INDEMNIFICATION AGREEMENT


     AGREEMENT, effective as of March 7, 2000 (the "Effective Date") between
Tandycrafts, Inc., a Delaware corporation (the "Company"), and Michael J. Walsh
(the "Indemnitee").

     WHEREAS, it is essential to the Company to retain and attract as directors
and officers the most capable persons available;

     WHEREAS, Indemnitee is a director and/or officer of the Company;

     WHEREAS, both the Company and Indemnitee recognize the increased risk of
litigation and other claims being asserted against directors and officers of
public companies in today's environment;

     WHEREAS, the By-laws (the "By-laws") of the Company require the Company to
indemnify and advance expenses to its directors and officers to the fullest
extent permitted by law, and the Indemnitee has agreed or continued to serve as
a director and/or an officer of the Company in part in reliance on such
provisions in the By-laws;

     WHEREAS, in recognition of Indemnitee's need for substantial protection
against personal liability, in order to enhance Indemnitee's continued service
to the Company in an effective manner and Indemnitee's reliance on the foregoing
provisions in the By-laws, and in part to provide Indemnitee with specific
contractual assurance that the protection promised by such provisions in the By-
laws will be available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such provisions in the By-laws or any change in
the composition of the Company's Board of Directors (the "Board") or acquisition
transaction relating to the Company), the Company wishes to provide in this
Agreement for the indemnification of and the advancing of expenses to Indemnitee
to the fullest extent permitted by law and as set forth in this Agreement, and,
to the extent insurance is maintained, for the continued coverage of Indemnitee
under Company directors' and officers' liability insurance policies;

     NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties hereto agree
as follows:

1.   Certain Definitions.

     (a)  Change in Control:  shall be deemed to have occurred upon any of the
          following events:

          (i)  The acquisition in or more transactions by any "Person" (as the
               term person is used for purposes of Section 13(d) or 14(d) of the
               Securities Exchange Act of 1934, as amended (the "1934 Act"), of
               "Beneficial Ownership" (within the meaning of Rule 13d-3
               promulgated under the 1934 Act) of twenty-five percent (25%) or
               more of the combined voting power of the Company's then
               outstanding voting securities (the "Voting Securities"),
               provided, however, that for purposes of this Section 1(a)(i), the
               Voting Securities acquired directly from the Company by any
               Person shall be excluded from the determination of such Person's
               Beneficial Ownership of Voting Securities (but such Voting
               Securities shall be included in any subsequent calculation of the
               total number of Voting Securities then outstanding or owned by
               such Person); or

          (ii) The individuals who, as of the Effective Date, are members of the
               Board (the "Incumbent Board"), cease for any reason to constitute
               at least two-thirds of the Board; provided, however, that if the
               election, or nomination for election by the Company's
               stockholders, of any new director was approved by a vote of at
               least two-thirds of the Incumbent Board, such new director shall,
               for purposes of this Agreement, be considered as a member of the
               Incumbent Board; or

          (iii)Approval by stockholders of the Company of (A) a merger or
               consolidation involving the Company if the stockholders of the
               Company immediately before such merger or consolidation do not
               own, directly or indirectly immediately following such merger or
               consolidation, more than fifty-one percent (51%) of the combined
               voting power of the outstanding voting securities of the
               corporation resulting from such merger or consolidation in
               substantially the same proportion as their ownership of the
               Voting Securities immediately before such merger or consolidation
               or (B) a complete liquidation or dissolution of the Company or an
               agreement for the sale or other disposition of all or
               substantially all of the assets of the Company.

          (iv) Notwithstanding the foregoing, a Change in Control shall not be
               deemed to occur solely because twenty-five percent (25%) or more
               of the then outstanding Voting Securities is acquired by (i) a
               trustee or other fiduciary holding securities under one or more
               employee benefit plans maintained by the Company or any of its
               subsidiaries or (ii) any corporation that, immediately prior to
               such acquisition, is owned directly or indirectly by the
               stockholders of the Company in the same proportion as their
               ownership of stock in the Company immediately prior to such
               acquisition;

          (v)  Moreover, notwithstanding the foregoing, a Change in Control
               shall not be deemed to occur solely because any Person (the
               "Subject Person") acquired Beneficial Ownership of more than the
               permitted amount of the outstanding Voting Securities as a result
               of the acquisition of Voting Securities by the Company which, by
               reducing the number of Voting Securities outstanding, increases
               the proportional number of shares Beneficially Owned by the
               Subject Person, provided that if a Change in Control would occur
               (but for the operation of this sentence) as a result of the
               acquisition of Voting Securities by the Company, and after such
               share acquisition by the Company, the Subject Person becomes the
               Beneficial Owner of any additional Voting Securities which
               increases the percentage of the then outstanding Voting
               Securities Beneficially Owned by the Subject Person, then a
               Change in Control shall occur.

     (b)  Claim:  any threatened, pending or completed action, suit or
          proceedings, whether civil, criminal, administrative or investigative
          or other, including, without limitation, an action by or in the right
          of any other corporation of any type or kind, domestic or foreign, or
          any partnership, joint venture, trust, employee benefit plan or other
          enterprise, whether predicated on foreign, federal, state or local law
          and whether formal or informal.

     (c)  Expenses:  include attorneys' fees and all other costs, charges and
          expenses paid or incurred in connection with investigating, defending,
          being a witness in or participating in (including on appeal), or
          preparing to defend, be a witness in or participate in any Claim
          relating to any Indemnifiable Event.

     (d)  Indemnifiable Event:  any event or occurrence related to the fact that
          Indemnitee is or was or has agreed to become a director, officer,
          employee, agent or fiduciary of the Company, or is or was serving or
          has agreed to serve in any capacity, at the request of the Company, in
          any other corporation, partnership, joint venture, trust, employee
          benefit plan or other enterprise, or by reason of anything done or not
          done by Indemnitee in any such capacity.

     (e)  Voting Securities:  any securities of the Company that vote generally
          in the election of directors.

2.   Basic Indemnification Arrangement.

     (a)  In the event Indemnitee was, is or becomes a party to or witness or
          other participant in, or is threatened to be made a party to or
          witness or other participant in, a Claim by reason of (or arising in
          part out of) an Indemnifiable Event, the Company shall indemnify, hold
          harmless and defend Indemnitee (without regard to the negligence or
          other fault of the Indemnitee) to the fullest extent permitted by
          applicable law, as soon as practicable but in no event later than
          thirty days after written demand is presented to the Company, against
          any and all Expenses, judgments, fines, penalties, excise taxes and
          amounts paid or to be paid in settlement (including all interest,
          assessments and other charges paid or payable in connection with or in
          respect of such Expenses, judgments, fines, penalties, excise taxes or
          amounts paid or to be paid in settlement) of such Claim.  If
          Indemnitee makes a request to be indemnified under this Agreement, the
          Board of Directors (acting by a quorum consisting of directors who are
          not parties to the Claim with respect to an Indemnifiable Event or, if
          such a quorum is not obtainable, acting upon an opinion in writing of
          independent legal counsel ("Board Action")) shall, as soon as
          practicable but in no event later than thirty days after such request,
          authorize such indemnification.  Notwithstanding anything in the
          Certificate of Incorporation (the "Certificate") of the Company, the
          By-laws or this Agreement to the contrary, following a Change in
          Control, Indemnitee shall be entitled to indemnification pursuant to
          this Agreement in connection with any Claim initiated by Indemnitee.

     (b)  Notwithstanding anything in the Certificate, the By-laws or this
          Agreement to the contrary, if so requested by Indemnitee, the Company
          shall advance (within two business days of such request) any and all
          Expenses relating to a Claim to Indemnitee (an "Expense Advance"),
          upon the receipt of a written undertaking by or on behalf of
          Indemnitee to repay such Expense Advance if a judgment or other final
          adjudication or determination adverse to Indemnitee establishes that
          Indemnitee, with respect to such Claim, is not eligible for
          indemnification.

     (c)  If there has been no Board Action or Arbitration (as defined in
          Section 3), or if Board Action determines that Indemnitee would not be
          permitted to be indemnified, in any respect, in whole or in part, in
          accordance with Section 2(a) of this Agreement, Indemnitee shall have
          the right to commence litigation in the court that is hearing the
          action or proceeding relating to the Claim for which indemnification
          is sought or in any court in the State of Texas having subject matter
          jurisdiction thereof and in which venue is proper seeking an initial
          determination by the court or challenging any Board Action or any
          aspect thereof, and the Company hereby consents to service of process
          and to appear in any such proceeding.  Notwithstanding anything in the
          Certificate, the By-laws or this Agreement to the contrary, if
          Indemnitee has commenced legal proceedings in a court of competent
          jurisdiction or Arbitration to secure a determination that Indemnitee
          should be indemnified under this Agreement, the By-laws of the Company
          or applicable law, any Board Action under which Indemnitee would not
          be permitted to be indemnified in accordance with Section 2(a) of this
          Agreement shall not be binding.  Any Board Action not followed by such
          litigation or Arbitration shall be conclusive and binding on the
          Company and Indemnitee.

     3.   Change in Control.  The Company agrees that if there is a Change in
Control, Indemnitee, by giving written notice to the Company and the American
Arbitration Association (the "Notice"), may require that any controversy or
Claim arising out of or relating to this Agreement, or the breach thereof, shall
be settled by arbitration (the "Arbitration") in Fort Worth, Texas in accordance
with the Rules of the American Arbitration Association (the "Rules").  The
Arbitration shall be conducted by a panel of three arbitrators selected in
accordance with the Rules within thirty days of delivery of the Notice.  The
decision of the panel shall be made as soon as practicable after the panel has
been selected, and the parties agree to use their reasonable efforts to cause
the panel to deliver its decision within ninety days of its selection.  The
Company shall pay all fees and expenses of the Arbitration.  The Arbitration
shall be conclusive and binding on the Company and Indemnitee, and the Company
or Indemnitee may cause judgment upon the award rendered by the arbitrators to
be entered in any court having jurisdiction thereof.

     4.   Indemnification For Additional Expenses.  The Company shall indemnify
Indemnitee against any and all expenses (including attorneys' fees) and, if
requested by Indemnitee, shall (within two business days of such request)
advance such expenses to Indemnitee, which are incurred by Indemnitee in
connection with any Claim asserted by or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under law, this
Agreement, or any other agreement or By-law of the Company now or hereafter in
effect relating to Claims for Indemnifiable Events and/or (ii) recovery under
any directors' and officers' liability insurance policies maintained by the
Company, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, advance expense payment or insurance recovery,
as the case may be.

     5.   Partial Indemnity, Etc.  If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of the
Expenses, judgments, fines, penalties, excise taxes and amounts paid or to be
paid in settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the portion
thereof to which Indemnitee is entitled.  Moreover, notwithstanding any other
provision of this Agreement, to the extent that Indemnitee has been successful
on the merits or otherwise in defense of any or all Claims relating in whole or
in part to an Indemnifiable Event or in defense of any issue or matter therein,
including, without limitation, dismissal without prejudice, Indemnitee shall be
indemnified against any and all Expenses, judgments, fines, penalties, excise
taxes and amounts paid or to be paid in settlement of such Claim.  In connection
with any determination by Board Action, Arbitration or a court of competent
jurisdiction that Indemnitee is not entitled to be indemnified hereunder, the
burden of proof shall be on the Company to establish that Indemnitee is not so
entitled.

     6.   No Presumption.  For purposes of this Agreement, the termination of
any Claim, action, suit or proceeding, by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo contendere
or its equivalent, shall not create a presumption that Indemnitee did not meet
any particular standard of conduct or have any particular belief or that a court
has determined that indemnification is not permitted by applicable law or this
Agreement.

     7.   Contribution.  In the event that the indemnification provided for in
this Agreement is unavailable to Indemnitee for any reason whatsoever, the
Company, in lieu of indemnifying Indemnitee, shall contribute to the amount
incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes,
amounts paid or to be paid in settlement and/or for Expenses, in connection with
any Claim deemed fair and reasonable in light of all of the circumstances of
such action by Board Action or Arbitration or by the court before which such
action was brought in order to reflect (i) the relative benefits received by the
Company and Indemnitee as a result of the event(s) and/or transaction(s) giving
cause to such action; and/or (ii) the relative fault of the Company (and its
other directors, officers, employees and agents) and Indemnitee in connection
with such event(s) and/or transaction(s).  Indemnitee's right to contribution
under this Paragraph 7 shall be determined in accordance with, pursuant to and
in the same manner as, the provisions in Paragraphs 2 and 3 hereof relating to
Indemnitee's right to indemnification under this Agreement.

     8.   Notice to the Company by Indemnitee.  Indemnitee agrees to notify the
Company promptly in writing upon being served with or having actual knowledge of
any citation, summons, complaint, indictment or any other similar document
relating to any action which may result in a claim of indemnification or
contribution hereunder, but the failure to give such notice shall not relieve
the Company of any liability hereunder except to the extent the Company has been
materially prejudiced thereby.

     9.   Non-exclusive, Etc.  The rights of the Indemnitee hereunder shall be
in addition to any other rights Indemnitee may have under the Certificate or By-
laws or the Delaware General Corporation Law or otherwise, and nothing herein
shall be deemed to diminish or otherwise restrict Indemnitee's right to
indemnification under any such other provision.  To the extent applicable law or
the Certificate or By-laws, as in effect on the date hereof or at any time in
the future, permit greater indemnification than as provided for in this
Agreement, the parties hereto agree that Indemnitee shall enjoy by this
Agreement the greater benefits so afforded by such law or provision of the
Certificate or By-laws and this Agreement shall be deemed amended without any
further action by the Company or Indemnitee to grant such greater benefits.
Indemnitee may elect to have Indemnitee's rights hereunder interpreted on the
basis of applicable law in effect at the time of execution of this Agreement, at
the time of the occurrence of the Indemnifiable Event giving rise to a Claim or
at the time indemnification is sought.

     10.  Liability Insurance.

     (a)  To the extent the Company maintains at any time an insurance policy or
          policies providing directors' and officers' liability insurance,
          Indemnitee shall be covered by such policy or policies, in accordance
          with its or their terms, to the maximum extent of the coverage
          available for any other Company director or officer under such
          insurance policy.  The purchase and maintenance of such insurance
          shall not in any way limit or affect the rights and obligations of the
          parties hereto, and the execution and delivery of this Agreement shall
          not in any way be construed to limit or affect the rights and
          obligations of the Company and/or of the other parties under any such
          insurance policy.

     (b)  For seven years after the Indemnitee no longer serves as a director or
          officer of the Company, the Company shall continue to provide
          directors' and officers' liability coverage for liabilities of the
          Indemnitee occurring during his service with the Company on terms no
          less favorable in terms of coverage and amount than such insurance
          maintained by the Company at the date of the Indemnitee's separation
          from the Company.  In the event such coverage is not available, the
          maximum available coverage shall be maintained pursuant to this
          covenant.

     11.  Period of Limitations.  No legal action shall be brought and no cause
of action shall be asserted by or on behalf of the Company or any affiliate of
the Company against Indemnitee, Indemnitee's spouse, heirs, executors or
personal or legal representatives after the expiration of two years from the
date of accrual of such cause of action, and any Claim or cause of action of the
Company or its affiliate shall be extinguished and deemed released unless
asserted by the timely filing of a legal action within such two-year period;
provided, however, that if any shorter period of limitations is otherwise
applicable to any such cause of action such shorter period shall govern.

     12.  Amendments, Etc.  No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto.  No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.

     13.  Subrogation.  In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery with respect to such payment of Indemnitee, who shall execute all
papers required and shall do everything that may be necessary to secure such
rights, including the execution of such documents necessary to enable the
Company effectively to bring suit to enforce such rights.

     14.  No Duplication of Payments.  The Company shall not be liable under
this Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, By-law or otherwise) of the amounts otherwise
indemnifiable hereunder.

     15.  Binding Effect, Etc.  This Agreement shall be binding upon and inure
to the benefit of and be enforceable against and by the parties hereto and their
respective successors, assigns (including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business and/or assets of the Company), spouses, heirs and personal and legal
representatives.  The Company shall require and cause any successor (whether
direct or indirect by purchase, merger, consolidation, or otherwise) to all,
substantially all, or a substantial part, of the business and/or assets of the
Company, by written agreement in form and substance satisfactory to Indemnitee,
expressly to assume and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform if no such
succession had taken place.  This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as a director and/or officer of the
Company or of any other enterprise at the Company's request.

     16.  Severability.  The provisions of this Agreement shall be severable in
the event that any of the provisions thereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.

     17.  Notices.  All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given when delivered by hand or when mailed by certified registered
mail, return receipt requested, with postage prepaid.

          A.   If to Indemnitee, to:         Michael J. Walsh
                                             2716 Shadow Wood Drive
                                             Arlington, Texas 76006

or to such other person or address which Indemnitee shall furnish to the Company
in writing pursuant to the above.

          B.   If to the Company, to:        Tandycrafts, Inc.
                                             1400 Everman Parkway
                                             Fort Worth, Texas  76140
                                             Attention:  General Counsel

or to such person or address as the Company shall furnish to Indemnitee in
writing pursuant to the above.

     18.  Governing Law.  This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed in such State without giving effect to the
principles of conflicts of laws.

     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the Effective Date.

                                       TANDYCRAFTS, INC.



                                       By:-------------------------
                                       Name:-----------------------
                                       Title:----------------------


                                       INDEMNITEE:


                                       /s/ Michael J. Walsh
                                       --------------------
                                       Michael J. Walsh