Exhibit 10.1

 

﻿

 

 

  952-797-4349

: Jamie.elliott@tileshop.com

 

 

Picture 3 [ttsh-20200930xex10_1g001.jpg] 

Jamie Elliott

Director of Talent Acquisition

The Tile Shop

Phone:  952-797-4349

E-mail: Jamie.elliott@tileshop.com

 

﻿

Offer of Employment: 07/21/2020

﻿

Joe Kinder

Watertown, MN 

﻿

Dear Joe,

﻿

Congratulations! I am pleased to extend this letter to you as a formal offer of
promotion with The Tile Shop Corporate Headquarters. The position being offered
is that of Senior Vice President of Supply Chain & Distribution. This position
is a named executive officer of the company and will be reporting directly to
the President & CEO.

﻿

Specifically, this offer of employment includes the following:

﻿

·

You will be paid an annual salary of $218,000.

·

Eligible to participate in the Company's corporate bonus program. Under this
plan, you will have a target bonus opportunity of 40% of your annual salary
based on the Company's performance. More details surrounding the corporate bonus
plan are attached.

·

Relocation from Alabama to Minnesota per The Tile Shop Relocation Policy.
Relocation contract and details surrounding the policy are attached.

·

Paid Time Off per the attached Corporate Policy, along with 7 paid Holidays.

·

You will be qualified on the first day of the month, following sixty (60) days
of employment, to participate in the standard benefits program in effect for
employees, including medical, dental, life, and accident insurance.

·

401(k) Retirement Savings Plan.

·

Change of Control:

(A) In the event of a Change of Control of the Company, if (1) you are not
offered employment or continued employment by the Successor Entity upon
consummation of such Change of Control, or

(2) prior to the first anniversary of such Change of Control, (a) you are
discharged by the Successor Entity other than for Cause or (b) you resign from
employment with the Successor Entity as a result of a Constructive Termination
(as defined below), all of your unvested restricted stock award grants will vest
and become exercisable immediately prior to such Change of Control or cessation
of employment, as applicable.

(B) “Constructive Termination” will occur if you resign from your employment
with the Successor Entity within 30 days following (1) a material reduction in
your annual base salary or job responsibility or (2) the relocation of your
principal office location to a facility or location located more than 50 miles
from your principal office location on the date of the Change of Control.

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(C)  If you are terminated without Severance Cause (as defined below) or resign
for Good Reason (as defined below) due to a Change of Control, you will be
entitled to receive an amount equal to your then-current base salary for a
six-month period commencing with the effective date of your termination of
employment with the Company (the “Severance Period”). The foregoing amount will
be payable pro rate over the Severance Period in accordance with the Company’s
normal payroll practices; provided, however, that the Company will not pay any
severance payments unless and until (a) you execute and deliver to the Company a
general release (b) such Release is executed and delivered to the Company within
21 days after your termination date and (c) all time periods for revoking the
Release have lapsed. If you are terminated during the month of December of any
calendar year and are owed severance hereunder, no severance payments will be
made prior to January 1st of the next calendar year and any amount that would
have otherwise been payable to you in December of the preceding calendar year
will be paid to you on the first date in January on which you would otherwise be
entitled to any payment. Following your termination date, all benefits offered
by the Company, including health insurance benefits, will cease. From and after
such date, you may elect to continue your participation in the Company’s health
insurance benefits at your expense pursuant to COBRA by notifying the Company in
the time specified in the COBRA notice you will be provided and paying the
monthly premium yourself.

(D) “Severance Cause” means (1) willful misconduct in connection with your
employment or willful failure to perform your responsibilities in the best
interests of the Company, as determined by the CFO; (2) conviction of, or plea
of nolo contendre or guilty to, a felony other than an act involving a traffic
related infraction; (3) any act of fraud, theft, embezzlement or other material
dishonesty by you that harmed the Company; (4) intentional violation of a
federal or state law or regulation applicable to the Company’s business, which
violation was or is reasonably likely to be injurious to the Company; or (5)
repeated failure to perform your duties and obligations of your position with
the Company, which failure is not cured within 30 days after notice of such
failure from the CFO to you.

(E)  “Good Reason” for your resignation will exist if you resign from your
employment with the Company as a result of (1) a material reduction in your
annual base salary or job responsibility or (2) the relocation of your principal
office location to a facility or location located more than 50 miles from your
current principal office location.

·

This offer is contingent upon review by our corporate office and successful
completion of our reference checking process, including but not limited to a
background investigation, drug screen, personal references, and prior work
history.

·

As a Senior VP, you will be required, as a condition of your employment with The
Tile Shop, to sign a Nondisclosure, Confidentiality, Assignment and
Noncompetition Agreement, a copy of which is attached hereto as Exhibit A (the
"Non-Competition and Non-Disclosure Agreement").    

·

You agree that, during the term of your employment with the Company, you will
not engage in any other employment, occupation, consulting or other business
activity directly related to the business in which the Company is now involved
or becomes involved during the term of your employment, nor will you engage in
any other activities that conflict with your obligations to the Company.

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The Company reserves the right to make changes to the corporate bonus plan and
other benefits outlined in the letter above and attached.

﻿

Joe, we hope you decide to accept this promotion at The Tile Shop Corporate
Headquarters. We are confident that your skills and abilities will be a
tremendous asset to our team and that you will be afforded opportunities to
learn and advance your career with us. We recognize that you retain the option,
as does the company, of ending your employment at any time, with or without
notice and with or without cause. As such, your employment with The Tile Shop is
at-will, and neither this letter nor any other oral or written representations
may be considered a contract for any period of time. If you accept the offer of
employment, please sign below. If you have any questions, please do not hesitate
to contact Jamie Elliott at 952-797-4349. We would love you to start your
Corporate Career at The Tile Shop on July 31st, 2020, at 8:00am.

﻿

Congratulations!!

﻿

Sincerely,

/s/ Cabell Lolmaugh

Cabell Lolmaugh

President & CEO

The Tile Shop

﻿

I accept the offer of employment under the terms and conditions listed above.

﻿

﻿

 

 

/s/ Joseph Kinder

 

October 16, 2020

Name

 

Date

﻿

 

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EXHIBIT A

﻿

TILE SHOP HOLDINGS, INC.

﻿

NONDISCLOSURE, CONFIDENTIALITY, ASSIGNMENT AND

NONCOMPETITION AGREEMENT

﻿

THIS    NONDISCLOSURE,    CONFIDENTIALITY,    ASSIGNMENT    AND NONCOMPETITION
AGREEMENT (this "Agreement") is made this 31st day of July, 2020, by and between
Tile Shop Holdings, Inc.,  a Delaware corporation (collectively with
any predecessors, successors, and assignees, the "Company"), and Joe Kinder (“I”
or "  me"),  to be effective on July 31, 2020.

﻿

In consideration of my engagement or continued engagement as an officer,
 employee,
director, advisor, partner, independent contractor or consultant of the Company (an "Associate"),
 and for other valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, I hereby agree as follows:

﻿

1.    DEFINITIONS.

﻿

1.1.    "Affiliate" means any direct or indirect subsidiary of the Company.

﻿

1.2.    "Confidential Information" means any and all confidential and/or
proprietary knowledge, data or information concerning the business, business
relationships and financial affairs of the Company or its Affiliates whether or
not in writing and whether or not labeled or identified as confidential or
proprietary. By way of illustration, but not limitation, Confidential
Information includes (a) Inventions and (b) research and development activities
of the Company or its Affiliates, services and marketing plans, business plans,
budgets and unpublished financial statements, licenses,  prices and costs,
customer and supplier information and information disclosed to the Company or
its Affiliates or to me by third parties of a proprietary or
confidential nature or under an obligation of confidence. Confidential Information is contained in
various media, including without limitation, patent applications, computer
programs in object and/or source code, flow charts and other program
documentation, manuals, plans,  drawings, designs, technical specifications,
laboratory notebooks, supplier and customer lists, internal financial data and
other documents and records of the Company or its Affiliates. Notwithstanding
the foregoing, nothing in this Agreement is intended to or will be used in any
way to prevent disclosure of Confidential Information in accordance with the
immunity provisions set forth in the Defend Trade Secrets Act of 2016 (18 U.S.C.
§ 1833(b)), meaning the disclosure is (1) in confidence to a government official
or attorney solely for the purpose of reporting or investigating a suspected
legal violation; or (2) under seal in connection with a lawsuit or other
proceeding (including an anti-retaliation lawsuit) .

﻿

1.3.    "Inventions" means all ideas, concepts, discoveries, inventions,
developments, improvements, formulations, products, processes, know-how,
designs, formulas, methods, developmental or experimental work, clinical data,
original works of authorship, software
programs, software and systems documentation, trade secrets, technical data, or licenses to use

 

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(whether or not patentable or registrable under copyright or similar statutes),
that are or were made, conceived, devised, invented, developed or reduced to
practice or tangible medium by me, either alone or jointly with others (a)
during any period that I am an Associate of the Company, whether or not during
normal working hours or on the premises of the Company, that relate, directly or
indirectly, to the business of the Company or its Affiliates, (b) at the request
of or for the benefit of the Company during any period prior to my engagement as
an Associate of the Company that relate, directly or indirectly, to the business
of the Company or its Affiliates, or (c) that arise out of, or are incidental
to, my engagement as an Associate of the Company.

﻿

1.4.    "Prior Inventions" means any inventions made, conceived, devised,
invented, developed or first reduced to practice by me, under my direction or
jointly with others prior to the date of this Agreement and that do not
constitute Inventions within the meaning of Section 1.3 above. Prior Inventions
also means an invention for which no equipment, supplies, facility or trade
secret information of the Company was used and which was developed entirely on
my own time, and (1) which does not relate (a) directly to the business of the
Company or (b) to the Company's actual or demonstrably anticipated research or
development, or (2) which does not result from any work performed by the me for
the Company.

﻿

1.5.    "Third Party Information" means any confidential or proprietary
information received by the Company or its Affiliates from third parties.

﻿

2.    CONFIDENTIALITY.

﻿

2.1.    Recognition of the Company's Rights. I understand that the Company
continually obtains and develops valuable Confidential Information that may or
has become known to me in connection with my engagement as an Associate of the
Company. I acknowledge that all Confidential Information is and will remain the
exclusive property of the Company or the third party providing such Confidential
Information to myself, the Company, or the Company's Affiliates.

﻿

2.2.    Nondisclosure of Confidential Information. I agree that during the term
of my engagement as an Associate of the Company and thereafter, I will hold in
strictest confidence and will not disclose, use, lecture upon, publish or
otherwise make available to any third party (other than personnel of the Company
or its Affiliates who need to know such information in connection with their
work for the Company), any Confidential Information of the Company, except as
such disclosure, use or publication may be required in connection with my work
for the Company, or as expressly authorized in writing by an executive officer
of the Company. I agree that I will use such Confidential Information only in
the performance of my duties for the Company and in accordance with any Company
policies with respect to the protection of Confidential Information. I agree not
to use such Confidential Information for my own benefit or for the benefit of
any other person or business entity.

﻿

2.3.    Third Party Information. In addition, I understand that the Company has
received and in the future will receive Third Party Information subject to a
duty on the Company's part to maintain the confidentiality of such information
and to use it only for certain limited purposes.
During the term of my engagement as an Associate of the Company and thereafter, I will hold

 

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Third Party Information in the strictest confidence and will not disclose to
anyone (other than personnel of the Company or its Affiliates who need to know
such information in connection with the performance of their duties for the
Company) or use any Third Party Information, except as such disclosure or use
may be required in connection with the performance of my duties for the Company,
or as expressly authorized in writing by an executive officer of the Company.

﻿

2.4.    Exceptions. My obligations under Sections 2.2 and 2.3 hereof will not
apply to the extent that certain Confidential Information (a) is or becomes
generally known within the Company's industry through no fault of mine; (b) was
known to me at the time it was disclosed as evidenced by my written records at
the time of disclosure; (c) is lawfully and in good faith
made available to me by a third party who did not derive it from the Company or the Company' s
 Affiliates and who imposes no obligation of confidence to me, the Company, or
the Company's Affiliates; or (d) is required to be disclosed by a governmental
authority or by order of a court of competent jurisdiction, provided that such
disclosure is subject to all applicable governmental or judicial protection
available for like material and reasonable advance notice is given to the
Company.

﻿

2.5.    Protection and Return of Confidential Information. I agree to exercise
all reasonable precautions to protect the integrity and confidentiality of
Confidential Information in my possession and not to remove any materials
containing Confidential Information from the premises of the Company, except to
the extent necessary in the performance of my duties for the Company or unless
expressly authorized in writing by an executive officer of the Company. Upon the
termination of my engagement as an Associate of the Company, or at any time upon
the Company's request, I will return immediately to the Company any and all
notes, memoranda, specifications,  devices, formulas and documents,  together
with copies thereof, and any other material containing or disclosing any
Confidential Information of the Company or Third Party Information then in my
possession or under my control.

﻿

3.    ASSIGNMENT OF INVENTIONS.

﻿

3.1.    Ownership of Inventions. I acknowledge that all Inventions already
existing at the date of this Agreement or that arise after the date of this
Agreement, belong to and are the absolute property of the Company and will not
be used by me for any purpose other than carrying out my duties as an Associate
of the Company.

﻿

3.2.    Assignment of Inventions; Enforcement of Rights.  Subject to Section
3.6, I hereby assign and agree to assign in the future to the Company all of my
right, title and interest to any and all Inventions and any and all related
patent rights, copyrights and applications and registrations therefore. I also
agree to assign all my right, title and interest in and to any particular
Inventions to a third party as directed by the Company. During and after my
engagement as an Associate of the Company, I will cooperate with the Company,
 at the Company's expense,  in obtaining proprietary protection for the
Inventions and I will execute all documents that the Company reasonably requests
in order to perfect the Company's rights in the Inventions. I hereby appoint the
Company my attorney to execute and deliver any such
documents on my behalf in the event I should fail or refuse to do so within a reasonable period

 

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following the Company's request. I understand that,  to the extent this
Agreement is construed in accordance with the laws of any country or state that
limits the assignability to the Company of certain inventions, this Agreement
will be interpreted not to apply to any such invention that a court rules or the
Company agrees is subject to such limitation.

﻿

3.3.    Works for Hire.  I acknowledge that all original works of authorship
made by me (solely or jointly with others) within the scope of my engagement as
an Associate of the Company or any prior engagement by the Company,  that are
protectable by copyright are intended to be "works made for hire",  as that term
is defined in Section 101 of the United States Copyright Act of 1976
(the "Act"), and will be the property of the Company and the Company will be the
sole author within the meaning of the Act. If the copyright to any such
copyrightable work is not the property of the Company by operation of law, I
will, without further consideration, assign to the Company all of my right,
title and interest in such copyrightable work and will cooperate with the
Company and its designees, at the Company's expense, to secure, maintain and
defend for the Company's benefit copyrights and any extensions and renewals
thereof on any and all such work.  I hereby waive all claims to moral rights in
any Inventions.

﻿

3.4.    Records. I agree to keep and maintain adequate and current records (in
the form of notes, sketches, drawings and in any other form that may be required
by the Company) of all Inventions made by me during the period of my engagement
as an Associate of the Company or any prior engagement by the Company, which
records will be available to and remain the sole property of the Company at
all times.

﻿

3.5.    Obligation to Keep Company Informed. During the period of my engagement
as an Associate of the Company, and for six months after termination of my
engagement as an Associate of the Company, I agree to promptly disclose to the
Company fully and in writing all Inventions authored,  conceived or reduced to
practice by me, either alone or jointly with others. In addition, I will
promptly disclose to the Company all patent applications filed by me or on my
behalf within one year after termination of my engagement as an Associate of
the Company.

﻿

3.6.    Prior Inventions. I further represent that the attached Schedule A
contains a complete list of all Prior Inventions. I agree to update and/or amend
Schedule A during my employment as may be necessary and to promptly notify the
Company of the same. Such Prior Inventions are considered to be my property or
the property of third parties and are not assigned to the Company hereunder. If
there is no such Schedule A attached hereto, I represent that there are no such
Prior Inventions. If I am claiming any Prior Inventions on Schedule A, I agree
that, if in the course of my engagement as an Associate of the Company or any
prior engagement by the Company, I incorporate any Prior Invention into a
Company product, process or machine, the Company will automatically be granted
and will have a non-exclusive, royalty-free, irrevocable, transferable,
perpetual, world-wide license (with rights to sublicense) to make, have made,
modify, use and sell such Prior Invention as part of,  or in connection with,
such product, process or machine. Notwithstanding the foregoing, I agree that I
will not incorporate,  or permit to be incorporated, Prior Inventions in any
Company Inventions without the Company'  s prior written consent.

 

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4.    OTHER AGREEMENTS.

﻿

4.1.    No Conflicting Obligations. I hereby represent to the Company that,
except as identified on Schedule B, I am not bound by any agreement or any other
previous or existing business relationship that conflicts with or prevents the
full performance of my duties and obligations to the Company (including my
duties and obligations under this or any other agreement with the Company)
during my engagement as an Associate of the Company. I agree I will not enter
into any agreement, either written or oral,  that conflicts with this Agreement.

﻿

4.2.    No Improper Use of Information of Prior Employers or Others. I
understand that the Company does not desire to acquire from me any trade
secrets, know-how or confidential business information I may have acquired from
others. Therefore, I agree during my engagement as an Associate of the Company,
I will not improperly use or disclose any proprietary information or trade
secrets of any former or concurrent employer, or any other person or entity with
whom I have an agreement or to whom I owe a duty to keep such information in
confidence. Those persons or entities with whom I have such agreements or to
whom I owe such a duty are identified on Schedule B.

﻿

5.    NON-COMPETITION. I agree that while I am engaged as an Associate of the
Company and for a period of one year after termination or cessation of such
engagement for any reason, I will not, without the Company's prior written
consent, directly or indirectly,  as a principal, employee, consultant, partner,
 or stockholder of, or in any other capacity with, any business enterprise
(other than in my capacity as a holder of not more than 1%  of the combined
voting power of the outstanding stock of a publicly held company) (a) engage in
direct or indirect competition with the Company or its Affiliates,  (b) conduct
a business of the type or character engaged in by the Company or its Affiliates
at the time of termination or cessation of my engagement as an Associate of the
Company,  or (c) develop products or services competitive with those of the
Company or its Affiliates.

﻿

6.    GENERAL NON-SOLICITATION. I agree that while I am engaged as an Associate
of the Company and for a period of one year after termination or cessation of
such engagement for any reason, I will not solicit, divert or take away, or
attempt to divert or take away, the business or patronage of any of the clients,
 customers or accounts, or prospective clients, customers or accounts,  of the
Company or its Affiliates that were contacted, solicited or served by me while I
was engaged as an Associate of the Company or any Affiliate.

﻿

7.    NON-SOLICITATION OF EMPLOYEES AND CONSULTANTS. I agree that while I am
engaged as an Associate of the Company and for a period of one year after
termination or cessation of such engagement for any reason, I will not directly
or indirectly hire, recruit, or solicit any employee, independent contractor or
consultant of the Company or its Affiliates, or induce or attempt to induce any
employee independent contractor or consultant of the Company or its Affiliates
to discontinue his or her relationship with the Company or its Affiliates.

﻿

8.    NOTICE OF SUBSEQUENT EMPLOYMENT OR ENGAGEMENT. I will,  for a period of
one year after the termination or cessation of my engagement as an Associate of
the Company, notify the Company of any change of address, and of any subsequent
employment or engagement (stating the name and address of the employer and the
nature of the position) or any other business activity.

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9.    GENERAL.

﻿

9.1.    Assignment; Successors and Assigns. This Agreement may not be assigned
by either party except that the Company may assign this Agreement to any
Affiliate or in connection with the merger, consolidation or sale of all or
substantially all of its business or assets. This Agreement will be binding upon
and will inure to the benefit of the parties hereto and their respective
successors and other legal representatives and, to the extent that any
assignment hereof is permitted hereunder, their assignees.

﻿

9.2.    Entire Agreement. The obligations pursuant to Sections 2 and J of this
Agreement will apply to any time during which I was previously engaged as an
Associate of the Company, or am in the future engaged as an Associate of the
Company or any Affiliate if no other agreement governs nondisclosure and
assignment of inventions during such period.  This Agreement supersedes all
prior agreements, written or oral, with respect to the subject matter of
this Agreement.

﻿

9.3.    Severability. In the event that any one or more of the provisions
contained herein is, for any reason, held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability
will not affect any other provisions of this Agreement, and all other provisions
will remain in full force and effect. If any of the provisions of this Agreement
is held to be excessively broad, it will be reformed and construed by limiting
and reducing it so as to be enforceable to the maximum extent permitted by law.

﻿

9.4.    Amendments and Waivers.  No modification of or amendment to this
Agreement, nor any waiver of any rights under this Agreement, will be effective
unless in writing and signed by the party to be charged. No delay or omission by
the Company in exercising any right under this Agreement will operate as a
waiver of that or any other right. A waiver or consent given by the Company on
any occasion if effective only in that instance and will not be construed as a
bar to or waiver of any right on any other occasion.

﻿

9.5.    Employment. I understand that this Agreement does not constitute a
contract of employment or create an obligation on the part of the Company to
continue my employment (if any) with the Company. I understand that my
employment (if any) is "at will" and that my obligations under this Agreement
will not be affected by any change in my position, title or function with, or
compensation, by the Company. Any subsequent change or changes in my duties,
salary or compensation will not affect the validity or scope of this Agreement.

﻿

9.6.    Legal and Equitable Remedies. I acknowledge that (a) the business of the
Company and its Affiliates is global in scope and its services may be marketed
and sold throughout the world; (b) the Company and its Affiliates compete with
other businesses that are or could be located in any part of the world; (c) the
Company has required that I make the covenants contained in this Agreement as a
condition to my engagement as an Associate of the Company; and (d) the
restrictions contained in this Agreement are necessary for the protection of

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the business and goodwill of the Company and its Affiliates and are reasonable
for such purpose.  I agree that any breach of this Agreement by me will cause
irreparable damage to the Company and its Affiliates and that in the event of
such breach, the Company will be entitled,  in addition to monetary damages and
to any other remedies available to the Company under this Agreement and at law,
to equitable relief, including injunctive relief, and to payment by myself of
all costs  incurred by the Company in enforcing of the provisions of this
Agreement,  including reasonable attorneys' fees. I agree that should I violate
any obligation imposed on me in this Agreement, I will continue to be bound by
the obligation until a period equal to the term of such obligation has expired
without violation of such obligation.

﻿

9.7.    Governing Law. This Agreement will be construed as a sealed instrument
and will in all events and for all purposes be governed by, and construed in
accordance with, the laws of the State of Delaware without regard to any choice
of law principle that would dictate the application of the laws of another
jurisdiction. Any action, suit or other legal proceeding that I may commence to
resolve any matter arising under or relating to any provision of this Agreement
will be commenced only in a court of the State of Delaware (or, if appropriate,
a federal court located within the State of Delaware), and I hereby consent to
the jurisdiction of such court with respect to any action, suit or proceeding
commenced in such court by the Company.

﻿

[Next Page is Signature Page]

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

﻿

﻿

/s/ Joseph Kinder

Joe Kinder

﻿

﻿

/s/ Cabell Lolmaugh

TILE SHOP HOLDINGS, INC.

﻿

Title:  Chief Executive Officer

﻿

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