Exhibit 10.4

 

Outside Director Form

 

RESTRICTED STOCK AWARD AGREEMENT

Tuesday Morning Corporation
2014 Long-Term Incentive Plan

 

This RESTRICTED STOCK AWARD AGREEMENT (this “Agreement”) is entered into between
Tuesday Morning Corporation, a Delaware corporation (the “Company”), and
                               (the “Participant”) effective as of
                                    , 201     (the “Date of Grant”), pursuant to
the Tuesday Morning Corporation 2014 Long-Term Incentive Plan, as amended (the
“Plan”), the terms of which are incorporated by reference herein in their
entirety.

 

WHEREAS, the Company desires to grant to the Participant the shares of common
stock, par value $0.01 per share (“Common Stock”), as an inducement for the
Participant’s continued and effective performance of services for the Company as
a member of the Board of Directors of the Company (the “Board”), subject to the
terms and conditions of this Agreement; and

 

WHEREAS, the Participant desires to have the opportunity to hold the Common
Stock subject to the terms and conditions of this Agreement;

 

NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:

 

1.                                      Grant of Restricted Stock.  Effective as
of the Date of Grant, the Company shall cause to be issued in the Participant’s
name                        shares of Common Stock (the “Restricted Stock”). 
The Company shall electronically register the Restricted Stock, and any Retained
Distributions issued with respect to the Restricted Stock, in the Participant’s
name and note that such shares are Restricted Stock.  If certificates evidencing
the Restricted Stock, or any Retained Distributions, are issued to the
Participant during the Restricted Period, such certificates shall bear a
restrictive legend, substantially as provided in Section 15.10 of the Plan, to
the effect that ownership of such Restricted Stock (and any such Retained
Distributions), and the enjoyment of all rights appurtenant thereto, are subject
to the restrictions, terms, and conditions provided in the Plan and this
Agreement.  The Participant shall have the right to vote the Restricted Stock
awarded to the Participant and to receive and retain all regular cash dividends,
and to exercise all other rights, powers and privileges of a holder of Common
Stock, with respect to such Restricted Stock, with the exception that (a) the
Participant shall not be entitled to delivery of a stock certificate or
certificates representing such Restricted Stock until the Forfeiture
Restrictions applicable thereto shall have expired and the Participant requests
delivery of a certificate as described in Section 6.4(a) of the Plan, (b) the
Company shall retain custody of all Retained Distributions made or declared with
respect to the Restricted Stock (and such Retained Distributions shall be
subject to the same restrictions, terms and conditions as are applicable to the
Restricted Stock) until such time, if ever, as the Restricted Stock with respect
to which such Retained Distributions shall have been made, paid, or declared
shall have become vested, and such Retained Distributions shall not bear
interest or be segregated in separate accounts and (c) the Participant may not
sell, assign, transfer, pledge, exchange, encumber, or

 

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dispose of the Restricted Stock or any Retained Distributions during the
Restricted Period.  Upon issuance, the certificates for the Restricted Stock
shall be delivered to the Secretary of the Company or to such other depository
as may be designated by the Committee as a depository for safekeeping until the
forfeiture of such Restricted Stock occurs or the Forfeiture Restrictions lapse,
together with stock powers or other written instruments or electronic agreements
of assignment, each endorsed in blank, which will permit transfer to the Company
of all or any portion of the Restricted Stock and any securities constituting
Retained Distributions which shall be forfeited in accordance with the Plan and
this Agreement.  In accepting the award of Restricted Stock set forth in this
Agreement, the Participant accepts and agrees to be bound by all the terms and
conditions of the Plan and this Agreement.

 

2.                                      Definitions.  For purposes of this
Agreement, the following terms shall have the meanings indicated below:

 

(a)                                 “Forfeiture Restrictions” shall mean any
prohibitions and restrictions set forth herein with respect to the sale or other
disposition of Restricted Stock issued to the Participant hereunder and the
obligation to forfeit and surrender such Restricted Stock to the Company.

 

(b)                                 “Restricted Period” shall mean the period
designated by the Committee during which Restricted Stock is subject to the
Forfeiture Restrictions and may not be sold, assigned, transferred, pledged, or
otherwise encumbered.

 

(c)                                  “Retained Distributions” shall mean any
securities or other property (other than regular cash dividends) distributed by
the Company in respect of the Restricted Stock during any Restricted Period.

 

Capitalized terms not otherwise defined in this Agreement shall have the
meanings given to such terms in the Plan.

 

3.                                      Transfer Restrictions.  The Restricted
Stock granted hereby may not be sold, assigned, pledged, exchanged, hypothecated
or otherwise transferred, encumbered or disposed of (other than by will or the
applicable laws of descent and distribution) to the extent then subject to the
Forfeiture Restrictions, except as otherwise authorized by the Committee.  Any
such attempted sale, assignment, pledge, exchange, hypothecation, transfer,
encumbrance or disposition in violation of this Agreement shall be void and the
Company shall not be bound thereby.  Further, the Restricted Stock granted
hereby that is no longer subject to Forfeiture Restrictions may not be sold or
otherwise disposed of in any manner that would constitute a violation of any
applicable federal or state securities laws.  The Participant also agrees
(a) that the Company may refuse to cause the transfer of the Restricted Stock to
be registered on the applicable stock transfer records if such proposed transfer
would, in the opinion of counsel satisfactory to the Company, constitute a
violation of any applicable securities law and (b) that the Company may give
related instructions to the transfer agent, if any, to stop registration of the
transfer of the Restricted Stock.  The Restricted Stock is registered with the
Securities and Exchange Commission under a Registration Statement on Form S-8. 
A Prospectus describing the Plan and the Stock is available from the Company.

 

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4.                                      Vesting.  The Restricted Stock that is
granted hereby shall be subject to Forfeiture Restrictions.  The Forfeiture
Restrictions shall lapse as to the Restricted Stock that is granted hereby in
accordance with the provisions of subsections (a) through (d) of this Section 4.

 

(a)                                 Generally.  The Forfeiture Restrictions
shall lapse as to the Restricted Stock that is granted hereby as provided in
subsection (b), provided that the Participant  has not incurred a Termination of
Service prior to the date provided in subsection (b).  If the Participant has
incurred a Termination of Service before the date provided in
subsection (b) then, except as otherwise specified in subsections (c) or
(d) below, the Forfeiture Restrictions then applicable to any of the Restricted
Stock shall not lapse and all of the Restricted Stock with respect to which
Forfeiture Restrictions have not then lapsed shall be forfeited to the Company
upon such Termination of Service.

 

(b)                                 Vesting Date.  The Forfeiture Restrictions
shall lapse, and the Restricted Stock will vest in full, subject to the
provisions of subsection (a), on the earlier of the one year anniversary of the
Date of Grant or immediately prior to the Company’s next Annual Meeting of
Stockholders (the “Annual Meeting”) on the Annual Meeting date.

 

(c)                                  Death or Total and Permanent Disability. 
Notwithstanding any provisions of Section 4 to the contrary, in the event the
Participant’s Termination of Service is due to the Participant’s death or Total
and Permanent Disability prior to the date provided in subsection (b), the
Forfeiture Restrictions shall lapse on the date of such Termination of Service
due to death or Total and Permanent Disability.

 

(d)                                 Change in Control.  Notwithstanding any
provisions of Section 4 to the contrary, in the event a Change in Control occurs
prior to the date of the Participant’s Termination of Service, the Forfeiture
Restrictions shall lapse upon the occurrence of such Change in Control.

 

5.                                      Effect of Lapse of Restrictions.  Upon
the lapse of the Forfeiture Restrictions with respect to the Restricted Stock
granted hereby, if requested by the Participant as described in
Section 6.4(a) of the Plan, the Company shall cause to be delivered to the
Participant a stock certificate representing such Restricted Stock, and such
Restricted Stock shall be transferable by the Participant (except to the extent
that any proposed transfer would, in the opinion of counsel satisfactory to the
Company, constitute a violation of applicable securities law).

 

6.                                      Capital Adjustments and
Reorganizations.  The existence of the Restricted Stock shall not affect in any
way the right or power of the Company or its stockholders to make or authorize
any adjustment, recapitalization, reorganization or other change in the
Company’s capital structure or its business, engage in any merger or
consolidation, issue any debt or equity securities, dissolve or liquidate, or
sell, lease, exchange or otherwise dispose of all or any part of its assets or
business, or engage in any other corporate act or proceeding.

 

7.                                      Section 83(b) Election.  The Participant
shall not exercise the election permitted under section 83(b) of the Code with
respect to the Restricted Stock without the written approval of the Chief
Financial Officer of the Company.

 

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8.                                      No Fractional Shares.  All provisions of
this Agreement concern whole shares of Common Stock.  If the application of any
provision hereunder would yield a fractional share, such fractional share shall
be rounded down to the next whole share if it is less than 0.5 and rounded up to
the next whole share if it is 0.5 or more.

 

9.                                      Not a Service Agreement.  This Agreement
is not an employment or service agreement, and no provision of this Agreement
shall be construed or interpreted to create an employment or service
relationship between the Participant and the Company or guarantee the right to
remain a member of the Board for any specified term.

 

10.                               Limit of Liability.  Under no circumstances
will the Company or an Affiliate be liable for any indirect, incidental,
consequential or special damages (including lost profits or taxes) of any form
incurred by any person, whether or not foreseeable and regardless of the form of
the act in which such a claim may be brought, with respect to the Plan, this
Agreement or the Restricted Stock.

 

11.                               Legend.  The Participant consents to the
placing on the certificate for the Restricted Stock of an appropriate legend
restricting resale or other transfer of the Restricted Stock except in
accordance with the Securities Act of 1933 and all applicable rules thereunder.

 

12.                               Notices.  Any notice, instruction,
authorization, request or demand required hereunder shall be in writing, and
shall be delivered either by personal delivery, telegram, telex, telecopy or
similar facsimile means, by certified or registered mail, return receipt
requested, or by courier or delivery service, addressed to the Company at the
Company’s principal business office address and to the Participant at the
Participant’s residential address as shown in the records of the Company, or at
such other address and number as a party shall have previously designated by
written notice given to the other party in the manner hereinabove set forth. 
Notices shall be deemed given when received, if sent by facsimile means
(confirmation of such receipt by confirmed facsimile transmission being deemed
receipt of communications sent by facsimile means); and when delivered (or upon
the date of attempted delivery where delivery is refused), if hand-delivered,
sent by express courier or delivery service, or sent by certified or registered
mail, return receipt requested.

 

13.                               Amendment and Waiver.  Except as otherwise
provided herein or in the Plan, or as necessary to implement the provisions of
the Plan, this Agreement may be amended, modified or superseded only by written
instrument executed, or an electronic agreement agreed to, by the Company and
the Participant.  Only a written instrument executed and delivered by, or an
electronic agreement agreed to by, the party waiving compliance hereof shall
waive any of the terms or conditions of this Agreement.  Any waiver granted by
the Company shall be effective only if executed and delivered by a duly
authorized director or officer of the Company other than the Participant.  The
failure of any party at any time or times to require performance of any
provisions hereof shall in no manner effect the right to enforce the same.  No
waiver by any party of any term or condition, or the breach of any term or
condition contained in this Agreement, in one or more instances, shall be
construed as a continuing waiver of any such condition or breach, a waiver of
any other condition, or the breach of any other term or condition.

 

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14.                               Governing Law and Severability.  The validity,
construction and performance of this Agreement shall be governed by the laws of
the State of Delaware, excluding any conflicts or choice of law rule or
principle that might otherwise refer construction or interpretation of this
Agreement to the substantive law of another jurisdiction.  The invalidity of any
provision of this Agreement shall not affect any other provision of this
Agreement, which shall remain in full force and effect.

 

15.                               Successors and Assigns.  Subject to the
limitations which this Agreement imposes upon the transferability of the
Restricted Stock granted hereby, this Agreement shall bind, be enforceable by
and inure to the benefit of the Company and its successors and assigns, and to
the Participant, the Participant’s permitted assigns and upon the Participant’s
death, the Participant’s estate and beneficiaries thereof (whether by will or
the laws of descent and distribution), executors, administrators, agents, legal
and personal representatives.

 

16.                               Miscellaneous.  This Agreement is awarded
pursuant to and is subject to all of the provisions of the Plan, including
amendments to the Plan, if any.

 

17.                               Acceptance.  The Participant, by his or her
acceptance of the Restricted Stock, agrees to be bound by all of the terms and
conditions of this Agreement and the Plan, and further consents to and agrees to
be bound by the Irrevocable Stock Power presented herewith.

 

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IRREVOCABLE STOCK POWER

 

KNOW ALL MEN BY THESE PRESENTS, That For Value Received, the Participant (as
defined in the Award Agreement) has bargained, sold, assigned and transferred
and by these presents does bargain, sell, assign and transfer unto Tuesday
Morning Corporation, a Delaware corporation (the “Company”), the Restricted
Stock transferred pursuant to the RESTRICTED STOCK AWARD AGREEMENT dated as of
and effective                             , 201    , between the Company and the
Participant granting such Restricted Stock to the Participant (the “Award
Agreement”); and subject to and in accordance with the terms of the Award
Agreement the Participant does hereby constitute and appoint the Secretary of
the Company the Participant’s true and lawful attorney, IRREVOCABLY, to sell,
assign, transfer, hypothecate, pledge and make over all or any part of such
Restricted Stock and for that purpose to make and execute all necessary acts of
assignment and transfer thereof, and to substitute one or more persons with like
full power, hereby ratifying and confirming all that said attorney or his or her
substitutes shall lawfully do by virtue hereof.

 

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