Exhibit 10.1


 


EXECUTION VERSION


 


transition
agreement


 


This Transition Agreement
(“Agreement”) is entered into by and between Tuesday Morning Corporation, a Delaware corporation (the “Company”),
and Fred Hand (the “Executive”), effective as of the date it is executed by both Parties (the “Effective
Date”). The Company and the Executive are referred to herein individually as a “Party” and collectively
as the “Parties.”


 


WHEREAS, the Executive
has been employed by the Company as Chief Executive Officer and has served as a member of the Company’s Board of Directors (the
 “Board”);


 


WHEREAS, the Executive
and the Company entered into the Employment Agreement, dated May 4, 2021 (the “Employment Agreement”);


 


WHEREAS, the Executive
and the Company entered into certain equity award agreements under the Tuesday Morning Corporation 2014 Long-Term Incentive Plan (the
 “Incentive Plan”), as amended, providing for grants of Inducement time-based Restricted Stock Units, dated
May 19, 2021, and Inducement performance-based vesting Restricted Stock Units, dated May 19, 2021 (collectively, the “Inducement
RSU Award Agreements”), and time-based Restricted Stock Units, dated September 22, 2021 (the “Time-Based
RSU Award Agreement”), some of which are unvested and unexercised as of the date hereof, as more specifically set forth
on Exhibit A hereto (collectively, the Inducement RSU Award Agreements and the Time-Based RSU Award Agreement shall be referred
to as the “Award Agreements”);


 


WHEREAS, the Employment
Agreement and Award Agreements contain confidentiality, non-competition, non-solicitation, and cooperation provisions that the Parties
agree survive the Executive’s separation from the Company and remain in full force and effect as set forth in Section 8
below;


 


WHEREAS, the Company
and the Executive believe it is appropriate and in their mutual best interests to transition the Executive’s position as Chief
Executive Officer of the Company and for the Executive’s employment to terminate effective November 4, 2022 (the “Separation
Date”) and for the Executive to resign from the Board effective on the Separation Date;


 


WHEREAS, the Executive
agrees to perform the transition services as set forth below from the Effective Date of this Agreement through June 30, 2023 (the
 “Transition Period”); and


 


WHEREAS, the Parties
desire to set forth the Executive’s separation benefits and obligations and to finally, fully and completely resolve all matters
arising from or during the Executive’s employment and separation from employment, any benefits, bonuses and compensation connected
with such employment; and


 


NOW, THEREFORE, in
consideration of the premises and mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:


 


1.               End
of the Executive’s Employment and Transition.


 


(a)            Separation
Date. The Parties agree that on the Separation Date the Executive’s employment with the Company shall terminate and his resignation
from the Board shall be effective. The Executive shall execute all documents and take such further steps as may be required to effectuate
the Executive’s separation from the Company. The Executive shall not perform any work except as set forth in this Agreement, and
shall not make any representations or execute any documents, or take any other actions, on behalf of the Company on or after the Separation
Date.


 






    TRANSITION AGREEMENT


     


    

 


EXECUTION VERSION


 


(b)            Transition
Services. During the Transition Period, the Executive agrees to provide Transition Services (as defined herein) during regular business
hours and to cooperate fully and provide additional assistance as reasonably requested by the Company and consistent with this Section 1(b).
Specifically, the Executive agrees to: (i) fully inform the Company of all activities in which the Executive was involved prior
to the Separation Date and of the status of any projects; (ii) transfer or otherwise make available to the Company to the extent
possible, all of the Executive’s knowledge and experience regarding the Executive’s duties; (iii) accomplish a smooth
transition of the Executive’s responsibilities and to cooperate with the Company through the Transition Period; and (iv) comply
with this Agreement, and to act in good faith at all times in performing the services described in clauses (b)(i)-(iii) (collectively,
the “Transition Services”). The Parties agree to use their commercially reasonable efforts to schedule the
performance of any Transition Services at times that are mutually convenient for each Party and the Company will use its commercially
reasonable efforts to provide reasonable notice to the Executive when any Transition Services will require a specific time commitment
from the Executive. For clarity, the Transition Services shall exclusively be with respect to transition of duties and the Executive’s
knowledge of operations on or prior to the Separation Date. The Executive acknowledges and agrees that the Executive shall receive no
additional compensation for time spent assisting the Company pursuant to this Section 1(b) other than the compensation
and benefits provided for in this Agreement. The Executive shall have the right to provide the Transition Services remotely. During any
portion of the Transition Period after December 31, 2022, the Company shall use its best efforts to not disclose any material nonpublic
information (“MNPI”) to the Executive in connection with his performance of the Transition Services and the
number of hours that the Company requests the Executive to perform the Transition Services shall not exceed 20 hours per month. To the
extent the Company inadvertently (or otherwise) discloses MNPI to the Executive after December 31, 2022, the Company shall promptly
notify the Executive.


 


2.            Payments.


 


(a)             Final
Pay. The Company shall continue to pay the Executive his base salary through the Separation Date pursuant to the Employment Agreement
in accordance with its normal payroll practices, and following the Separation Date, shall pay the Executive for all base salary earned
but unpaid through the Separation Date in accordance with its normal payroll practices, and all accrued but unused vacation days through
the Separation Date in accordance with Company policy, payable with the Executive’s final payroll following the Separation Date.
The Executive will be eligible to participate in the Company’s benefit plans through the Separation Date in accordance with the
applicable benefit plan documents. The Company will also reimburse the Executive for all reasonable and documented business expenses
incurred and submitted in accordance with the Company’s expense reimbursement policies.


 


(b)             Transition
Benefits. Provided that the Executive executes and does not revoke this Agreement and complies with this Agreement and the Surviving
Provisions (as defined below), in consideration of the Executive’s execution of this Agreement and promises herein, and release
of claims against the Company, as described in Section 3 below, the Parties agree as follows:


 


(i)            Transition
Pay. The Company will pay the Executive a transition payment in the aggregate amount of $2,275,948.32 (“Transition Payment”),
minus lawful taxes and withholdings, payable in one lump sum payment within 30 days following the Separation Date on the Company’s
first payroll date following the date this Agreement is irrevocable.


 


(ii)            Legal
Fees. The Company shall reimburse the Executive for all of his reasonable, documented legal fees and expenses associated with the
negotiation of this Agreement up to a maximum aggregate amount of $50,000 for the Executive’s legal fees, and the legal fees of
Marc Katz and Paul Metcalf in negotiating their transition agreements.


 


(iii)          Vesting
of Equity Awards. Notwithstanding the provisions of the Award Agreements, the Executive shall be entitled to accelerated time-vesting
of any time-unvested RSUs as of the Separation Date (as summarized in Exhibit A hereto), based on the “change in control”
(as defined in the Incentive Plan) of the Company that occurred on September 20, 2022.


 






    2


     


    

 


EXECUTION VERSION


 


The benefits set forth in
this Section 2(b) are referred to herein as the “Transition Benefits.” The Company shall have
no obligation to provide the Transition Benefits until the Executive has had the opportunity to consider this Agreement as described
in Section 15 below, and the Executive has not revoked the Agreement in the timetable specified in Section 15.
The Transition Benefits shall not be treated as compensation under the Company’s 401(k) plan or any other benefit or retirement
plan. The Parties agree that the Transition Benefits are full and fair consideration between the Parties and that the Executive is not
otherwise entitled to the Transition Benefits.


 


(c)            Other
than the compensation and payments provided for in this Agreement, the Executive shall not be entitled to any additional compensation,
bonuses, vacation pay, PTO, payments, grants, options or benefits under any agreement or any benefit plan, equity, long term incentive
plan, profit sharing, short term incentive plan, severance plan or bonus or any other incentive program established by the Company.


 


3.            Mutual
Release of Claims.


 


(a)            Release
of Claims by the Executive. In consideration of the promises of the Company provided herein, including the Company’s mutual
release of claims, the consideration provided for in Section 2, and other consideration provided for in this Agreement, that
being good and valuable consideration, the receipt, adequacy and sufficiency of which the Executive acknowledges, the Executive, on the
Executive’s own behalf and on behalf of the Executive’s agents, administrators, representatives, executors, successors, heirs,
devisees and assigns (collectively, the “Executive Releasing Parties”) hereby fully and forever waives, releases,
extinguishes and discharges the Company, its affiliates, subsidiaries and each of their respective past, present and future parents,
owners, officers, directors, executives, employees, consultants, independent contractors, partners, agents, attorneys, advisers, insurers,
fiduciaries, employee benefit plans, representatives, successors and assigns (each, a “Company Released Party”
and collectively, the “Company Released Parties”), jointly and severally, from any and all claims, rights,
demands, debts, obligations, losses, causes of action, suits, controversies, setoffs, affirmative defenses, counterclaims, third party
actions, damages, penalties, costs, expenses, attorneys’ fees, liabilities and indemnities of any kind or nature whatsoever (collectively,
the “Claims”), whether known or unknown, suspected or unsuspected, accrued or unaccrued, whether at law, equity,
administrative, statutory or otherwise, and whether for injunctive relief, back pay, front pay, fringe benefits, equity, reinstatement,
reemployment, compensatory damages, punitive damages, or any other kind of damages, which any of the Executive Releasing Parties have,
had or may have against any of the Company Released Parties relating to or arising out of any matter arising on or before the date this
Agreement is executed by the Executive. Such released Claims include, without limitation, (i) all Claims arising out of or in connection
with, or in any way related to the Executive’s employment, compensation, equity, bonuses, commissions, incentive compensation,
payments, vacation, leaves of absence, alleged payments, benefits, employment contracts, terms and conditions of employment, severance
pay, and any other benefits the Executive may or may not have received during the Executive’s employment with the Company (or any
Company Released Party), including the Employment Agreement, (ii) all Claims arising at law or equity or sounding in contract (express
or implied) or tort, including Claims for wrongful discharge, libel, slander, breach of express or implied contract or implied covenant
of good faith and fair dealing, (iii) Claims arising by statute, common law or otherwise, including all Claims arising under any
federal, state, local, county or municipal laws of any jurisdiction, (iv) Claims for alleged fraud, concealment, negligence, negligent
misrepresentation, promissory estoppel, quantum meruit, intentional or negligent infliction of emotional distress, violation of public
policy, (v) Claims for discrimination, harassment, sexual harassment or retaliation and Claims arising under any laws that prohibit
discrimination, harassment or retaliation based on age, sex, gender, pregnancy, sexual orientation, race, color, ancestry, national origin,
alienage or citizenship status, religion, creed, disability, medical leave, military status, veteran status, marital status, genetic
information, the filing of or intent to file a workers’ compensation claim, or any other protected trait, characteristic, or activity,
including, without limitation, the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act of 1990,
as amended, the Rehabilitation Act of 1973, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §1981, the Civil Rights
Act of 1991, the Civil Rights Act of 1866 and/or 1871, the Equal Pay Act of 1963, the Lilly Ledbetter Fair Pay Act of 2009, the Fair
Labor Standards Act, the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Family
and Medical Leave Act of 1993, the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation
Act of 2010, the Occupational Safety and Health Act, the Employee Polygraph Protection Act, the Uniformed Services Employment and Reemployment
Rights Act, the Worker Adjustment and Retraining Notification Act, the Genetic Information Nondiscrimination Act, the National Labor
Relations Act, the Labor Management Relations Act, the Immigration Reform and Control Act, the Texas Labor Code, the Texas Payday Law,
the Texas Commission on Human Rights or Chapter 21, any statute or laws of the State of Texas or any other federal, state, local, municipal
or common law whistleblower, discrimination or anti-retaliation statute law or ordinance, and (vi) any other Claims arising under
state, federal, local, municipal or common law, as well as any expenses, costs or attorneys’ fees. Except as required by law, the
Executive agrees that the Executive will not commence, maintain, initiate, or prosecute, or cause, encourage, assist, volunteer, advise
or cooperate with any other person to commence, maintain, initiate or prosecute, any action, lawsuit, proceeding, charge, petition, complaint
or Claim before any court, agency or tribunal against the Company or any of the Company Released Parties arising from, concerned with,
or otherwise relating to, in whole or in part, the Executive’s employment, the terms and conditions of the Executive’s employment,
or the Executive’s separation from employment with the Company or any of the matters or Claims discharged and released in this
Agreement. The Executive represents that the Executive has not filed any complaints, charges or lawsuits against the Company with any
governmental agency or any court based on Claims that are released and waived by this Release.


 






    3


     


    

 


EXECUTION VERSION


 


(b)            By
the Company. In consideration of the mutual promises contained in this Agreement, including the Executive’s release of claims,
which is in addition to anything of value to which the Company is already entitled, the Company, on behalf of itself and all of its parents,
divisions, subsidiaries, affiliates, joint venture partners, and related companies, and their present and former agents, executives,
employees, officers, directors, attorneys, stockholders, plan fiduciaries, successors and assigns, irrevocably and unconditionally releases,
waives, and forever discharges, the Executive and the Executive heirs, executors, successors and assigns (the “Executive
Released Parties”), from any and all claims, demands, actions, causes of action, costs, fees, and all liability whatsoever,
whether known or unknown, fixed or contingent, which the Company has, had, or may have against the Executive Released Parties relating
to or arising out of the Executive employment, compensation and terms and conditions of employment or separation from employment up through
the Effective Date. This release includes, without limitation, claims at law or equity or sounding in contract (express or implied) or
tort, claims arising under any federal, state or local laws, or any other statutory or common law claims related to relating to or arising
out of the Executive’s employment or separation from employment for any period up to and including the date this Agreement is signed
by the Parties.


 






    4


     


    

 


EXECUTION VERSION


 


(c)            Claims
Excluded from Release. Notwithstanding the above, the Parties agree that the Parties’ respective release of claims shall not
include any of the following claims or rights:


 


(i)            Claims
a Company Released Party may have relating to or arising out of any illegal conduct, fraud or breach of fiduciary duty by the Executive
or any action(s) from a government agency arising from or relating to the Executive’s actions or inactions, but only to the
extent that such claims are not eligible for coverage under the Indemnification Agreement (as defined below).


 


(ii)           Vested
benefits the Executive may have under any employee benefit plan subject to ERISA and any rights the Executive may have under the Award
Agreements.


 


(iii)          Any
indemnification rights the Executive may have under the Company’s by-laws, applicable insurance or any other written agreement
between the Parties.


 


(iv)         Any
claim which may not be waived by applicable law.


 


(v)          The
Parties’ obligations under this Agreement.


 


(vi)         Any
claims arising after the date this Agreement is executed by the Parties.


 


(vii)         Any
claim which the Executive may have solely as a stockholder of the Company.


 


4.              No
Interference. Nothing in this Agreement is intended to interfere with a Party’s right to report possible violations of
federal, state or local law or regulation to any governmental or law enforcement agency or entity, or to make other disclosures that
are protected under the whistleblower provisions of federal or state law or regulation. The Parties acknowledge that nothing in this
Agreement (a) is intended to interfere with a Party’s right to file a claim or charge with, or testify, assist, or participate
in an investigation, hearing, or proceeding conducted by, the Equal Employment Opportunity Commission (the “EEOC”),
the Securities Exchange Commission (“SEC”), the National Labor Relations Board (“NLRB”),
Occupational Safety and Health Administration (“OSHA”), any state human rights commission, or any other government
agency or entity charged with enforcement of any laws, (b) limits the Executive’s right to challenge the validity of the waiver
of claims under the ADEA, or (c) limits the Executive from exercising rights, if any, under Section 7 of the NLRA to engage
in protected, concerted activity with other employees. In making such disclosures, a Party need not seek prior authorization from the
other Party, and is not required to notify the other Party of any such reports, disclosures or conduct. However, by executing this Agreement,
the Executive hereby waives the right to recover any damages or benefits in any proceeding the Executive may bring before the EEOC, the
NLRB, any state human rights commission, or any other government agency or entity or in any proceeding brought by the EEOC, NLRB any
state human rights commission, or any other government agency or entity on the Executive’s behalf with respect to any Claim released
in this Agreement; except for any right the Executive may have to receive a payment or award from a government agency (and not
the Company) for information provided to the government agency or otherwise where prohibited.


 


5.              Known
Violations. The Executive represents and warrants that the Executive is not aware of any illegal acts committed by or on behalf
of the Company and agrees that, to the extent the Executive is aware of conduct by anyone while employed by or representing the Company
that gives the Executive a belief, concern or suspicion that a violation of any state, federal or foreign law, regulation (particularly
involving employment, securities (including, but not limited to, the Investment Advisors Act of 1940, Securities Act of 1933, and/or
Securities Exchange Act of 1934), tax, and/or real property), or any policy of the Company, the Executive has reported such belief, concern
or suspicion to the Company. If the Executive has not reported this information as of the date of this Agreement, the Executive agrees
the Executive does not know of any such conduct. The Executive understands that the Company has a strict policy against retaliation for
reporting such information, and the Executive has not withheld such information by reason of any concerns about retaliation. The Executive
acknowledges and understands that nothing in this provision is intended to interfere with the Executive’s right to engage in the
conduct outlined in Section 4.


 






    5


     


    

 


EXECUTION VERSION


 


6.              Return
of Company Property. As of the Separation Date, the Executive shall, to the extent not previously returned or delivered, without
copying or retaining any copies: (a) return all equipment, records, files, documents, data, computer programs, programs or other
materials and property in the Executive’s possession which belong to the Company or any one or more of its affiliates, including,
without limitation, all computer access codes, credit cards, cell phones, laptops, computers and related equipment, keys and access cards;
and (b) deliver all original and copies of Confidential Information (defined below) notes, materials, records, reports, plans, data
or other documents, files or programs (whether stored in paper form, computer form, digital form, electronically or otherwise or on the
Executive’s personal computer or any other media) that relate or refer to (1) the Company or any one or more of its affiliates,
or (2) the Company’s or any one or more of its affiliates’ Confidential Information, financial information, financial
data, financial statements, personnel information, business information, strategies, sales, customers, suppliers or similar information.
Notwithstanding the above, the Parties agree that the Executive may take ownership of the Executive’s Company issued cell phone
and tablet (subject to transfer of billing to the Executive). Should the Executive later discover additional items described or referenced
in subsections (a) or (b) above, the Executive will promptly notify the Company and return/deliver such items to the Company.
the Executive agrees to execute any such documents requested by the Company confirming that the Executive has complied in all regards
with this Section 6.


 


7.              Public
Announcements. The Parties agree to develop and agree on an overall plan for the announcement of the Executive’s separation
to the public and to employees, and the Company shall not release the press release or make any public announcement regarding the Executive’s
transition and separation until the Executive has approved such press release and/or public announcement, which approval shall not be
unreasonably withheld, conditioned or delayed. The Executive agrees not to speak with the press or make any press release or make any
public announcement, except to the extent the Executive’s comments are consistent with the press release announcing the Executive’s
transition and separation from the Company, without the prior written consent of the Company (such consent not to be unreasonably withheld,
conditioned or delayed), with respect to the Executive’s termination of employment and transition as the CEO of the Company, provided,
however, that the foregoing shall not prohibit any communications that are required by applicable law, by any governmental or regulatory
or self-regulatory agency, or that are a part of normal reporting, rating or review procedures or fundraising, marketing, information
or reporting activities of any stockholder of the Company.


 


8.              Surviving
Provisions. The Executive and the Company agree that Section 5 (Restrictive Covenants) and Section 6
(Cooperation) of the Employment Agreement, Section 18 of the Inducement RSU Award Agreements, and Section 3(d) and
Exhibit A of the Time-Based RSU Award Agreement (collectively, the “Surviving Provisions”) survive
the termination of the Executive’s employment and shall remain in full force and effect as set forth in the Employment Agreement
and Award Agreements. The Executive reaffirms and agrees to honor and abide by the terms of the Surviving Provisions.


 


9.              Mutual
Non-Disparagement. The Executive shall refrain from publishing any oral or written statements about the Company or any of the
Company’s directors, managers, officers, employees, or consultants that (A) are slanderous, libelous, or defamatory;
or (B) place the Company or any of its directors, managers, officers, employees, or consultants in a false light before the public.
The Board of the Company shall refrain, and shall cause the Company’s officers to refrain, from publishing any oral or written
statements about the Executive that (A) are slanderous, libelous, or defamatory; or (B) place the Executive in a false
light before the public. Notwithstanding the foregoing, the Executive and the Company shall be permitted to make truthful statements
to the extent required by law or by any court, governmental body, or any regulatory or self-regulatory agency or to the extent reasonably
necessary in connection with any dispute between the Parties. Nothing in this Section 9 is intended to interfere with a Party’s
rights set forth in Section 4.


 






    6


     


    

 


EXECUTION VERSION


 


10.            Indemnification
and Insurance. The Parties agree that the Indemnification Agreement, dated May 17, 2021 (the “Indemnification
Agreement”) shall survive the termination of the Executive’s employment.


 


11.            No
Assignment of Claims. The Executive represents that the Executive has not transferred or assigned, to any person or entity, any
claim involving the Company or the Company Released Parties, or any portion thereof or interest therein. The Parties acknowledge and
agree that nothing in this Agreement shall prohibit payment of any amounts due to the Executive under this Agreement to the Executive’s
estate or legal guardian.


 


12.            Controlling
Law and Venue; Waiver of Jury Trial. This Agreement shall in all respects be interpreted, enforced, and governed under the laws
of the State of Texas, without regard to any conflict of law principles. The Company and the Executive agree that the language in this
Agreement shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for, or against, either of the
Parties. Exclusive venue of any claim or dispute shall be in a state district court of competent jurisdiction in Dallas County, Texas,
or the United States District Court for the Northern District of Texas, and the Executive consents to the jurisdiction of such courts.


 


With
respect to any dispute between the Executive and the Company arising out of, in connection with or in any way related to this Agreement,
the Executive agrees to resolve such dispute(s) before a judge without a jury. EXECUTIVE has knowledge of this provision and AGREES
TO hereby waivE EXECUTIVE’s right to trial by jury and agrees to have any dispute(s) arising between the Company and the Executive
arising out of, in connection with or in any way related to this Agreement resolved by a judge of a competent court in dallas County,
Texas, OR THE UNITED sTATES dISTRICT COURT FOR THE NOrTHERN DISTRICT OF TEXAS sitting without a jury.


 


13.            Severability.
Should any provision of this Agreement be declared or determined to be illegal or invalid by any government agency or court of competent
jurisdiction, the validity of the remaining parts, terms or provisions of this Agreement shall not be affected and such provisions shall
remain in full force and effect. Upon any finding by any government agency or court of competent jurisdiction that Section 3
above is illegal or invalid, the Executive agrees to execute a valid and enforceable general release.


 


14.            Breach
of Agreement. In the event the Executive breaches any portion of this Agreement, the Company may, in its sole discretion (a) seek
to recover any portion of the Transition Benefits already paid to the Executive from the date of such breach, except for the sum of $10,000.00;
(b) to the extent the Transition Benefits have not been paid to the Executive in full, terminate the Transition Benefits and the
Executive will not be entitled to receive any remaining portion of the Transition Benefits; and/or (c) recover any and all other
damages to which the Company may be entitled at law or in equity as a result of a breach of this Agreement.


 


15.            Knowing
and Voluntary Waiver of Age Claims; Time for Consideration. The Executive, by the Executive’s free and voluntary act of
signing below, acknowledges that (a) the Executive has been given a period of 21 days (“Review Period”)
to consider whether to agree to the terms contained in this Agreement, (b) the Company is advising and has advised the Executive
in writing (i.e., through this Agreement) to consult with an attorney of the Executive’s own choosing at the Executive’s
cost, regarding the effect of this Agreement, and the Executive has had a reasonable opportunity to do so, if so desired, (c) the
Executive understands that this Agreement specifically releases and waives all rights and claims the Executive may have under the Age
Discrimination in Employment Act (“ADEA”) prior to the date on which the Executive signs this Agreement, (d) that
the Executive is receiving valid consideration for this Agreement that is in addition to anything of value to which the Executive is
otherwise entitled, and (d) the Executive understands the terms of this Agreement and knowingly and voluntarily agrees to all of
the terms of this Agreement and intends to be legally bound thereby. The Parties agree that any changes to this Agreement, whether material
or immaterial, will not restart the running of the Review Period. The Executive may execute this Agreement anytime during the Review
Period. The Executive shall return the executed copy of this Agreement to the Company, ATTN: Interim General Counsel and Corporate Secretary,
Tuesday Morning Corporation, 6250 LBJ Freeway, Dallas, Texas 75240; E-mail: jgray@tuesdaymorning.com, before the end of the Review Period.
If the Executive does not execute this Agreement before the expiration of the Review Period, then the Agreement is withdrawn without
notice and the Company’s offer to provide the benefits provided for in Section 2 will become null and void.


 






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EXECUTION VERSION


 


This Agreement will become effective, enforceable
and irrevocable as to the Executive’s release of any claims the Executive may have under the Age Discrimination in Employment Act
on the eighth day after the date on which it is executed by the Executive (“Age Release Date”). During the
seven-day period prior to the Age Release Date (“Revocation Period”), the Executive may revoke the Executive’s
agreement to release any claims the Executive may have under the Age Discrimination in Employment Act, and any amendments thereto, by
indicating in writing to the Company, ATTN: Interim General Counsel and Corporate Secretary, Tuesday Morning Corporation, 6250 LBJ Freeway,
Dallas, Texas 75240; E-mail: jgray@tuesdaymorning.com the Executive’s intention to revoke before the end of such (“Revocation
Period”). If the Executive exercises the Executive’s right to revoke hereunder, the Executive shall forfeit the Executive’s
right to receive the consideration provided for in Section 2(b) of this Agreement.


 


16.            No
Admission of Liability. This Agreement shall not in any way be construed as an admission by the Company or the Executive of any
acts of wrongdoing or violation of any statute, law, or legal right. Rather, the Parties specifically deny and disclaim that either has
any liability to the other, but are willing to enter this Agreement at this time to definitely resolve once and forever this matter and
to avoid the costs, expense, and delay of litigation.


 


17.            Binding
Effect of Agreement. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective
successors, assigns, executors, administrators, heirs and estates. The Released Parties are third-party beneficiaries of this Agreement.


 


18.            Entire
Agreement. This Agreement, the Indemnification Agreement, and the Surviving Provisions constitute the entire agreement and understanding
between the Parties with respect to the subject matter hereof, and fully supersede all prior and contemporaneous negotiations, understandings,
representations, writings, discussions and/or agreements between the Parties, whether oral or written, pertaining to or concerning the
subject matter of this Agreement. No oral statements or other prior written material not specifically incorporated into this Agreement
shall be of any force and effect, and no changes in or additions to this Agreement shall be recognized, unless incorporated into this
Agreement by written amendment, such amendment to become effective on the date stipulated in it. Any amendment to this Agreement must
be signed by all Parties to this Agreement.


 


19.            Disclaimer
of Reliance. Except for the specific representations expressly made by the Company
in this Agreement, the Executive specifically disclaims that the Executive is relying upon or has relied upon on any communications,
promises, statements, inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of
this Agreement. The Parties represent that they are relying solely and only on their own judgment in entering into this Agreement. Therefore,
the Executive understands that the Executive is precluded from bringing any fraud or similar claim against the Company associated with
any such communications, promises, agreements, statements, inducements, understandings, or representations. In addition, the Executive
acknowledges and agrees that the Company has not made any warranty or representation to the Executive with respect to the income tax
consequences of this Agreement or any of the transactions contemplated herein, and the Executive further represents that the Executive
is in no manner relying on the Company or any of its’ respective directors, managers, officers, employees or authorized representatives
(including attorneys, accountants, consultants, bankers, lenders, prospective lenders, or financial representatives) for tax advice or
an assessment of such tax consequences.


 






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EXECUTION VERSION


 


20.            The
Executive Acknowledgments and Representations. The Executive acknowledges and represents that the Executive has not been denied
any leave, benefits or rights to which the Executive may have been entitled under any other federal or state law. The Executive acknowledges
and represents that, as of the date of this Agreement and except as expressly provided in this Agreement, the Executive has been paid
all wages, bonuses, compensation, equity and benefits related to the Executive’s employment, with the exception of any right the
Executive may have under the terms of a written employee benefit plan subject to ERISA or this Agreement. The Executive warrants and
represents that the Executive has not taken any Confidential Information for any purpose not permitted in this Agreement or necessary
to perform the Executive duties under this Agreement. the Executive acknowledges and represents that the Executive has not suffered any
on the job injury for which the Executive has not already filed a claim. The Executive acknowledges that neither this Agreement nor the
Company’s offer to enter into this Agreement constitutes an admission of any liability or unlawful conduct or discriminatory acts
of any kind by the Company or any Company Released Party, or anyone acting under their supervision or on their behalf. The Executive
acknowledges and represents that the Executive has had the opportunity to provide the Company with written notice of any and all concerns
regarding suspected ethical and/or compliance issues or violations on the part of the Company or any other Released Parties.


 


21.            No
Waiver. Failure of the Company to exercise and/or delay in exercising any right, power or privilege in this Agreement shall not
operate as a waiver. No waiver of the Company’s rights hereunder shall be effective unless it is in writing and signed by the Company.
The Company’s waiver of any provision of the Agreement shall not constitute (i) a continuing waiver of that provision, or
(ii) a waiver of any other provision of this Agreement. Furthermore, no waiver of any breach of any provision shall be deemed to
be a waiver of any preceding or succeeding breach of the same or any other provision.


 


22.            Section 409A.
The Company intends that all of the transition benefits provided to the Executive as described in this Agreement will either comply with
or be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “IRC”).
However, nothing contained in this Agreement shall be construed as a representation, guarantee or other undertaking on the part of the
Company that the transition benefits are, or will be found to be, exempt from or compliant with the requirements of Section 409A
of the IRC. The Executive is solely responsible for determining the tax consequences to the Executive of any and all payments made pursuant
to this Agreement, including, without limitation, any possible tax consequences under Section 409A of the IRC.


 


23.            Counterparts.
This Agreement may be executed by the Parties in multiple counterparts, whether or not all signatories
appear on these counterparts (including via electronic signatures and exchange of PDF documents via email), each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument.


 


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    9


     


    

 


EXECUTION VERSION


 


By executing this Agreement, the Executive
acknowledges that: (i) the Executive has considered the terms of this Agreement; (ii) the Executive has been advised to consult
with an attorney prior to executing this Agreement and, in fact, have consulted with an attorney before executing this Agreement or intentionally
elected not to do so; (iii) the Executive has read this Agreement and fully understand its terms and their import; (iv) except
as provided for in this Agreement, the Executive has no contractual right or claim to the benefits described herein; (v) the consideration
provided for herein is good and valuable; and (vi) the Executive is entering into this Agreement voluntarily, deliberately of the
Executive’s own free will, with all the information needed to make an informed decision to enter this Agreement, and without any
coercion, undue influence, threat, or intimidation of any kind or type whatsoever.


 


	Accepted
    and AGREED TO BY:	 
	 	 
	the Executive	 
	 	 
	/s/ Fred
    Hand	 
	Fred Hand	 
	 	 
	November 4, 2022	 
	Date	 




 





	TUESDAY MORNING CORPORATION	 
	 	 
	By:	/s/ Alex Mehr	 
	 	 	 
	Title:	Co-Chairman
    of the Board of Directors           	 
	 	 	 
	Date:	November 4, 2022	 



 


Signature Page to
Transition Agreement


 






     


     


    

 


EXECUTION VERSION


 


EXHIBIT A


 


LIST OF OUTSTANDING EQUITY AWARDS


 


		1.	Inducement Restricted Stock Unit Award Agreement under the Tuesday
                                            Morning Corporation 2014 Long-Term Incentive Plan dated May 19, 2021 with respect to
                                            1,538,462 time-based vesting restricted stock units.



 


		2.	Inducement Restricted Stock Unit Award Agreement under the Tuesday
                                            Morning Corporation 2014 Long-Term Incentive Plan dated May 19, 2021 with respect to
                                            1,230,769 performance-based vesting restricted stock units.



 


		3.	Restricted Stock Unit Award Agreement under the Tuesday Morning Corporation
                                            2014 Long-Term Incentive Plan dated September 22, 2021 with respect to 545,455 time-based
                                            vesting restricted stock units.



 



    Exhibit A – Page 1