TANDY LEATHER FACTORY, INC.
AMENDMENT TO
2007 DIRECTOR NON-QUALIFIED STOCK OPTION PLAN

This Amendment (this “Amendment”), was adopted by the Board of Directors (the
“Board”) of Tandy Leather Factory, Inc., a Delaware corporation (the “Company”),
as of May 3, 2010 (the “Effective Date”) and amends the 2007 Director
Non-qualified Stock Option Plan of the Company dated as of March 22, 2007 (the
“Original Plan”).
 
Recitals
 
A.           The Company adopted the Original Plan as of March 22, 2007.
 
B.           On May 22, 2007, at a duly held meeting of the stockholders of the
Company, the stockholders ratified and affirmed the Original Plan.
 
C.           Notwithstanding the Stock Option grant schedule set forth in
Article 4 of the Original Plan, the Board has deemed it to be in its best
interest of the Company not to grant the Stock Options according to such
schedule.
 
D.           As of the Effective Date, no Options have been granted under the
Plan.
 
E.           Article 10 of the Original Plan provides that the Original Plan may
be amended by the Board without the approval of the stockholders of the Company
with certain exceptions.
 
F.           The Original Plan is being amended to set forth a new Stock Option
grant schedule as more particularly set forth below.
 
Amendment
 
The Original Plan is hereby amended as follows:
 
1.           Definitions.  Unless otherwise defined herein, terms utilized
herein which are defined in the Original Plan shall have the meanings ascribed
to them in the Original Plan.
 
2.   Amendment to Article 4 of the Original Plan.  The first paragraph of
Article 4 of the Original Plan is hereby amended to read in its entirety as
follows:
 
The Committee shall grant Stock Options as follows: (i) on May 28, 2010, a Stock
Option for 3,000 shares of Common Stock shall be granted to each individual who
is serving as an outside director of the Company or any Subsidiary on that date;
(ii) on March 22 of each calendar year thereafter, a Stock Option for 3,000
shares of Common Stock shall be granted to each individual who is serving as an
outside director of the Company or any Subsidiary on that date; and (iii) if an
individual first becomes an outside director of the Company or any Subsidiary
within six months after March 22 of a year, such individual shall be granted a
Stock Option for 3,000 shares of Common Stock immediately upon becoming an
outside director.  Notwithstanding the foregoing, the Committee may elect to
delay any Stock Option grant date under this Article 4 up to the end of any
applicable calendar year (but not beyond March 22, 2017) if the Committee deems
such delay to be in the best interests of the Company.  The Committee shall not
grant Stock Options under any other circumstances.
 
3.           Effective Date.  This Amendment shall become effective as of the
Effective Date.
 
4.           No Other Amendments.  Except as expressly amended hereby, the
Original Plan shall continue in full force and effect in accordance with the
terms and provisions thereof.
 
5.           Headings.  The headings of the various sections of this Amendment
are for convenience of reference only and do not constitute a part hereof and
shall not be interpreted or construed to affect the meanings or construction of
any provision hereof.
 
6.           Governing Law.  This Amendment shall be governed by and construed
in accordance with the laws of the State of Delaware without regard to its
conflict-of-laws principles.
 
 
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
Effective Date.

 
TANDY LEATHER FACTORY, INC.

By:   /s/ Shannon L. Greene
Shannon L. Greene,
Chief Financial Officer and Treasurer

ATTEST:

/s/ William M. Warren

William M. Warren,
General Counsel and Secretary