Document:

exv4w6

EXHIBIT 4.6 and 10.3

AMENDMENT NO. 3 TO CREDIT AGREEMENT

This Amendment No. 3 to Credit Agreement (“Amendment”) is dated May 10, 2010 (“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 term, which is defined in the Defined Terms Addendum attached to the
Credit Agreement, is given the following amended definition:

     “Revolving Credit Maturity Date” shall mean October 31, 2012 or such earlier
date on which the Bank’s commitment to fund Loans and to issue Letters of Credit
hereunder is terminated pursuant to this Agreement; provided, however, if any such
date is not a Business Day, then the Revolving Credit Maturity Date shall be the
next succeeding Business Day.

   (b) Section 5.17 of the Credit Agreement is amended to read in its entirety as follows:

     “5.17 Acquire Fixed Assets. Acquire or expend for, or commit to
acquire or expend for, fixed assets by lease (including any Capitalized Lease
Obligations), purchase or otherwise, in an aggregate amount in excess of (i)
$5,500,000 in the Fiscal Year ending June 30, 2010, but excluding any fixed assets
acquired pursuant to the terms of the Asset Purchase Agreement dated as of April 23,
2009 between Borrower and Chambers Belt Company, as amended by that certain Amended
and Restated Asset Purchase Agreement dated as of July 9, 2009, and (ii) $2,000,000
in any Fiscal Year thereafter.”

(c) 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 June 30, 2010, $35,000,000;

 

 

	 
	 	(b)	 	as of September 30, 2010,
$33,000,000;
	 
	 	(c)	 	as of December 31, 2010,
$36,500,000;
	 
	 	(d)	 	as of March 31, 2011,
$35,000,000;
	 
	 	(e)	 	as of June 30, 2011, $35,000,000;
	 
	 	(f)	 	as of September 30, 2011,
$33,000,000;
	 
	 	(g)	 	as of December 31, 2011,
$36,500,000;
	 
	 	(h)	 	as of March 31, 2012,
$35,000,000;
	 
	 	(i)	 	as of June 30, 2012, $35,000,000;
and
	 
	 	(j)	 	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 respects, except to the extent that they expressly speak as
of a specific prior 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; and

(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”.

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. 3 to Credit Agreement is executed and delivered as of the Effective Date.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Comerica Bank	 	 	 	TANDY BRANDS ACCESSORIES, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Steven Colwick	 	 	 	By:	 	/s/ Craig Mackey	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Steven Colwick
	 	 	 	 	 	Name:
	 	Craig Mackey	 	 
	 

	 	Title:
	 	Vice President — Texas Division
	 	
	 	 	 	Title:
	 	Chief Financial Officer
	 	

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. 3 to Credit Agreement and the Amendment No. 1 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, 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/ Craig Mackey
 	 
	 	 	Craig Mackey, as Vice President of each of the above 	 
	 	 	 	 

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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”)
	 
	 	 
	Transaction:

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

	 	May 10, 2010

      

ITEM

ORGANIZATION DOCUMENTATION

	 
	1.	 	Tandy Brands Accessories, Inc.     

	 	(a)	 	Recertification of Authority
	 
	 	(b)	 	Certificate of Good Standing

	2.	 	TBAC Investment Trust (“TBAC Trust”)

	 	(a)	 	Recertification of Authority
	 
	 	(b)	 	Certificate of Good Standing

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

	 	(a)	 	Recertification of Authority
	 
	 	(b)	 	Certificate of Good Standing

	4.	 	TBAC—Torel, Inc. (“Torel”)

	 	(a)	 	Recertification of Authority
	 
	 	(b)	 	Certificate of Good Standing

DUE DILIGENCE DOCUMENTATION

	5.	 	UCC and Tax Lien Search

	 	(a)	 	Borrower
	 
	 	(b)	 	TBAC Trust
	 
	 	(c)	 	TBA Handbags
	 
	 	(d)	 	Torel

LOAN DOCUMENTATION

	6.	 	Amendment No. 3 to Credit Agreement
	 
	7.	 	Amendment No. 1 to Master Revolving Noteexv10w1

EXHIBIT 10.1

AGREEMENT TO PROVIDE SEVERANCE PAY

     THIS AGREEMENT TO PROVIDE SEVERANCE PAY (“Agreement”), dated as of this
22nd day of April, 2010 (the “Effective Date”), is by and between Tandy Brands
Accessories, Inc., a Delaware corporation (the “Company” or “Tandy Brands”), and N.
Roderick McGeachy, III (the “Executive”). As used herein the term the “Company” shall be
deemed to include any and all present and future Subsidiaries and Affiliates of the Company.

Recitals

     A. The Executive is the Chief Executive Officer and President of the Company;

     B. Executive and the Company are entering into this Agreement in order to set forth the terms
and conditions under which any severance payments shall be made to the Executive upon a termination
of the services of the Executive to the Company.

     NOW, THEREFORE, the parties, intending to be legally bound, and in consideration of the mutual
covenants contained herein, agree as follows:

     1. Definitions. Capitalized terms used in this Agreement, but not otherwise defined
herein, shall have the meaning hereby assigned to them as follows:

     “Affiliate” means with respect to any Person, any other Person which is directly or
indirectly controlling, controlled by or under direct or indirect common control with (directly or
indirectly through any Person) the Person referred to. The term “control” (including, with
correlative meaning, the terms “controlled by” and “under common control with”) as used with
respect to any Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether through the ownership of
voting securities, by contract or otherwise.

     “Cause” shall mean: (1) Executive’s breach of this Agreement (which remains uncured
at the end of a 10-day period after receipt of written notice of the breach); (2) Executive’s
willful misconduct, malfeasance, negligence in the performance or intentional nonperformance (in
either case continuing for 10 days after receipt of written notice of need to cure) of any of
Executive’s material duties and responsibilities hereunder; (3) Executive’s dishonesty or fraud
with respect to the business, reputation or affairs of the Company; (4) fraud, misappropriation or
embezzlement of funds or other property of the Company, (5) Executive’s conviction of a felony
crime which, in the opinion of the Board of Directors of the company, brings Executive or the
Company into disrepute or causes harm to the Company’s business, customer relations, financial
condition or prospects, or (6) violation of any statutory or common law duty of loyalty to the
Company. After providing a notice of need to cure, the Board of Directors may suspend Executive
with pay until a final determination has been made by the Board of Directors regarding Executive’s
termination. No act, or failure to act, on Executive’s part shall be deemed “willful” unless done,
or omitted to be done, by Executive in bad faith and/or without reasonable belief that Executive’s
action or omission was in the best interest of the Company.

     “Person” means any individual, sole proprietorship, partnership, joint venture,
limited liability company, limited liability partnership, trust, estate, unincorporated
organization, association, corporation, institution or other entity.

 

 

     “Subsidiary” means any Person of which or the Company or any Subsidiary now or
hereafter shall, at the time, own directly or indirectly through another Person at least majority
of the outstanding capital stock (or other shares of beneficial interest) entitled to vote
generally.

     2. Termination

          (a) Termination by Executive or Termination by Company for Cause. The Executive may
terminate his services at any time. In addition, the Company may terminate the Executive’s
services to the Company for Cause. Upon any termination pursuant to this Section 2(a), the
Company shall pay to the Executive (i) any unpaid salary or other periodic compensation (the
“Base Compensation”) at the rate set forth in Section 12 and accrued through the
effective date of termination and (ii) any accrued but unused vacation days for the calendar year
of termination in accordance with the standard Company practice. Such amounts shall be paid on the
next regularly scheduled pay date following the Executive’s termination. Except as provided in
this Section 2(a), the Company shall have no further liability hereunder.

          (b) Termination Without Cause. The Company may terminate the Executive’s services to
the Company without Cause at any time. If the Company terminates the Executive’s services for no
reason or for any reason other than Cause, then the Company will provide Executive with the
severance benefits described in this Section 2(b); provided, however, that the Company’s
obligations under Section 2(b)(1)-(5) shall be conditioned upon (i) the Executive’s
execution and delivery of a mutual release in the form attached hereto as Exhibit A (the
“Mutual Release”), and (ii) such Mutual Release, once executed by Executive and delivered
to the Company, becoming irrevocable and final under applicable law within sixty (60) days of
Executive’s termination of employment:

     (1) Executive’s annual bonus for the current fiscal year, pro-rated to the Executive’s
termination date at the actual level of performance for the year of termination.
Notwithstanding any provision of an applicable document governing such annual bonus program,
such bonus shall be paid on the later of the sixtieth (60th) day after
Executive’s termination and the ninetieth (90th) day following the end of the
current fiscal year.

     (2) Executive’s Base Compensation in effect at the time of the termination for the
Severance Payment Period. Such amounts shall be paid ratably over the Severance Payment
Period (as defined below) at the same intervals as payments of Base Compensation were made
to Executive prior to the date of termination, provided, however, that the first payment
shall not be made until the first pay date following the sixtieth (60th) day
after Executive’s termination and shall be comprised of all accrued but unpaid payments
during such 60-day period.

     (3) An amount equal to 200% of Executive’s target annual bonus for the fiscal year in
which Executive’s termination date occurs. Such amounts shall be paid on the sixtieth
(60th) day after Executive’s termination.

     (4) Vesting of performance units granted to Executive (as if Executive had experienced
a Termination of service due to Retirement during the Performance Cycle in which the
Executive’s termination occurs, as such capitalized terms are defined under the applicable
award agreements). Notwithstanding any provision of an award agreement governing such
performance units, the performance units shall be settled on the later of the sixtieth
(60th) day after Executive’s termination and the date specified in the applicable
award agreement.

     (5) Outplacement assistance benefits of up to a maximum total amount of $15,000.00 to
aid Executive in locating suitable alternative employment opportunities, commencing on the

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sixtieth (60th) day following Executive’s termination of employment. Such
expenses shall be paid directly by the Company as incurred by the Executive during the
Severance Payment Period.

     (6) Continued coverage of Executive and his qualified beneficiaries (for as long as
they are qualified beneficiaries under Section 4980 of the Internal Revenue Code) under the
Company’s group health plan in which Executive or such beneficiaries participated
immediately prior to Executive’s termination, or a successor plan thereto, (the “Company
Health Plan”), subject to the terms of the Company Health Plan, for the Severance
Payment Period; provided Executive continues to pay the employee-portion of the cost
of coverage during such period and provided, further, that if Executive
becomes employed with another employer and is eligible to receive coverage under another
employer-provided group health plan, the benefits provided under this Section
2(b)(6) shall cease. This continued coverage shall run concurrently with the
continuation coverage period provided under Section 4980B of the Internal Revenue Code or
other applicable law.

     (7) Continued coverage of Executive under Company-sponsored life insurance plans, at
the Company’s sole cost and expense, at such levels of coverage as are in effect at the date
of Executive’s termination, subject to the existing terms of and eligibility requirements of
such insurance programs, for the Severance Payment Period; provided Executive
continues to pay the employee-portion of the cost of coverage during such period and
provided, further, that if Executive becomes employed with another employer
and is eligible to receive coverage under another employer-provided life insurance plan,
the benefits provided under this Section 2(b)(7) shall cease.

Notwithstanding any provision of this Agreement to the contrary, the Company’s obligation to make
any of the foregoing severance payments and benefits shall terminate and be of no further force or
effect upon the Executive’s breach of this Agreement, the Mutual Release, or any non-competition,
non-solicitation or confidentiality provisions of any other agreement with the Company to which the
Executive is a party. The Executive’s obligations to perform under any non-competition,
non-solicitation or confidentiality provisions of this Agreement or any other agreement with the
Company to which the Executive is a party shall terminate and be of no further term or effect upon
the Company’s breach of this Agreement or the Mutual Release.

The Company may deduct and withhold from any payments made under this Section 2(b) all
amounts required to be deducted and/or withheld by any federal, state or local laws. The payments
set forth herein constitute all payments to which the Executive is entitled in the event of any
termination of services without Cause, except for potential payments related to any accrued but
unpaid Base Compensation through the date of termination or any accrued but unused vacation days
for the calendar year of termination in accordance with the standard Company practice (which shall
be paid on the next regularly scheduled pay date following the Executive’s termination).

The “Severance Payment Period” shall be twenty-four (24) months from the effective date of
Executive’s termination.

          (c) Termination Upon Death of Executive. The death of Executive shall immediately
terminate this Agreement with no severance compensation due Executive’s estate; provided, however,
the Company shall continue to provide Executive’s qualified beneficiaries (for as long as they are
qualified beneficiaries thereunder) with coverage under the Company Health Plan, subject to the
terms of the Plan, for the 90-day period following Executive’s death, provided the qualified
beneficiaries continue to pay the employee-portion of the cost of coverage during such period.
This continued coverage shall run concurrently with the continuation coverage period provided under
Section 4980B of the Internal Revenue Code or other applicable law.

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          (d) Termination Upon Disability of Executive. If Executive becomes entitled to and
receives benefits under an insured long term disability plan of the Company (incurs a
“Disability”), the Company may terminate this Agreement and Executive’s employment. In the
event this Agreement is terminated as a result of Executive’s Disability, Executive shall have no
right to any severance compensation and shall only be entitled to the benefits provided under the
Company’s long term disability policy; provided, however, the Company shall continue the coverage
of Executive and his qualified beneficiaries (for as long as they are qualified beneficiaries
thereunder) under the Company Health Plan, subject to the terms of the Company Health Plan, for the
90-day period following Executive’s Disability, provided the Executive continues to pay the
employee-portion of the cost of coverage during such period. This continued coverage shall run
concurrently with the continuation coverage period provided under Section 4980B of the Internal
Revenue Code or other applicable law. In the event Executive ceases to be disabled, all
non-competition and non-solicitation agreements between Executive and the Company shall immediately
terminate and cease to apply to Executive unless the Company shall offer to reinstate Executive’s
employment with the Company under terms and provisions no less beneficial to Executive than those
in effect prior to the commencement of Executive’s Disability.

          (e) Code Section 409A Compliance.

     (1) Required Delay under Code Section 409A. Notwithstanding any
provision herein to the contrary, if and to the extent that any portion of the
amounts payable or benefits provided to Executive under this Section 2
constitute payments pursuant to a “nonqualified deferred compensation plan” (as such
term is defined under Section 409A(d)(1) of the Code) and, at the time of his
termination of employment, the Executive is a “specified employee” (as such term is
defined under Section 409A(a)(2)(B)(i) of the Code), then the Company shall delay
making such payments until the first day of the seventh calendar month following
Executive’s termination or, if earlier, the date of Executive’s death.

     (2) Separation from Service Required. For purposes of determining the
timing of any payment to which the Executive is entitled under this Section
2 on or following his termination, such event shall not have occurred, and such
payment shall not be made, unless Executive has experienced a “separation from
service” as defined under Treasury Regulations § 1.409A-1(h), without regard to the
alternative definitions provided thereunder.

     (3) Interpretation of Ambiguous Terms. To the extent an ambiguity
exists under this Agreement, the parties shall interpret the Agreement in a manner
necessary to comply with Section 409A of the Code.

     3. Effect on Other Benefits. This Agreement is voluntarily entered into and will
supersede and take the place of any severance or employment agreements or other arrangements
between the parties hereto providing for severance or similar benefits, unless and to the extent
otherwise specifically provided therein to the contrary. The payments and benefits set forth in
Section 2 constitute all payments and benefits to which the Executive is entitled in the
event of any termination of services, except for potential payments and benefits to which the
Executive may be entitled pursuant to the terms of any Company benefit plan, or otherwise payable
in accordance with the provisions of any agreements pertaining to the Executive’s ownership of
interests in the Company, including but not limited to Executive’s time and performance-based
option agreements.

     4. No Mitigation Obligation: The Company hereby acknowledges that it will be
difficult, and may be impossible, for Executive to find reasonably comparable employment following
his termination of employment and that the restrictive covenants contained in Section 5
hereof will further

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limit the employment opportunities for Executive. Accordingly, the parties hereto expressly
agree that the payment of the severance compensation and benefits by the Company to the Executive
in accordance with Section 2(b) above will be liquidated damages, and that Executive shall
not be required to mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise, nor shall any profits, income, earnings or other benefits from any
source whatsoever create any mitigation, offset, reduction or any other obligation on the part of
Executive hereunder or otherwise.

     5. Restrictive Covenants.

     (a) Confidential Information. During his employment with Company, Executive
was provided with, and had access to, information regarding Company’s methods of business,
and was also provided with, and had access to, other Confidential Information.
“Confidential Information” includes, but is not limited to, customer lists, customer
information, business plans, marketing plans, cost information, sourcing information,
compensation figures, product pricing information, product design specification, future
business plans, any and all documents, memoranda, records and files, correspondence, notes,
specifications, and plans, policies and procedures, computer programs, software, and other
proprietary data of whatever type or nature. Executive understands that this Confidential
Information is in the nature of a trade secret, and is the sole property of Company.
Executive promises and agrees that he will not directly or indirectly, use for his benefit,
use to the injury of Company, or divulge to persons other than authorized representatives of
Company, any Confidential Information of the Company.

     (b) Competitive Activity. In further consideration of the Company entering
into this Agreement and providing Executive with the benefits described in Section
2(b) hereof, during a period ending one (1) year following the Termination Date (the
“Non-Compete Period”), if the Executive shall have received or shall be receiving benefits
under Section 2(b) hereof, the Executive shall not, without the prior written
consent by the Company, directly or indirectly engage in the business of developing products
competitive with the business of the Company within the United States of America and any
other geographical area served by the Company (the “Applicable Area”) during the twelve (12)
month period immediately preceding termination of the Executive’s employment with the
Company nor will the Executive engage, within such geographical area(s), in the design,
development, distribution, manufacture, assembly or sale of a product or service in
competition with any product or service marketed or planned by the Company immediately prior
to the Termination Date, the plans, designs or specifications of which have been revealed to
the Executive. The Executive acknowledges that these limited prohibitions are reasonable as
to time, geographical area and scope of activities to be restrained and that the limited
prohibitions do not impose a greater restraint than is necessary to protect the Company’s
goodwill, proprietary information and other business interests. “Competitive Activity”
shall not include (i) the mere ownership of a de minimis amount of securities in any such
enterprise and exercise of rights appurtenant thereto or (ii) participation in management of
any such enterprise or business operation thereof other than in connection with the
competitive operation of such enterprise.

     (c) Non-Solicitation. Executive understands and agrees that, during the
Severance Payment Period, he will not solicit or hire, directly or indirectly, any
individual employed by Company, or any individual who worked for Employer during the
previous twelve (12) months.

     6. Waivers and Amendments. The respective rights and obligations of the Company and
the Executive under this Agreement may be waived (either generally or in a particular instance,
either retroactively or prospectively, and either for a specified period of time or indefinitely)
or amended only with the written consent of a duly authorized representative of the Company and the
Executive.

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     7. Successors and Assigns. The provisions hereof shall inure to the benefit of, and
be binding upon, the Company’s successors and assigns, but neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by the Executive.

     8. Entire Agreement. This Agreement constitutes the full and entire understanding and
agreement of the parties with regard to the subjects hereof and supersede in their entirety all
other or prior agreements, whether oral or written, with respect thereto. For the avoidance of
doubt, this Agreement supersedes and replaces that certain Employment Agreement, dated October 1,
2008, between the Company and the Executive, which Employment Agreement shall be terminated
effective upon the execution of this Agreement.

     9. Notices. All demands, notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing and shall be personally delivered or
sent by facsimile machine (with a confirmation copy sent by one of the other methods authorized in
this Section 9), nationally recognized commercial overnight delivery service (including Federal
Express or other reputable overnight delivery service) or, deposited in the mail first class,
registered or certified mail, postage prepaid, as set forth below:

If to the Company, addressed to:

Tandy Brands Accessories, Inc.

c/o Winstead PC

1201 Elm Street, Suite 5400

Dallas, Texas 75270

Attention: Chris Williams

Telecopier No.: (214) 745-5390

     If to the Executive, to the address set forth on the signature page of this Agreement or at
the current address listed in the Company’s records.

     Notices shall be deemed delivered upon the earliest to occur of (a) actual receipt by the
party to whom such notice is directed; (b) if sent by facsimile machine, on the day (other than a
Saturday, Sunday or legal holiday in the jurisdiction to which such notice is directed) such notice
is sent if sent (as evidenced by the facsimile confirmed receipt) prior to 5:00 p.m. Central Time
and, if sent after 5:00 p.m. Central Time, on the day (other than a Saturday, Sunday or legal
holiday in the jurisdiction to which such notice is directed) after which such notice is sent;
(c) on the first day (other than a Saturday, Sunday or legal holiday in the jurisdiction to which
such notice is directed) following the day the same is deposited with the commercial courier if
sent by commercial overnight delivery service; or (d) the fifth day (other than a Saturday, Sunday
or legal holiday in the jurisdiction to which such notice is directed) following deposit thereof in
the mail, first class prepaid certified mail, return receipt requested, as aforesaid. Each party,
by notice duly given in accordance therewith, may specify a different address for the giving of any
notice hereunder.

     10. Governing Law. This Agreement shall be construed and enforced in accordance with
and governed by the laws of Texas (without giving effect to any conflicts or choice of laws
provisions thereof that would cause the application of the domestic substantive laws of any other
jurisdiction).

     11. Consent to Jurisdiction. EACH OF THE PARTIES HERETO HEREBY CONSENTS TO THE
JURISDICTION OF ALL COURTS LOCATED IN TEXAS AS WELL AS TO THE JURISDICTION OF ALL COURTS TO WHICH
AN APPEAL MAY BE TAKEN FROM SUCH COURTS, FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING
ARISING OUT OF, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY, INCLUDING, WITHOUT LIMITATION, ANY PROCEEDING

-6-

 

RELATING TO ANCILLARY MEASURES IN AID OF ARBITRATION, PROVISIONAL REMEDIES AND INTERIM RELIEF,
OR ANY PROCEEDING TO ENFORCE ANY ARBITRAL DECISION OR AWARD. EACH PARTY HEREBY EXPRESSLY WAIVES
ANY AND ALL RIGHTS TO BRING ANY SUIT, ACTION OR OTHER PROCEEDING IN OR BEFORE ANY COURT OR TRIBUNAL
OTHER THAN THE COURTS DESCRIBED ABOVE AND COVENANTS THAT IT SHALL NOT SEEK IN ANY MANNER TO RESOLVE
ANY DISPUTE OTHER THAN AS SET FORTH IN THIS SECTION, OR TO CHALLENGE OR SET ASIDE ANY DECISION,
AWARD OR JUDGMENT OBTAINED IN ACCORDANCE WITH THE PROVISIONS HEREOF.

     12. Base Compensation; No Guarantee of Term. The Base Compensation of the Executive
shall be as determined by the Board of Directors of the Company in its discretion; provided that
nothing contained in this Agreement is intended to imply, or obligate the Company to retain the
services of the Executive for, any specified term of employment. The Executive acknowledges and
agrees that the Executive’s services to the Company are at the will of the Company and may be
terminated at any time, subject the payment of any severance obligations set forth herein.

     13. Remedies. The Executive’s sole and exclusive remedy upon any termination of
employment shall be the payments due the Executive under Section 2 hereof and in no event
shall the Company be required to pay the Executive any consequential, punitive or other special
damages hereunder. The prevailing party to an injunction brought pursuant hereto or any other
action brought in connection with this Agreement shall be entitled to the payment by the other
party of reasonable attorneys’ fees and other costs incurred in connection with such action, in
addition to any other relief to which it may be entitled.

     14. Advice of Counsel. The Executive has had the opportunity to seek the advice of
counsel and other personal advisors and acknowledges that the Company has not provided the
Executive with any advice regarding the tax, economic or other impacts to the Executive of the
arrangements contemplated hereby.

     15. Severability; Titles and Subtitles; Gender; Singular and Plural; Counterparts;
Facsimile.

          (a) In case any provision of this Agreement shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions of this Agreement shall not in
any way be affected or impaired thereby.

          (b) The titles of the sections and subsections of this Agreement are for convenience of
reference only and are not to be considered in construing this Agreement.

          (c) The use of any gender in this Agreement shall be deemed to include the other genders, and
the use of the singular in this Agreement shall be deemed to include the plural (and vice versa),
wherever appropriate.

          (d) This Agreement may be executed in any number of counterparts, each of which shall be an
original, but all of which together constitute one instrument.

          (e) Counterparts of this Agreement (or applicable signature pages hereof) that are manually
signed and delivered by facsimile transmission shall be deemed to constitute signed original
counterparts hereof and shall bind the parties signing and delivering in such manner.

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written
above.

	 	 	 	 	 
	 	COMPANY:

Tandy Brands Accessories, Inc.

 	 
	 	By:  	/s/ W. Grady Rosier
 	 
	 	 	Name:  	W. Grady Rosier 	 
	 	 	Title:  	Lead Independent Director 	 
	 

	 	 	 	 	 
	 	EXECUTIVE:

 	 
	 	/s/ N. Roderick McGeachy, III
 	 
	 	Name:  	N. Roderick McGeachy, III 	 
	 	Address: 	 	 
	 	 	 	 
	 	 	 	 

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Exhibit A

MUTUAL RELEASE

       This Mutual Release (the “Mutual Release”) is made and entered into by and between
Tandy Brands Accessories, Inc., a Delaware corporation (together with any subsidiary or affiliate,
the “Company”) and N. Roderick McGeachy, III (the “Executive”) (collectively, the
“Parties”). In consideration of the mutual promises and agreements of the Parties hereto
and in the Agreement to Provide Severance Pay (the “Severance Agreement”), the receipt and
sufficiency are hereby acknowledged by each of said Parties and expressing their intent to be
legally bound, the Parties hereto do hereby agree as follows:

	1.	 	The Executive hereby releases and forever discharges as of the date hereof, the Company and
all present and former general partners, managers, directors, officer, officers, agents,
representatives, employees, successors and assigns of the Company, its subsidiaries and their
respective affiliates and direct or indirect equity holders of the Company and the
subsidiaries (collectively, the “Released Parties”) to the extent provided herein.
	 
	2.	 	The Company hereby releases and forever discharges as of the date hereof, the Executive, his
heirs, assigns or agents to the extend provided herein.
	 
	3.	 	Executive understands that any payments or benefits paid or granted to him under
Section 2 of the Severance Agreement represent, in part, consideration for signing
this Mutual Release and are not salary, wages or benefits to which he was already entitled.
He understands and agrees that he will not receive the payments and benefits specified in
Section 2 of the Severance Agreement unless he executes this Mutual Release and does
not revoke this Mutual Release within the time period permitted hereafter or breach this
Mutual Release. Executive also acknowledges and represents that he has received all payments
and benefits that he is entitled to receive (as of the date hereof) by virtue of any provision
of services to the Company.
	 
	4.	 	The Company understands that any obligations of the Executive undertaken in the Severance
Agreement and/or any other non-competition, non-solicitation, or confidentiality agreement
represent, in part, consideration for signing this Mutual Release. The Company understands
and agrees that it will not receive any benefits from the Executive as specified in the
Severance Agreement and/or any other non-competition, non-solicitation, or confidentiality
agreement unless it executes this Mutual Release or breaches this Mutual Release.
	 
	5.	 	Except as provided in paragraph 13 below, Executive knowingly and voluntarily (for himself,
his heirs, executors, administrators and assigns) releases and forever discharges the Company
and the other Released Parties from any and all claims, suits, controversies, actions, causes
of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated
damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees,
or liabilities of any nature whatsoever in law and in equity, both past and present (through
the date this Mutual Release becomes effective and enforceable) and whether known or unknown,
suspected, or claimed against the Company or any of the Released Parties which Executive, his
spouse, or any of his heirs, executors, administrators or assigns, may have, which arise out
of or are connected with his provision of services to, or his separation or termination from,
the Company under any other federal, state, foreign or local civil or human rights law, or
under any other local, state, or federal law, regulation or ordinance; or under any public
policy, contract or tort, or under common law; or arising under any policies, practices or
procedures of the Company; or any claim for wrongful discharge, breach of contract, infliction
of emotional distress or defamation; or any claim for costs, fees, or other expenses,
including attorneys’ fees incurred in these matters) (all of

A-1

 

	 	 	the foregoing collectively referred to herein as the “Claims”). The waiver
provisions of this Mutual Release are acknowledged and conclusively deemed to be in
compliance with the requirements of the Older Workers Benefit Protection Act, 29 U.S.C. §
626(f)(1) (A)-(G). Executive has knowingly and voluntarily agreed, for the consideration
set forth herein, to waive, among other things, any and all rights and claims Executive may
have against the Company under the Age Discrimination in Employment Act of 1967, as amended,
29 U.S.C. § 621 et seq. (“ADEA”). Executive specifically acknowledges that the waiver of
rights under ADEA has been written in a manner that Executive understood, that the waiver
specifically refers to claims arising under ADEA, that Executive has not waived any rights
or claims under ADEA that arise after the date this Mutual Release is executed, that the
waiver of rights or claims under ADEA has been in exchange for consideration in addition to
anything of value that Executive is otherwise entitled to receive from the Company, that
Executive has been advised in writing to consult with an attorney before signing this Mutual
Release, and that Executive has been given at least 21 days within which to consider the
terms of the Mutual Release. Moreover, Executive may revoke this Mutual Release for a
period of seven days following the day it is signed by Executive. Any revocation within
this period must be submitted, in writing, to the Company and must be personally delivered
to the Company, or express overnight mailed to the Company and postmarked within seven days
of execution of this Mutual Release. This Mutual Release will become effective and
enforceable on the first day after the revocation period has expired, provided that
Executive has not revoked his acceptance. If the last day of the revocation period is a
Saturday, Sunday, or legal holiday in Texas, then the revocation period will not expire
until the next following day which is not a Saturday, Sunday, or legal holiday.
	 
	6.	 	The Company hereby releases the Executive, his spouse, heirs, executives, or agents he may
have, from all claims, suits, controversies, actions, causes of action, cross-claims,
counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or
exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any
nature whatsoever in law and in equity, both past and present through the date of this Mutual
Release becomes effective and enforceable and whether known or unknown, suspected, or claimed
against the Executive which the Company has or may have against the Executive which arise out
of or are connected with the Executive’s provision of services to, or his separation or
termination from, the Company under any other federal, state, foreign or local civil or human
rights law, or under any other local, state, or federal law, regulation or ordinance; or under
any public policy, contract or tort, or under common law; or arising under any policies,
practices or procedures of the Company; breach of contract, infliction of emotional distress
or defamation; or any claim for costs, fees, or other expenses, including attorneys’ fees
incurred in these matters) (all of the foregoing collectively referred to herein as the
“Claims”).
	 
	7.	 	The Parties represent that they have made no assignment or transfer of any right, claim,
demand, cause of action, or other matter covered by paragraphs 4 and 5 above.
	 
	8.	 	In signing this General Release, the Parties acknowledge and intend that it shall be
effective as a bar to each and every one of the Claims hereinabove mentioned or implied. The
Parties expressly consent that this Mutual Release shall be given full force and effect
according to each and all of its express terms and provisions, including those relating to
unknown and unsuspected Claims (notwithstanding any state statute that expressly limits the
effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any,
as well as those relating to any other Claims hereinabove mentioned or implied. The Parties
acknowledge and agree that this waiver is an essential and material term of this Mutual
Release and that without such waiver the Parties would not have agreed to the terms of the
Agreement. The Parties further agree that in the event they should bring a Claim seeking
damages against each other, or in the event the Parties should seek to recover against the
each other in any Claim brought by a governmental agency on their

A-2

 

	 	 	behalf, this Mutual Release shall serve as a complete defense to such Claims. The Parties
further agree that they are not aware of any pending Claim as of the execution of this
Mutual Release.
	 
	9.	 	The Parties agree that neither this Mutual Release, nor the furnishing of the consideration
for this Mutual Release, shall be deemed or construed at any time to be an admission by the
Parties of any improper or unlawful conduct.
	 
	10.	 	Executive agrees that he will forfeit all amounts payable by the Company pursuant to the
Agreement if he challenges the validity of this Mutual Release. The Parties also agree that
if either violates this Mutual Release by suing the other party, the party who sues will pay
all costs and expenses of defending against the suit incurred by the other party, including
reasonable attorneys’ fees; the Executive will return all payments received by him pursuant to
the Agreement. The Company understands and agrees that it will not receive any benefits from
the Executive as specified in the Severance Agreement and/or any non-competition,
non-solicitation, or confidentiality agreement unless it executes this Mutual Release or
breaches this Mutual Release.
	 
	11.	 	The Parties agree that this Mutual Release is confidential and agree not to disclose any
information regarding the terms of this Mutual Release, except the Executive may disclose such
information to his immediate family and any tax, legal or other counsel he may have consulted
regarding the meaning or effect hereof or as required by law, and the Executive will instruct
each of the foregoing not to disclose the same to anyone.
	 
	12.	 	Executive agrees not to disparage the Company, its past and present investors, officers,
managers, directors or employees or its affiliates and to keep all confidential and
proprietary information about the past or present business affairs of the Company and its
affiliates confidential unless a prior written release from the Company is obtained.
Executive further agrees that as of the date hereof, he has returned to the Company any and
all property, tangible or intangible, relating to its business, which he possessed or had
control over at any time (including, but not limited to, company-provided credit cards,
building or office access cards, keys, computer equipment, manuals, files, documents, records,
software, customer data base and other data) and that he shall not retain any copies,
compilations, extracts, excerpts, summaries or other notes of any such manuals, files,
documents, records, software, customer data base or other data. The Company agrees not to
disparage the Executive.
	 
	13.	 	Notwithstanding anything in this Mutual Release to the contrary, this Mutual Release shall
not relinquish, diminish, or in any way affect any rights or claims arising out of any breach
by the Company of the Agreement after the date hereof.
	 
	14.	 	Whenever possible, each provision of this Mutual Release shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this Mutual Release
is held to be invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any
other provision or any other jurisdiction, but this Mutual Release shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision had never been contained herein.

BY SIGNING THIS MUTUAL RELEASE, EXECUTIVE REPRESENTS AND AGREES THAT:

	15.	 	HE HAS READ IT CAREFULLY;
	 
	16.	 	HE HAS VOLUNTARILY CONSENT TO EVERYTHING IN IT;

A-3

 

	17.	 	HE HAS HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND HE HAS DONE SO
OR, AFTER CAREFUL READING AND CONSIDERATION HE HAS CHOSEN NOT TO DO SO OF HIS OWN VOLITION;
	 
	18.	 	HE HAS HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE SUBSTANTIALLY IN ITS
FINAL FORM ON                      ___, ___TO CONSIDER IT AND THE CHANGES MADE SINCE THE
                     ___, ___VERSION OF THIS RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE
REQUIRED 21-DAY PERIOD;
	 
	19.	 	THE CHANGES TO THE AGREEMENT SINCE                      ___, ___EITHER ARE NOT MATERIAL OR WERE
MADE AT HIS REQUEST.
	 
	20.	 	HE UNDERSTANDS THAT HE HAS SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO REVOKE IT AND
THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS
EXPIRED;
	 
	21.	 	HE HAS SIGNED THIS MUTUAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY
COUNSEL RETAINED TO ADVISE HIM WITH RESPECT TO IT; AND

HE AGREES THAT THE PROVISIONS OF THIS MUTUAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR
MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY
AND BY THE EXECUTIVE.

Date:                    
                    
          

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	N. Roderick McGeachy, III 	 
	 	 	 	 
	 
	 	And-

TANDY BRANDS ACCESSORIES, INC.

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

A-4

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