Exhibit 10.1

 

SETTLEMENT and RELEASE AGREEMENT

 

This Settlement and Release Agreement (“Agreement”), dated May 18, 2016, by and
between Lumber Liquidators Holdings, Inc. (“LL”) and Robert Martin Lynch
(“Employee”), states as follows:

 

RECITALS:

 

WHEREAS, Employee has been employed by the Company pursuant to the terms of an
Executive Employment Agreement dated December 17, 2010, and amendments thereto
(the “Executive Employment Agreement,” attached hereto as Exhibit A);

 

WHEREAS, the Employee’s employment with the Company has concluded;

 

WHEREAS certain disputes have arisen between LL and Employee concerning certain
of the terms and obligations provided for in the Executive Employment Agreement
and other matters; and

 

WHEREAS, Employee and Company desire to settle any and all matters arising out
of Employee’s employment with the Company, the cessation of Employee’s
employment with the Company, and any other disputes between them in a mutually
satisfactory manner.

 

NOW, THEREFORE, in consideration of the promises and of the mutual covenants
contained in the herein contained and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties do hereby
covenant and agree as follows:

 

AGREEMENT:

 

1.          Termination of Employment. Employee acknowledges that his employment
by LL and/or its affiliated entity(ies) (collectively and, where applicable,
individually, the “Company”) concluded on May 21, 2015 (the “Separation Date”).

 

2.          Separation Pay. In consideration of Employee’s acceptance of this
Agreement, and expressly subject to the Employee's ongoing compliance with the
Agreement, including but not limited to Sections 5 and 7-9 herein, the Company
shall:

 

i.            pay to Employee a sum totaling one-million dollars ($1,000,000)
(the “Separation Pay”). The Separation Pay shall be paid as follows:

 

- an initial lump sum payment constituting five hundred thousand dollars
($500,000) of the Separation Pay, less applicable taxes and withholdings, shall
be paid in the first regular pay period occurring after the Effective Date of
this Agreement; and

 

- the remaining half ($500,000) of the Separation Pay shall be paid in
twenty-six (26) equal weekly installments, pursuant to the Company’s normal
payroll procedures, beginning on the first regular pay period occurring after
the payment of the initial lump sum payment.

 

 

 

  

ii.         waive and release its right to collect payback or restitution for
payments made to Employee pursuant to the Relocation Assistance Agreement
between Company and Employee executed on or about February 5, 2014.

 

Employee agrees that, in the event that (a) the Company issues a restatement
which restatement is found by a final order of a competent court or governmental
agency to have been caused by Employee’s material noncompliance, due to
misconduct, with financial reporting requirements under federal securities laws
and, as a consequence of such restatement and finding, repayment or clawback of
the amounts herein are determined by a final order of a competent court or
governmental agency to be mandated pursuant to any law, government regulation or
stock exchange listing or (b) Employee breaches this Agreement, expressly
including but not limited to Sections 5 and 7-9 herein; then, in each such
instance, in addition to compensation for any damages incurred by the Company,
and/or any injunctive relief provided for herein or otherwise, Employee shall be
liable for the repayment of all amounts paid to Employee pursuant to this
Section 2, and Employee agrees to repay all such amounts in full.

 

3.           Consideration/Complete Payment. Employee hereby agrees and
acknowledges that the benefits set forth in Section 2 of this Agreement are more
than the Company is required to provide under its normal policies and
procedures, are more than Employee is entitled to under the Executive Employment
Agreement and any other agreement or contract with the Company, and that they
are in addition to anything of value to which Employee already is entitled.
Employee further agrees that, other than with respect to payments regarding the
non-released rights for monetary or other benefits described in Section 4 below
(the “Non-Released Rights”), the payments and performances described in this
Agreement are all that Employee shall be entitled to receive from the Company,
except for vested qualified retirement benefits, if any, to which Employee may
be entitled under the Company's ERISA plans. Except as expressly provided herein
(including with respect to the Non-Released Rights) or as required by law, the
Company shall not be required to make any payments of any kind to Employee.
Employee acknowledges that May 21, 2015 was his final date of employment, and
that any non-qualified stock options or shares of common stock, whether provided
for under Lumber Liquidators Holdings, Inc. Equity Compensation Plan or
otherwise, which did not vest as of May 21, 2015 are forever forfeited. Employee
further agrees and acknowledges that he shall have no right or claim to any
bonus payment from the Company including, but not limited to, any bonus under
the LL’s Annual Bonus Plan for Executive Management, nor any right or claim to
any additional severance payment under his Executive Employment Agreement or
otherwise. Notwithstanding the termination, expiration or nonrenewal of this
Agreement, the parties shall be required to carry out any provisions of this
Agreement that contemplate performance by them after such termination,
expiration or nonrenewal, expressly including Sections 5 and 7-9.

 

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4.          General Release. Other than with respect to the Non-Released Rights
set out below, Employee hereby knowingly and voluntarily releases and forever
discharges the Company, any related companies, and the former and current
employees, officers, agents, directors, shareholders, investors, attorneys,
affiliates, successors and assigns of any of them (the “Released Parties”) from
all liabilities, claims, demands, rights of action or causes of action Employee
had, has or may have against any of the Released Parties, including but not
limited to, any claims or demands based upon or relating to Employee’s
employment with the Company, the Executive Employment Agreement, or the
cessation of Employee’s employment with the Company. This complete release
includes, but is not limited to, a release of any rights or claims Employee may
have under the Age Discrimination in Employment Act of 1967, Title VII of the
Civil Rights Act of 1964, the Equal Pay Act, the Americans with Disabilities
Act, the Family and Medical Leave Act, or any other federal, state or local laws
or regulations prohibiting employment discrimination. This also includes, but is
not limited to, a release by Employee of any claims for wrongful discharge,
breach of contract, defamation, or any other statutory, common law, tort,
contract, or negligence claim that Employee had, has or may have against any of
the Released Parties. This release covers both claims that Employee knows about
and those claims Employee may not know about. Employee further acknowledges that
Employee has received compensation for all hours worked in accordance with
applicable state and federal laws.

 

Notwithstanding the above, this release does not include a release of (i)
Employee’s right, if any, to payment of vested qualified retirement benefits
under the Company’s ERISA plans; (ii) Employee’s right, if any, to benefits
under the Company’s health, dental and vision insurance plans that arose or
vested on or before the Separation Date; (iii) the right, if any, to
continuation in the Company’s medical plans as provided by COBRA; (iv)
Employee’s right, if any, to indemnification and/or advancement of expenses
(including attorney’s fees) in accordance with any applicable Company Bylaws or
the DGLC; (v) Employee’s right, if any, to coverage under directors’ and
officers’ liability insurance policy or policies of the Company and its
subsidiaries and affiliates; or (vi) Employee’s rights under this Agreement.
Nothing in this Section 4, nor any other provision of this Agreement, waives or
affects Employee’s right to file a charge of discrimination with the Equal
Employment Opportunity Commission (“EEOC”) or to provide information to, or
participate as a witness in, an investigation undertaken or a proceeding
initiated by the EEOC. However, Employee waives Employee’s right to monetary or
other recovery, including attorney’s fees, should Employee or any federal, state
or local administrative agency pursue any EEOC claims on Employee’s behalf
arising out of Employee’s employment or the conclusion of his employment with
the Company.

 

Notwithstanding the foregoing, the parties agree that nothing in this Agreement
shall be construed to prohibit the exercise of any rights by either party that
such party may not waive as a matter of law.

 

5.          No Future Lawsuits. To the fullest extent allowed by law, Employee
promises never to file a lawsuit asserting any claims that are released in
Section 4. In the event Employee breaches this Section 5, Employee shall pay to
the Company all of its expenses incurred as a result of such breach, including
but not limited to, reasonable attorney’s fees and expenses. Notwithstanding the
foregoing, this Agreement does not waive or release any rights or claims that
Employee may have under the Age Discrimination in Employment Act which arise
after the date that Employee signs this Agreement. Further, the parties
acknowledge and agree that this Agreement and this Section 5 shall not be
construed to prohibit the exercise of any rights by Employee that Employee may
not waive or forego as a matter of law.

 

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6.          Disclaimer of Liability. This Agreement and the payments and
performances hereunder are made solely to assist Employee in making the
transition from employment with Company, and are not and shall not be construed
to be an admission of liability, an admission of the truth of any fact, or a
declaration against interest on the part of Company.

 

7.          Confidentiality. Employee shall not disclose or use at any time for
a period of ten (10) years after the Separation Date, or as otherwise protected
by applicable law including the Virginia Uniform Trade Secrets Act, whichever is
longer, any Confidential Information (as defined below) of which Employee is
aware, whether or not such information was developed by him, except to the
extent that such disclosure or use is directly related to and required by this
Agreement or is required to be disclosed by law, court order, or similar
compulsion or (ii) as is necessary for Employee to defend himself in any
matters, lawsuits, investigation and inquiries arising out of his employment as
an officer of the Company or his position as a director on the Company’s Board
of Directors (“Relevant Claims”); provided, however, that such disclosure shall
be limited to the extent so required or compelled; and provided, further, that
Employee shall give the Company notice of such disclosure and cooperate with the
Company in seeking suitable protection. Employee shall take reasonable and
appropriate steps to safeguard Confidential Information and to protect it
against disclosure, misuse, espionage, loss and theft. Employee acknowledges and
agrees that all Confidential Information, which Employee had access to, received
or generated in the course of providing, directly or indirectly, services to the
Company, is the sole property of the Company and shall be returned to the
Company at the conclusion of all proceedings relating to Relevant Claims.
Employee will allow the Company access all memoranda, notes, plans, records,
reports, computer tapes and software and other documents and data (and copies
thereof regardless of the form thereof, including electronic and tangible
copies) that constitute Confidential Information (as defined below) of the
Company which Employee possesses or has under his control and provide copies to
the Company of any such Confidential Information as the Company requests;
provided that, while Employee will – consistent with Section 9 below – work
cooperatively with the Company with respect to Relevant Claims and share
materials and information Employee and his counsel have generated as Employee
and his counsel deem appropriate, nothing in this Agreement (including in
Sections 7 and 9) shall require Employee or his counsel to share any such
material or information with the Company to the extent it is covered by
attorney-client or other privileges belonging to Employee or is attorney work
product of his counsel. Notwithstanding anything herein to the contrary,
Employee may retain personal papers relating to his employment, compensation and
benefits.

 

As used in this Agreement, the term “Confidential Information” means any data or
information related to the Company’s business operations and is not generally
known by the public, and that was made known to Employee or acquired by Employee
in the course of his employment with the Company or directly or indirectly
providing services to the Company, including business and trade secrets and the
following: (i) reports, pricing, sales manuals and training manuals, selling,
purchasing, and pricing procedures, and financing methods of the Company,
together with any proprietary techniques utilized by the Company in designing,
developing, testing or marketing its products, product mix and supplier
information or in performing services for clients, customers and accounts of the
Company; (ii) the business plans and financial statements, reports and
projections of the Company; (iii) research or development projects or results;
(iv) identities and addresses of consultants, customers or clients and
prospective clients, or any other Confidential Information relating to or
dealing with the business operations or activities of the Company; (v) trade
secrets and other intellectual property of the Company; and (vi) existing or
contemplated software, products, databases, services, technology, designs,
processes and research or product developments of the Company. Notwithstanding
the foregoing or any other provision herein, Confidential Information shall not
include any information that (A) is generally known to the public at the time of
disclosure or becomes generally known through no wrongful act on the part of
Employee, (B) becomes known to Employee through disclosure by independent
third-party sources having a legal right to disclose such information, or (C) is
independently developed by Employee without reference to Confidential
Information.

 

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Nothing in this Section 7 or in any other provision of this Agreement prohibits
Employee or Company from reporting possible violations of federal law or
regulation to any governmental agency or entity, including but not limited to
the Department of Justice, the Securities and Exchange Commission, the Congress,
and any agency Inspector General, or making other disclosures that are protected
under the whistleblower provisions of federal or state law or regulation.
Employee does not need the prior authorization of the Company to make any such
reports or disclosures and Employee is not required to notify the Company that
he has made such reports or disclosures.

 

8.          Restrictive Covenants. Employee acknowledges that, in the course of
his employment with the Company, he has become familiar with the Company’s trade
secrets and other Confidential Information and that his services have been of
special, unique and extraordinary value to the Company. Therefore,
notwithstanding anything else in this agreement to the contrary, Employee hereby
covenants and agrees to abide by the terms and conditions of the restrictive
covenants contained in his Executive Employment Agreement, including, without
limitation, the restrictions and covenants contained in Article III of the
Executive Employment Agreement.

 

Employee understands that these restrictions will not limit his ability to earn
a livelihood and that he has received and will receive sufficient consideration
and other benefits as an employee of the Company and as otherwise provided
hereunder to clearly justify such restrictions (given his education, skills and
ability). Employee further understands that (i) the Company would not have
consummated this Agreement but for the covenants contained in this Section 8 and
(ii) the provisions of Sections 7 and 8 are reasonable and necessary to preserve
the business of the Company.

 

Employee shall inform any prospective employer of these restrictions during any
period when such restrictions remain effective and provide such employer with a
copy of such restrictions prior to the commencement of that employment.

 

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9.          Cooperation. Subject to the proviso in Section 7 regarding material
or information covered by attorney-client or other privileges belonging to
Employee or attorney work product of his counsel, Employee agrees that for a
period of ten (10) years following the Separation Date, Employee shall have a
continuing duty to fully and promptly cooperate with the Company and its legal
counsel by providing any and all requested information and assistance concerning
any legal or business matters that in any way relate to Employee’s actions or
responsibilities as an employee of the Company, or to the period during
Employee’s employment with the Company. Such cooperation shall include but not
be limited to truthfully and in a timely manner participating and consulting
concerning facts, responding to questions, providing pertinent information,
providing affidavits and statements, preparing for and attending depositions,
and preparing for and attending trials, hearings and other proceedings. Such
cooperation shall include meeting with representatives of the Company upon
reasonable notice at reasonable times and locations. The Company shall use its
reasonable efforts to coordinate with Employee the time and place at which
Employee's reasonable cooperation shall be provided with the goal of minimizing
the impact of such reasonable cooperation on any other material pre-scheduled
business commitment that Employee may have. The coordination and communication
from the Company to the Employee regarding Employee’s cooperation shall come
through the Company’s chief legal counsel or designee thereof. The Company shall
reimburse Employee for reasonable out-of-pocket expenses incurred by Employee in
compliance with this Section, including any reasonable travel expenses incurred
by Employee in providing such assistance. At no time subsequent to the
Separation Date shall Employee be deemed to be a contractor or employee of the
Company.

 

The Company agrees to provide Employee and his counsel with electronic copies of
documents in the Company’s possession and control that Employee needs to defend
himself regarding Relevant Claims, including, but not limited to, all documents
produced by the Company to either the Securities and Exchange Commission or the
Department of Justice.

 

The Company will provide Employee with a letter in the form attached as Exhibit
B.

 

10.         Enforcement. Employee agrees that the Company has a legitimate
business interest to protect justifying the covenants set forth in Sections 7-9.
Such legitimate business interests include: (i) trade secrets, (ii) valuable
Confidential Information that does not otherwise qualify as a trade secret,
(iii) substantial relationships with prospective or existing Customers, (iv)
Customer goodwill, and (v) preservation of the brands with which Employee has
operated. For purposes of the Company obtaining specific performance and/or
injunctive relief, Employee acknowledges that irreparable injuries shall be
presumed in the event that Employee violates his covenants herein contained.
Because the Employee’s services are unique and because the Employee has access
to Confidential Information, the parties hereto agree that money damages would
be an inadequate remedy for any breach of this Agreement. Therefore, in the
event of a breach or threatened breach of Sections 7-9 of this Agreement, the
Company and its successors or assigns may, in addition to other rights and
remedies existing in their favor under this Agreement, at law or in equity,
apply to any court of competent jurisdiction for specific performance and/or
injunctive or other relief in order to enforce, or prevent any violations of,
the provisions in Sections 7-9 hereof. In addition to the foregoing, if any
action should have to be brought by the Company against the Employee to enforce
the provisions of this Agreement, the Employee recognizes, acknowledges and
agrees that the Company may be entitled (without limitation) to (a) preliminary
and permanent injunctive relief restraining the Employee from unauthorized
disclosure or use of any trade secret or Confidential Information, in whole or
in part, or otherwise violating any of the restrictive covenants set forth
herein, and (b) actual damages. Nothing in this Agreement shall be construed as
prohibiting the Company from pursuing any other legal or equity remedies
available for breach or threatened breach to the provisions of this Agreement,
which may otherwise be available. In the event of an alleged breach or violation
by the Employee of Sections 7-9 of this Agreement, the parties agree that the
court, in its discretion, may toll the Restricted Period during the period of
the breach.

 

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11.         Claim for Reinstatement. Employee agrees to waive and abandon any
claim to reinstatement with Company.

 

12.         Period for Review and Consideration of Agreement. Employee
understands that Employee has been given a period of twenty one (21) days to
review and consider this Agreement before signing it. Employee further
understands that Employee may use as much of this 21-day period as Employee
wishes prior to signing.

 

13.         Employee’s Right to Revoke Agreement. Employee may revoke this
Agreement within seven (7) days of Employee’s signing it. Revocation can be made
by delivering a written notice of revocation to Sandra Whitehouse, Senior Vice
President, Human Resources, 3000 John Deere Road, Toano, Virginia 23168. For
this revocation to be effective, written notice must be received by Ms.
Whitehouse no later than the close of business on the seventh day after Employee
signs this Agreement. If Employee has not revoked the Agreement, the eighth
(8th) day after Employee signs this Agreement shall be the Effective Date for
purposes of this Agreement.

 

14.         Encouragement to Consult with Attorney. Employee is encouraged to
consult with an attorney before signing this Agreement.

 

15.         Execution of Documents. Each of the parties hereto shall execute any
and all further documents and perform any and all further acts reasonably
necessary or useful in carrying out the provisions of this Agreement.

 

16.         Invalid Provisions. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the validity or
enforceability of any other provisions hereof, and this Agreement shall be
construed in all respects as if such invalid or unenforceable provision were
omitted.

 

17.         Acknowledgment. Employee acknowledges that Employee has signed this
Agreement freely and voluntarily without duress of any kind. Employee has
conferred with an attorney or has knowingly and voluntarily chosen not to confer
with an attorney about the Agreement.

 

18.         Entire Agreement. This Agreement contains the entire understanding
of the parties concerning the separation benefits being provided to Employee
herein. This Agreement may not be modified or supplemented except by a
subsequent written agreement signed by all parties.

 

19.         Successorship. It is the intention of the parties that the
provisions hereof are binding upon, and inure to the benefit of, the parties,
their employees, affiliates, agents, heirs, estates, successors and assigns
forever.

 

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20.         Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Virginia, without regard to its conflict of laws principles.

 

21.         Arbitration of Disputes. Except as to a request for an injunction or
similar equitable relief as provided in Section 10, the parties agree that any
controversy or claim arising out of or relating to this Agreement, or the breach
thereof, shall be fully and finally settled by arbitration administered by Judge
Daniel Weinstein of JAMs, and a judgment on the award rendered by Judge
Weinstein may be entered in any court having jurisdiction thereof. The place of
arbitration shall be the City of New York, New York. Except as may be required
by law, neither a party nor an arbitrator may disclose the existence, content,
or results of any arbitration hereunder without the prior written consent of
both parties. Provided, however, that prior to initiating arbitration under this
section, the Parties agree to provide no fewer than thirty (30) days advance
notice to the other party and, during such notice period, the Parties agree to
engage in a good faith effort to resolve the applicable dispute(s) between them
in good faith negotiations.

 

EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE HAS READ THIS AGREEMENT, UNDERSTANDS IT, AND
IS VOLUNTARILY ENTERING INTO IT. PLEASE READ THIS AGREEMENT CAREFULLY. IT
CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties have freely and voluntarily executed this
Agreement in a manner so as to be binding on the dates stated below.

 

    EMPLOYEE       May 18, 2016   /s/ Robert Martin Lynch Date   Robert Martin
Lynch           LUMBER LIQUIDATORS HOLDINGS, INC.       May 18, 2016   By: /s/
John M. Presley Date         Its: President and CEO

 

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EXHIBIT A

 

EXECUTIVE EMPLOYMENT AGREEMENT

This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of
this 17th day of December, 2010, by and between Lumber Liquidators Holdings,
Inc. and Robert Martin Lynch (“Employee”). Hereinafter, Lumber Liquidators
Holdings, Inc. and its subsidiaries shall collectively be referred to as “Lumber
Liquidators” or the “Company”, unless the context otherwise requires.

WHEREAS, the Company is primarily engaged in the business of the production and
retail sale of hardwood, laminate, engineered, bamboo, cork and resilient
flooring and related products;

WHEREAS, the Company maintains its corporate headquarters in Toano, Virginia,
and operates retail locations throughout the United States and Canada;

WHEREAS, Employee has certain valuable experience and expertise in matters
related to the management of enterprises similar to the Company’s business; and

WHEREAS, the Company desires to employ Employee and Employee desires to be
employed by the Company under the terms and conditions set forth below.

NOW, THEREFORE, for and in consideration of the promises and undertakings of the
parties as hereinafter set forth, the parties covenant and agree as follows:

ARTICLE I

EMPLOYMENT

1.1. Employment.

(a) The Company will employ Employee in the position of President and Chief
Operating Officer and, in that position, Employee will report directly to the
Chief Executive Officer. The Company retains the right to make reasonable
changes in Employee’s duties and reporting relationships as may be determined by
the Company.

(b) This Agreement, and Employee’s employment hereunder, is conditioned upon
(i) Employee’s successful completion of a drug screen in compliance with state
and federal law and as more fully set forth in the Company’s policies,
(ii) Employee’s successful completion of a background screen, to be completed in
compliance with applicable state and federal law, and (iii) Employee’s ability
to satisfactorily comply with the I-9 requirements set forth by the Immigration
Reform and Control Act of 1986.

1.2. Term. Employee’s employment with the Company shall begin on January 17,
2011 (“Commencement Date”) and shall continue for a period of five (5) years
from such date, unless it is terminated earlier in accordance with Article II of
this Agreement. The term of this Agreement may be extended upon written
agreement by Employee and a designated representative of the Company’s Board of
Directors. Notwithstanding the termination of this Agreement for whatever
reason, the parties shall be required to carry out any provisions of this
Agreement which contemplate performance by them subsequent to such termination.

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1.3. Duties. In the position of President and Chief Operating Officer, Employee
will be a key employee of the Company and will be involved in the Company’s
strategic planning. In his executive capacity with the Company, Employee shall:

(a) Report to the Chief Executive Officer and/or the Board of Directors.

(b) Diligently perform the duties and exercise the powers and functions which
from time to time may reasonably be required of, assigned to, or vested in
Employee by the Company, the Chief Executive Officer and/or the Board of
Directors. The Company shall have the sole authority and discretion to set and
establish the reasonable work schedules, duties, and standards applicable to
Employee.

(c) Comply with all policies, standards and rules of the Company now or
hereafter promulgated.

(d) During working hours, devote the whole of Employee’s time, attention and
ability to Employee’s duties hereunder at such place or places as the Company
shall from time to time reasonably determine. It is expected that Employee will
relocate to the Williamsburg/Richmond, Virginia area

(e) Employee shall not, during the term hereof, directly or indirectly, engage
or associate with, or become employed with, as an employee, consultant, or
otherwise, any other business without the prior written approval of the Board of
Directors of the Company.

(f) Well and faithfully serve the Company to the best of Employee’s abilities,
and at all times use Employee’s best efforts to promote, develop, and extend the
interests of the Company.

1.4. Compensation.

(a) Base Salary. Employee shall receive an annual base salary of $500,000
payable to Employee in accordance with the Company’s normal payroll schedule.
The Company shall withhold state and federal income taxes, social security taxes
and shall make such other payroll deductions as may be required by law or
mutually agreed upon in writing by Employee and the Company. On or about March
2012, Employee’s base salary will increase to $550,000 per annum subject to
Employee’s satisfactory performance as determined by the Company.

(b) Signing Bonus. After Employee begins employment with the Company, the
Company shall pay to Employee a gross signing bonus of $60,000 as soon as
administratively possible. The Company shall withhold state and federal income
taxes, social security taxes and shall make such other payroll deductions as may
be required by law or mutually agreed upon in writing by Employee and the
Company.

 

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(c) Incentive Bonus Plan. Effective on the Commencement Date, Employee will be
eligible to participate in the Company’s Annual Bonus Plan for Executive
Management (the “Bonus Plan”). Under the terms of the Bonus Plan as approved by
the Compensation Committee of the Company’s Board of Directors (the
“Compensation Committee”), Employee will be eligible to receive a yearly bonus
in an amount up to 75% of Employee’s base salary. Of that target bonus amount,
75% will be based upon Lumber Liquidators’ performance as a company and the
remaining 25% will be based upon goals and objectives specific to Employee’s
position, each as defined by the Compensation Committee. The awarding (or
decision not to award) a bonus and the amount thereof is a decision left to the
sole discretion of Lumber Liquidators and the Compensation Committee. The Bonus
Plan is subject to amendment, modification or termination, with or without
notice, in the Company’s sole discretion. All compensation payments, bonus
payments, and benefits provided to Employee shall be subject to all applicable
withholding and deductions.

(d) Relocation Expenses. Employee’s relocation expenses shall be covered in
accordance with the Company’s Relocation Policy, a copy of which has been
provided to Employee.

(e) Benefits. Employee shall be entitled to participate in or become a
participant in any employee benefit plan and fringe benefits maintained by the
Company for which Employee is or will become eligible on such terms as the
Company, in its discretion, may uniformly establish, maintain, modify or
otherwise change for executive level employees. The uniformly applied benefits
plans and fringe benefits contemplated hereby may be amended, enlarged, or
diminished by the Company at any time in the Company’s discretion.

(f) Paid Time Off. Employee will be provided twenty (20) days of paid time off
(“PTO”) per year beginning on the Commencement Date. PTO includes sick and
vacation time but not holidays. Unused PTO will not be carried over to
subsequent years.

(g) Holidays. Lumber Liquidators observes six (6) scheduled holidays each year.
Those holidays currently are New Year’s Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, and Christmas Day. The holiday schedule is
established in advance of each year and is subject to change.

(h) Severance Payment and Separation Benefits. Should Employee’s employment be
involuntarily terminated by Company for any reason other than “for cause” (as
defined in Section 2.3(a)), Employee shall be entitled to the following:

 

  i.

One (1) year of Employee’s base salary payable in twelve (12) equal monthly
installments commencing on the 60th day following termination of employment; and

 

  ii.

If, after the date of the termination of Employee’s employment with the Company,
Employee elects to continue and maintains health, vision and dental insurance
through COBRA continuation coverage, Company agrees to pay to the Employee for a
period of twelve (12) months following the date of termination, an amount

 

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equal to the portion of the premium for such insurance that Company would have
paid had Employee maintained such insurance prior to the date of his
termination. Employee shall be responsible for paying the entire premium.

Employee acknowledges and understands that the amounts set forth in this
Section 1.4(h) are taxable income to Employee for which Employee is responsible.
To the extent required because Employee is a “specified employee” as determined
under Section 409A of the Internal Revenue Code of 1986, as amended, and
Treasury Regulations thereunder (“Section 409A”) as of the date of Employee’s
termination of employment, any payments or benefits provided under this
Section 1.4(h) shall commence on the first day of the month following the
six-month anniversary of Employee’s termination of employment, with installments
that would have been paid during such six-month delay included in the first
payment. The making of any severance payments or the providing of any benefits
as set forth in this Section 1.4(h) is strictly conditioned upon (a) the
Employee executing a release of the Company, its subsidiaries and affiliates,
its officers, directors and employees, and its and their respective successors
within the 60 day period commencing on Employee’s termination of employment and
(b) Employee’s continued compliance with the provisions of Article III.
“Termination of employment” under this Agreement shall be determined in a manner
consistent with the definition of separation from service under Section 409A.

1.5. Stock Options, Restricted Stock. In addition to the compensation described
in Section 1.4 above, the Board of Directors or a committee thereof shall grant
to Employee as of the Commencement Date the following stock options and stock
awards pursuant and subject to the terms, limitations and conditions of the
Lumber Liquidators Holdings, Inc. 2007 Equity Compensation Plan and agreements
that will be substantially similar to the forms of agreement used in connection
with prior grants of stock options and restricted stock awards to the Company’s
executive officers (except as specifically described below):

(a) A whole number of non-qualified stock options with a cumulative value of
approximately $4,400,000, subject to adjustment as set forth below, determined
by using the Black-Scholes-Merton method as of the Commencement Date (the
“Option Shares”). The Option Shares shall vest in accordance with the following
schedule:

 

Percentage of Option

Shares Exercisable

 

Vesting Date

20%

  First Anniversary of Commencement Date

20%

  Second Anniversary of Commencement Date

20%

  Third Anniversary of Commencement Date

20%

  Fourth Anniversary of Commencement Date

20%

  Fifth Anniversary of Commencement Date

 

4

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(b) A whole number of shares of common stock with a cumulative value of
approximately $330,000 as of the date of the Commencement Date (the “Stock
Shares”). The Stock Shares shall vest in accordance with the following schedule:

 

Percentage of Stock

Shares Exercisable

 

Vesting Date

33.3%

  Commencement Date

33.3%

  Six Months After Commencement Date

33.3%

  Twelve Months After Commencement Date

If Employee ceases to be employed by the Company for any reason, any of the
Option Shares or Stock Shares that are not yet vested will be forfeited. In
addition, the Lumber Liquidators Holdings, Inc. 2007 Equity Compensation Plan
limits the aggregate number of awards that may be granted to any one individual
during a plan year to awards covering no more than 400,000 shares of common
stock. In the event the aggregate number of stock options and stock awards to be
granted pursuant to this Section 1.5 would exceed this limitation, the number of
stock options granted pursuant to Section 1.5(a) will be reduced to the extent
necessary to comply with this limitation. Any such reduction will be made on a
pro rata basis such that the percentage of stock options vesting at a given time
is consistent with the percentages set forth above.

1.6. Reimbursement of Business Expenses. The Company shall reimburse Employee
for all normal and customary business expenses reasonably incurred during the
term of this Agreement by Employee in the proper performance of his duties under
this Agreement, consistent with written Company policy. With respect to
reimbursement, Employee shall comply with the Company’s policies regarding
documentation and submittal of expenses incurred.

1.7. Cessation of Compensation. Except as provided by Sections 2.3(b), 2.4(b)
and 2.4(c) of this Agreement, all compensation and benefits provided Employee
under this Agreement will stop on the date of the cessation of the Employee’s
employment hereunder, except where Employee is eligible for continuation of such
benefits as specified by federal laws or laws of the Commonwealth of Virginia,
including continuation of group health insurance benefits pursuant to the terms
of the Consolidated Omnibus Budget Reconciliation Act of 1986 (“COBRA”).

ARTICLE II

TERMINATION

2.1. Illness and Incapacity. If, during the term of Employee’s employment,
Employee is prevented, in the Company’s reasonable judgment, from effectively
performing any essential part of his duties under this Agreement for a period in
excess of 90 consecutive days (or more than 120 days during any period of 365
calendar days) by reason of illness, disability, or any other reason, the
Company, by written notice to Employee, may terminate Employee’s employment.
Upon delivery to Employee of such notice, Employee’s employment and all
obligations of the Company

 

5

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under Article I will terminate, other than with respect to Employee’s
entitlement to (a) any earned but unpaid salary and accrued but unused PTO, and
(b) any benefits for which he is then eligible. The obligations of Employee
under Article III of this Agreement will continue notwithstanding the cessation
of Employee’s employment pursuant to this Section.

2.2. Death. The Agreement and the parties’ obligations hereunder shall terminate
upon the death of Employee; provided, however, that in such event, the parties
shall be required to carry out any provisions of this Agreement which
contemplate performance by them subsequent to termination, and the Company shall
pay to the estate of the Employee any earned but unpaid salary and accrued but
unused PTO as of the date of Employee’s death.

2.3. Termination by the Company. Employee’s employment under this Agreement may
be terminated by the Company with or without cause as set forth hereunder.

(a) The Company shall have the right to terminate Employee’s employment under
this Agreement at any time for Cause, which termination shall be effective
immediately. For purposes of this Agreement, “Cause” shall include:

 

  i. Unauthorized use or disclosure of the Company’s confidential information or
trade secrets;

 

  ii. Material breach of any agreement between Employee and the Company,
including this Agreement, which such breach is not cured within ten (10) days
after Employee’s receipt of prior written notice thereof from the Company;

 

  iii. Material failure to comply with the Company’s policies or rules, which
such failure is not cured within ten (10) days after Employee’s receipt of prior
written notice thereof from the Company;

 

  iv. Conviction of, or plea of “guilty” or “no contest” to, a felony under the
laws of the United States or any state thereof, or any crime of moral turpitude;

 

  v. Intentional failure to perform Employee’s duties or refusal to abide by or
comply with the lawful directives of the Company;

 

  vi. Willful dishonesty, fraud, misconduct, or gross negligence with respect to
the business or affairs of the Company that, in the reasonable judgment of the
Company, materially and adversely affects the operations or reputation of the
Company; and

 

  vii.

Failure of the Company to meet financial performance measurements set by the
Company’s Board of Directors; provided, however, that such failure shall not
constitute grounds for termination of Employee’s employment by the Company for
“Cause” hereunder if such failure is the

 

6

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result of (A) events, occurrences or circumstances affecting the economy or
financial markets in general, or (B) other events, occurrences or circumstances
which Employee cannot control.

(b) Employee’s employment hereunder may also be terminated without Cause by the
Company upon thirty (30) days written notice to the Employee. In the event
Employee’s employment under this Agreement is terminated by the Company without
Cause, Employee shall be entitled to:

 

  i. Any earned but unpaid salary and accrued but unused PTO as of the date of
termination; and

 

  ii. The applicable severance payment as set forth in Section 1.4(h), provided
Employee complies with Section 1.4(h) and subject to the payment conditions set
forth therein.

(c) Any provision to the contrary notwithstanding, with respect to
Section 2.3(a), the ten (10) day corrective periods therein referenced shall
only apply to matters readily correctable within a ten (10) day period, and such
correction period shall be reasonably extended beyond ten (10) days for all
other deficiencies so as to allow a reasonable period for corrective action in
reference to the specifically-identified deficiency.

2.4. Termination by Employee.

(a) Employee may terminate his employment hereunder by providing the Company
with sixty (60) days written notice of his intention to resign. Without
converting such termination to a termination by the Company without Cause or
reason (as noted in Section 2.3(b), the Company may provide Employee with
Employee’s salary in an amount equivalent to that due over the applicable notice
period in lieu of allowing the Employee to continue his employment throughout
the required notice period. In such case, the effective date of Employee’s
termination shall be the date that the Company makes such payment to Employee.
If Employee terminates his employment under this Section, he shall have no right
to receive any further compensation or benefits (including severance payments or
payments under the applicable Bonus Plan), if any, under this Agreement after
the effective date of the termination of his employment.

(b) Upon occurrence of a Change of Control and a resulting material reduction in
either Employee’s compensation or job responsibilities, Employee may, within
sixty (60) days of the Change of Control, elect to terminate his employment. In
such instance, provided that Employee declares his intent in writing to the
Company to terminate his employment within sixty (60) days of the Change of
Control, Employee shall be entitled to the compensation package set forth in
Section 2.3(b). For purposes of this Section 2.4(b) the term “Change of Control”
shall have the meaning ascribed to such term in the Lumber Liquidators Holdings,
Inc. 2007 Equity Compensation Plan.

 

7

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(c) Employee shall have the right to terminate employment under this Agreement
at any time upon thirty (30) days written notice to the Company after a Good
Reason Event. For purposes of this Agreement, a “Good Reason Event” shall
include (i) failure to pay or provide, or a material reduction in, Employee’s
compensation or Employee’s benefits, (ii) a material reduction in Employee’s
responsibilities within the Company, or (iii) a material breach of this
Agreement by the Company which is not cured within ten (10) days after the
Company’s receipt of prior written notice thereof from Employee, or such other
period as is reasonable for a curative response. In the event that Employee
terminates this Agreement in connection with a Good Reason Event, Employee shall
be entitled to the compensation package set forth in Section 2.3(b).

2.5. Continuation of Obligations. Regardless of how Employee’s employment with
the Company ends, the obligations of Employee under Article III of this
Agreement shall continue notwithstanding the cessation of Employee’s employment.
In addition, no cessation of the Employee’s employment with the Company shall
affect any liability or other obligation of Employee that shall have accrued
prior to such termination, including, but not limited to, any liability, loss or
damage on account of breach of this Agreement.

ARTICLE III

EMPLOYEE’S COVENANTS AND AGREEMENTS

3.1. Proprietary Rights. All rights, including without limitation any writing,
discoveries, inventions, innovations, and computer programs and related
documentation and all intellectual property rights therein, including without
limitation copyright (collectively “Intellectual Property”) created, designed or
constructed by Employee during the Employee’s term of employment with the
Company, that are related in any way to Employee’s work with the Company or to
any of the products and/or services provided by the Company, shall be the sole
and exclusive property of the Company. Employee agrees to deliver and assign to
the Company all such Intellectual Property and all rights which Employee may
have therein and Employee agrees to execute all documents, including without
limitation patent applications, and make all arrangements necessary to further
document such ownership and/or assignment and to take whatever other steps may
be needed to give the Company the full benefit thereof. Employee further agrees
that if the Company is unable after reasonable effort to secure the signature of
Employee on any such documents, the Chief Executive Officer of the Company or a
designee thereof shall be entitled to execute any such papers as the agent and
attorney-in-fact of Employee and Employee hereby irrevocably designates and
appoints each such person as Employee’s agent and attorney-in-fact to execute
any such papers on Employee’s behalf and to take any and all actions required or
authorized by the Company pursuant to this subsection. Without limitation to the
foregoing, Employee specifically agrees that all copyrightable materials
generated during the term of Employee’s employment with the Company, including
but not limited to, computer programs and related documentation, that are
related in any way to Employee’s work with the Company or to any of the services
provided by the Company, shall be considered works made for hire under the
copyright laws of the United States and shall upon creation be owned exclusively
by the Company. To the extent that any such materials, under applicable law, may
not be considered works made for hire, Employee hereby assigns to the Company
the ownership of all copyrights in such materials, without the necessity of any
further consideration, and the Company shall be entitled to register and hold in
its own name all copyrights in respect of such materials. The provisions of this
section shall apply regardless of whether any activities related to the creation
of any Intellectual Property took place inside or outside of the Company’s
working hours.

 

8

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3.2. Confidential Information. Employee understands and agrees that:

(a) in the course of his employment with the Company, he will acquire
information that could include, in whole or in part, information concerning
Company sales, sales volume, sales methods, sales proposals, customers and
prospective customers, identity of customers and prospective customers, identity
of key purchasing personnel in the employ of customers and prospective
customers, amount or kind of customer purchases from the Company, Company
sources of supply, Company computer programs, system documentation, special
hardware, product hardware, related software development, Company manuals,
formulae, processes, methods, machines, compositions, ideas, improvements,
inventions, or other confidential or proprietary information belonging to the
Company or relating to the Company’s affairs (collectively referred to as
“Confidential Information”);

(b) the Confidential Information is the property of the Company;

(c) the use, misappropriation, or disclosure of the Confidential Information
would constitute a breach of trust and could cause irreparable injury to the
Company;

(d) it is essential to the protection of the Company’s goodwill and to the
maintenance of the Company’s competitive position that the Confidential
Information be kept secret; and

(e) that Employee will not disclose the Confidential Information to others or
use the Confidential Information for any reason other than on behalf of the
Company, either during, or at any time following the cessation of, Employee’s
employment with the Company. Notwithstanding anything to the contrary contained
herein, Confidential Information shall not be deemed to include any information
generally known or readily accessible in the trade or industry in which the
Company is involved, provided the same are not in the public domain as a
consequence of disclosure by the Employee in violation of this Agreement.

3.3. Return of Materials. Upon the cessation, for any reason, of Employee’s
employment with the Company, Employee will promptly deliver to the Company all
Company property, including but not limited to, all computers, phones,
equipment, correspondence, manuals, letters, notes, notebooks, reports, flow
charts, programs, proposals, and any documents concerning the Company’s
customers, operations, products or processes (actual or prospective) or
concerning any other aspect of the Company’s business (actual or prospective)
and, without limiting the foregoing, will promptly deliver to the Company any
and all other documents or materials containing or constituting Confidential
Information.

3.4. Non-Solicitation. Throughout any period during which Employee is an
employee of the Company, and for a period of twenty-four (24) months from and
after the date upon which Employee shall cease for any reason whatsoever to be
an employee of the Company (the “Employment Cessation Date”) or for a period of
twenty-four (24) months from the date of entry by

 

9

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a court of competent jurisdiction of a final judgment enforcing this Section of
the Agreement in the event of a breach thereof by Employee, whichever is later,
Employee covenants and agrees that Employee will not directly or indirectly, for
himself or for the benefit of another:

(a) Solicit any person or entity who, during the twelve-month period immediately
preceding the Employment Cessation Date, paid or engaged the Company for
products or services of any type or who received the benefit of the Company’s
services (a “Client”) to withdraw, curtail or cancel such Client’s relationship
with the Company;

(b) Provide or agree to provide for any Client products or services of the type
that the Company renders to its Clients, except for or on behalf of the Company
in the exercise of Employee’s duties under this Agreement; or

(c) Induce or influence, or attempt to induce or influence, any person who,
during the twelve-month period immediately preceding the Employment Cessation
Date, is an employee, agent, independent contractor, partner, officer, supplier,
vendor or director of the Company to terminate his, her or its relationship with
the Company or cease providing services or products to or on behalf of the
Company.

3.5. Non-Competition.

(a) Throughout any period during which Employee is an employee of the Company,
and for a period of twenty-four (24) months from and after the Employment
Cessation Date or for a period of twenty-four (24) months from the date of entry
by a court of competent jurisdiction of a final judgment enforcing this Section
of the Agreement in the event of a breach thereof by Employee, whichever is
later, Employee covenants and agrees that:

 

  i. Employee will not compete with Company within the Restricted Area by
performing for or providing to a Competing Business the same or materially
similar duties or services that Employee performed for or provided to Company
within the last 12 months of Employee’s employment with the Company;

 

  ii. Employee will not own or acquire, either as a proprietor, partner, member,
shareholder, trustee, a greater than five percent (5%) equity or synthetic
equity ownership interest, in any Competing Business within the Restricted Area.

(b) For purposes of this Section 3.5, the following definitions will apply:

 

  i. Competing Business. Any business which sells or distributes flooring
products (including, but not limited to, hardwood, engineered, resilient,
bamboo, cork and/or laminate flooring) or any other products or services
substantially similar to those sold or provided by the Company within the
twelve-month period immediately preceding the Employment Cessation Date that
constituted more than five percent (5%) of the Company’s gross sales.

 

10

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  ii. Restricted Area. Because of the national and expanding scope of the
Company’s business, for purposes of this Agreement, the “Restricted Area” is
defined as the United States of America and any city, town, county or
metropolitan area in Canada in which the Company operates store locations as of
the Employment Cessation Date.

ARTICLE IV

EMPLOYEES REPRESENTATIONS AND WARRANTIES

4.1. No Prior Agreements. Employee represents and warrants that he is not a
party to or otherwise subject to or bound by the terms of any contract,
agreement, or understanding which in any manner would limit or otherwise affect
his ability to perform any of his obligations under this Agreement, including,
without limitation, any contract, agreement, or understanding containing terms
and provisions similar in any manner to those contained in Article III. The
Company shall have no liability under any such agreement between Employee and a
third party.

4.2. Employee’s Abilities. Employee represents that his experience and
capabilities are such that the provisions of Article III will not prevent him
from earning a livelihood in the event his employment with the Company were to
cease and Employee acknowledges that it would cause the Company serious and
irreparable injury and cost if Employee were to violate any of the provision of
Article III to the detriment of the Company or to otherwise breach his
obligations under Article III.

4.3. Review by Counsel. Employee represents and warrants that this Agreement is
the result of full and otherwise fair bargaining over its terms following a full
and otherwise fair opportunity to have legal counsel for Employee review this
Agreement and to verify that the terms and provisions of this Agreement are
reasonable and enforceable.

ARTICLE V

GENERAL PROVISIONS

5.1. Authorization to Modify Restrictions. The invalidity of any portion of this
Agreement shall not be deemed to affect the validity of any other provisions. In
the event that any provision of this Agreement is held to be invalid, the
parties agree that the remaining provisions shall be deemed in full force and
effect as if they had been executed by both parties subsequent to the
expungement of the invalid provision. Further, if any part on any provision of
this Agreement, including Article III, shall be determined to be invalid or
unenforceable by reason of the extent, duration or geographical scope thereof,
or otherwise, then the parties agree that the court making such determination
may reduce such extent, duration or geographical scope, or other provisions
thereof, and in its reduced form such part or provision shall then be
enforceable in the manner contemplated hereby.

 

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5.2. No Waiver. The failure of either the Company or Employee to insist upon the
performance of any term in this Agreement shall not waive any such term or any
other term of this Agreement. Instead, this Agreement shall remain in full force
and effect as if no such forbearance had occurred.

5.3. Company Violation Not a Defense. In an action by the Company for specific
performance and/or injunctive relief under this Agreement, any claims asserted
by Employee against the Company as violations of this Agreement shall not
constitute a defense.

5.4. Entire Agreement. This Agreement represents the entire agreement of the
parties with respect to the subject matter of this Agreement and may be amended
only by a writing signed by each of them.

5.5. Governing Law, Section 409A. This Agreement will be governed by and
construed in accordance with the internal substantive laws of the Commonwealth
of Virginia without regard to Virginia’s conflict of laws provisions. This
Agreement is intended to comply with Section 409A and shall be interpreted and
administered accordingly.

5.6. Consent to Jurisdiction. Employee hereby irrevocably submits to the
jurisdiction of the appropriate state or federal courts located in the
Commonwealth of Virginia in any action or proceeding arising out of or relating
to disputes under this Agreement.

5.7. Venue. Employee irrevocably waives any current or future objection to the
laying of venue of any action or proceeding arising out of or relating to this
Agreement brought in any Virginia state or federal court and any objection on
the ground that any such action or proceeding in either court has been brought
in an inconvenient forum. However, nothing in this Section 5.7 will affect the
right of the Company to bring any action or proceeding against Employee or his
property in the courts of other jurisdictions.

5.8. Remedy. Employee understands and acknowledges that the Company has a
legitimate business interest in preventing Employee from taking any actions in
violation of Article III of this Agreement and that Article III is intended to
protect the legitimate business interests and goodwill of the Company. Employee
further acknowledges that a breach of Article III of this Agreement will
irreparably and continually damage the Company. Employee therefore agrees that
in the event Employee violates any provision of this Agreement contained in
Article III, the Company will be entitled to seek an injunction stopping
Employee from breaching or continuing to breach Employee’s obligations
thereunder, other appropriate injunctive relief, specific performance, any other
equitable remedies and any and all remedies provided by law. Employee further
acknowledges that the Company engages in a highly competitive business
throughout the United States as well as countries outside of the United States,
and further, that the geographic limitation contained in Section 3.5 is
necessary to protect the Company’s business.

5.9. Recovery of Expenses. The prevailing party in any proceeding arising from
this Agreement will be entitled to reasonable attorneys’ fees, costs, and the
expenses of litigation from the non-prevailing party.

 

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5.10. Agreement Binding. The obligations of Employee under this Agreement will
continue as stated in this Agreement after the cessation of his employment with
the Company and will inure to the benefit of any successors and assigns of the
Company.

5.11. Counterparts, Section Headings. This Agreement may be executed in any
number of counterparts. Each will be considered an original, but all will
constitute one and the same instrument. The section headings of this Agreement
are for convenience of reference only and shall not affect the construction or
interpretation of any of its provisions.

5.12. Notices. All notices, demands, requests and other communications required
by or in regards to this Agreement shall be in writing or by written
telecommunication and given by personal delivery to the addressee, by mail
(certified mail, return receipt requested, postage prepaid) or by
telecommunication. Either party may from time to time change its address,
facsimile number, electronic mail address or designated individual by notice to
the other party.

 

To Company:    Lumber Liquidators Holdings, Inc.    3000 John Deere Road   
Toano, Virginia 23168    Attention: General Corporate Counsel To Employee:   
Robert M. Lynch    1143 Rugby Court    San Jose, California 95120

EMPLOYEE ACKNOWLEDGES THAT HE HAS READ AND UNDERSTANDS THE FOREGOING PROVISIONS
AND THAT SUCH PROVISIONS ARE REASONABLE AND ENFORCEABLE.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Executive Employment
Agreement or caused it to be executed this 17th day of December, 2010.

 

EMPLOYEE     LUMBER LIQUIDATORS HOLDINGS, INC.

/s/ Robert Martin Lynch

    By:  

/s/ Jeffrey W. Griffiths

Robert Martin Lynch     Name:  

Jeffrey W. Griffiths

    Title:  

Chief Executive Officer

 

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AMENDMENT TO

EXECUTIVE EMPLOYMENT AGREEMENT

THIS AMENDMENT to the Executive Employment Agreement (the “Agreement”) by and
between Lumber Liquidators Holdings, Inc. (the “Company”) and Robert Martin
Lynch (“Employee”) is made and entered into this 21st day of December, 2011.

WHEREAS, the Compensation Committee of the Board of Directors of the Company has
determined that certain changes to Employee’s title, duties and compensation are
in the best interest of the Company; and

WHEREAS, the Company and Employee wish to amend the Agreement to reflect such
changes.

NOW, THEREFORE, the Agreement is amended as set forth below, effective
January 1, 2012:

FIRST: The first sentence of Section 1.1(a) is revised to read as follows: “The
Company will employ Employee in the position of President and Chief Executive
Officer and, in that position, Employee will report directly to the Board of
Directors of the Company.”

SECOND: The term, “Chief Operating Officer,” in the first sentence of
Section 1.3 is replaced with the term, “Chief Executive Officer.”

THIRD: The phrase, “the Chief Executive Officer and/or the Board of Directors,”
in Section 1.3(a) is replaced with the phrase, “the Board of Directors.”

FOURTH: The phrase, “the Company, the Chief Executive Officer and/or the Board
of Directors,” in Section 1.3(b) is replaced with the phrase, “the Company
and/or the Board of Directors.”

FIFTH: Section 1.4(a) is replaced with the following:

(a) Base Salary. Employee shall receive an annual base salary of $550,000
payable to Employee in accordance with the Company’s normal payroll schedule.
The Company shall withhold state and federal income taxes, social security taxes
and shall make such other payroll deductions as may be required by law or
mutually agreed upon in writing by Employee and the Company.

SIXTH: The phrase, “up to 75% of Employee’s base salary,” in the second sentence
of Section 1.4(c) is replaced with the phrase, “up to 100% of Employee’s base
salary.”

SEVENTH: The term, “Chief Executive Officer,” in Section 3.1 is replaced with
the term, “Secretary.”

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EIGHTH: The notice address in Section 5.12 for Employee shall be changed to the
following:

IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Executive
Employment Agreement or caused it to be executed as of the date first written
above.

 

EMPLOYEE     LUMBER LIQUIDATORS HOLDINGS, INC.

/s/ Robert Martin Lynch

    By:  

/s/ Jeffrey W. Griffiths

Robert Martin Lynch    

 

Name:

 

Jeffrey W. Griffiths

    Title:  

President and Chief Executive Officer