 1. The decisions on stock option grants at that December meeting are shown as grants for the fiscal year which ends in that December. Occasionally, the compensation committee will defer final approval of compensation decisions including awards to the beginning of the following year to permit additional review and revisions to compensation and award decisions based on final financial results for the prior year. In some cases, decisions on option grants may be made at a different time. Also, compensation adjustments may be made due to promotions or changes in duties during a year. Adjustments were made during 2009 in connection with changes in positions as discussed further below. In addition in 2009, an option grant was made in April for the reasons discussed below.

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Salary. We intend that the salary levels of our executives be at the lower end of the competitive range. Effective for 2005, theThe compensation committee adoptedhas a policy of making salary adjustments for executive officers every two years in general. Exceptions have been and will be made when appropriate, such as for an executive who is given increased responsibilities or a promotion.Otherpromotion. Other executives are generally considered for salary adjustments annually.

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Bonus. Cash bonus opportunities are established annually. Bonus opportunities are set at a percentage of salary or at a fixed dollar amount. The bonus opportunities may be adjusted separately from salary changes. Whether base salaries are changed does not significantly impact decisions about annual bonus opportunities. Also, the amount of annual bonuses earned or not earned is not a major factor in future base salary decisions.

The CEO has the discretion to reduce the amount of an earned bonus for the executives other than the named executive officers.

Stock Options. Stock options are granted primarily in consideration of providingto provide incentives to those executives who have the most impact on creating stockholder value. The stock option grants are made annually, except in cases of hiring, promotions, changes in duties, or in unusual circumstances.

Balancing Types of Compensation. As noted above, weWe do not maintain any supplemental retirement plans for executives or other executive programs that reward tenure with us more than our actual performance. We consider that stock options and the resulting stock ownership are our method of providing for a substantial part of an executive’s retirement and wealth creation. In contrast, we expect that most executives will use their salary and annual cash bonus primarily for current or short-term expenses. Since the stock options are our primary contribution to an executive’s long-term wealth creation, we determine the size of the grants with that consideration in mind. We intend that our executives will share in the creation of value in the company but will not have substantial guaranteed benefits if value has not been created for stockholders.

Key Factors in Determining Compensation

Performance Measures. The bonus is measured on an annual basis. Because of the cyclical nature of the furniture industry, it is difficult to predict operating results on a multi-year basis. The use of annual targets fits with our annual business planning and allows us to measure the executive group’s performance against targets which we believe can be set in a reasonable manner. The compensation committee has the discretion to waive or reduce a performance goal for an annual incentive grant.

All of our executives who participate in the bonus program have the same targets for their annual bonus. The annual bonus is intended to be paid or not be paid primarily based on actions and decisions taken for that fiscal year.

The compensation committee has the discretion to waive or reduce a performance goal for an annual grant, although the compensation committee has not done so during the last eight years.

The annual bonus is measured solely or predominately on our earnings before interest and taxes (EBIT). We believe EBIT has been used because we believe that it representsis an appropriate measurement of our operating earnings. Interest and taxes are excluded because those items can significantly reflect our long-term decisions on capital structure rather than annual decisions on business operations.

We determine bonuses based on our EBIT, toa measure of our performance as an entity, as opposed to stock price which may be affected by market conditions other than our performance, especially over shorter intervals. Because EBIT for performance purposes is intended to reflect operating earnings, the compensation committee may make adjustments in the calculation of EBIT to reflect extraordinary events, such as excluding from earnings amounts we receive under the Continued Dumping and Subsidy Offset Act in connection with the case involving wooden bedroom furniture imported from China or financial effects of restructuring operations.

Performance measures other than EBIT may be used for annual bonuses when deemed appropriate. Factors that may be considered in selecting other performance measures could include the intent to provide incentive for a particular company initiative that may produce long-term stockholder value or to reflect particular factors such as a protracted period of decline in our overall industry.

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As discussed below, we did not have a bonus program for executives in fiscal 2009.

For fiscal 2010, we addedused an operational performance component tofor a portion of the annual bonus program. The operational performance measure chosen for fiscal 2010 isbonus: quality performance in the manufacturing process. Consistent with our use of objective measurements, quality performance is measured on returns and allowances and related costs. Financial performance remains the primary measurement with EBIT representing 75% of the potential bonus for fiscal 2010.

The price All of our stock is used for all long-term incentive purposes through the grant of stock options. All stock options are granted with an exercise price equal to the fair market value of our stock on the date of grant. Therefore, the executive does not receive any value unless there is an increaseexecutives who participate in the valuebonus program had the same targets for their annual bonus.

For fiscal 2011, we modified the bonus performance targets to reflect changes in our business operations. Performance will be measured based on areas of our stock.business responsibilities for some executives. For the named executive officers and some other executives with company-wide duties, performance will be measured on a company-wide basis. The quality performance measure will not be used in the fiscal 2011 bonus program.

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Individual Executive Officers. For compensation setting purposes, each named executive officer is considered individually, however, the same considerations apply to all executives except(except for our current Chairman.Mr. Albert Prillaman). In setting salary, the primary factors are the scope of the officer’s duties and responsibilities, the officer’s performance of those duties and responsibilities, the officer’s tenure with us, and a general evaluation of the competitive market conditions for executives with the officer’s experience. The compensation setting for our current Chairman is addressed below.

For the named executive officers (other than the Chairman)Mr. Albert Prillaman) and other executives, annual bonus potential is set as a percentage of salary or as a fixed dollar amount. The percentage of salary or fixed dollar amounts used for this purpose reflects the officer’s duties and responsibilities. The same measurement is used for all officers to encourage all officers to focus on the same company goals. In setting the salary and bonus potential, we do look at total potential cash compensation for reasonableness and for internal pay equity.

Long-term incentives are focused largely on the Chairman, CEO, COO and our executive vice presidentsCFO as the officers with the largest roles to play in determining our overall performance over an extended period. Awards are made to other executives when the award is viewed as consistent with retention needs or to promote our long-term goals.

goals or serve a retention purpose.

We have not looked specifically at amounts realizable from prior year’syears’ compensation in setting compensation for the current year. We believe that the amount of compensation for each year should be reasonable for that year. We believe that any increase in our value that is reflected in prior stock options is largely the result of the efforts of our executives in the current and prior periods. Therefore, we do not give substantial consideration to the amount of actual or potential compensation that any prior stock option grants may represent.

Other Matters Related to Compensation

Tax and Accounting Considerations. We are covered by Internal Revenue Code section 162(m) that may limit the income tax deductibility to us of certain forms of compensation paid to our named executive officers in excess of $1,000,000 per year. A primary exemptionCertain performance-based compensation is exempt from section 162(m) is performance-based compensation.this limit. Our stock option awards under our 2008 Incentive Compensation Plan and prior stock plans have met the requirements of beingare performance-based compensation and are not subject to the limits of section 162(m). With stock options excluded, wefor this purpose. We have not paid any other compensation which has been subject to these deductibility limits.

Change of Control Triggers. We provide change in control benefits under an employment agreement between us and Douglas I. Payne, chief financial officer and executive vice president. The change in control benefits were negotiated in his employment agreement in 1996 and retained in a 2008 restatement of the agreement. In establishing the change in control benefits,During 2010, we considered that the CFO position is particularly vulnerable in a change in control and concluded that these benefits are necessary to attract a qualified person to that position. We believe these benefits will help protect stockholders’ interests during any negotiations relating to a possible business combination transaction by encouraging Mr. Payne to remain with us through a business combination transaction. The agreement provides for payment if Mr. Payne terminates for any reason during the first two years after the change in control. The change in control benefits are described under the heading “Employment Agreements” following this section.

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Following his promotion to President and Chief Operating Officer, we entered into ahad change of control agreementagreements with Mr. Glenn Prillaman.Prillaman, Mr. Micah Goldstein and Mr. Douglas Payne. The compensation committee determined that the agreement was appropriate due to the increased importance ofagreements with Mr. Glenn Prillaman to the operations of our business. The agreement hasand Mr. Goldstein are substantially similar, including a one-year term and is renewable annuallyannual renewal unless either party provides prior notice. The agreement providesagreements provide benefits only on a termination within two years after a change in control. The agreement with Mr. Payne had been in place for a number of years and ended with Mr. Payne’s retirement in January 2011. Additional information on the change in control benefits is found under the heading “Employment Agreements” following this section.

No Stock Ownership Guidelines. We have not adopted any stock ownership requirements or guidelines.

Compensation Information. We have not engaged in any formal benchmarking of any element of compensation or total compensation in recentfor several years. When we have looked at comparable company information in the past, the information was used to obtain a general understanding of current compensation practices. In 2009, we looked at publicly available compensation and financial information for a group of companies in setting the base salary for Mr. Glenn Prillaman when he was promoted to President and Chief Operating Officer. The companies were American Woodmark Corporation, Bassett Furniture Industries, Inc., Chromcraft Revington, Inc., Culp, Inc., Ethan Allen Interiors Inc., Flexsteel Industries, Inc., Furniture Brands International, Inc., Hooker Furniture Corporation, and La-Z-Boy Incorporated.

Fiscal 20092010 Compensation

For the 20092010 fiscal year, the compensation of executives was set and administered consistent with the philosophy and polices described above. The salaries for the named executive officers are shown on the Summary Compensation Table following this section.

We consider the positions, responsibilities, and longevity with us of our executive officers in setting their salaries. The 20092010 salaries for Mr. Glenn Prillaman and Mr. Douglas Payne and Mr. Stephen Bullock reflected, in large part, that these three officers were functioning as the office of the presidentmaintained at the time that 2009 salaries were initially set. In viewsame level as in effect at the end of his responsibilities as part of the office of the president, Mr. Glenn Prillaman’s salary was increased for 2009 to $250,000, which equaled Mr. Bullock’s salary that had been set when he was hired in 2008 and which was not increased for 2009. For 2009, Mr. Payne received a salary increase to $300,000, primarily because of his longer service in his current position without a salary increase. This was the first base salary increase for Mr. Payne in four years. Later in 2009 whenWhen Mr. Glenn Prillaman was promoted to President andelected Chief Executive Officer in February 2010, his salary was not increased. In August 2010, Mr. Micah Goldstein was hired as Chief Operating Officer, hisOfficer. Mr. Goldstein’s compensation for 2010 was increased to $320,000 prospectively in connection with the increased responsibilities of those positions. These three officers received the sameset at an annual amount of stock options for$260,000. Mr. Goldstein’s salary was not increased when he became chief financial officer in December 2010.

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At the 2009 grant that was made while they were functioning as the officebeginning of the president.

During 2008,2010, Mr. Albert Prillaman a formerserved as CEO of the Company, became the chairmanand Chairman of the Board of Directors. At that time,His initial compensation was continued at the same rate as in 2010. In May 2010, his compensation was setreduced to an annual rate of $15,000 at his request.

The 2010 bonus plan was established based on two performance factors: EBIT weighted 75% and quality performance based on returns weighted 25%. Mr. Glenn Prillaman had a base salarybonus potential for 2010 of $100,000 per year with no$200,000. This bonus opportunity. This salary reflected, in part, the scopepotential was not adjusted when he was promoted to CEO. Mr. Douglas Payne had a bonus potential for 2010 of his duties as related primarily to strategic activities. Later in 2008,$250,000 Mr. Albert Prillaman became the CEO and his salary was not increased. For 2009,eligible for a bonus during 2010. Mr. Albert Prillaman’s salaryGlenn Prillaman and Mr. Payne did not receive a bonus under the 2010 bonus plan. In connection with his hiring during the 2010 fiscal year, Mr. Micah Goldstein was not increased and he did receivegranted a bonus of $75,000 contingent on his continued employment to the end of 2010. Mr. Goldstein earned this bonus.
In December 2010, the compensation committee awarded Mr. Glenn Prillaman a grant of stock options at the same level as the other executive officers at the time.

During consideration of the 2009 bonus plan, the compensation committee evaluated the uncertainties associated with economic conditionson 200,000 shares and the Company’s 2009 business plan and expected results of operations. Based on a recommendation from management, the compensation committee determined that there would be no bonus plan for the 2009 year for executive officers. Consistent with that decision, there were no bonus payments to executives for the 2009 fiscal year.

When it determined that there would be no annual bonus plan for 2009, the compensation committee determined to makeMr. Micah Goldstein a grant of stock options on 75,000 shares. In addition in April 2009. ThisSeptember 2010, Mr. Goldstein also received a grant of stock option grant was made

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options on 75,000 shares in considerationconnection with his initial employment. The size of the decisionoption pool for executives in December 2010 was larger than in recent years. The size reflects our intent to provide the possibility of a meaningful amount of compensation for executives from a potential increase in our stock price resulting from a successful implementation of our business restructuring and also our recognition that regular bonuses have no 2009 annual bonus plan. We believe that these stock optionnot been paid for several years. Of the December 2010 grants, will be an appropriate incentive for the executives to stimulate our performance for future years. This grant included a grant for Mr. AlbertGlenn Prillaman who was serving as our CEO at the time of the grant and who served in that position for the rest of the year.

Additional information about the stock option grants to the named executive officers in fiscal 2009 is shown in three places in the proxy. The total fair value of the fiscal 2009 option grants as determined under FASB ASC paragraph 718-10-30-27 is shown in the “Option Awards” column on the Summary Compensation Table following this section. The number of options, grant date, exercise price and vesting schedule of the options are shown on the Grants of Plan-Based Awards table following this section. The option expiration date is shown on the Outstanding Equity Awards at Fiscal Year-End table following this section. The stock option grants for named executive officers were 62.5%Mr. Micah Goldstein received 44% of the total option grants made to employees in fiscal 2009.all executives and employees. The sizes of the stock option grants for the named executive officers (including the option grant to Mr. Goldstein in connection with his hiring) reflect their relative responsibilities and are intended to give them a significant stake in the outcome of our restructuring which will be substantially dependent on their efforts. During 2010, no option grants were made to other executives were madeMr. Douglas Payne. All of the grants had terms consistent with prior option grants. In connection with his salary reduction, Mr. Albert Prillaman received a grant of stock options in the same grant date, exercise price, vesting scheduleamount and otheron the same terms as the annual stock option grants for named executive officers.

grant to non-employee directors.

 

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Summary Compensation Table

The following table sets forth, for the year ended December 31, 2009,2010, our compensation for services in all capacities to those persons who at December 31, 20092010 were our chief executive officer (principal executive officer), executive vice president – financechief operating and administrationfinancial officer (principal financial officer) and our remaining executive officers at December 31, 20092010 (collectively, the “Named Executive Officers”).

SUMMARY COMPENSATION TABLE


FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009

Name and Principal Position

  Year  Salary
($)		  Bonus
($)		  Option Awards
($) (1)		  Non-Equity
Incentive Plan
Compensation		  All Other
Compensation
($)(2)		  Total
($)

ALBERT L. PRILLAMAN,
Chairman and Chief Executive Officer (3)

  2009  99,996  —    272,100  —    1,667   373,763
  2008  71,217  —    345,600  —    18,881(4)  435,698

GLENN PRILLAMAN,
President and Chief Operating Officer (5)

  2009  274,955  —    272,100  —    6,720   553,775
  2008  200,004  —    112,100  —    5,929   318,033
  2007  200,004  —    81,210  —    5,976   287,190

DOUGLAS I. PAYNE,
Executive Vice President-Finance and Administration and Secretary

  2009  300,000  —    272,100  —    6,390   578,490
  2008  272,004  —    112,100  —    6,900   391,004
  2007  272,004  —    108,280  —    6,750   387,034

STEPHEN A. BULLOCK,
Executive Vice President-Operations (6)

  2009  250,008  —    272,100  —    41,054(7)  563,162
  2008  210,826  —    218,279  —    30,683(8)  459,779

2010
                             
                  Non-Equity  All Other    
Name and Principal     Salary  Bonus  Option Awards  Incentive Plan  Compensation  Total 
Position Year  ($)  ($)  ($) (1)  Compensation  ($) (2)  ($) 
         
ALBERT L. PRILLAMAN,  2010   46,874   —   15,000   —   —   61,974 
Chairman and Former  2009   99,996   —   272,100   —   1,667   373,763 
Chief Executive Officer (3)  2008   71,217   —   345,600   —   18,881(4)  435,698 
                             
GLENN PRILLAMAN,  2010   320,004   —   321,188   —   —   641,192 
President and Chief  2009   274,955   —   272,100   —   6,720   553,775 
Executive Officer (5)  2008   200,004   —   112,100   —   5,929   318,033 
                             
MICAH S. GOLDSTEIN,  2010   92,506   —   268,646   —   75,000(7)  436,152 
Chief Operating and Financial Officer (6)                            
                             
DOUGLAS I. PAYNE,  2010   300,000   —   —   —   —   300,000 
Executive Vice President- Finance  2009   300,000   —   272,100   —   6,390   578,490 
and Administration and Secretary (8)  2008   272,004   —   112,100   —   6,900   391,004 
                             
(1)The option awards are valued under the assumptions contained in Note 68 to our Consolidated Financial Statements included in our annual report on Form 10-K for the fiscal year ended December 31, 2009.2010.
(2)Unless otherwise indicated, reflects employer contributions to our 401(k) Plan.
(3)Mr. Albert Prillaman served as Chief Executive Officer until February 2010 and Chairman until December 31, 2010.
(4)Amount includes $17,500 in director fees earned and paid in cash to Mr. Albert Prillaman while he served as lead director during 2008 before being named Chairman in April 2008 and employer contributions of $1,381 to our 401(k) Plan.
(5)Mr. Glenn Prillaman served as Executive Vice President –— Marketing and Sales until August 2009. He served as President and Chief Operating Officer from August 2009 until February 2010. He became President and Chief Executive Officer in February 2010.
(6)Mr. Bullock served as Executive Vice President – Operations untilGoldstein became Chief Operating Officer in August 2010 and became Chief Financial Officer in December 31, 2009.2010. He became Secretary after Mr. Payne’s retirement.
(7)Amount includes a relocation reimbursement of $24,293, a related tax gross-up of $10,511, and employer contributions of $6,250 to our 401(k) Plan.employment bonus.
(8)Amount includes a relocation reimbursement of $22,907, a related tax gross-up of $1,546, and employer contributions of $6,230 to our 401(k) Plan.Mr. Payne retired in January 2011.

 

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Change of Control and Employment Agreements

Mr. Glenn Prillaman
We have a change of control agreement with Mr. Glenn Prillaman. During the two years after a change in control (as defined in this change in control protection agreement), Mr. Prillaman is entitled to receive severance pay if his employment is terminated other than for cause (as defined in this change in control protection agreement) or if he terminates his employment for good reason which generally is defined to exist if:

(i) there is a material reduction in his base salary,

(ii) his authority, duties or responsibilities are materially reduced,

(iii) he is required to report to a corporate officer or employee instead of reporting directly to our board of directors or our ultimate parent following a change in control,

(iv) his place of employment is relocated further than 50 miles from his current place of employment, or

(v) any other action or inaction that constitutes a material breach by us or our successor of the change in control protection agreement.

In the event Mr. Prillaman’s employment is terminated in the circumstances described in the preceding sentence, he is entitled to receive the following severance payments:

(i) two times base salary paid in a lump sum at termination,

(ii) two times the average bonus paid over the last two prior fiscal years paid in a lump sum at termination,

(iii) a pro rata annual bonus for the year of termination, based on our actual results, payable when the bonus is otherwise payable, and

(iv) vesting in the outstanding stock awards that would have vested in the next two years.

The change in control protection agreement will continue in effect until December 31, 2011, subject to automatic extensions for additional one-year terms at the beginning of each year unless either party to the change in control protection agreement gives notice on or before October 1 of any year that the agreement will not be extended.

The estimated payments that would be provided upon termination under the various scenarios described above are quantified in the following table, assuming termination of employment took place on December 31, 2009.

2010.

Name

 
Termination Other
TerminationThan For
for Cause orCause After
VoluntaryChange in Control;
TerminationTermination for
by Executive with noGood Reason
Death orNon-CompetitionAfter
NameDisabilityCovenantChange in Control($Control ($)

Glenn Prillaman

—— 640,000

 

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Mr. Prillaman has received option grants under our 2000 and 2008 Incentive Compensation Plans that have not yet vested. On a change of control, or on death or disability, all outstanding option grants would become fully vested. See “Outstanding Equity Awards at Fiscal Year End” for a summary of outstanding option grants at December 31, 2009.2010.
Mr. Micah Goldstein
We also have a change of control agreement with Mr. Goldstein. During the two years after a change in control (as defined in this change in control protection agreement), Mr. Goldstein is entitled to receive severance pay if his employment is terminated other than for cause (as defined in this change in control protection agreement) or if he terminates his employment for good reason which generally is defined to exist if:
(i) there is a material reduction in his base salary,
(ii) his authority, duties or responsibilities are materially reduced,
(iii) he is required to report to a corporate officer other than the Chief Executive Officer,
(iv) his place of employment is relocated further than 75 miles from his current place of employment, or
(v) any other action or inaction that constitutes a material breach by us or our successor of the change in control protection agreement.
In the event Mr. Goldstein’s employment is terminated in the circumstances described in the preceding sentence, he is entitled to receive the following severance payments:
(i) two times base salary paid in a lump sum at termination,
(ii) two times the average bonus paid over the last two prior fiscal years paid in a lump sum at termination,
(iii) a pro rata annual bonus for the year of termination, based on our actual results, payable when the bonus is otherwise payable, and
(iv) vesting in the outstanding stock awards that would have vested in the next two years.
The change in control protection agreement will continue in effect until December 31, 2011, subject to automatic extensions for additional one-year terms at the beginning of each year unless either party to the change in control protection agreement gives notice on or before October 1 of any year that the agreement will not be extended.
If Mr. Goldstein’s employment is terminated within the first 12 months by the Company other than for cause, or by Mr. Goldstein for good reason as described above, Mr. Goldstein will be entitled to receive the following severance payments:
(i) one times base salary paid in a lump sum at termination;
(ii) a pro rata annual bonus for the year in which termination occurs, based on the Company’s actual results, payable when the bonus is otherwise payable;
(iii) if not previously paid, the $75,000 bonus for 2010, and
(iv) vesting in any outstanding stock awards that would have vested if Mr. Goldstein remained an employee for one year following the date of termination.

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Mr. Goldstein has also agreed to a non-competition covenant and a non-solicitation covenant for a period of one year from the date of termination in the event he receives these payments.
If Mr. Goldstein terminates his employment other than for good reason as described above during the first 12 months, he will forfeit the right to receive the $75,000 bonus described above or, if previously paid, will be obligated to repay the bonus to the Company.
The estimated payments that would be provided upon termination under the various scenarios described above are quantified in the following table, assuming termination of employment took place on December 31, 2010.
                 
              Termination Other Than 
      Termination  Termination Other Than  For 
      for Cause or  For  Cause Within First 
      Voluntary  Cause After Change in  Twelve Months; 
      Termination  Control;  Termination for Good 
      by Executive with no  Termination for Good  Reason 
  Death or  Non-Competition  Reason  Within First Twelve 
Name Disability  Covenant  After Change in Control ($)  Months ($) 
                 
Micah Goldstein  —   —   520,000   260,000 
Mr. Goldstein has received option grants under our 2008 Incentive Compensation Plans that have not yet vested. On a change of control, or on death or disability, all outstanding option grants would become fully vested. See “Outstanding Equity Awards at Fiscal Year End” for a summary of outstanding option grants at December 31, 2010.
Mr. Douglas Payne
We havehad an employment agreement with Douglas I. Payne.Payne until his retirement in January 2011. Mr. Payne’s employment agreement providesprovided for a base salary of at least $272,000 per year and a potential annual bonus of $50,000, both subject to upward adjustment.

In the event of Mr. Payne’s death or disability, his employment agreement providesprovided for his base salary to cease at the end of the month in which that event occurred. He or his estate iswas also entitled to a bonus payment equal to the bonus which would otherwise have been payable for the full year prorated for the number of days he was employed during that year. If we terminateterminated Mr. Payne’s employment for cause (as defined in his employment agreement), payments under his employment agreement cease.would have ceased. If we terminateterminated Mr. Payne’s employment without cause, Mr. Payne iswas entitled to receive the following severance payments:

 (i)base salary on a monthly basis for the remainder of the calendar year in which termination occurred;

 (ii)annual bonus for the calendar year in which termination occurred equal to the average bonuses paid to Mr. Payne for the three fiscal years before the year of his employment termination;

 (iii)annual severance pay in monthly installments for the two years following the year in which termination occurred equal to:

base salary in effect at the termination of employment plus

•base salary in effect at the termination of employment plus
•an amount equal to the average of bonuses paid for the three fiscal years before the year of his employment termination;

an amount equal to the average of bonuses paid for the three fiscal years before the year of his employment termination;

however, amounts otherwise payable during the first six months following termination will bewould have been made in a lump sum six months and one day after termination of employment.

16

Mr. Payne’s employment agreement extendsextended automatically for additional one-year terms at the end of each year unless either party to the agreement givesgave notice on or before November 1 of any year that the agreement willwould not be extended. In the event of such notice, employment terminatesterminated as of December 31 of the year in which such notice iswas given. If we givegave notice of termination, Mr. Payne iswas entitled to severance pay during the two years following termination in an amount equal to his base salary plus the average of bonuses paid for the three fiscal years before the year of his employment termination; however, amounts payable for the first six months following termination will bewould have been made in a lump sum six months and one day after termination of employment. During the two years after a change of control (as defined in his employment agreement), Mr. Payne iswas entitled to terminate his employment with us and receive severance pay in a single payment six months and one day after termination of employment.

Mr. Payne’s employment agreement providesprovided that he willwould not compete against us for two years following the termination of his employment. In addition, his employment agreement also provides that Mr. Payne will not solicit our employees for two years after the term of his employment agreement. The non-competition covenant does not apply if:

 (i)Mr. Payne terminatesterminated his employment within two years after a change of control for good reason (as defined in his employment agreement) or

 (ii)Mr. Payne voluntarily terminatesterminated his employment and we do not elect to pay severance to Mr. Payne.Payne (we did not elect to pay severance in connection with Mr. Payne’s retirement).

16

The estimated payments that would be provided upon termination under the various scenarios described above are quantified in the following table, assuming termination of employment took place on December 31, 2009.

Name

  Death or
Disability		  Termination
for Cause or
Voluntary
Termination
by Executive with no
Non-Competition
Covenant		  Termination
without
Cause ($)		  Non Renewal by Stanley
Furniture; Termination
After
Change in
Control; Voluntary
Termination with
Non-Competition
Covenant ($)

Douglas I. Payne

  —    —    600,000  600,000

2010.

                 
              Non Renewal by Stanley 
      Termination      Furniture; Termination 
      for Cause or      After 
      Voluntary      Change in 
      Termination      Control; Voluntary 
      by Executive with no  Termination  Termination with 
  Death or  Non-Competition  without  Non-Competition 
Name Disability  Covenant  Cause ($)  Covenant ($) 
                 
Douglas I. Payne  —   —   600,000   600,000 
Mr. Payne has received option grants under our 2000 and 2008 Incentive Compensation Plans that havehad not yet vested. Onvested as of December 31, 2010. Had a change of control, or on death or disability occurred on or before December 31, 2010, all outstanding option grants would have become fully vested. See “Outstanding Equity Awards at Fiscal Year End” for a summary of outstanding option grants at December 31, 2009.

2010.

 

17

Grants of Plan-Based Awards

The following table sets forth information concerning individual grants of plan-based awards made during the year ended December 31, 20092010 to the NameNamed Executive Officers.

GRANTS OF PLAN–PLAN—BASED AWARDS

      Estimated Possible
Payouts Under Non-Equity
Incentive Plan Awards		  

All Other

Option

Awards:

Number of

Securities

Underlying

  

Exercise

or Base

Price of

Option

  

Grant Date
Fair Value of

Stock and

Name

  Grant Date  Threshold
$		  Maximum
$		  Options
(#) (1)		  Awards
($/Sh) (2)		  Option
Awards ($)

ALBERT L. PRILLAMAN,
Chairman and Chief Executive Officer (3)

  4/16/2009  —    —    100,000  8.64  272,100

GLENN PRILLAMAN,
President and Chief Operating Officer (4)

  4/16/2009  —    —    100,000  8.64  272,100

DOUGLAS I. PAYNE,
Executive Vice President-Finance and Administration and Secretary

  4/16/2009  —    —    100,000  8.64  272,100

STEPHEN A. BULLOCK,
Executive Vice President-Operations (5)

  4/16/2009  —    —    100,000  8.64  272,100

                         
              All Other       
              Option       
              Awards:  Exercise    
      Estimated Possible  Number of  or Base  Grant Date 
      Payouts Under Non-Equity  Securities  Price of  Fair Value of 
      Incentive Plan Awards  Underlying  Option  Stock and 
      Threshold  Maximum  Options  Awards  Option 
Name Grant Date  $  $  (#) (1)  ($/Sh) (2)  Awards ($) 
ALBERT L. PRILLAMAN,  4/29/2010   —   —   3,106   10.01   15,000 
Chairman and Former Chief Executive Officer (3)                        
                         
GLENN PRILLAMAN,  12/9/2010   —   —   200,000   3.20   321,188 
President and Chief Executive Officer (4)                        
                         
MICAH S. GOLDSTEIN,  9/16/2010   —   —   75,000   3.69   148,200 
Chief Operating and  12/9/2010   —   —   75,000   3.20   120,446 
Financial Officer (5)                        
                         
DOUGLAS I. PAYNE,  —   —   —   —   —   — 
Executive Vice President- Finance and Administration and Secretary (6)                        
(1)All awards are made under the Stanley Furniture Company, Inc. 2008 Incentive Compensation Plan. AllExcept for the grant to Albert Prillaman of 3,106 shares which vested immediately, all option awards vest over a four-year period with 25% of each award vesting on the anniversary of the grant date if the recipient remains employed. The vesting is accelerated if there is a change in control or if the recipient dies or has a disability while employed.
(2)All awards are made at the closing market price of the stock on the grant date pursuant to the terms of the 2008 Incentive Compensation Plan.
(3)Mr. Albert Prillaman served as Chief Executive Officer until February 2010 and Chairman until December 31, 2010.
(4)Mr. Glenn Prillaman served as Executive Vice President –— Marketing and Sales until August 2009. He served as President and Chief Operating Officer from August 2009 until February 2010. He became President and Chief Executive Officer in February 2010.
(5)Mr. Bullock served as Executive Vice President – Operations untilGoldstein became Chief Operating Officer in August 2010 and became Chief Financial Officer in December 31, 2009.2010.
(6)Mr. Payne retired in January 2011.

 

18

Outstanding Equity Awards at Fiscal Year-End Table

The following table sets forth information concerning the year-end number and value of unexercised options, stock that has not vested and equity incentive plan awards for each of the Named Executive Officers.

OUTSTANDING EQUITY AWARDS


AT DECEMBER 31, 20092010 FISCAL YEAR-END

Option Awards

Name

  Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable		  Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable		  Option
Exercise
Price ($)		  Option
Expiration
Date

ALBERT L. PRILLAMAN,
Chairman and Chief Executive Officer (1)

  3,055   —     28.10  04/19/2016
  3,897   —     20.64  04/18/2017
  66,000   34,000 (2)  10.48  04/15/2018
  12,500   37,500 (3)  9.22  09/24/2018
  —     100,000 (3)  8.64  04/16/2019

GLENN PRILLAMAN,
President and Chief Operating Officer (4)

  20,000   —     12.44  08/23/2010
  20,000   —     13.94  04/24/2011
  8,000   —     24.51  12/14/2015
  15,000   5,000 (3)  23.03  12/05/2016
  15,000   15,000 (3)  10.77  12/04/2017
  12,500   37,500 (3)  9.22  09/24/2018
  —     100,000 (3)  8.64  04/16/2019

DOUGLAS I. PAYNE,
Executive Vice President-Finance and Administration and Secretary

  90,000   —     12.44  08/23/2010
  100,000   —     13.94  04/24/2011
  20,000   —     24.51  12/14/2015
  22,500   7,500 (3)  23.03  12/05/2016
  20,000   20,000 (3)  10.77  12/04/2017
  12,500   37,500 (3)  9.22  09/24/2018
  —     100,000 (3)  8.64  04/16/2019

STEPHEN A. BULLOCK,
Executive Vice President-Operations (5)

  7,500(6)  22,500 (3) (7)  13.85  02/04/2018
  12,500(6)  37,500 (3) (7)  9.22  09/24/2018
  —     100,000 (3) (7)  8.64  04/16/2019

                 
Option Awards 
  Number of  Number of       
  Securities  Securities       
  Underlying  Underlying       
  Unexercised  Unexercised  Option  Option 
  Options (#)  Options (#)  Exercise  Expiration 
Name Exercisable  Unexercisable  Price ($)  Date 
         
ALBERT L. PRILLAMAN,  3,055   —   28.10   04/19/2016 
Chairman and Former Chief Executive Officer (1)  3,897   —   20.64   04/18/2017 
   100,000   —   10.48   04/15/2018 
   25,000   25,000(2)  9.22   09/24/2018 
   25,000   75,000(2)  8.64   04/16/2019 
   3,106   —   10.01   04/29/2020 
                 
GLENN PRILLAMAN,  20,000   —   13.94   04/24/2011 
President and Chief Executive Officer (3)  8,000   —   24.51   12/14/2015 
   20,000   —   23.03   12/05/2016 
   22,500   7,500(2)  10.77   12/04/2017 
   25,000   25,000(2)  9.22   09/24/2018 
   25,000   75,000(2)  8.64   04/16/2019 
   —   200,000(2)  3.20   12/09/2020 
                 
MICAH S. GOLDSTEIN,  —   75,000(2)  3.69   09/16/2020 
Chief Operating and Financial Officer (4)  —   75,000(2)  3.20   12/09/2020 
                 
DOUGLAS I. PAYNE,  100,000   —   13.94   04/24/2011 
Executive Vice President- Finance and  20,000   —   24.51   12/14/2015 
Administration and Secretary (5)  30,000   —   23.03   12/05/2016 
   30,000   10,000(2)  10.77   12/04/2017 
   25,000   25,000(2)  9.22   09/24/2018 
   25,000   75,000(2)  8.64   04/16/2019 
(1)Mr. Albert Prillaman served as Chief Executive Officer until February 2010 and Chairman until December 31, 2010.
(2)Award vests over a two-year period with 33.33% vesting on the date of grant and 33.33% vesting annually over two years on each anniversary of the grant date if the recipient remains employed. The vesting is accelerated if there is a change in control or if the recipient dies or has a disability while employed.
(3)Award vests over a four-year period with 25% of the award vesting on each anniversary date of the grant if the recipient remains employed. The vesting is accelerated if there is a change in control or if the recipient dies or has a disability while employed.
(4)
(3)Mr. Glenn Prillaman served as Executive Vice President –— Marketing and Sales until August 2009. He served as President and Chief Operating Officer from August 2009 until February 2010. He became President and Chief Executive Officer in February 2010.
(4)Mr. Goldstein became Chief Operating Officer in August 2010 and became Chief Financial Officer in December 2010.
(5)Mr. Bullock served as Executive Vice President – Operations until December 31, 2009.
(6)Options will terminate unless exercised by March 31, 2010.
(7)Award lapsed unvested as a result of Mr. Bullock’s termination of employment.Payne retired in January 2011.

 

19

Option Exercises Table

There was no exercise of stock options for the year ended December 31, 20092010 by any of the Named Executive Officers.

Pension Benefits Table

The following table sets forth information concerning pension benefits for each of the Named Executive Officers.

PENSION BENEFITS

Name

  

Plan Name

  Number of
Years Credited
Service
(#)		  Present Value of
Accumulated
Benefit
($)		  Payments During
Last Fiscal Year
($)

ALBERT L. PRILLAMAN,
Chairman and Chief Executive Officer (1)

  Supplemental Retirement Plan of Stanley Furniture Company  26.50  782,700  62,263

GLENN PRILLAMAN,
President and Chief Operating Officer (2)

  —  —    —    —  

DOUGLAS I. PAYNE,
Executive Vice President-Finance and Administration and Secretary

  Supplemental Retirement Plan of Stanley Furniture Company  12.25  37,300  —  

STEPHEN A. BULLOCK,
Executive Vice President-Operations (3)

  —  —    —    —  

               
    Number of Years  Present Value of  Payments During 
    Credited Service  Accumulated Benefit  Last Fiscal Year 
Name Plan Name (#)  ($)  ($) 
         
ALBERT L. PRILLAMAN,
Chairman and Former Chief Executive
Officer (1)		 Supplemental Retirement Plan of Stanley Furniture Company  26.50   816,600   62,263 
               
GLENN PRILLAMAN, —  —   —   — 
President and Chief Executive Officer (2)              
               
MICAH S. GOLDSTEIN, —  —   —   — 
Chief Operating and Financial Officer (3)              
               
DOUGLAS I. PAYNE, Supplemental  12.25   44,700   — 
Executive Vice President- Finance
and Administration and Secretary (4)		 Retirement Plan of Stanley Furniture Company            
(1)Mr. Albert Prillaman served as Chief Executive Officer until February 2010 and Chairman until December 31, 2010.
(2)Mr. Glenn Prillaman served as Executive Vice President –— Marketing and Sales until August 2009. He served as President and Chief Operating Officer from August 2009 until February 2010. He became President and Chief Executive Officer in February 2010.
(3)Mr. Bullock served as Executive Vice President – Operations untilGoldstein became Chief Operating Officer in August 2010 and became Chief Financial Officer in December 31, 2009.2010.
(4)Mr. Payne retired in January 2011.

The Supplemental Retirement Plan (SRP) is a nonqualified deferred compensation plan that was frozen in 1995. Mr. Albert Prillaman and Mr. Douglas Payne are the only named executive officers covered by the SRP. Upon retirement, the SRP provides a monthly benefit calculated using a formula based on final average compensation, years of credited service, estimated Social Security benefits, and age at retirement, reduced by the benefit the participant received under the Stanley Retirement Plan. Final average compensation is the average annual compensation from January 1, 1987 until December 31, 1995. Compensation was all amounts paid limited to the IRS maximum for each year. The limit was $150,000 in 1995 when the SRP was frozen. Credited service is measured in months and is limited to 35 years for the covered pay portion and was frozen in 1995. Covered pay is the average of the taxable wage bases for the 35-year period up to the participant’s Social Security retirement age.

The formula is A plus B where:

A is 0.75% of final average compensation times years of credited service,

and

B is 0.50% of final average compensation in excess of covered pay times years of credited service up to 35 years.

 

20

Benefit payment options are a joint and 50% survivor annuity and a single life annuity. Benefits commence at the same time as the benefits could have commenced under the Stanley Retirement Plan. The SRP plan provides unreduced retirement benefits at or after age 65. Reduced retirement is available after age 55 with 10 years of service. For retirements between age 60 and 65, the benefit is reduced 0.2775% per month and 0.555% per month for retirements between age 55 and 60.

Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans Table

The following table sets forth information with respect to each defined contribution or other plan that provides for deferral of compensation on a basis that is not tax-qualified for each of the Named Executive Officers.

NONQUALIFIED DEFERRED COMPENSATION


FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009

Name

  Executive
Contributions
in Last FY
($)		  Registrant
Contributions
In Last FY
($)		  Aggregate
Earnings in
Last FY
($)		  Aggregate
Withdrawals/Distributions
($)		  Aggregate
Balance at Last
FYE
($)

ALBERT L. PRILLAMAN,
Chairman and Chief Executive Officer (1)

  —  —  53,221  56,513  233,681

GLENN PRILLAMAN,

President and Chief Operating Officer (2)

  —  —  —  —  —

DOUGLAS I. PAYNE,
Executive Vice President-Finance and Administration and Secretary

  —  —  3,151  —  24,974

STEPHEN A. BULLOCK,
Executive Vice President-Operations (3)

  —  —  —  —  —

2010
                     
  Executive  Registrant  Aggregate      Aggregate 
  Contributions  Contributions  Earnings in  Aggregate  Balance at Last 
  in Last FY  In Last FY  Last FY  Withdrawals/Distributions  FYE 
Name ($)  ($)  ($)  ($)  ($) 
ALBERT L. PRILLAMAN,  —   —   52,250   56,513   229,418 
Chairman and Former Chief Executive Officer (1)                    
                     
GLENN PRILLAMAN,  —   —   —   —   — 
President and Chief Executive Officer (2)                    
                     
MICAH S. GOLDSTEIN,  —   —   —   —   — 
Chief Operating and Financial Officer (3)                    
                     
DOUGLAS I. PAYNE,  —   —   3,606   —   28,581 
Executive Vice President- Finance and Administration and
Secretary (4)		                    
(1)Mr. Albert Prillaman served as Chief Executive Officer until February 2010 and Chairman until December 31, 2010.
(2)Mr. Glenn Prillaman served as Executive Vice President –— Marketing and Sales until August 2009. He served as President and Chief Operating Officer from August 2009 until February 2010. He became President and Chief Executive Officer in February 2010.
(3)Mr. Bullock served as Executive Vice President – Operations untilGoldstein became Chief Operating Officer in August 2010 and became Chief Financial Officer in December 31, 2009.2010.
(4)Mr. Payne retired in January 2011.

 

21

ADVISORY VOTE ON EXECUTIVE COMPENSATION (SAY-ON-PAY)
The Dodd-Frank Wall Street Reform and Consumer Protection Act requires us to seek a non-binding advisory vote from our stockholders to approve the compensation as disclosed in the Compensation Discussion & Analysis (“CD&A”) and tabular disclosures and narrative sections accompanying the tabular disclosures in this proxy statement. Since the required vote is advisory, the result of the vote is not binding upon the board of directors.
The compensation and benefits committee and the board of directors has created a compensation program designed to obtain and retain the services of highly-skilled executives who can perform multiple roles in our lean management team and to provide incentives linked to achievement of important financial goals in order to enhance our performance and value to stockholders by aligning closely the financial interests of our executives with those of our stockholders.
The board of directors urges stockholders to read the CD&A beginning on page 8 of this proxy statement, which describes in more detail how our executive compensation policies and procedures operate and are designed to achieve our compensation objectives, as well as the Summary Compensation Table and other related compensation tables and narrative, appearing on pages 13 through 21, which provide detailed information on the compensation of our named executive officers. The board of directors and the compensation and benefits committee believe that the policies and procedures articulated in the CD&A are effective in achieving our goals and that the compensation of our named executive officers reported in this proxy statement reflects and supports these compensation policies and procedures.
In accordance with recently adopted Section 14A of the Securities Exchange Act of 1934, as amended, and as a matter of good corporate governance, stockholders will be asked at the Annual Meeting to approve the following advisory resolution:
“RESOLVED, that the stockholders approve the compensation awarded by the company to the named executive officers, as described in the CD&A, tabular disclosures, and other narrative executive compensation disclosures in the proxy statement for the 2011 Annual Meeting of Stockholders as required by the rules of the Securities and Exchange Commission.”
Effect of Proposal
The say-on-pay resolution is non-binding. The approval or disapproval of this proposal by stockholders will not require the board of directors or the compensation and benefits committee to take any action regarding the company’s executive compensation practices. The final decision on the compensation and benefits of our named executive officers and on whether, and if so, how, to address stockholder approval or disapproval remains with the board of directors and the compensation and benefits committee.
The board of directors believes that the compensation and benefits committee is in the best position to consider the extensive information and factors necessary to make independent, objective, and competitive compensation recommendations and decisions that are in the best interest of the company and its stockholders.
The board of directors values the opinions of the company’s stockholders as expressed through their votes and other communications. Although the resolution is non-binding, the board of directors will carefully consider the outcome of the advisory vote on executive compensation and those opinions when making future compensation decisions. If a stockholder does not specify a choice, the shares will be voted in favor of the advisory resolution approving the compensation paid to certain executive officers.
Our board of directors believes that approval of the compensation paid to certain officers is in the best interest of all stockholders and, accordingly, unanimously recommends a vote “FOR” approval of the compensation paid to certain executive officers.

22

ADVISORY VOTE ON THE FREQUENCY OF SAY-ON-PAY VOTES (SAY-ON-FREQUENCY)
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, at least once every six years we are required to submit for stockholder vote a non-binding resolution to determine whether the advisory stockholder vote on executive compensation described above shall occur every one, two, or three years.
After careful consideration, the board of directors has determined that holding an annual advisory vote on executive compensation is the most appropriate policy for the Company at this time, and recommends that stockholders vote for future advisory votes on executive compensation to occur every ONE year. The board of directors believes an annual advisory vote is appropriate because the compensation and benefits committee evaluates and approves incentive compensation of our named executive officers on an annual basis. Additionally, an annual advisory vote promotes corporate transparency, and gives stockholders the opportunity to provide frequent direct input on compensation matters.
The proxy card provides stockholders with four choices (every one, two, or three years, or abstain). Stockholders are not voting to approve or disapprove the Board’s recommendation.
Effect of Proposal
The frequency vote is non-binding. Stockholder approval of a one, two, or three-year frequency vote will not require the Company to implement an advisory vote on executive compensation every one, two, or three years. The final decision on the frequency of the advisory vote on executive compensation remains with the board of directors and/or its committees.
The board of directors values the opinions of the company’s stockholders as expressed through their votes and other communications. Although the resolution is non-binding, the board of directors and the compensation and benefits committee will carefully consider the outcome of the frequency vote and other communications from stockholders when making future decisions regarding the frequency of say-on-pay votes. If a stockholder does not specify a choice, the shares will be voted in favor of an advisory vote approving the compensation paid to certain executive officers every year.
Our board of directors believes that an advisory vote each year on the compensation paid to certain officers is in the best interest of all stockholders and, accordingly, unanimously recommends a vote “FOR” a frequency of one year.

23

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect to the beneficial ownership of our common stock as of March 3, 2010,4, 2011, by each stockholder we know to be the beneficial owner of more than 5% of its outstanding common stock, by each director and director nominee, by each of the Named Executive Officers and by all directors and executive officers as a group:

Name

  Amount and Nature
of Beneficial Ownership		  Percent
of Class		 

Third Avenue Management LLC

  2,443,437 (a)  23.7% 

T. Rowe Price Associates, Inc.

  1,557,700 (b)  15.1% 

FMR LLC

  1,265,614 (c)  12.3% 

Peninsula Capital Advisors, LLC

  813,716 (d)  7.9% 

Royce & Associates, LLC

  693,324 (e)  6.7% 

BlackRock Inc.

  596,008 (f)  5.8% 

Albert L. Prillaman

  518,842 (g)  5.0% 

Douglas I. Payne

  290,000 (h)  2.7% 

Glenn Prillaman

  200,706 (i)  1.9% 

T. Scott McIlhenny, Jr.

  54,006 (j)   (p) 

Thomas L. Millner

  49,643 (k)   (p) 

Michael P. Haley

  40,043 (l)   (p) 

Robert G. Culp, III

  32,643 (m)   (p) 

Stephen A. Bullock

  20,000 (n)   (p) 

All directors and executive officers as a group (8 persons)

  1,205,883 (o)  10.9% 

         
  Amount and Nature  Percent 
Name of Beneficial Ownership  of Class 
Third Avenue Management LLC  3,696,174(a)  25.8%
T. Rowe Price Associates, Inc.  1,768,004(b)  12.3%
FMR LLC  1,289,638(c)  9.0%
Royce & Associates, LLC  912,235(d)  6.4%
JBF Capital, Inc.  843,858(e)  5.9%
Albert L. Prillaman  680,086(f)  4.7%
Glenn Prillaman  263,652(g)  1.8%
Douglas I. Payne  230,000(h)  1.6%
T. Scott McIlhenny, Jr.  51,112(i)  (m)
Michael P. Haley  39,149(j)  (m)
Robert G. Culp, III  35,749(k)  (m)
D. Paul Dascoli  —   — 
Micah S. Goldstein  10,000   (m)
All directors and executive officers as a group (8 persons)  1,309,748(l)  8.7%
(a)

The beneficial ownership information for Third Avenue Management LLC (“TAM”) is based upon the Schedule 13G filed with the SEC on February 16, 2010.14, 2011. The Schedule 13G indicates that TAM has sole voting and dispositive power with respect to all the shares. The principal business address of TAM is 622 Third Avenue, 32nd Floor, New York, New York 10017. TAM reports that Met Investors Series Trust ThirdTrust-Third Avenue Small Cap Portfolio has the right to receive dividends from, and the proceeds from the sale of, 2,388,3073,627,538 of the shares reported by TAM. Met Investors Advisory, LLC, as investment managerTAM reports that OFI Select-Third Avenue US Equity Fund has the right to receive dividends from, and the proceeds from the sale of, each series of Met Investors Series Trust, filed a Schedule 13G with the SEC on February 10, 2010 reporting shared voting and dispositive power with respect to 2,388,307 (representing 23.1%68,636 of the shares outstanding).

reported by TAM.
(b)The beneficial ownership information for T. Rowe Price Associates, Inc. (“Price Associates”) is based upon the Schedule 13G/A filed with the SEC on February 12, 2010,10, 2011, by Price Associates and T. Rowe Price Small-Cap Value Fund, Inc. (“TRP Small-Cap”). These securities are owned by various individual and institutional investors, including TRP Small-Cap (which has sole voting power for 908,4001,230,331 shares, representing 8.6% of the shares outstanding), for which Price Associates serves as investment adviser with power to direct investments and/or sole power to vote the securities. The Schedule 13G/A indicates that Price Associates has sole voting power for 611,900521,173 shares and sole dispositive power of 1,557,7001,768,004 shares. For purposes of the reporting requirements of the Securities Exchange Act of 1934, Price Associates is deemed to be a beneficial owner of 1,557,7001,768,004 shares; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities. The principal business address of Price Associates and TRP Small-Cap is 100 E. Pratt Street, Baltimore, Maryland 21202.
(c)The beneficial ownership information concerning the shares beneficially owned byfor FMR LLC is based upon the Schedule 13G/A filed with the SEC on February 16, 201014, 2011 by FMR LLC together with Edward C. Johnson 3d, Chairman of FMR LLC. Fidelity Management & Research Company (“Fidelity”), a wholly-owned subsidiary of FMR LLC, is the beneficial owner of all 1,265,6141,289,638 shares as a result of acting as investment advisor to various investment companies (the “Funds”). One investment company, Fidelity Low-Priced Stock Fund, owned 975,354all of the shares reported by FMR LLC. Edward C. Johnson 3d, FMR LLC, through its control of Fidelity, and the Funds each has sole power to dispose of the 1,265,614all 1,289,638 shares owned by the funds. Neither Edward C. Johnson 3d nor FMR LLC has sole power to vote or direct the voting of the shares owned directly by the Funds, which power resides with the Board of Trustees of the Funds. The principal business address of FMR LLC, Fidelity, Fidelity Low Priced Stock Fund and Mr. Johnson is 82 Devonshire Street, Boston, Massachusetts 02109.
(d)The beneficial ownership information with respect to Peninsula Capital Advisors, LLC (“Peninsula Advisors”) is based upon its Schedule 13G/A filed with the SEC on February 9, 2009 by Peninsula Advisors and Peninsula Investment Partners, LP (“Peninsula Partners”). The Schedule 13G/A indicates that Peninsula Advisors and Peninsula Partners have shared voting and dispositive power with respect to 813,716 shares. The principal business address of Peninsula Advisors and Peninsula Partners is 404B East Main Street, Charlottesville, Virginia 22902.

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(e)The beneficial ownership information for Royce & Associates, LLC (“Royce & Associates”) is based upon the Schedule 13G/A filed with the SEC on January 26, 2010.February 3, 2011. The Schedule 13G/A indicates that Royce & Associates has sole voting and dispositive power with respect to 693,324912,235 shares. The principal business address of Royce & Associates is 745 Fifth Avenue, New York, New York 10151.

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(f)

(e)The beneficial ownership information for BlackRock,JBF Capital, Inc. (“BlackRock”JBF”) is based upon the Schedule 13G filed with the SEC on JanuaryDecember 29, 2010.2010 by JBF together with John B. Fullerton, the controlling person of JBF, and Drakes Landing Associates, L.P. (the “Partnership”). JBF is a registered investment adviser whose clients have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the 843,858 shares. JBF is the general partner of Fullerton Partners, which is the general partner of the Partnership. John B. Fullerton is the President of JBF. The Schedule 13G indicates that BlackRock has soleJBF, John B. Fullerton and the Partnership have shared voting and dispositive power with respectover all 843,858 shares. Each of John B. Fullerton and JBF disclaims beneficial ownership of the shares except to 596,008the extent of that person’s pecuniary interest therein. The Partnership also disclaims beneficial ownership of the shares. The principal business address of BlackRockJBF, John B. Fullerton and the Partnership is 40 East 52nd306 West Francis Street, New York, New York 10022.

Aspen, Colorado 81611.
(f)Includes 185,058 shares which could be acquired through the exercise of stock options.
(g)Includes 144,452145,500 shares which could be acquired through the exercise of stock options.
(h)Mr. Payne served as Executive Vice President-Finance and Administration and Secretary until January 2011. Includes 290,000230,000 shares which could be acquired through the exercise of stock options.
(i)Includes 115,50043,149 shares which could be acquired through the exercise of stock options.
(j)Includes 46,04339,149 shares which could be acquired through the exercise of stock options.
(k)Includes 46,04335,149 shares which could be acquired through the exercise of stock options.
(l)Includes 36,043678,005 shares which could be acquired through the exercise of stock options.
(m)Includes 32,043 shares which could be acquired through the exercise of stock options.
(n)Mr. Bullock served as Executive Vice President – Operations until December 31, 2009. Includes 20,000 shares which could be acquired through the exercise of stock options.
(o)Includes 730,124 shares which could be acquired through exercise of stock options.
(p)Less than 1%.

INDEPENDENT PUBLIC AUDITORS

The firm of PricewaterhouseCoopers LLP served as our independent public auditors for 20092010 and has served in that capacity since 1979. While we expect PricewaterhouseCoopers LLP to be selected as its independent public auditors for 2010,2011, the audit committee will not make that selection until it completes its review of the engagement terms for the current year.

Representatives of PricewaterhouseCoopers LLP are expected to be present at the Annual Meeting. These representatives will have the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions.

The following table sets forth the fees, including reimbursement of expenses, paid to PricewaterhouseCoopers LLP for services in the fiscal years ended December 31, 20082009 and December 31, 2009.

   2008  2009

Audit Fees

  $321,094  $304,051

Audit-Related Fees

   —     —  

Tax Fees

   —     15,000

All Other Fees

   —     —  
        

Total

  $321,094  $319,051
        

2010.

         
  2009  2010 
Audit Fees $304,051  $308,500 
Audit-Related Fees  —   21,000 
Tax Fees  15,000   96,361 
All Other Fees  —   — 
       
Total $319,051  $425,861 
       
Audit Fees

Annual audit fees relate to professional services rendered for the audit of our annual financial statements and reviews of our Forms 10-Q.

Audit-Related Fees
The audit-related fees relate to professional services rendered in connection with our registration statement for shares of our common stock offered pursuant to subscription rights issued to our stockholders in 2010.
Tax Fees

Tax fees primarily include fees associated with tax audits, tax compliance and general tax planning and assistance. In 2010, PricewaterhouseCoopers LLP performed our tax compliance work. Also in 2010, tax fees included $41,000 for a tax planning study of repairs and maintenance.

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The audit committee has established a policy to pre-approve all audit, audit-related, tax and other services proposed to be provided by our independent accountants before engaging the accountants for that purpose. Consideration and approval of these services generally occur at the audit committee’s regularly scheduled meetings. In order to address situations where it is impractical to wait until the next scheduled meeting, the audit committee has delegated the authority to approve non-audit services to the

23

chairman of the audit committee or, in his absence, other members of the audit committee. Any services approved pursuant to this delegation of authority are required to be reported to the full audit committee at the next regularly scheduled meeting.

AUDIT COMMITTEE REPORT

The primary purpose of the audit committee is to assist the board in fulfilling its responsibility to oversee management’s conduct of our financial reporting process, including internal control over financial reporting. Management is responsible for preparing the company’s financial statements and assessing the effectiveness of the company’s internal control over financial reporting. The independent accountants are responsible for performing an independent audit of the company’s financial statements in accordance with generally accepted auditing standards and for issuing a report thereon. In addition, the independent accountants also express their opinion on the company’s internal control over financial reporting. The audit committee is directly responsible for the appointment, compensation and oversight of the work of the company’s independent accountants.

In this context, the audit committee has met and held discussions with management and the independent accountants. Management represented to the audit committee that the company’s financial statements were prepared in accordance with generally accepted accounting principles, and the audit committee has reviewed and discussed the financial statements with management and the independent accountants.

The audit committee discussed with the independent accountants matters required to be discussed by Statement on Auditing Standards No. 61 (Communications with Audit Committees). In addition, the audit committee has discussed with the independent accountants the accountant’s independence from the company and its management, including the matters in the written disclosures required by Rule 3526 (Communications with Audit Committees Concerning Independence) of the Public Company Accounting Oversight Board. The audit committee has also considered whether the provision of non-audit services by the independent accountants is compatible with maintaining the independent accountant’s independence.

In reliance on the reviews and discussions referred to above, the audit committee recommended to the board of directors that the audited financial statements be included in the company’s Annual Report on Form 10-K for the year ended December 31, 2009,2010, for filing with the Securities and Exchange Commission.

The members of the Audit Committee are:

Thomas L. Millner,

D. Paul Dascoli, Chairman


Robert G. Culp, III


Michael P. Haley


T. Scott McIlhenny, Jr.

OTHER BUSINESS

Management knows of no other business which will be presented for consideration at the Annual Meeting, but should any other matters be brought before the meeting, it is intended that the persons named in the accompanying proxy will vote such proxy at their discretion.

 

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ADDITIONAL INFORMATION

Voting Procedures

Votes will be tabulated by one or more Inspectors of Elections. ExceptThe say-on-pay advisory resolution approving the compensation paid to certain executives will be adopted if it receives the affirmative vote of the holders of at least a majority of the shares of our outstanding common stock represented at the meeting. For the advisory vote on the frequency on say-on-pay votes to be adopted, a majority of the shares of our outstanding common stock must be voted for a frequency of one, two or three years. The company will consider stockholders to have expressed a non-binding preference for the election of directors, anyfrequency option that receives the most favorable votes. Any other matters properly brought before the meeting will require the affirmative vote of the holders of at least a majority of the shares of our outstanding common stock represented at the meeting. If a stockholder, present in person or by proxy, abstains on any matter, the stockholder’s shares will not be voted on such matter. Thus an abstention from voting on a matter has the same legal effect as a vote “against” the matter, even though the stockholder may interpret such action differently. With respect to the election of directors, the two nominees in the class which term ends in 20132014 receiving the greatest number of votes cast for the election of directors will be elected.

A majority of the shares entitled to vote, represented in person or by proxy, will constitute a quorum for the transaction of business at the meeting. Shares for which the holder has elected to abstain or to withhold the proxies’ authority to vote on a matter will count toward a quorum. “Broker non-votes” will not count toward a quorum and will not be voted on any matter to be considered at the meeting.

If you hold your shares in street name and you do not provide your broker with timely voting instructions on the election of directors, the say-on-pay vote or the say-on-frequency vote, rules governing voting of proxies by brokers will not permit your brokerage firm to vote your shares. Consequently, without your voting instructions on the election of directors, the say-on-pay vote or the say-on-frequency vote, a “broker non-vote” will occur.

Internet Availability of Proxy Materials

Under rules adopted by the Securities and Exchange Commission, we are now furnishing proxy materials on the Internet and sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders. The Notice includes instructions on how to access the proxy materials on the Internet and instructions on how to access the proxy card to vote over the Internet. Paper copies of the proxy materials are available to stockholders upon request. We provide instructions on the Notice on how to request paper copies.

Stockholder Proposals for 20112012 Annual Meeting

Any stockholder desiring to present a proposal to the stockholders at the 20112012 Annual Meeting and who desires that such proposal be included in our proxy statement and proxy card relating to that meeting, must transmit such to our secretary so that it is received at our principal executive offices on or before November 15, 2010.19, 2011. All such proposals should be in compliance with applicable Securities and Exchange Commission regulations. With respect to stockholder proposals that are not included in the proxy statement for the 20112012 Annual Meeting, the persons named in the proxy solicited by our board of directors for the 20112012 Annual Meeting will be entitled to exercise the discretionary voting power conferred by such proxy under the circumstances specified in Rule 14a-4(c) under the Securities Exchange Act of 1934, as amended, including with respect to proposals we receive after January 29, 2011.

February 2, 2012.
By Order of the Board of Directors,
Douglas I. Payne
Micah S. Goldstein
Secretary

March 15, 2010

18, 2011

 

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Stanley Furniture Company, Inc.

LOGO

(IMAGE)
As a stockholder of Stanley Furniture Company, Inc., you have the option of voting your shares electronically through the Internet or on the telephone, eliminating the need to return the proxy card. Your electronic vote authorizes the named proxies to vote your shares in the same manner as if you marked, signed, dated and returned the proxy card. Votes submitted electronically over the Internet or by telephone must be received by 7:00 p.m., Eastern Time, on April 28, 2010.

26, 2011.

LOGO

  

LOGO

  

LOGO

(IMAGE)
(IMAGE)(IMAGE)
Vote Your Proxy on the Internet:

Vote Your Proxy by Phone:
Call 1 (866) 894-0537		Vote Your Proxy by mail:
Go to www.continentalstock.com

www.cstproxyvote.com
Have your proxy card available when you access the above website. Follow the prompts to vote your shares.

 OR 

Vote Your Proxy by Phone:

Call 1 (866) 894-0537

Use any touch-tone telephone to vote your proxy. Have your proxy card available when you call. Follow the voting instructions to vote your shares.

 OR 

Vote Your Proxy by mail:

Mark, sign, and date your proxy card, then detach it, and return it in the postage-paid envelope provided.

PLEASE DO NOT RETURN THE PROXY CARD IF YOU ARE

VOTING ELECTRONICALLY OR BY PHONE

qPLEASE DO NOT RETURN THE PROXY CARD IF YOU ARE
VOTING ELECTRONICALLY OR BY PHONE
▼ FOLD AND DETACH HERE AND READ THE REVERSE SIDE q▼

PROXY -(Continued from reverse side)
                                             PROXY -(Continued from reverse side) Please mark

your votes

like this

 

x

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED STOCKHOLDER. IF NO CHOICE IS SPECIFIED BY THE STOCKHOLDER, THIS PROXY WILL BE VOTED “FOR” ALL PORTIONS OF ITEM (1), “FOR” ITEM (2), “FOR” A FREQUENCY OF ONE YEAR IN ITEM (3) AND IN THE PROXIES’ DISCRETION ON ANY OTHER MATTERS COMING BEFORE THE MEETING.

Please mark
your votes
like this		x
                   
1. Election of directors for three-year term ending 2014. FOR all nominees WITHHOLD  2.  An advisory vote regarding the approval of compensation paid to certain executive officers.
  NOMINEES: 01 Robert G. Culp, III, and listed to the left AUTHORITY to    
    02 T. Scott McIlhenny, Jr. (except as indicated vote for all nominees    
        otherwise) listed to the left     o FOR  o AGAINST  o ABSTAIN

  INSTRUCTIONS: To withhold authority to vote for any individual nominee, write such nominee’s name in the space provided below. o o  3.  
An advisory vote regarding the frequency of stockholder approval of the compensation paid to certain executive officers.

                o 1 YEAR  o 2 YEARS  o 3 YEARS o ABSTAIN

             4.  
In their discretion the proxies are authorized to vote upon such other matters as may come before the meeting or any adjournment thereof.

               
           
Label Area 4” x 1 1/2”       
Please promptly mark, date, sign, and mail this Proxy Card in the enclosed envelope. No postage is required.

PRINT AUTHORIZATION     (THIS BOXED AREA DOES NOT PRINT)

To commence printing on this proxy card please sign, date and fax
this card to this number: 212-691-9013 or email us your approval.

SIGNATURE:                                           DATE:               TIME:           

Registered Quantity 800 Broker Quantity                 

Note: SCOTTI to Email final approved copy for Electronic Voting website setup: Yeso

 UPON FINAL APPROVAL
FORWARD INTERNET &
TELEPHONE VOTING
TO
SUNGUARD
WITHOUT THE YELLOW
BOX, BLUE BOX & CROP
MARKS		 COMPANY ID:


PROXY NUMBER:


ACCOUNT NUMBER:
   

1. 

Election of directors for three-year term ending 2013.

 

NOMINEES: 01 Thomas L. Millner, and 02 Glenn Prillaman

 

INSTRUCTIONS: To withhold authority to vote for any individual nominee, write such nominee’s name in the space provided below.

 

 

FOR all nominees

listed to the left

(except as indicated

otherwise)

 

¨

 

WITHHOLD AUTHORITY to vote for all nominees

listed to the left

 

¨

 2. 

In their discretion the proxies are authorized to vote upon such other matters as may come before the meeting or any adjournment thereof.

 

All as more particularly described in the Company’s Proxy Statement for the Annual Meeting of Stockholders to be held on April 29, 2010, receipt of which is hereby acknowledged.

     

 

The undersigned hereby revokes any proxy or proxies heretofore given to vote upon or act with respect to such stock and hereby ratifies and confirms all that said proxies, their substitutes or any of them may lawfully do by virtue hereof.

 

 LOGO 

LOGO

 

Please promptly mark, date, sign, and mail this Proxy Card in the enclosed envelope. No postage is required.

 

   

COMPANY ID:

 

PROXY NUMBER:

 

ACCOUNT NUMBER:

Signature
 

 Signature 

 Dated: 

Please date this Proxy Card and sign your name exactly as it appears hereon. Where there is more than one owner, each should sign. When signing as an attorney, administrator, executor, guardian or trustee, please add your title as such. If executed by a corporation, this Proxy Card should be signed by a duly authorized officer. If executed by a partnership, please sign in partnership name by authorized persons.

    

Important Notice Regarding the Availability of Proxy Materials for the

Annual Meeting of Stockholders to Be Held on April 29, 2010

    
Please date this Proxy Card and sign your name exactly as it appears hereon. Where there is more than one owner, each should sign. When signing as an attorney, administrator, executor, guardian or trustee, please add your title as such. If executed by a corporation, this Proxy Card should be signed by a duly authorized officer. If executed by a partnership, please sign in partnership name by authorized persons.

Important Notice Regarding the Availability of Proxy Materials for the
Annual Meeting of Stockholders to Be Held on April 27, 2011
The following Proxy Materials are available to you at http:/www.cstproxy.com/stanleyfurniture/2011
• 

The following Proxy Materials are available to you at http://www.cstproxy.com/stanleyfurniture/2010/

•   the Company’s Annual Report for the year ended December 31, 2009,

2010,
• 

•   the Company’s 20102011 Proxy Statement (including all attachments thereto),

• 

•   the Proxy Card, and

• 

•   any amendments to the foregoing materials that are required to be furnished to stockholders.

 

ACCESSING YOUR PROXY MATERIALS ONLINE

Have this notice available to vote your proxy electronically. You must reference your

Company ID, 9-digit proxy number and 10-digit account number.

Directions to the Annual Meeting of Stockholders can be obtained by calling (276) 627-2010.

q FOLD AND DETACH HERE AND READ THE REVERSE SIDEq

REVOCABLE PROXY

LOGO

Annual Meeting of Stockholders – April 29, 2010

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Douglas I. Payne and David W. Robertson and either of them, proxies of the undersigned, with full power of substitution, to vote all the shares of Common Stock of Stanley Furniture Company, Inc. (the “Company”) held of record by the undersigned on March 3, 2010, at the Annual Meeting of Stockholders to be held April 29, 2010, and at any adjournment thereof.

(Continued and to be dated and signed on reverse side)

ACCESSING YOUR PROXY MATERIALS ONLINE
Have this notice available to vote your proxy electronically. You must reference your
Company ID, 9-digit proxy number and 10-digit account number.
Directions to the Annual Meeting of Stockholders can be obtained by calling (276) 627-2010.
▼FOLD AND DETACH HERE AND READ THE REVERSE SIDE▼
REVOCABLE PROXY
(STANLEY LOGO)
Annual Meeting of Stockholders – April 27, 2011
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Micah S. Goldstein and David W. Robertson and either of them, proxies of the undersigned, with full power of substitution, to vote all the shares of Common Stock of Stanley Furniture Company, Inc. (the “Company”) held of record by the undersigned on March 4, 2011, at the Annual Meeting of Stockholders to be held on April 27, 2011, and at any adjournment thereof.
All as more particularly described in the Company’s Proxy Statement for the Annual Meeting of Stockholders to be held on April 27, 2011, receipt of which is hereby acknowledged.
The undersigned hereby revokes any proxy or proxies heretofore given to vote upon or act with respect to such stock and hereby ratifies and confirms all that said proxies, their substitutes or any of them may lawfully do by virtue hereof.
(Continued and to be dated and signed on reverse side)