Document:

Exhibit 4.7

Exhibit 4.7

AMENDMENT NO. 4 TO CREDIT AGREEMENT

This Amendment No. 4 to Credit Agreement (“Amendment”) is dated as of March 31, 2011 (“Effective
Date”) between Tandy Brands Accessories, Inc., a Delaware corporation (“Borrower”) and Comerica
Bank, a Texas banking association (“Bank”).

Borrower and Bank entered into a Credit Agreement dated as of February 12, 2008, as amended
(“Credit Agreement”) providing terms and conditions governing certain loans and other credit
accommodations extended by Bank to Borrower (“Indebtedness”). Borrower and Bank have agreed to
amend the terms of the Credit Agreement as provided in this Amendment.

Accordingly, Borrower and Bank agree as follows:

1. Capitalized Terms. In this Amendment, capitalized terms that are used without separate
definition shall have the meanings given to them in the Credit Agreement.

2. Amendments. The Credit Agreement is amended as follows:

(a) The following terms are hereby added to the Defined Terms Addendum in the correct
alphabetical order:

“Contract Negotiation Reserve” shall mean, with respect to any Account, any
offset, charge back or payment discount (not included in Account Debtor Reserve) of
an Account Debtor negotiated between Borrower and such Account Debtor.

“Eligible Gift Account” means an Eligible Account that is generated from the
sale of prepackaged gift merchandise ordered by Borrower’s customers on a seasonal
basis in anticipation of the holiday season.

“Eligible Walmart Account” means an Eligible Account or Eligible Gift Account
owing by Walmart.

“Gift Reserve” shall mean, with respect to each Eligible Gift Account, a dollar
amount equal to the anticipated rate of return of the goods that are subject to such
Eligible Gift Account based on the actual rate of return of similar products in
prior years.

“NOLV Percentage” means the net orderly liquidation value percentage for such
Inventory identified in the Satisfactory Updated Inventory Appraisal, or any
subsequent appraisal of the Borrowing Base Obligor’s Inventory performed by an
independent third party appraiser and on terms satisfactory to Bank.

“Satisfactory Updated Inventory Appraisal” means an appraisal of the Borrowing
Base Obligor’s Inventory (i) dated after March 31, 2011, (ii) in form and substance
satisfactory to Bank, and (iii) prepared by independent third party licensed
appraisers satisfactory to Bank.

 

 

 

(b) The following terms, which are defined in the Defined Terms Addendum attached to the
Credit Agreement, are given the following amended definition:

“Applicable Fee Percentage” shall mean one-half of one percent (0.50%) per
annum.

“Borrowing Base Limitation” shall mean the sum of:

	 	(a)	 	eighty percent (80%) of Eligible Accounts and
Eligible Gift Accounts, other than Eligible Walmart Accounts, which for
purposes of this Agreement shall be measured or valued net of the
Account Debtor Reserve, the Contract Negotiation Reserve and the Gift
Reserve applicable to each such Eligible Account;

	 	(b)	 	through September 30, 2011, ninety percent
(90%) of Eligible Walmart Accounts, and at all times thereafter, eighty
percent (80%) of Eligible Walmart Accounts, which for purposes of this
Agreement shall be measured net of the Account Debtor Reserve, the
Contract Negotiation Reserve, and the Gift Reserve applicable to each
such Eligible Walmart Account; and

	 	(c)	 	the lesser of (i) (A) from March 31, 2011
through the date on which Bank notifies Borrower in writing that it has
received a Satisfactory Updated Inventory Appraisal, forty percent
(40%) of Eligible Inventory, and (B) at all times thereafter, the
lesser of (y) eighty-five percent (85%) of the NOLV Percentage of
Eligible Inventory, or (z) fifty percent (50%) of Eligible Inventory,
or (ii) the Inventory Cap;

provided (i) in the determination of availability under clause (a) above,
that portion of the Eligible Accounts of any Account Debtor, other than
Walmart, which exceed fifty percent (50%) of the sum of (a) and (b) above
shall be excluded, and (ii) in the determination of availability under
clause (b) above, through and including September 30, 2011, that portion of
the Eligible Walmart Accounts which exceed sixty percent (60%) of the sum of
(a) and (b) above shall be excluded, and thereafter, that portion of the
Eligible Walmart Accounts which exceed fifty percent (50%) of the sum of (a)
and (b) above shall be excluded.

“Eligible Account” shall mean an Account (but shall not include interest and
service charges thereon) arising in the ordinary course of a Borrowing Base
Obligor’s business which meets each of the following requirements:

	 	(a)	 	it is not owing more than ninety
(90) days after the date of the original invoice or other
writing evidencing such Account;

	 	(b)	 	it is not owing by an Account
Debtor who has failed to pay twenty-five percent (25%) or more
of the aggregate amount of its Accounts owing to any Borrowing
Base Obligor within ninety (90) days after the dates of the
respective invoices or other writings evidencing such Accounts;

	 	(c)	 	it arises from the sale or lease
of goods and such goods have been shipped or delivered to the
Account Debtor under such Account, or it arises from services
rendered and such services have been performed;

 

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	 	(d)	 	it is evidenced by an invoice,
dated not later than the date of shipment or performance,
rendered to such Account Debtor or some other evidence of
billing acceptable to Bank;

	 	(e)	 	it is not evidenced by any note,
trade acceptance, draft or other Instrument or by any Chattel
Paper, unless such note or other document or Instrument or
Chattel Paper has previously been endorsed and delivered by the
relevant Loan Party to Bank;

	 	(f)	 	it is a valid, legally
enforceable obligation of the Account Debtor thereunder, and is
not subject to any offset or any counterclaim or other defense
on the part of such Account Debtor or to any claim on the part
of such Account Debtor denying liability thereunder in whole or
in part;

	 	(g)	 	it is not subject to any sale of
accounts, any rights of offset other than an Account Debtor
Reserve, Contract Negotiation Reserve or Gift Reserve, or Lien
whatsoever other than to Bank and other than the Permitted
Encumbrances subordinated to Bank’s Lien;

	 	(h)	 	it is not owing by a Subsidiary
or Affiliate of any Borrowing Base Obligor, or by an Account
Debtor which (i) does not maintain its chief executive office in
the United States of America, or (ii) is not organized under the
laws of the United States of America, or any state thereof, or
(iii) is the government of any foreign country or sovereign
state, or of any state, province, municipality or other
instrumentality thereof;

	 	(i)	 	is not an Account billed in
advance, payable on delivery, for unsold consigned goods, for
guaranteed sales, for unbilled sales, for progress billings,
payable at a future date in accordance with its terms, subject
to a retainage or holdback by the Account Debtor or insured by a
surety company;

	 	(j)	 	it is not an Account owing by the
United States of America or any state or political subdivision
thereof, or by any department, agency, public body corporate or
other instrumentality of any of the foregoing, unless all
necessary steps are taken to comply with the Federal Assignment
of Claims Act of 1940, as amended, or with any comparable state
law, if applicable, and all other necessary steps are taken to
perfect Bank’s security interest in such Account;

	 	(k)	 	it is not owing by an Account
Debtor for which a Loan Party or any of its Subsidiaries has
received a notice of (i) the death of the Account Debtor or any
partner of the Account Debtor, (ii) the dissolution,
liquidation, termination of existence, insolvency or business
failure of the Account Debtor, (iii) the appointment of a
receiver for any part of the property of the Account Debtor, or
(iv) an assignment for the benefit of creditors, the filing of a
petition in bankruptcy, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against the
Account Debtor; and

 

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	 	(l)	 	it is not an Excluded Account.

An Account which is at any time an Eligible Account, but which subsequently
fails to meet any of the foregoing requirements, shall forthwith cease to be
an Eligible Account.

(c) Section 4.3(h) of the Credit Agreement is amended to read in its entirety as follows:

“(h) within fifteen (15) days after and as of the 15th day and the
last day of each calendar month, a Borrowing Base Certificate dated as of the
15th day and the end of such month respectively;”

(d) Section 7.4 of the Credit Agreement is amended to read in its entirety as follows:

“7.4 Audits and Appraisals of Collateral; Fees. Bank shall have the
right at reasonable times during normal business hours of Borrower or the applicable
Loan Party, upon three (3) Business Days prior written request of Bank, provided
that no advance request or notice shall be required upon the occurrence and during
the existence or continuance of an Event of Default, to (a) audit Accounts and
Inventory pledged by any Loan Party and other Collateral four (4) times per year,
and at any time an Event of Default exists or is continuing, and (b) conduct such
appraisals and/or valuations of the Collateral, in scope and detail satisfactory to
Bank in its sole discretion, as Bank may require from time to time. Borrower agrees
to reimburse Bank, within thirty (30) days of written demand, for customary and
reasonable fees and costs incurred by Bank for such audits and for each appraisal of
Collateral and financial analysis and examination of Borrower or any other Loan
Party performed from time to time in accordance with this Section.”

(e) Section 1.9(b)(iii) of the Loan Terms, Conditions, and Procedures Addendum attached to
the Credit Agreement is amended to read in its entirety as follows:

“(iii) Borrower shall pay to Bank, quarterly in arrears on the first day of
each calendar quarter, letter of credit fees for each standby Letter of Credit
computed (on the basis of a year of 360 days for the actual number of days elapsed)
at the rate of four and one-half percent (4.50%) per annum on the daily average
maximum amount available for drawing under such Letter of Credit during the
immediately preceding quarter. Borrower shall pay to Bank a letter of credit fee for
each commercial Letter of Credit, in advance upon issuance in an amount equal to the
greater of (a) one-half percent (0.50%) of the amount of the commercial Letter of
Credit, or (b) $250.”

 

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(f) Section 1.1 of the Financial Covenants Addendum attached to the Credit Agreement is
amended to read in its entirety as follows:

“1.1 Tangible Net Worth. Maintain a Tangible Net Worth as of the end
of each of Borrower’s fiscal quarters, to be tested as of the end of each such
fiscal quarter, of not less than the amount set forth below for such quarter:

	 	(a)	 	as of March 31, 2011,
$33,000,000;

	 	(b)	 	as of June 30, 2011, $32,000,000;

	 	(c)	 	as of September 30, 2011,
$31,250,000;

	 	(d)	 	as of December 31, 2011,
$34,750,000;

	 	(e)	 	as of March 31, 2012,
$35,000,000;

	 	(f)	 	as of June 30, 2012, $35,000,000;
and

	 	(g)	 	as of September 30, 2012 and each
quarter thereafter, $33,000,000.”

3. Representations. Borrower represents and agrees that:

(a) Except as expressly modified in this Amendment, (i) the representations and warranties
set forth in the Credit Agreement and in each related document, agreement, and instrument
remain true and correct in all material respects, except to the extent that they expressly
speak as of a specific prior date, in which case they remain true and correct in all
material respects as of such earlier date and (ii) the covenants set forth in the Credit
Agreement continue to be satisfied in all respects, and are legal, valid and binding
obligations with the same force and effect as if entirely restated in this Amendment.

(b) When executed, this Amendment will be a duly authorized, legal, valid, and binding
obligation of Borrower enforceable in accordance with its terms.

(c) There is no default continuing under the Credit Agreement, or any related document,
agreement, or instrument, and no event has occurred or condition exists that is or, with the
giving of notice or lapse of time or both, would be such a default.

4. Conditions Precedent. The effectiveness of this Amendment is subject to Bank’s receipt
of all of the following:

(a) this Amendment and such other agreements and instruments reasonably requested by Bank
pursuant hereto (including such documents as are necessary to create and perfect Bank’s
interest in the Collateral), each duly executed by Borrower;

(b) such other documents and completion of such other matters as Bank may reasonably deem
necessary or appropriate, including those items set forth on the Documentation Checklist
attached hereto as Exhibit “A”;

(c) a modification fee in the amount of $100,000.

5. No Other Changes. Except as specifically provided in this Amendment, this Amendment
does not vary the terms and provisions of any note, mortgage, security agreement, or other
document, instrument, or agreement evidencing, securing or relating to the Indebtedness or the
Credit Agreement (“Loan Documents”). This Amendment shall not impair the rights, remedies, and
security given in and by the Loan Documents. The terms of this Amendment shall control any
conflict between its terms and those of the Credit Agreement.

 

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6. Ratification. Except for the modifications under this Amendment, the parties ratify and
confirm the Credit Agreement and the Loan Documents and agree that they remain in full force and
effect.

7. Further Modification; No Reliance. This Amendment may be altered or modified only by
written instrument duly executed by Borrower and Bank. In executing this Amendment, Borrower is
not relying on any promise or commitment of Bank that is not in writing signed by Bank. This
Amendment shall not be more strictly construed against one of the parties as compared to the other.

8. Confirmation of Lien Upon Collateral. Borrower acknowledges and agrees that
Indebtedness and the individual advances under the Indebtedness are secured by the Collateral (as
defined in the Credit Agreement) and that the Loan Documents constitute valid, legal, and binding
agreements and obligations of Borrower. The Collateral is and shall remain subject to and
encumbered by the lien, charge, and encumbrance of any applicable Loan Document, and nothing herein
contained shall affect or be construed to affect the lien or encumbrance created by any applicable
Loan Document respecting the Collateral, or its priority over other liens or encumbrances.

9. Successors and Assigns. This Amendment shall inure to the benefit of and be binding
upon the parties and their respective successors and assigns.

10. Governing Law. The parties agree that the terms and provisions of this Amendment shall
be governed by and construed in accordance with the internal laws of the State of Michigan, without
regard to principles of conflicts of law.

11. No Defenses. Borrower acknowledges, confirms, and warrants to Bank that as of the date
hereof Borrower has absolutely no defenses, claims, rights of set-off, or counterclaims against
Bank under, arising out of, or in connection with, this Amendment, the Credit Agreement, the Loan
Documents and/or the individual advances under the Indebtedness, or against any of the indebtedness
evidenced or secured thereby.

12. Expenses. Borrower upon request shall promptly pay all out-of-pocket fees, costs,
charges, expenses, and disbursements of Bank, including, without limitation, reasonable attorneys’
fees and legal expenses, incurred in connection with the preparation, execution, and delivery of
this Amendment, and the other documents contemplated by this Amendment.

13. Counterparts. This Amendment may be executed in one or more counterparts, and by
separate parties on separate counterparts, all of which shall constitute one and the same
agreement.

[Remainder of Page Intentionally Blank]

 

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This Amendment No. 4 to Credit Agreement is executed and delivered as of the Effective Date.

	 	 	 	 	 	 	 	 	 	 	 
	Comerica Bank	 	 	 	TANDY BRANDS ACCESSORIES, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Donald Hellman
 

Name: Donald Hellman
	 	 	 	By:
	 	/s/ N. Roderick McGeachy, III
 

Name: N. Roderick McGeachy, III
	 	 
	 

	 	Title: Senior Vice President
	 	 	 	 	 	Title: President	 	 

Acknowledgement and Consent of Guarantors

Each of the undersigned has guaranteed the payment and performance of the Indebtedness by
Borrower pursuant to a Guaranty dated as of February 12, 2008 (“Guaranty”). Each of the
undersigned acknowledges and consents to the execution, delivery and performance of the foregoing
Amendment No. 4 to Credit Agreement and the Amendment No. 2 to Master Revolving Note of even date
between Borrower and Bank amending the $27,500,000 Master Revolving Note dated as of October 6,
2009 from Borrower to Bank, as amended, and agrees that its guaranty remains in full force and
effect. Each of the undersigned further represents that it is in compliance with all of the terms
and conditions of its Guaranty.

	 	 	 	 	 
	 	TBAC INVESTMENT TRUST

TANDY BRANDS ACCESSORIES HANDBAGS, INC.

TBAC — TOREL, INC.

 	 
	 	By:  	/s/ N. Roderick McGeachy, III
 	 
	 	 	N. Roderick McGeachy, III, President of each 	 
	 	 	of the forgoing entities 	 
	 

 

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Exhibit “A”

DOCUMENTATION CHECKLIST

	 	 	 
	Borrower:

	 	Tandy Brands Accessories, Inc.
	 
	 	 
	Lender:

	 	Comerica Bank
	 
	 	 
	Guarantor:

	 	TBAC Investment Trust (“TBAC Trust”)
	 

	 	Tandy Brands Accessories Handbags, Inc. (“TBA Handbags”)
	 

	 	TBAC—Torel, Inc. (“Torel”)
	 
	 	 
	Other Parties:

	 	H.A. Sheldon Canada, Ltd. (“Sheldon Canada”)
	 
	 	 
	Transaction:

	 	Fourth Amendment to $27,500,000 (originally $35,000,000)
Secured Formula Based Revolving Credit Facility
	 
	 	 
	Effective Date:

	 	March 31, 2011

ITEM

ORGANIZATION DOCUMENTATION

	1.	 	Tandy Brands Accessories, Inc.

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	2.	 	TBAC Investment Trust (“TBAC Trust”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	3.	 	Tandy Brands Accessories Handbags, Inc. (“TBA Handbags”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	4.	 	TBAC—Torel, Inc. (“Torel”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

DUE DILIGENCE DOCUMENTATION

	5.	 	UCC and Tax Lien Search — Borrower

LOAN DOCUMENTATION

	6.	 	Amendment No. 4 to Credit Agreement

	 
	7.	 	Amendment No. 2 to Note — $27,500,000 Master Revolving
NoteExhibit 10.1

Exhibit 10.1

AMENDMENT NO. 4 TO CREDIT AGREEMENT

This Amendment No. 4 to Credit Agreement (“Amendment”) is dated as of March 31, 2011 (“Effective
Date”) between Tandy Brands Accessories, Inc., a Delaware corporation (“Borrower”) and Comerica
Bank, a Texas banking association (“Bank”).

Borrower and Bank entered into a Credit Agreement dated as of February 12, 2008, as amended
(“Credit Agreement”) providing terms and conditions governing certain loans and other credit
accommodations extended by Bank to Borrower (“Indebtedness”). Borrower and Bank have agreed to
amend the terms of the Credit Agreement as provided in this Amendment.

Accordingly, Borrower and Bank agree as follows:

1. Capitalized Terms. In this Amendment, capitalized terms that are used without separate
definition shall have the meanings given to them in the Credit Agreement.

2. Amendments. The Credit Agreement is amended as follows:

(a) The following terms are hereby added to the Defined Terms Addendum in the correct
alphabetical order:

“Contract Negotiation Reserve” shall mean, with respect to any Account, any
offset, charge back or payment discount (not included in Account Debtor Reserve) of
an Account Debtor negotiated between Borrower and such Account Debtor.

“Eligible Gift Account” means an Eligible Account that is generated from the
sale of prepackaged gift merchandise ordered by Borrower’s customers on a seasonal
basis in anticipation of the holiday season.

“Eligible Walmart Account” means an Eligible Account or Eligible Gift Account
owing by Walmart.

“Gift Reserve” shall mean, with respect to each Eligible Gift Account, a dollar
amount equal to the anticipated rate of return of the goods that are subject to such
Eligible Gift Account based on the actual rate of return of similar products in
prior years.

“NOLV Percentage” means the net orderly liquidation value percentage for such
Inventory identified in the Satisfactory Updated Inventory Appraisal, or any
subsequent appraisal of the Borrowing Base Obligor’s Inventory performed by an
independent third party appraiser and on terms satisfactory to Bank.

“Satisfactory Updated Inventory Appraisal” means an appraisal of the Borrowing
Base Obligor’s Inventory (i) dated after March 31, 2011, (ii) in form and substance
satisfactory to Bank, and (iii) prepared by independent third party licensed
appraisers satisfactory to Bank.

 

 

 

(b) The following terms, which are defined in the Defined Terms Addendum attached to the
Credit Agreement, are given the following amended definition:

“Applicable Fee Percentage” shall mean one-half of one percent (0.50%) per
annum.

“Borrowing Base Limitation” shall mean the sum of:

	 	(a)	 	eighty percent (80%) of Eligible Accounts and
Eligible Gift Accounts, other than Eligible Walmart Accounts, which for
purposes of this Agreement shall be measured or valued net of the
Account Debtor Reserve, the Contract Negotiation Reserve and the Gift
Reserve applicable to each such Eligible Account;

	 	(b)	 	through September 30, 2011, ninety percent
(90%) of Eligible Walmart Accounts, and at all times thereafter, eighty
percent (80%) of Eligible Walmart Accounts, which for purposes of this
Agreement shall be measured net of the Account Debtor Reserve, the
Contract Negotiation Reserve, and the Gift Reserve applicable to each
such Eligible Walmart Account; and

	 	(c)	 	the lesser of (i) (A) from March 31, 2011
through the date on which Bank notifies Borrower in writing that it has
received a Satisfactory Updated Inventory Appraisal, forty percent
(40%) of Eligible Inventory, and (B) at all times thereafter, the
lesser of (y) eighty-five percent (85%) of the NOLV Percentage of
Eligible Inventory, or (z) fifty percent (50%) of Eligible Inventory,
or (ii) the Inventory Cap;

provided (i) in the determination of availability under clause (a) above,
that portion of the Eligible Accounts of any Account Debtor, other than
Walmart, which exceed fifty percent (50%) of the sum of (a) and (b) above
shall be excluded, and (ii) in the determination of availability under
clause (b) above, through and including September 30, 2011, that portion of
the Eligible Walmart Accounts which exceed sixty percent (60%) of the sum of
(a) and (b) above shall be excluded, and thereafter, that portion of the
Eligible Walmart Accounts which exceed fifty percent (50%) of the sum of (a)
and (b) above shall be excluded.

“Eligible Account” shall mean an Account (but shall not include interest and
service charges thereon) arising in the ordinary course of a Borrowing Base
Obligor’s business which meets each of the following requirements:

	 	(a)	 	it is not owing more than ninety
(90) days after the date of the original invoice or other
writing evidencing such Account;

	 	(b)	 	it is not owing by an Account
Debtor who has failed to pay twenty-five percent (25%) or more
of the aggregate amount of its Accounts owing to any Borrowing
Base Obligor within ninety (90) days after the dates of the
respective invoices or other writings evidencing such Accounts;

	 	(c)	 	it arises from the sale or lease
of goods and such goods have been shipped or delivered to the
Account Debtor under such Account, or it arises from services
rendered and such services have been performed;

 

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	 	(d)	 	it is evidenced by an invoice,
dated not later than the date of shipment or performance,
rendered to such Account Debtor or some other evidence of
billing acceptable to Bank;

	 	(e)	 	it is not evidenced by any note,
trade acceptance, draft or other Instrument or by any Chattel
Paper, unless such note or other document or Instrument or
Chattel Paper has previously been endorsed and delivered by the
relevant Loan Party to Bank;

	 	(f)	 	it is a valid, legally
enforceable obligation of the Account Debtor thereunder, and is
not subject to any offset or any counterclaim or other defense
on the part of such Account Debtor or to any claim on the part
of such Account Debtor denying liability thereunder in whole or
in part;

	 	(g)	 	it is not subject to any sale of
accounts, any rights of offset other than an Account Debtor
Reserve, Contract Negotiation Reserve or Gift Reserve, or Lien
whatsoever other than to Bank and other than the Permitted
Encumbrances subordinated to Bank’s Lien;

	 	(h)	 	it is not owing by a Subsidiary
or Affiliate of any Borrowing Base Obligor, or by an Account
Debtor which (i) does not maintain its chief executive office in
the United States of America, or (ii) is not organized under the
laws of the United States of America, or any state thereof, or
(iii) is the government of any foreign country or sovereign
state, or of any state, province, municipality or other
instrumentality thereof;

	 	(i)	 	is not an Account billed in
advance, payable on delivery, for unsold consigned goods, for
guaranteed sales, for unbilled sales, for progress billings,
payable at a future date in accordance with its terms, subject
to a retainage or holdback by the Account Debtor or insured by a
surety company;

	 	(j)	 	it is not an Account owing by the
United States of America or any state or political subdivision
thereof, or by any department, agency, public body corporate or
other instrumentality of any of the foregoing, unless all
necessary steps are taken to comply with the Federal Assignment
of Claims Act of 1940, as amended, or with any comparable state
law, if applicable, and all other necessary steps are taken to
perfect Bank’s security interest in such Account;

	 	(k)	 	it is not owing by an Account
Debtor for which a Loan Party or any of its Subsidiaries has
received a notice of (i) the death of the Account Debtor or any
partner of the Account Debtor, (ii) the dissolution,
liquidation, termination of existence, insolvency or business
failure of the Account Debtor, (iii) the appointment of a
receiver for any part of the property of the Account Debtor, or
(iv) an assignment for the benefit of creditors, the filing of a
petition in bankruptcy, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against the
Account Debtor; and

 

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	 	(l)	 	it is not an Excluded Account.

An Account which is at any time an Eligible Account, but which subsequently
fails to meet any of the foregoing requirements, shall forthwith cease to be
an Eligible Account.

(c) Section 4.3(h) of the Credit Agreement is amended to read in its entirety as follows:

“(h) within fifteen (15) days after and as of the 15th day and the
last day of each calendar month, a Borrowing Base Certificate dated as of the
15th day and the end of such month respectively;”

(d) Section 7.4 of the Credit Agreement is amended to read in its entirety as follows:

“7.4 Audits and Appraisals of Collateral; Fees. Bank shall have the
right at reasonable times during normal business hours of Borrower or the applicable
Loan Party, upon three (3) Business Days prior written request of Bank, provided
that no advance request or notice shall be required upon the occurrence and during
the existence or continuance of an Event of Default, to (a) audit Accounts and
Inventory pledged by any Loan Party and other Collateral four (4) times per year,
and at any time an Event of Default exists or is continuing, and (b) conduct such
appraisals and/or valuations of the Collateral, in scope and detail satisfactory to
Bank in its sole discretion, as Bank may require from time to time. Borrower agrees
to reimburse Bank, within thirty (30) days of written demand, for customary and
reasonable fees and costs incurred by Bank for such audits and for each appraisal of
Collateral and financial analysis and examination of Borrower or any other Loan
Party performed from time to time in accordance with this Section.”

(e) Section 1.9(b)(iii) of the Loan Terms, Conditions, and Procedures Addendum attached to
the Credit Agreement is amended to read in its entirety as follows:

“(iii) Borrower shall pay to Bank, quarterly in arrears on the first day of
each calendar quarter, letter of credit fees for each standby Letter of Credit
computed (on the basis of a year of 360 days for the actual number of days elapsed)
at the rate of four and one-half percent (4.50%) per annum on the daily average
maximum amount available for drawing under such Letter of Credit during the
immediately preceding quarter. Borrower shall pay to Bank a letter of credit fee for
each commercial Letter of Credit, in advance upon issuance in an amount equal to the
greater of (a) one-half percent (0.50%) of the amount of the commercial Letter of
Credit, or (b) $250.”

 

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(f) Section 1.1 of the Financial Covenants Addendum attached to the Credit Agreement is
amended to read in its entirety as follows:

“1.1 Tangible Net Worth. Maintain a Tangible Net Worth as of the end
of each of Borrower’s fiscal quarters, to be tested as of the end of each such
fiscal quarter, of not less than the amount set forth below for such quarter:

	 	(a)	 	as of March 31, 2011,
$33,000,000;

	 	(b)	 	as of June 30, 2011, $32,000,000;

	 	(c)	 	as of September 30, 2011,
$31,250,000;

	 	(d)	 	as of December 31, 2011,
$34,750,000;

	 	(e)	 	as of March 31, 2012,
$35,000,000;

	 	(f)	 	as of June 30, 2012, $35,000,000;
and

	 	(g)	 	as of September 30, 2012 and each
quarter thereafter, $33,000,000.”

3. Representations. Borrower represents and agrees that:

(a) Except as expressly modified in this Amendment, (i) the representations and warranties
set forth in the Credit Agreement and in each related document, agreement, and instrument
remain true and correct in all material respects, except to the extent that they expressly
speak as of a specific prior date, in which case they remain true and correct in all
material respects as of such earlier date and (ii) the covenants set forth in the Credit
Agreement continue to be satisfied in all respects, and are legal, valid and binding
obligations with the same force and effect as if entirely restated in this Amendment.

(b) When executed, this Amendment will be a duly authorized, legal, valid, and binding
obligation of Borrower enforceable in accordance with its terms.

(c) There is no default continuing under the Credit Agreement, or any related document,
agreement, or instrument, and no event has occurred or condition exists that is or, with the
giving of notice or lapse of time or both, would be such a default.

4. Conditions Precedent. The effectiveness of this Amendment is subject to Bank’s receipt
of all of the following:

(a) this Amendment and such other agreements and instruments reasonably requested by Bank
pursuant hereto (including such documents as are necessary to create and perfect Bank’s
interest in the Collateral), each duly executed by Borrower;

(b) such other documents and completion of such other matters as Bank may reasonably deem
necessary or appropriate, including those items set forth on the Documentation Checklist
attached hereto as Exhibit “A”;

(c) a modification fee in the amount of $100,000.

5. No Other Changes. Except as specifically provided in this Amendment, this Amendment
does not vary the terms and provisions of any note, mortgage, security agreement, or other
document, instrument, or agreement evidencing, securing or relating to the Indebtedness or the
Credit Agreement (“Loan Documents”). This Amendment shall not impair the rights, remedies, and
security given in and by the Loan Documents. The terms of this Amendment shall control any
conflict between its terms and those of the Credit Agreement.

 

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6. Ratification. Except for the modifications under this Amendment, the parties ratify and
confirm the Credit Agreement and the Loan Documents and agree that they remain in full force and
effect.

7. Further Modification; No Reliance. This Amendment may be altered or modified only by
written instrument duly executed by Borrower and Bank. In executing this Amendment, Borrower is
not relying on any promise or commitment of Bank that is not in writing signed by Bank. This
Amendment shall not be more strictly construed against one of the parties as compared to the other.

8. Confirmation of Lien Upon Collateral. Borrower acknowledges and agrees that
Indebtedness and the individual advances under the Indebtedness are secured by the Collateral (as
defined in the Credit Agreement) and that the Loan Documents constitute valid, legal, and binding
agreements and obligations of Borrower. The Collateral is and shall remain subject to and
encumbered by the lien, charge, and encumbrance of any applicable Loan Document, and nothing herein
contained shall affect or be construed to affect the lien or encumbrance created by any applicable
Loan Document respecting the Collateral, or its priority over other liens or encumbrances.

9. Successors and Assigns. This Amendment shall inure to the benefit of and be binding
upon the parties and their respective successors and assigns.

10. Governing Law. The parties agree that the terms and provisions of this Amendment shall
be governed by and construed in accordance with the internal laws of the State of Michigan, without
regard to principles of conflicts of law.

11. No Defenses. Borrower acknowledges, confirms, and warrants to Bank that as of the date
hereof Borrower has absolutely no defenses, claims, rights of set-off, or counterclaims against
Bank under, arising out of, or in connection with, this Amendment, the Credit Agreement, the Loan
Documents and/or the individual advances under the Indebtedness, or against any of the indebtedness
evidenced or secured thereby.

12. Expenses. Borrower upon request shall promptly pay all out-of-pocket fees, costs,
charges, expenses, and disbursements of Bank, including, without limitation, reasonable attorneys’
fees and legal expenses, incurred in connection with the preparation, execution, and delivery of
this Amendment, and the other documents contemplated by this Amendment.

13. Counterparts. This Amendment may be executed in one or more counterparts, and by
separate parties on separate counterparts, all of which shall constitute one and the same
agreement.

[Remainder of Page Intentionally Blank]

 

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This Amendment No. 4 to Credit Agreement is executed and delivered as of the Effective Date.

	 	 	 	 	 	 	 	 	 	 	 
	Comerica Bank	 	 	 	TANDY BRANDS ACCESSORIES, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Donald Hellman
 

Name: Donald Hellman
	 	 	 	By:
	 	/s/ N. Roderick McGeachy, III
 

Name: N. Roderick McGeachy, III
	 	 
	 

	 	Title: Senior Vice President
	 	 	 	 	 	Title: President	 	 

Acknowledgement and Consent of Guarantors

Each of the undersigned has guaranteed the payment and performance of the Indebtedness by
Borrower pursuant to a Guaranty dated as of February 12, 2008 (“Guaranty”). Each of the
undersigned acknowledges and consents to the execution, delivery and performance of the foregoing
Amendment No. 4 to Credit Agreement and the Amendment No. 2 to Master Revolving Note of even date
between Borrower and Bank amending the $27,500,000 Master Revolving Note dated as of October 6,
2009 from Borrower to Bank, as amended, and agrees that its guaranty remains in full force and
effect. Each of the undersigned further represents that it is in compliance with all of the terms
and conditions of its Guaranty.

	 	 	 	 	 
	 	TBAC INVESTMENT TRUST

TANDY BRANDS ACCESSORIES HANDBAGS, INC.

TBAC — TOREL, INC.

 	 
	 	By:  	/s/ N. Roderick McGeachy, III
 	 
	 	 	N. Roderick McGeachy, III, President of each 	 
	 	 	of the forgoing entities 	 
	 

 

- 7 -

 

Exhibit “A”

DOCUMENTATION CHECKLIST

	 	 	 
	Borrower:

	 	Tandy Brands Accessories, Inc.
	 
	 	 
	Lender:

	 	Comerica Bank
	 
	 	 
	Guarantor:

	 	TBAC Investment Trust (“TBAC Trust”)
	 

	 	Tandy Brands Accessories Handbags, Inc. (“TBA Handbags”)
	 

	 	TBAC—Torel, Inc. (“Torel”)
	 
	 	 
	Other Parties:

	 	H.A. Sheldon Canada, Ltd. (“Sheldon Canada”)
	 
	 	 
	Transaction:

	 	Fourth Amendment to $27,500,000 (originally $35,000,000)
Secured Formula Based Revolving Credit Facility
	 
	 	 
	Effective Date:

	 	March 31, 2011

ITEM

ORGANIZATION DOCUMENTATION

	1.	 	Tandy Brands Accessories, Inc.

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	2.	 	TBAC Investment Trust (“TBAC Trust”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	3.	 	Tandy Brands Accessories Handbags, Inc. (“TBA Handbags”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

	4.	 	TBAC—Torel, Inc. (“Torel”)

	 	(a)	 	Recertification of Authority

	 
	 	(b)	 	Resolution

	 
	 	(c)	 	Evidence of Good Standing

DUE DILIGENCE DOCUMENTATION

	5.	 	UCC and Tax Lien Search — Borrower

LOAN DOCUMENTATION

	6.	 	Amendment No. 4 to Credit Agreement

	 
	7.	 	Amendment No. 2 to Note — $27,500,000 Master Revolving
Note

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