From Wizards Insider.
Thibodeau had been in the building for several days for meetings with Jordan and the coaching staff and was already in the process of outlining some new defensive schemes for the upcoming season. Jordan's carry-over assistants - Mike O'Koren, Phil Hubbard and Wes Unseld Jr. - signed one-year contract extensions on Friday. The contracts were offered on Thursday. I have no idea whether that situation had anything to do with Thibodeau's decision because I have not been able to reach the guy since he came on staff.
"He decided to have a change of heart," Jordan said, following today's workout. "He is going to back to Houston (where Thibodeau lives,not to the work for the Rockets) and he's going to pursue other options. He was here for four or five days, we came to some agreements and then we had a meeting with him this morning. We thought he was terrific here going through some things but he decided to go in another direction."
We probably shouldn't pass judgment until we hear more facts, but this really doesn't look good at all.