<SEC-DOCUMENT>0001299933-16-003230.txt : 20161122
<SEC-HEADER>0001299933-16-003230.hdr.sgml : 20161122
<ACCEPTANCE-DATETIME>20161122091002
ACCESSION NUMBER:		0001299933-16-003230
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20161122
ITEM INFORMATION:		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20161122
DATE AS OF CHANGE:		20161122

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			KIRKLAND'S, INC
		CENTRAL INDEX KEY:			0001056285
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-RETAIL STORES, NEC [5990]
		IRS NUMBER:				621287151
		FISCAL YEAR END:			0130

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-49885
		FILM NUMBER:		162011827

	BUSINESS ADDRESS:	
		STREET 1:		5310 MARYLAND WAY
		CITY:			BRENTWOOD
		STATE:			TN
		ZIP:			37027
		BUSINESS PHONE:		615-872-4800

	MAIL ADDRESS:	
		STREET 1:		5310 MARYLAND WAY
		CITY:			BRENTWOOD
		STATE:			TN
		ZIP:			37027

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KIRKLANDS INC
		DATE OF NAME CHANGE:	19980219
</SEC-HEADER>
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<TYPE>8-K
<SEQUENCE>1
<FILENAME>htm_54298.htm
<DESCRIPTION>LIVE FILING
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<TITLE> Kirkland's, Inc. (Form: 8-K) </TITLE>
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		UNITED STATES<BR>
	SECURITIES AND EXCHANGE COMMISSION
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	WASHINGTON, D.C. 20549
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	FORM 8-K
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	CURRENT REPORT
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	Pursuant to Section&nbsp;13 or 15(d) of the Securities Exchange Act of 1934
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	Date of Report (Date of Earliest Event Reported):
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	November 22, 2016
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	Kirkland's, Inc.
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	(Exact name of registrant as specified in its charter)
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	Tennessee
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	000-49885
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	621287151
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_____________________<BR>
	(State or other jurisdiction
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_____________<BR>
	(Commission
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______________<BR>
	(I.R.S. Employer
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	of incorporation)
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	File Number)
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	Identification No.)
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	5310 Maryland Way, Brentwood, Tennessee
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	37027
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_________________________________<BR>
	(Address of principal executive offices)
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	&nbsp;
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___________<BR>
	(Zip Code)
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	Registrant&#146;s telephone number, including area code:
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	615-872-4800
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	Not Applicable
<BR>______________________________________________<BR>
	Former name or former address, if changed since last report
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	&nbsp;
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions:</FONT>
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[&nbsp;&nbsp;]&nbsp;&nbsp;Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)<br>
[&nbsp;&nbsp;]&nbsp;&nbsp;Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<br>
[&nbsp;&nbsp;]&nbsp;&nbsp;Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<br>
[&nbsp;&nbsp;]&nbsp;&nbsp;Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<br>
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<P align="left" style="font-size: 10pt"><FONT style="font-size: 12pt"><B>Item&nbsp;5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.</B>
</FONT>

<P align="left" style="font-size: 12pt">On November&nbsp;22, 2016, Kirkland&#146;s Inc. (the &#147;Company&#148;) announced that it had named Mike Cairnes to
the newly-created position of Chief Operating Officer and Executive Vice President effective
November&nbsp;28, 2016. As Chief Operating Officer and under the direction of the Chief Executive
Officer, Mr.&nbsp;Cairnes will be responsible for the daily operation of the Company and will help
implement the strategy for the Company&#146;s Stores and Merchandising operations. He will also be
responsible the Company&#146;s Ecommerce operations, as well as Planning, Allocations and Supply Chain
operations, and report to the Chief Executive Officer.


<P align="left" style="font-size: 12pt">Mr.&nbsp;Cairnes, age 57, served as the President of the Aaron Brothers and Artistree divisions of
Michaels Inc., a publicly-traded retailer of arts, crafts and custom framing. He was President of
Artistree from June of 2007 through August of 2016, and President of Aaron Brothers from September
of 2015 through August of 2016. Prior to joining Michaels in 2006 as a Divisional Merchandise
Manager, Mr.&nbsp;Cairnes held various leadership positions with Brushstrokes, Larson-Juhl and Texas
Instruments.


<P align="left" style="font-size: 12pt">The Company and Mr.&nbsp;Cairnes also entered into an employment agreement (the &#147;Employment Agreement&#148;),
with an effective term that will commence on November&nbsp;28, 2016 and continue for an indefinite term
(the &#147;Term&#148;), until terminated as provided in the Employment Agreement. The Employment Agreement
provides Mr.&nbsp;Cairnes with the following compensation and benefits: (a)&nbsp;annual base salary of no
less than $400,000, subject to periodic review and adjustment in the discretion of the Board of
Directors of the Company (the &#147;Board&#148;) or the Compensation Committee of the Board; (b)
participation in any annual bonus plans maintained by the Company for its senior executives with a
target amount for such bonus to be 75% of Mr.&nbsp;Cairnes&#146;s base salary; (c)&nbsp;participation in any
equity-based compensation plans maintained by the Company for its senior executives at the
discretion of the Compensation Committee; and (d)&nbsp;participation in all employee benefit plans or
programs for which any member of the Company&#146;s senior management is eligible under any existing or
future Company plan or program.


<P align="left" style="font-size: 12pt">The Company may terminate Mr.&nbsp;Cairnes&#146;s employment hereunder at any time either for any or no
reason, and Mr.&nbsp;Cairnes may terminate his employment hereunder for Good Reason or upon thirty days&#146;
advance notice without Good Reason. The term &#147;Good Reason&#148; is defined in the Employment Agreement
to mean the occurrence of any of the following: (i)&nbsp;the assignment to Mr.&nbsp;Cairnes of any duties
inconsistent with Mr.&nbsp;Cairnes&#146;s position, authority, duties or responsibilities, or any other
action by the Company which results in a material diminution in such position, authority, duties or
responsibilities; (ii)&nbsp;a reduction by the Company in Mr.&nbsp;Cairnes&#146;s annual salary, provided that if
the salaries of substantially all of the Company&#146;s senior executive officers (including the
Company&#146;s President and CEO) are contemporaneously and proportionately reduced, a reduction in Mr.
Cairnes&#146;s salary will not constitute &#147;Good Reason&#148; hereunder; (iii)&nbsp;the failure by the Company,
without Mr.&nbsp;Cairnes&#146;s consent, to pay to him any portion of his current compensation, except
pursuant to a compensation deferral elected by Mr.&nbsp;Cairnes, other than an isolated and inadvertent
failure which is remedied by the Company promptly after receipt thereof given by Mr.&nbsp;Cairnes; (iv)
the relocation of the Company&#146;s principal executive offices to a location more than 35 miles from
the current location of such offices, or the Company&#146;s requiring Mr.&nbsp;Cairnes to be based anywhere
other than the Company&#146;s principal executive offices, except for required travel on the Company&#146;s
business; or (v)&nbsp;the failure of the Company to obtain a satisfactory agreement from any successor
to assume and agree to perform this Agreement.


<P align="left" style="font-size: 12pt">If the Company terminates Mr.&nbsp;Cairnes&#146;s employment without Cause or if Mr.&nbsp;Cairnes resigns for Good
Reason, the Company shall pay Mr.&nbsp;Cairnes one times his Base Salary for the year in which such
termination shall occur in regular payroll cycles. The term &#147;Cause&#148; is defined in the Employment
Agreement to mean the occurrence of any of the following, as determined in good faith by the Board:
(i)&nbsp;alcohol abuse or use of controlled drugs (other than in accordance with a physician&#146;s
prescription) by Mr.&nbsp;Cairnes; (ii)&nbsp;illegal conduct or gross misconduct of Mr.&nbsp;Cairnes which is
materially and demonstrably injurious to the Company or its Affiliates including, without
limitation, fraud, embezzlement, theft or proven dishonesty; (iii)&nbsp;Mr.&nbsp;Cairnes&#146;s conviction of a
misdemeanor involving moral turpitude or a felony; (iv)&nbsp;Mr.&nbsp;Cairnes&#146;s entry of a guilty or nolo
contendere plea to a misdemeanor involving moral turpitude or a felony; (v)&nbsp;Mr.&nbsp;Cairnes&#146;s material
breach of any agreement with, or duty owed to, the Company; or (vi)&nbsp;Mr.&nbsp;Cairnes&#146;s failure, refusal
or inability to perform, in any material respect, his duties to the Company, which failure
continues for more than 15&nbsp;days after written notice thereof from the Company.


<P align="left" style="font-size: 12pt">The payment of any severance by the Company to Mr.&nbsp;Cairnes is conditioned upon the execution and
delivery by Mr.&nbsp;Cairnes of a release in the form of the release attached as an exhibit to the
Employment Agreement. If Mr.&nbsp;Cairnes&#146;s employment with the Company ceases for any reason
(including but not limited to termination (a)&nbsp;by the Company for Cause, (b)&nbsp;as a result of Mr.
Cairnes&#146;s death, (c)&nbsp;as a result of Mr.&nbsp;Cairnes&#146;s Disability or (d)&nbsp;by Mr.&nbsp;Cairnes without Good
Reason) other than as a result of the Company terminating him without Cause or by his resignation
for Good Reason, then the Company&#146;s obligation to Mr.&nbsp;Cairnes will be limited solely to the payment
of accrued and unpaid base salary through the date of such cessation.


<P align="left" style="font-size: 12pt">The Employment Agreement also contains a non-competition agreement from Mr.&nbsp;Cairnes by which he
agrees to not be employed by a list of companies identified in the Agreement for a period of 12
months from the date of his termination. The Company also has the option to extend the term of Mr.
Cairnes&#146;s non-competition agreement for up to an additional 12&nbsp;months by agreeing to pay him his
base salary in substantially equal monthly installments for the number of months that the Company
elects to extend the non-competition agreement as severance. The Employment Agreement also
contains other standard restrictive covenants such as confidentiality, works for hire and
non-solicitation.


<P align="left" style="font-size: 12pt">In addition to his base compensation, Mr.&nbsp;Cairnes will receive 12,000 stock options and 6,000
restricted stock units upon his joining the Company. Both equity awards will vest ratably over a
period of four years.


<P align="left" style="font-size: 12pt">There is no arrangement or understanding between Mr.&nbsp;Cairnes and any other person pursuant to which
Mr.&nbsp;Cairnes was selected as an officer. Mr.&nbsp;Cairnes is not a party to any transaction with any
related person required to be disclosed pursuant to Item 404(a) of Regulation&nbsp;S-K.


<P align="left" style="font-size: 12pt">The preceding description of the Employment Agreement is a summary of its material terms, does not
purport to be complete, and is qualified in its entirety by reference to the Employment Agreement,
a copy of which is being filed as Exhibit&nbsp;10.1 to this Current Report on Form 8-K and incorporated
herein by reference.


<P align="left" style="font-size: 12pt"><B>Item&nbsp;9.01 Financial Statements and Exhibits.</B>


<P align="left" style="font-size: 12pt">(d)&nbsp;Exhibits


<P align="left" style="font-size: 12pt">The following exhibits are furnished as part of this Report:


<P align="left" style="font-size: 12pt">10.1 Employment Agreement, effective November&nbsp;22, 2016, by and between Mike Cairnes and
Kirkland&#146;s, Inc.
<BR>
99.1 Press Release dated November&nbsp;22, 2016 announcing the appointment of Mike Cairnes as Executive
Vice President and Chief Operating Officer.



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	SIGNATURES
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	Pursuant to the requirements of the Securities Exchange Act of 1934, the
	registrant has duly caused this report to be signed on its behalf by the
	undersigned hereunto duly authorized.
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	Kirkland's, Inc.
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	November 22, 2016
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	By:
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	/s/ Carter R. Todd
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<I>
	Name: Carter R. Todd
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<I>
	Title: Vice President and General Counsel
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	Exhibit&nbsp;Index
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	Exhibit No.
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	Description
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	10.1
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	&nbsp;
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<FONT SIZE="2">
Employment Agreement, effective November 22, 2016, by and between Mike Cairnes and Kirkland's, Inc.
</FONT>
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	99.1
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	&nbsp;
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<FONT SIZE="2">
Press Release dated November 22, 2016 announcing the appointment of Mike Cairnes as Executive Vice President and Chief Operating Officer.
</FONT>
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<TYPE>EX-10.1
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<FILENAME>exhibit1.htm
<DESCRIPTION>EX-10.1
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<P align="center" style="font-size: 10pt"><FONT style="font-size: 12pt"><U>EMPLOYMENT AGREEMENT</U></FONT>



<P align="left" style="font-size: 12pt; text-indent: 4%">This EMPLOYMENT AGREEMENT (this &#147;<U>Agreement</U>&#148;) is entered into as of November&nbsp;22, 2016,
between Mike Cairnes (the &#147;<U>Executive</U>&#148;) and KIRKLAND&#146;S, INC., a Tennessee corporation with
principal offices in Nashville, Tennessee (the &#147;<U>Company</U>&#148;).


<P align="center" style="font-size: 12pt"><U>RECITALS</U>



<P align="left" style="font-size: 12pt; text-indent: 4%">WHEREAS, the Company desires to employ the Executive as its Executive Vice President and Chief
Operating Officer, and the Executive desires to serve in such capacity pursuant to the terms of
this Agreement;


<P align="left" style="font-size: 12pt; text-indent: 4%">NOW, THEREFORE, in consideration of the premises and the parties&#146; mutual covenants, it is
agreed:


<P align="left" style="font-size: 12pt; text-indent: 4%">1.&nbsp;<U>Definitions</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;&#147;<U>Affiliate</U>&#148; means any person or entity controlling, controlled by or under common
control with the Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;&#147;<U>Base Salary</U>&#148; means Executive&#146;s current annual base salary as defined in
<U>Section&nbsp;4(a)</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;&#147;<U>Board</U>&#148; means the Board of Directors of the Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;&#147;<U>Cause</U>&#148; means the occurrence of any of the following, as determined in good faith
by the Board: (i)&nbsp;alcohol abuse or use of controlled drugs (other than in accordance with a
physician&#146;s prescription) by Executive; (ii)&nbsp;illegal conduct or gross misconduct of Executive which
is materially and demonstrably injurious to the Company or its Affiliates including, without
limitation, fraud, embezzlement, theft or proven dishonesty; (iii)&nbsp;Executive&#146;s conviction of a
misdemeanor involving moral turpitude or a felony; (iv)&nbsp;Executive&#146;s entry of a guilty or
<U>nolo</U> <U>contendere</U> plea to a misdemeanor involving moral turpitude or a felony, (v)
Executive&#146;s material breach of any agreement with, or duty owed to, the Company or its Affiliates,
or (vi)&nbsp;Executive&#146;s failure, refusal or inability to perform, in any material respect, Executive&#146;s
duties to the Company or its Affiliates, which failure continues for more than fifteen (15)&nbsp;days
after written notice thereof from the Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(e)&nbsp;&#147;<U>Code</U>&#148; shall mean the Internal Revenue Code of 1986, as amended from time to time.


<P align="left" style="font-size: 12pt; text-indent: 8%">(f)&nbsp;&#147;<U>Committee</U>&#148; means the Compensation Committee of the Board of Directors.


<P align="left" style="font-size: 12pt; text-indent: 8%">(g)&nbsp;&#147;<U>Confidential Information</U>&#148; means all information respecting the business and
activities of the Company, or any Affiliate, including, without limitation, the terms and
provisions of this Agreement, information relating to vendor relations, inventory procurement and
management, inventory distribution, marketing and sales, store operations, the clients, customers,
suppliers, employees, consultants, computer or other files, projects, products, computer disks or
other media, computer hardware or computer software programs, marketing plans, financial
information, methodologies, know-how, processes, practices, approaches, projections, forecasts,
formats, systems, data gathering methods and/or strategies of the Company or any Affiliate.
Notwithstanding the immediately preceding sentence, Confidential Information shall not include any
information that is, or becomes, generally available to the public (unless such availability occurs
as a result of Executive&#146;s breach of any portion of <U>Section&nbsp;7(a)</U> of this Agreement).


<P align="left" style="font-size: 12pt; text-indent: 8%">(h)&nbsp;&#147;<U>Disability</U>&#148; means Executive&#146;s termination of employment with the Company as a
result of Executive&#146;s incapacity due to reasonably documented physical or mental illness that is
reasonably expected to prevent Executive from performing Executive&#146;s duties for the Company on a
full-time basis for more than six consecutive months; <U>provided however</U>, that no such
incapacity will be deemed to be a &#147;Disability&#148; unless Executive would also be deemed to be
&#147;Disabled&#148; under Code Section&nbsp;409A.


<P align="left" style="font-size: 12pt; text-indent: 8%">(i)&nbsp;&#147;<U>Good Reason</U>&#148; means the occurrence of any of the following: (i)&nbsp;the assignment to
Executive of any duties inconsistent with Executive&#146;s position, authority, duties or
responsibilities, or any other action by the Company which results in a material diminution in such
position, authority, duties or responsibilities; (ii)&nbsp;a reduction by the Company in Executive&#146;s
annual salary, provided that if the salaries of substantially all of the Company&#146;s senior executive
officers (including the Company&#146;s President and CEO) are contemporaneously and proportionately
reduced, a reduction in Executive&#146;s salary will not constitute &#147;Good Reason&#148; hereunder; (iii)&nbsp;the
failure by the Company, without Executive&#146;s consent, to pay to him any portion of his current
compensation, except pursuant to a compensation deferral elected by Executive, other than an
isolated and inadvertent failure which is remedied by the Company promptly after receipt thereof
given by Executive; (iv)&nbsp;the relocation of the Company&#146;s principal executive offices to a location
more than 35 miles from the location of such offices on the Effective Date, or the Company&#146;s
requiring Executive to be based anywhere other than the Company&#146;s principal executive offices,
except for required travel on the Company&#146;s business; or (v)&nbsp;the failure of the Company to obtain a
satisfactory agreement from any successor to assume and agree to perform this Agreement.


<P align="left" style="font-size: 12pt">Notwithstanding the foregoing, Good Reason shall not be deemed to exist unless Executive gives the
Company written notice within ninety (90)&nbsp;days after the occurrence of the event which Executive
believes constitutes the basis for Good Reason, specifying the particular act or failure to act
which Executive believes constitutes the basis for Good Reason. If the Company fails to cure such
act or failure to act, within thirty (30)&nbsp;days after receipt of such notice, Executive may
terminate employment for Good Reason within thirty (30)&nbsp;days following the end of that cure period.
For the avoidance of doubt, if such act is not curable, Executive may terminate employment for
Good Reason upon providing such notice.


<P align="left" style="font-size: 12pt; text-indent: 8%">(j)&nbsp;&#147;<U>Invention</U>&#148; means any invention, discovery, improvement or innovation with regard
to any facet of the business of the Company or its Affiliates, whether or not patentable, made,
conceived, or first actually reduced to practice by Executive, alone or jointly with others, in the
course of, in connection with, or as a result of service as an employee of the Company or any of
its Affiliates, including any art, method, process, machine, manufacture, design or composition of
matter, or any improvement thereof. Each Invention shall be the sole and exclusive property of the
Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(k)&nbsp;&#147;<U>Restricted Non-Competition Period</U>&#148; means, subject to the Company&#146;s ability to
extend the Restricted Non-Competition Period as described in <U>Section&nbsp;8(d)</U> below, twelve
(12)&nbsp;months after any termination of Executive&#146;s employment hereunder, provided that the Restricted
Non-Competition Period shall be extended for the period, if any, that Executive is in default under
the restrictions contained in <U>Section&nbsp;7(d)</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(l)&nbsp;<U>&#147;Restricted Non-Solicitation Period</U>&#148; means twenty-four (24)&nbsp;months after any
termination of Executive&#146;s employment hereunder, provided that the Restricted Non-Solicitation
Period shall be extended for the period, if any, that Executive is in default under the
restrictions contained in <U>Section&nbsp;7(e)</U>.


<P align="left" style="font-size: 12pt; text-indent: 4%">2.&nbsp;<U>Employment; Scope of Duties</U>. The Company hereby employs Executive, and Executive
accepts employment as the Company&#146;s Executive Vice President and Chief Operating Officer. During
the term of this Agreement, Executive shall report to the Company&#146;s President and Chief Executive
Officer, and shall perform those duties as from time to time assigned.


<P align="left" style="font-size: 12pt; text-indent: 4%">3.&nbsp;<U>Term</U>. The term of this Agreement will commence on November&nbsp;28, 2016 (the
&#147;<U>Effective Date</U>&#148;), and shall continue until terminated as provided herein.


<P align="left" style="font-size: 12pt; text-indent: 4%">4.&nbsp;<U>Compensation and Benefits</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Base Salary</U>. As base compensation for the services rendered hereunder to the
Company, Executive shall be paid an annual base salary of $400,000, payable in accordance with the
Company&#146;s standard payroll practices as in effect from time to time. The Committee will review
Executive&#146;s base salary on an annual basis and such base salary shall be subject to upward (but not
downward) adjustment, as determined in the discretion of the Committee.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Annual Bonus</U>. For each fiscal year ending during Executive&#146;s employment,
Executive will be eligible to earn an annual bonus. The target amount of that bonus will be 75%
percent of Executive&#146;s Base Salary for the applicable fiscal year. The actual bonus payable with
respect to a particular year will be determined by the Committee, based on the achievement of
corporate and individual performance objectives established by the Committee. Any bonus payable
under this paragraph will be paid within 2 <FONT style="font-size: 75%">1/2</FONT> months following the end of the applicable fiscal year
and will only be paid if Executive remains continuously employed by the Company through the actual
bonus payment date.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Equity Incentives</U>. Equity incentives may be granted to Executive from time to
time pursuant to the terms and conditions of the Plan, at the discretion of the Committee.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;<U>Benefit Plans</U>. Executive shall be eligible to participate in and be covered on
the same basis as other senior management of the Company, under all employee benefit plans and
programs maintained by the Company, including without limitation retirement, health insurance and
life insurance.


<P align="left" style="font-size: 12pt; text-indent: 8%">(e)&nbsp;<U>Paid Time Off</U>. Executive will be entitled to paid time off each year in
accordance with the policies of the Company, as in effect from time to time.


<P align="left" style="font-size: 12pt; text-indent: 4%">5.&nbsp;<U>Expense Reimbursement</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Standard Business Expenses</U>. Executive shall be reimbursed for those reasonable
expenses (as determined by the Company in accordance with then existing policies) necessarily
incurred by Executive in the performance of the duties herein as are specifically approved by the
Company and as verified by vouchers, receipts, or other evidence of expenditure and business
necessity as from time to time required by the Company. All reimbursements provided under this
Agreement shall be made or provided in accordance with the requirements of Code Section&nbsp;409A to the
extent that such reimbursements are subject to Code Section&nbsp;409A, including, where applicable, the
requirements that (i)&nbsp;the amount of expenses eligible for reimbursement during a calendar year may
not affect the expenses eligible for reimbursement in any other calendar year, (ii)&nbsp;the
reimbursement of an eligible expense will be made on or before the last day of the calendar year
following the year in which the expense is incurred and (iii)&nbsp;the right to reimbursement is not
subject to set off or liquidation or exchange for any other benefit.


<P align="left" style="font-size: 12pt; text-indent: 4%">6.&nbsp;<U>Other Employment; Conduct</U>. Executive agrees to devote all working time and efforts
to performing the duties required hereunder. Executive shall not engage in other employment or
become involved in other business ventures requiring Executive&#146;s time, absent the prior written
consent of the Chief Executive Officer, which consent may be withheld or denied in the sole
discretion of the Chief Executive Officer. Executive shall at all times conduct such duties and
Executive&#146;s personal affairs in a manner that is satisfactory to the Company and so as to not in
any manner injure the reputation of or unfavorably reflect upon the Company or third persons or
entities connected therewith.


<P align="left" style="font-size: 12pt; text-indent: 4%">7.&nbsp;<U>Restrictive Covenants</U>. To induce the Company to enter into this Agreement and in
recognition of the compensation to be paid to Executive pursuant to this Agreement, Executive
agrees to be bound by the provisions of this <U>Section&nbsp;7</U> (the &#147;<U>Restrictive
Covenants</U>&#148;). These Restrictive Covenants will apply without regard to whether any termination
or cessation of Executive&#146;s employment is initiated by the Company or Executive, and without regard
to the reason for that termination or cessation. All provisions of this <U>Section&nbsp;7 </U>shall
survive the termination of this Agreement.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Confidentiality</U>. Executive shall not, during the term of this Agreement and at
any time thereafter, without the prior express written consent of the Company, directly or
indirectly divulge, disclose or make available or accessible any Confidential Information to any
person, firm, partnership, corporation, trust or any other entity or third party (other than when
required to do so in good faith to perform Executive&#146;s duties and responsibilities or when required
to do so by a lawful order of a court of competent jurisdiction, any governmental authority or
agency, or any recognized subpoena power). In addition, Executive shall not create any derivative
work or other product based on or resulting from any Confidential Information (except in the good
faith performance of his duties under this Agreement). Executive shall also proffer to the Board&#146;s
designee, no later than the effective date of any termination of Executive&#146;s employment with the
Company for any reason, and without retaining any copies, notes or excerpts thereof, all memoranda,
computer disks or other media, computer programs, diaries, notes, records, data, customer or client
lists, marketing plans and strategies, and any other documents consisting of or containing
Confidential Information that are in Executive&#146;s actual or constructive possession or which are
subject to his control at such time.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Ownership of Inventions.</U> Each Invention made, conceived or first actually reduced
to practice by Executive, whether alone or jointly with others, during the term of this Agreement
and each Invention made, conceived or first actually reduced to practice by Executive, within one
year after the termination of this Agreement, which relates in any way to work performed for the
Company or its Affiliates during the term of this Agreement, shall be promptly disclosed in writing
to the Board. Such report shall be sufficiently complete in technical detail and appropriately
illustrated by sketch or diagram to convey to one skilled in the art of which the invention
pertains, a clear understanding of the nature, purpose, operations, and, to the extent known, the
physical, chemical, biological or other characteristics of the Invention. Executive agrees to
execute an assignment to the Company or its nominee of Executive&#146;s entire right, title and interest
in and to any Invention, without compensation beyond that provided in this Agreement. Executive
further agrees, upon the request of the Company and at its expense, that Executive will execute any
other instrument and document necessary or desirable in applying for and obtaining patents in the
United States and in any foreign country with respect to any Invention. Executive further agrees,
whether or not Executive is then an employee of the Company, to cooperate to the extent and in the
manner reasonably requested by the Company in the prosecution or defense of any claim involving a
patent covering any Invention or any litigation or other claim or proceeding involving any
Invention covered by this Agreement, but all expenses thereof shall be paid by the Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Works for Hire</U>. Executive also acknowledges and agrees that all works of
authorship, in any format or medium, created wholly or in part by Executive, whether alone or
jointly with others, in the course of performing Executive&#146;s duties for the Company or any of its
Affiliates, or while using the facilities or money of the Company or any of its Affiliates, whether
or not during Executive&#146;s work hours, are works made for hire (&#147;<U>Works</U>&#148;), as defined under
United States copyright law, and that the Works (and all copyrights arising in the Works) are owned
exclusively by the Company. To the extent any such Works are not deemed to be works made for hire,
Executive agrees, without compensation beyond that provided in this Agreement, to execute an
assignment to the Company or its nominee of all right, title and interest in and to such Work,
including all rights of copyright arising in or related to the Works.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;<U>Restrictive Non-Competition Covenant</U>. Executive agrees that during the term of
this Agreement and for the Restricted Non-Competition Period, Executive will not, directly or
indirectly, own, manage, operate, control, be employed by, participate in, lend money, advise or
furnish services or information of any kind (including consulting services) to, be compensated in
any manner by, or be connected in any way with the management, ownership, operation or control of
any of the entities list on <U>Exhibit </U>A hereto. Executive understands and acknowledges that
the type of retail business conducted by the Company is national in scope. Executive further
acknowledges that these restrictions are reasonable and necessary to protect the legitimate
interests of the Company and its Affiliates and that the duration and geographic scope of these
restrictions are reasonable given the nature of this Agreement and the position Executive will hold
within the Company. Executive further acknowledges that these restrictions are included herein in
order to induce the Company to employ Executive pursuant to this Agreement and in connection with
the increased compensation and benefits provided hereunder and that the Company would not have
entered into this Agreement, increased Executive&#146;s compensation and other benefits or otherwise
employed Executive in the absence of these restrictions.


<P align="left" style="font-size: 12pt; text-indent: 4%">During the term of this Agreement and for the Restricted Non-Competition Period, Executive
agrees to (a)&nbsp;notify any prospective employer of the existence of this restrictive non-competition
covenant, and (b)&nbsp;notify the Company of Executive&#146;s commencement of employment with any other
employer, along with the identity of such new employer.


<P align="left" style="font-size: 12pt; text-indent: 8%">(e)&nbsp;<U>Restrictive Non-Solicitation Covenant</U>.


<P align="left" style="font-size: 12pt; text-indent: 12%">1.&nbsp;<U>Covenant Not to Solicit Company Employees</U>. During the term of this Agreement and
for the Restricted Non-Solicitation Period, Executive agrees that Executive shall not directly or
indirectly on Executive&#146;s own behalf or on behalf or any other employer solicit any present
employee of the Company to terminate their employment relationship with the Company.


<P align="left" style="font-size: 12pt; text-indent: 12%">2.&nbsp;<U>Covenant Not to Solicit Customers</U>. During the term of this Agreement and for the
Restricted Non-Solicitation Period, Executive shall not (except on the Company&#146;s behalf), directly
or indirectly, on Executive&#146;s own behalf or on behalf of any other person, firm, partnership,
corporation or other entity, contact, solicit, divert, induce, call on, take away, do business or
otherwise harm the Company&#146;s relationship, or attempt to contact, solicit, divert, induce, call on,
take away, do business or otherwise harm the Company&#146;s relationship, with any past, present or
prospective customer of the Company or any of its Affiliates (each, a &#147;<U>Customer</U>&#148;).
Following the term of this Agreement, a past or prospective Customer shall be limited to such
Customer measured within the two (2)&nbsp;year period prior to the date of termination hereunder.


<P align="left" style="font-size: 12pt; text-indent: 4%">8.&nbsp;<U>Termination</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Termination Rights</U>. The Company may terminate Executive&#146;s employment hereunder at
any time either for any or no reason, and Executive may terminate Executive&#146;s employment hereunder
for Good Reason or upon thirty (30)&nbsp;days advance notice without Good Reason. Upon any such
termination, Executive shall and shall be deemed to have immediately resigned from any and all
officer, director and other positions he then holds with the Company and its Affiliates (and this
Agreement shall act as notice of resignation by Executive without any further action required by
Executive). Upon any such termination, Executive shall be entitled only to such compensation and
benefits described in this <U>Section&nbsp;8</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Company Terminates Executive Without Cause or Executive Resigns For Good Reason</U>.
If the Company terminates Executive&#146;s employment without Cause or if Executive resigns for Good
Reason, the Company shall, subject to <U>Section&nbsp;8(e)</U> below, pay the Executive one (1)&nbsp;times
Executive&#146;s Base Salary for the year in which such termination shall occur in regular payroll
cycles.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Other Terminations</U>. If Executive&#146;s employment with the Company ceases for any
reason other than as described in <U>Section&nbsp;8(b)</U>, above (including but not limited to
termination (a)&nbsp;by the Company for Cause, (b)&nbsp;as a result of Executive&#146;s death, (c)&nbsp;as a result of
Executive&#146;s Disability or (d)&nbsp;by Executive without Good Reason), then the Company&#146;s obligation to
Executive will be limited solely to the payment of accrued and unpaid base salary through the date
of such cessation. All compensation and benefits will cease at the time of such cessation and,
except as otherwise provided by COBRA, the Company will have no further liability or obligation by
reason of such termination.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;<U>Extension of Restricted Non-Competition Period</U>. At any time during the sixty (60)
day period immediately following Executive&#146;s termination of employment hereunder for any reason,
the Company may elect to extend the Restricted Non-Competition Period for up to an additional
twelve (12)&nbsp;month period (or such lesser period, as determined in accordance with the Company&#146;s
election). In the event that the Company provides written notice to Executive that the Restricted
Non-Competition Period will be extended pursuant to this <U>Section&nbsp;8(d)</U>, in addition to any
amounts owed to executive under Section&nbsp;8(b), Executive will be entitled to receive his Base Salary
in substantially equal monthly installments for the number of months that the Company elects to
extend the applicable Restricted Non-Competition Period. Such payments will commence on the first
anniversary of Executive&#146;s termination of employment and continue monthly for the duration of any
such Restricted Non-Competition Period.


<P align="left" style="font-size: 12pt; text-indent: 8%">(e)&nbsp;<U>Severance Conditioned Upon Release</U>. Notwithstanding any other provision of this
Agreement, no amount will be paid or benefit provided under <U>Section&nbsp;8(b)</U> hereof unless
Executive executes and delivers to the Company a release substantially identical to that attached
hereto as <U>Exhibit&nbsp;B</U> (a &#147;<U>Release</U>&#148;) that becomes irrevocable within 30&nbsp;days following
Executive&#146;s separation from service. Subject to satisfaction of the foregoing Release requirement
and to any delay required by the next paragraph, the payments described in <U>Section&nbsp;8(b)</U>
above will commence on the 30<sup>th</sup> day following Executive&#146;s separation from service.
Notwithstanding any other provision of this Agreement, the Company&#146;s refusal to provide severance
benefits under <U>Section&nbsp;8(b)</U> due to Executive&#146;s failure or refusal to execute and deliver
the Release in accordance with this paragraph, or due to Executive&#146;s breach or purported revocation
of that Release, will not relieve Executive of any obligation under <U>Section&nbsp;7</U> of this
Agreement. Rather, in such a case, Executive&#146;s obligations under <U>Section&nbsp;7</U> will apply as
though such severance benefits had been provided.


<P align="left" style="font-size: 12pt; text-indent: 8%">(f)&nbsp;<U>Compliance with Code Section&nbsp;409A</U>. If the termination giving rise to the payments
described in <U>Section&nbsp;8(b)</U> is not a &#147;Separation from Service&#148; within the meaning of Treas.
Reg. &#167; 1.409A-1(h)(1) (or any successor provision), then the amounts otherwise payable pursuant to
that section will instead be deferred without interest and will not be paid until Executive
experiences a Separation from Service. In addition, to the extent compliance with the requirements
of Treas. Reg. &#167; 1.409A-3(i)(2) (or any successor provision) is necessary to avoid the application
of an additional tax under Code Section&nbsp;409A to payments due to Executive upon or following
Separation from Service, then notwithstanding any other provision of this Agreement (or any
otherwise applicable plan, policy, agreement or arrangement), any such payments that are otherwise
due within six months following Executive&#146;s Separation from Service (taking into account the
preceding sentence of this paragraph) will be deferred without interest and paid to Executive in a
lump sum immediately following that six month period. This paragraph should not be construed to
prevent the application of Treas. Reg. &#167; 1.409A-1(b)(9)(iii)(or any successor provision) to amounts
payable hereunder. For purposes of the application of Treas. Reg. &#167; 1.409A-1(b)(4)(or any
successor provision), each payment in a series of payments will be deemed a separate payment.


<P align="left" style="font-size: 12pt; text-indent: 8%">(g)&nbsp;<U>Compliance with Code Section&nbsp;280G</U>. If any payment or distribution by the Company
to or for the benefit of Executive, whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise pursuant to or by reason of any other
agreement, policy, plan, program or arrangement or the lapse or termination of any restriction on
or the vesting or exercisability of any payment or benefit (each a &#147;<U>Payment</U>&#148;), would be
subject to the excise tax imposed by Section&nbsp;4999 of the Code (or any successor provision thereto)
or to any similar tax imposed by state or local law (such tax or taxes are hereafter collectively
referred to as the &#147;<U>Excise Tax</U>&#148;), then the aggregate amount of Payments payable to
Executive shall be reduced to the aggregate amount of Payments that may be made to Executive
without incurring an excise tax (the &#147;<U>Safe-Harbor Amount</U>&#148;) in accordance with the
immediately following sentence; provided that such reduction shall only be imposed if the aggregate
after-tax value of the Payments retained by Executive (after giving effect to such reduction) is
equal to or greater than the aggregate after-tax value (after giving effect to the Excise Tax) of
the Payments to Executive without any such reduction. Any such reduction shall be made in the
following order: (i)&nbsp;first, any future cash payments (if any) shall be reduced (if necessary, to
zero); (ii)&nbsp;second, any current cash payments shall be reduced (if necessary, to zero); (iii)
third, all non-cash payments (other than equity or equity derivative related payments) shall be
reduced (if necessary, to zero); and (iv)&nbsp;fourth, all equity or equity derivative payments shall be
reduced.


<P align="left" style="font-size: 12pt; text-indent: 4%">9.&nbsp;<U>Injunctive Relief</U>. Executive understands and agrees that any breach by Executive
of the Restrictive Covenants will cause continuing and irreparable injury to the Company for which
monetary damages would not be an adequate remedy. Executive shall not, in any action or proceeding
to enforce any of the provisions of this Agreement, assert the claim or defense that such an
adequate remedy at law exists. In the event of such breach by Executive, the Company shall have
the right to enforce the Restrictive Covenants by seeking injunctive or other relief in any court
and this Agreement shall not in any way limit remedies of law or in equity otherwise available to
the Company.


<P align="left" style="font-size: 12pt; text-indent: 4%">10.&nbsp;<U>Waiver of Breach</U>. Any waiver by the Company of a breach of any provision hereof
shall not operate as or constitute a waiver of any of the terms hereof with regard to any
subsequent breach.


<P align="left" style="font-size: 12pt; text-indent: 4%">11.&nbsp;<U>Assignment</U>. Neither this Agreement nor any rights or obligations hereunder may be
assigned except by the Company to a business entity which is a successor to the Company by merger,
stock exchange, consolidation, or other reorganization, or to an entity which results from a
purchase or sale or other transfer or transaction involving third parties, or except to an entity
owned or controlled by the principals of the Company. This Agreement (and all rights and benefits
hereunder) is for Executive&#146;s personal services and is, therefore, not assignable by Executive.


<P align="left" style="font-size: 12pt; text-indent: 4%">12.&nbsp;<U>Entire Agreement; Modification</U>. This Agreement is the entire agreement of the
parties with regard to Executive&#146;s employment and all other agreements and understandings, whether
written or oral, if prior hereto, are merged herein so that the provisions of any prior
agreement(s), including without limitation, the Original Agreement, are void and of no further
force and effect. This Agreement may not be modified except by a writing signed by both parties.


<P align="left" style="font-size: 12pt; text-indent: 4%">13.&nbsp;<U>Applicable Law; Venue</U>. This Agreement shall be construed in accordance with the
laws of the State of Tennessee, without regard to the principles of conflicts of law, even if
Employee executed this Agreement outside Tennessee or Davidson County, Tennessee, and even if some
or all of Executive&#146;s services are to be rendered outside Tennessee. All legal disputes between
the parties shall have a venue in the courts of Davidson County, Tennessee.


<P align="left" style="font-size: 12pt; text-indent: 4%">14.&nbsp;<U>Notices</U>. Any notice or communication required or permitted under this Agreement
will be made in writing and (a)&nbsp;sent by overnight courier, (b)&nbsp;mailed by overnight U.S. express
mail, return receipt requested or (c)&nbsp;sent by telecopier. Any notice or communication to Executive
will be sent to the address contained in Executive&#146;s personnel file. Any notice or communication
to the Company will be sent to the Company&#146;s principal executive offices, to the attention of its
Vice President- Human Resources. Notwithstanding the foregoing, either party may change the
address for notices or communications hereunder by providing written notice to the other in the
manner specified in this paragraph.


<P align="left" style="font-size: 12pt; text-indent: 4%">15.&nbsp;<U>Provisions Severable</U>. Any provision hereof adjudged void or voidable by a court
of competent jurisdiction shall be deemed severable such that the remaining provisions are in full
force and effect. To the extent that any provision hereof is adjudged to be overly broad, then
such provision shall be deemed automatically replaced by a similar provision as near to the
original provision as possible but still enforceable.


<P align="left" style="font-size: 12pt; text-indent: 4%">16.&nbsp;<U>Section&nbsp;Headings</U>. The headings of sections and paragraphs of this Agreement are
inserted for convenience only and will not in any way affect the meaning or construction of any
provision of this Agreement.


<P align="left" style="font-size: 12pt; text-indent: 4%">17.&nbsp;<U>Parties Bound</U>. This Agreement shall bind the parties&#146; respective heirs, legal
representatives, successors and permitted assigns.


<P align="left" style="font-size: 12pt; text-indent: 4%">18.&nbsp;<U>Other Agreements</U>. Executive represents and warrants to the Company that there are
no restrictions, agreements or understandings whatsoever to which Executive is party (or by which
Executive is otherwise bound) that would prevent or make unlawful Executive&#146;s execution of this
Agreement or employment by the Company, or that would in any way prohibit, limit or impair (or
purport to prohibit, limit or impair) Executive&#146;s provision of services to the Company.


<P align="left" style="font-size: 12pt; text-indent: 4%">19.&nbsp;<U>Counterparts; Facsimile</U>. This Agreement may be executed in multiple counterparts
(including by facsimile signature), each of which will be deemed to be an original, but all of
which together will constitute but one and the same instrument. Counterparts may be delivered via
facsimile, electronic mail (including pdf) or other transmission method and any counterpart so
delivered shall be deemed to have been duly and validly delivered and be valid and effective for
all purposes.


<P align="center" style="font-size: 10pt; display: none; text-indent: 4%">1
<!-- PAGEBREAK -->

<P align="left" style="font-size: 12pt; text-indent: 4%">IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer, and Executive has executed this Agreement, in each case as of the date first
above written.

<DIV align="center">
<TABLE style="font-size: 11pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="54%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="46%">&nbsp;</TD>
</TR>
<TR style="font-size: 11pt" valign="bottom">
    <TD nowrap align="center"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left"><B>KIRKLAND&#146;S, INC.</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 11pt">
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By: /s/ Mike Madden</DIV></TD>
</TR>
<TR style="font-size: 1px">
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom" style="font-size: 11pt">
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Title: President and<BR>
CEO</DIV></TD>
</TR>
<TR style="font-size: 1px">
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom" style="font-size: 11pt">
    <TD align="left" valign="top"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>
</TD>
    <TD>&nbsp;</TD>
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>&nbsp;</B></DIV></TD>
</TR>
<TR valign="bottom" style="font-size: 11pt">
    <TD align="left" valign="top"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>
</TD>
    <TD>&nbsp;</TD>
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>MIKE CAIRNES</B></DIV></TD>
</TR>
<TR valign="bottom" style="font-size: 11pt">
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Mike Cairnes</DIV></TD>
</TR>
<TR style="font-size: 1px">
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 11pt"><FONT style="font-size: 12pt">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>

<P align="center" style="font-size: 12pt"><U>EXHIBIT A</U><BR>
<B>Entities Included in the Non-competition Provision</B>



<P align="left" style="font-size: 12pt; text-indent: 12%">1.&nbsp;Hobby Lobby


<P align="left" style="font-size: 12pt; text-indent: 12%">2.&nbsp;Bed Bath & Beyond


<P align="left" style="font-size: 12pt; text-indent: 12%">3.&nbsp;Tuesday Morning


<P align="left" style="font-size: 12pt; text-indent: 12%">4.&nbsp;TJMaxx


<P align="left" style="font-size: 12pt; text-indent: 12%">5.&nbsp;Target


<P align="left" style="font-size: 12pt; text-indent: 12%">6.&nbsp;Williams Sonoma


<P align="left" style="font-size: 12pt; text-indent: 12%">7.&nbsp;Restoration Hardware


<P align="left" style="font-size: 12pt; text-indent: 12%">8.&nbsp;Pier One


<P align="left" style="font-size: 12pt; text-indent: 12%">9.&nbsp;Wayfair


<P align="left" style="font-size: 12pt; text-indent: 12%">10.&nbsp;Etsy


<P align="left" style="font-size: 12pt; text-indent: 12%">11.&nbsp;Overstock


<P align="left" style="font-size: 12pt; text-indent: 12%">12.&nbsp;Michael&#146;s


<P align="left" style="font-size: 12pt; text-indent: 57%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="center" style="font-size: 12pt"><U>EXHIBIT B</U><BR>
<U>RELEASE AND NON-DISPARAGEMENT AGREEMENT</U>



<P align="left" style="font-size: 12pt; text-indent: 4%">THIS RELEASE AND NON-DISPARAGEMENT AGREEMENT (the &#147;<U>Release</U>&#148;) is made as of the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> day
of <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> by and between Mike Cairnes (&#147;<U>Executive</U>&#148;) and KIRKLAND&#146;S, INC. (the
&#147;<U>Company</U>&#148;).


<P align="left" style="font-size: 12pt; text-indent: 4%">WHEREAS, Executive&#146;s employment by the Company will terminate; and


<P align="left" style="font-size: 12pt; text-indent: 4%">WHEREAS, in connection with that termination and pursuant to <U>Section&nbsp;8(e)</U> of the
Employment Agreement by and between the Company and Executive dated as of November&nbsp;&nbsp;&nbsp;, 2016 (the
&#147;<U>Employment Agreement</U>&#148;), the Company has agreed to pay Executive certain amounts, subject
to the execution of this Release.


<P align="left" style="font-size: 12pt; text-indent: 4%">NOW THEREFORE, in consideration of these premises and the mutual promises contained herein,
and intending to be legally bound hereby, the parties agree as follows:


<P align="left" style="font-size: 12pt">SECTION 1. <U>Resignation</U>. Executive hereby resigns as an officer and employee of the
Company, and as an officer, employee director or board committee member of any subsidiary or
Affiliate of the Company, effective as of the date of this Release.


<P align="left" style="font-size: 12pt">SECTION 2. <U>Acknowledgements</U>. Executive acknowledges that: (a)&nbsp;the payments described in
<U>Section&nbsp;8(b)</U> of the Employment Agreement constitute full settlement of all Executive&#146;s
rights under the Employment Agreement, (b)&nbsp;Executive has no entitlement under any other severance
or similar arrangement maintained by the Company, and (c)&nbsp;except as otherwise provided specifically
in this Release, the Company does not and will not have any other liability or obligation to
Executive. Executive further acknowledges that, in the absence of Executive&#146;s execution of this
Release, Executive would not otherwise be entitled to the payments described in <U>Section
8(b)</U> of the Employment Agreement.


<P align="left" style="font-size: 12pt">SECTION 3. <U>Release and Covenant Not to Sue</U>.


<P align="left" style="font-size: 12pt; text-indent: 4%">(a)&nbsp;<U>Release</U>. Executive hereby fully and forever releases and discharges Company
(including, for purposes of this <U>Section&nbsp;3</U>, all predecessors and successors, subsidiaries,
Affiliates, assigns, officers, directors, trustees, employees, agents and attorneys, past and
present) from any and all claims, demands, liens, agreements, contracts, covenants, actions, suits,
causes of action, obligations, controversies, debts, costs, expenses, damages, judgments, orders
and liabilities, of whatever kind or nature, direct or indirect, in law, equity or otherwise,
whether known or unknown, arising out of Executive&#146;s employment by the Company or the termination
thereof, including, but not limited to, any claims for relief or causes of action under the Age
Discrimination in Employment Act, 29 U.S.C. &#167;&nbsp;621 <I>et seq</I>., or any other federal, state or local
statute, ordinance or regulation regarding discrimination in employment and any claims, demands or
actions based upon alleged wrongful or retaliatory discharge or breach of contract under any state
or federal law.


<P align="left" style="font-size: 12pt; text-indent: 4%">(b)&nbsp;<U>Covenant Not to Sue</U>. Executive expressly represents that Executive has not filed
a lawsuit or initiated any other administrative proceeding against the Company and that Executive
has not assigned any claim against the Company to any other person or entity. Executive further
promises not to initiate a lawsuit or to bring any other claim against the Company arising out of
or in any way relating to Executive&#146;s employment by the Company or the termination of that
employment. This Release will not prevent Executive from filing a charge with the Equal Employment
Opportunity Commission (or similar state agency) or participating in any investigation conducted by
the Equal Employment Opportunity Commission (or similar state agency); <I>provided, however</I>, that any
claims by Executive for personal relief in connection with such a charge or investigation (such as
reinstatement or monetary damages) will be barred.


<P align="left" style="font-size: 12pt; text-indent: 4%">(c)&nbsp;<U>Claims Not Released</U>. The forgoing will not be deemed to release the Company from
claims solely (i)&nbsp;to enforce this Release, (ii)&nbsp;to enforce <U>Section&nbsp;8(b)</U> of the Employment
Agreement, or (iii)&nbsp;for indemnification under the Company&#146;s By-Laws, under applicable law, under
any indemnification agreement between the Company and Executive or under any similar arrangement.


<P align="left" style="font-size: 12pt">SECTION 4. <U>Non-Competition and Confidentiality Obligations</U>. Executive acknowledges that
the Restrictive Covenants (as defined in the Employment Agreement) survive the termination of
Executive&#146;s employment. Executive affirms that the Restrictive Covenants are reasonable and
necessary to protect the legitimate interests of the Company, that Executive received adequate
consideration in exchange for agreeing to those restrictions, and that Executive will abide by
those restrictions.


<P align="left" style="font-size: 12pt">SECTION 5. <U>Non-Disparagement</U>. Executive will not disparage Company or any of its
directors, officers, agents or employees or otherwise take any action which could reasonably be
expected to adversely affect the personal or professional reputation of Company or any of its
directors, officers, agents or employees.


<P align="left" style="font-size: 12pt">SECTION 6. <U>Cooperation</U>. Executive further agrees to cooperate fully with the Company and
its counsel with respect to any matter (including litigation, investigations, or governmental
proceedings) that relates to matters with which Executive was involved during Executive&#146;s
employment with Company. Executive shall render such cooperation in a timely manner on reasonable
notice from the Company. The Company will (a)&nbsp;reimburse reasonable expenses incurred by Executive
in the course of fulfilling Executive&#146;s obligations under this paragraph and (b)&nbsp;will exercise
commercial reasonable efforts to schedule the time for Executive&#146;s cooperation so as to avoid
interfering with Executive&#146;s other personal and professional obligations.


<P align="left" style="font-size: 12pt">SECTION 7. <U>Rescission Right</U>. Executive expressly acknowledges and recites that (a)
Executive has read and understands this Release in its entirety, (b)&nbsp;Executive has entered into
this Release knowingly and voluntarily, without any duress or coercion; (c)&nbsp;Executive has been
advised orally and is hereby advised in writing to consult with an attorney with respect to this
Release before signing it; (d)&nbsp;Executive was provided twenty-one (21)&nbsp;calendar days after receipt
of the Release to consider its terms before signing it; and (e)&nbsp;Executive is provided seven (7)
calendar days from the date of signing to terminate and revoke this Release in which case this
Release shall be unenforceable, null and void. Executive may revoke this Release during those
seven (7)&nbsp;days by providing written notice of revocation to the Company, care of its Vice
President- Human Resources.


<P align="left" style="font-size: 12pt">SECTION 8. <U>Challenge</U>. If Executive violates or challenges the enforceability of this
Release, no further benefits under <U>Section&nbsp;8(b)</U> of the Employment Agreement will be paid or
provided to Executive.


<P align="left" style="font-size: 12pt">SECTION 9. <U>Miscellaneous</U>.


<P align="left" style="font-size: 12pt; text-indent: 4%">(a)&nbsp;<U>No Admission of Liability</U>. This Release is not to be construed as an admission of
any violation of any federal, state or local statute, ordinance or regulation or of any duty owed
by the Company to Executive. There have been no such violations, and the Company specifically
denies any such violations.


<P align="left" style="font-size: 12pt; text-indent: 4%">(b)&nbsp;<U>No Reinstatement</U>. Executive agrees to not apply for reinstatement with the
Company or seek in any way to be reinstated, re-employed or hired by the Company in the future.


<P align="left" style="font-size: 12pt; text-indent: 4%">(c)&nbsp;<U>Successors and Assigns</U>. This Release will inure to the benefit of and be binding
upon the Company and Executive and their respective successors, executors, administrators, heirs
and (in the case of the Company) permitted assigns. The Company may assign this Release to any
successor to all or substantially all of its assets and business by means of liquidation,
dissolution, merger, consolidation, transfer of assets, or otherwise. Executive may not make any
assignment of this Release or any interest herein.


<P align="left" style="font-size: 12pt; text-indent: 4%">(d)&nbsp;<U>Severability</U>. The provisions of this Release are severable. If any provision or
the scope of any provision is found to be unenforceable or is modified by a court of competent
jurisdiction, the other provisions or the affected provisions as so modified shall remain fully
valid and enforceable.


<P align="left" style="font-size: 12pt; text-indent: 4%">(e)&nbsp;<U>Entire Agreement; Amendments</U>. Except as otherwise provided herein, this Release
contains the entire agreement and understanding of the parties hereto relating to the subject
matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and
understandings of every nature relating subject matter hereof. This Release may not be changed or
modified, except by a Release in writing signed by each of the parties hereto.


<P align="left" style="font-size: 12pt; text-indent: 4%">(f)&nbsp;<U>Governing Law</U>. This Release shall be governed by, and enforced in accordance
with, the laws of the State of Tennessee, without regard to the application of the principles of
conflicts of laws.


<P align="left" style="font-size: 12pt; text-indent: 4%">(g)&nbsp;<U>Counterparts and Facsimiles</U>. This Release may be executed, including execution by
facsimile signature, in one or more counterparts, each of which shall be deemed an original, and
all of which together shall be deemed to be one and the same instrument. Counterparts may be
delivered via facsimile, electronic mail (including pdf) or other transmission method and any
counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and
effective for all purposes.


<P align="center" style="font-size: 12pt"><I>&#091;This space left blank intentionally; signature page follows.&#093;</I>




<P align="center" style="font-size: 10pt; display: none">2
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<P align="left" style="font-size: 12pt; text-indent: 58%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
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<P align="left" style="font-size: 12pt; text-indent: 4%">IN WITNESS WHEREOF, the Company has caused this Release to be executed by its duly authorized
officer, and Executive has executed this Release, in each case as of the date first above written.

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    <TD nowrap align="center"><B>&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left"><B>KIRKLAND&#146;S INC.</B></TD>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>MIKE CAIRNES</B></DIV></TD>
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<P align="center" style="font-size: 10pt"><FONT style="font-size: 12pt"><B>KIRKLAND&#146;S STRENGTHENS EXECUTIVE TEAM</B><BR>
<I>Adds New Chief Operating Officer and Planning and Allocation Veteran</I></FONT>



<P align="left" style="font-size: 12pt"><FONT style="font-size: 11pt">NASHVILLE, Tenn. (November&nbsp;22, 2016) &#151; Kirkland&#146;s, Inc. (NASDAQ: KIRK) is strengthening its
senior leadership team to support its ongoing strategy to transform Kirkland&#146;s into a
high-performing, nationally recognized home d&#233;cor brand of choice.
</FONT>

<P align="left" style="font-size: 11pt">Mike Cairnes has been named Executive Vice President and Chief Operating Officer, a new position,
effective November&nbsp;28, 2016. Mr.&nbsp;Cairnes brings 25&nbsp;years of experience in home d&#233;cor retailing and
manufacturing to Kirkland&#146;s and will focus on improving execution and consistency across the
organization. In his role as COO, Mr.&nbsp;Cairnes will be responsible for day-to-day operations,
overseeing Marketing/eCommerce, Merchandising, Planning & Allocation, Store and Supply Chain
operations. Mr.&nbsp;Cairnes was most recently with Michael&#146;s Stores, where he served concurrently as
President of its Aaron&#146;s Brothers retail business, since 2015, and President of its Artistree
framing business, since 2007. Prior to Michael&#146;s, Mr.&nbsp;Cairnes held senior leadership positions at
Brushstrokes, a publisher of art canvases, and Larson-Juhl, a manufacturer of home d&#233;cor products.
He also has served as a board and strategy advisor to Bain Capital and Blackstone.


<P align="left" style="font-size: 11pt">&#147;We&#146;re delighted to have Mike join the Kirkland&#146;s team,&#148; said Mike Madden, President and Chief
Executive Officer. &#147;He has an accomplished track record of operational excellence, driving
meaningful financial improvement and managing change across a wide range of retail and
manufacturing businesses. Mike&#146;s a great cultural fit and will play a key role in helping us shape
our vision and drive our strategic priorities.&#148;


<P align="left" style="font-size: 11pt">In addition, Sarah Hussey recently joined Kirkland&#146;s as Vice President of Planning and Allocation.
Prior to joining Kirkland&#146;s in the third quarter, Ms.&nbsp;Hussey worked in similar roles at Sports
Authority, since 2000, and held merchandising roles at both Macy&#146;s and Hess&#146;s Department Stores.


<P align="left" style="font-size: 11pt">&#147;These additions are an important step in our ongoing efforts to better position Kirkland&#146;s to
achieve our long-term growth objectives,&#148; continued Mr.&nbsp;Madden. &#147;While the industry faces
challenges, we believe we have a differentiated concept with a unique opportunity to grow sales and
profit as we improve our operational execution, expand our branding efforts and omni-channel
experience, and focus on new ways to better serve our customers.&#148;


<P align="left" style="font-size: 11pt"><I>About Kirkland&#146;s, Inc.</I>
<BR>
Kirkland&#146;s, Inc. was founded in 1966 and is a specialty retailer of home d&#233;cor in the United
States. Although originally focused in the Southeast, the Company has grown beyond that region and
currently operates 400 stores in 36 states.&nbsp; The Company&#146;s stores present a broad selection of
distinctive merchandise, including framed art, mirrors, candles, lamps, picture frames, accent
rugs, garden accessories and artificial floral products.&nbsp; The Company&#146;s stores also offer an
extensive assortment of gifts, as well as seasonal merchandise.&nbsp; More information can be found at
<U>www.kirklands.com</U>.


<P align="left" style="font-size: 11pt"><I>Forward-Looking Statements</I>
</FONT><BR>
<FONT style="font-size: 10.5pt"><I>Except for historical information contained herein, the statements in this release are
forward-looking and made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and
uncertainties, which may cause Kirkland&#146;s actual results to differ materially from forecasted
results. Those risks and uncertainties include, among other things, the competitive environment in
the home d&#233;cor industry in general and in Kirkland&#146;s specific market areas, inflation, fluctuations
in cost and availability of products, interruptions in supply chain and distribution systems, the
ability to control employment, and other operating costs, availability of suitable retail locations
and other growth opportunities, disruptions in information technology systems including the
potential for security breaches of Kirkland&#146;s or its customers&#146; information, seasonal fluctuations
in consumer spending, and economic conditions in general. Those and other risks are more fully
described in Kirkland&#146;s filings with the Securities and Exchange Commission, including the
Company&#146;s Annual Report on </I><I>Form 10-K</I><I> filed on April&nbsp;8, 2016. Kirkland&#146;s disclaims any obligation
to update any such factors or to publicly announce results of any revisions to any of the
forward-looking statements contained herein to reflect future events or developments.</I>
</FONT>


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