Exhibit 10.2


 





		
        3000 John Deere Road, Toano, VA 23168 

        Phone: (757) 259-4280.● Fax (757)
259-7293 

        www.lumberliquidators.com

         

         

        











 


February 23, 2016


 


VIA EMAIL (dknowles@me.com)


 


 


Mr. Dennis R. Knowles


147 Shelburne Place


Mooresville, NC 28117


 


	 	Re:	Offer Letter




 


Dear Dennis:


 


On behalf of John Presley, this letter
confirms our offer of employment to you with Lumber Liquidators Holdings, Inc. or one of its subsidiaries (individually and collectively,
as applicable, “Lumber Liquidators” or the “Company”). The details of our offer are as follows:


 


		·	Title: Chief Operating Officer



 


		·	Location: Toano, Virginia



 


		·	Reports to: Chief Executive Officer



 


		·	Start Date: March 1, 2016 (unless mutually changed and finalized between you and the Company)



 


		·	Annual Base Salary: $525,000. Lumber Liquidators currently processes payroll on a weekly
basis.  This schedule is subject to change.  Lumber Liquidators strongly encourages employees to receive their pay via
direct deposit. You will receive more information about direct deposit during your orientation.



 


		·	Incentive Plan: You will be eligible to participate in the Annual Bonus Plan for Executive
Management (the “Bonus Plan”). Your 100% target payout under the Bonus Plan will be equal to 60% of your annual base
salary, with the opportunity to earn a maximum of 200% of your target payout based on Lumber Liquidators’ performance against
certain financial objectives. In 2016, any earned bonus payout will be pro-rated based on your date of hire in 2016. Notwithstanding
the foregoing, the awarding (or decision not to award) a payment under the Bonus Plan and the amount thereof, is a decision left
to the sole discretion of Lumber Liquidators. Further, the Bonus Plan is subject to amendment, modification and/or termination
by Lumber Liquidators in its sole and absolute discretion. To the extent there is any conflict between this Offer Letter and the
language of the Bonus Plan, the Bonus Plan shall control.



 






     


     


    

 


		·	Stock Options: A recommendation will be made to the Compensation Committee of Lumber Liquidators’
Board of Directors that you receive an equity award of non-qualified stock options with a total cumulative value of $1,000,000. 
The valuation of the options will be made using the Black-Scholes-Merton method as of the date of award. If approved by the Compensation
Committee, any award will be granted under, subject to and governed by the 2011 Equity Compensation Plan or its successor plan
(the “Equity Plan”), and shall be evidenced by a grant agreement.  The grant agreement will specify, among other
things, the vesting schedule, consequences of termination of employment and other applicable terms and conditions.  The proposed
vesting schedule of the options will be as follows: 25% of the grant will vest on each anniversary of the grant date for a period
of four (4) years. The timing and amount of any such award to you is subject to the discretion of the Compensation Committee and
the Board of Directors. It is expected that the Compensation Committee will next award equity three business days after the Company
publicly announces its financial results for Q4-2015. In the event the stock price on the applicable grant date falls below $12.50,
it is expected that only 60% of your award will be granted at that time. In such case, the balance of the recommended grant would
then be awarded at a future date, with the exercise price to be equal to the closing price for Lumber Liquidators stock on that
future date, after additional shares are added to the Equity Plan.  You will not be eligible to receive an annual equity award
in 2017. The issuance of any annual equity grants in 2018 or thereafter will be made at the sole discretion of the Compensation
Committee and the Board of Directors only after consideration of a recommendation by the Company and other relevant factors including,
but not limited to, a review of your performance to date and the Company’s financial results. As an employee, you will be
subject to the expectations and restrictions of Lumber Liquidators’ Insider Trading Policy, a copy of which is provided at
the time of hire and is available upon request to Human Resources.



 


		·	Relocation Expense Reimbursement: This position is based in the corporate office in Toano,
VA. Financial support will be provided to cover reasonable relocation expenses from Mooresville, NC to the Toano/Richmond/Hampton
Roads, VA area. You will be provided with up to $100,000 (relocation expenses that are not tax deductible will be grossed up at
35% with a final true-up upon completion of your relocation) in relocation expense reimbursement provided you sign and return to
us the attached Relocation Expense Agreement. Please also refer to the attached Corporate Relocation Policy for Senior Vice Presidents.



 


		·	Severance Benefit: If your employment with Lumber Liquidators is terminated by the Company
without “Cause” (as defined in the applicable agreement) within eighteen (18) months of your actual hire date and provided
you have executed (i) a severance benefit agreement propounded by and acceptable to the Company within 30 days of your actual hire
date, and (ii) a General Release and Waiver as provided in such agreement, the Company will pay you severance in the form of salary
continuation in the amount equivalent to your base salary in effect as of your termination date for fifty-two (52) weeks, subject
to standard payroll deductions and withholdings.



 






     


     


    

 


		·	Performance Review and Merit Increase: Your performance will be reviewed periodically with
you by your supervisor, but no less than annually. Merit increases are discretionary based on performance and business considerations.



 


		·	Benefits Eligibility: You will be eligible to participate in benefit plans offered through
Lumber Liquidators per the terms and conditions of those plans.



 


		·	Paid Time Off (PTO): Per the terms and conditions of
the Lumber Liquidators Paid Time Off (PTO) Policy, located on Lumber Liquidators intranet, you will accrue hours of PTO based on
weeks worked, up to a maximum of 160 hours in your first year of employment.  You will continue to accrue hours of PTO based
on weeks worked, at this level until you reach the next milestone.



 


		·	Holidays: Lumber Liquidators observes six 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.



 


This offer of employment is contingent
on (1) satisfactory results of a drug screening test, (2) background verification, (3) your executing the Confidentiality, Non-Solicitation
and Non-Competition Agreement, and (4) your ability to show that you are eligible to work in the United States. 


 


On your first day of employment, you will
be required to provide your social security card for payroll purposes, and proof of identity and employment eligibility in order
to complete an Employment Eligibility Verification (I-9) form. A list of acceptable documents is enclosed. Please note that, if
you do not have one document from List A, you must bring one document from List B and one document from List C.


 


Please ensure that you bring the proper
documentation with you on your first day of employment. Your subsequent failure to provide the necessary documentation as required
by federal law may result in the termination of your employment. Please note that your name for payroll purposes must match exactly
with your social security records. To expedite the orientation process, please complete the attached forms and bring these with
you on your first day.


 


Please acknowledge your acceptance of
this offer by signing and returning a copy of this letter and the Incorporated Documents, all in their entirety, to me no later
than February 25, 2016 via email at swhitehouse@lumberliquidators.com or confidential
fax to (855) 234-7165. By signing this offer, you are, among other things, representing to Lumber Liquidators that there are no
legal or equitable agreements or restrictions that would prevent, limit, impair or otherwise compromise your ability to comply
with the terms of this offer and perform on behalf of Lumber Liquidators. A copy of the letter is enclosed for your records. The
Lumber Liquidators’ mailing address is 3000 John Deere Road, Toano, Virginia 23168.


 






     


     


    

 


Please note that your employment with Lumber
Liquidators is at-will and neither this document nor any other oral or written representations may be considered a contract of
employment for any specific length of time. You retain the option, as does Lumber Liquidators, of ending your employment with Lumber
Liquidators at any time, with or without notice and with or without cause.


 


If you have questions regarding any of
the above, please feel free to contact me by telephone at (757) 566-7484 (office) or (757) 268-7815 (mobile), or by email.


 


We look forward to you joining the Lumber
Liquidators team and working with you to further our success.


 


Sincerely,


 


/s/ Sandra C. Whitehouse


 


Sandra C. Whitehouse


SVP, Chief Human Resources Officer


  


 


ACKNOWLEDGEMENT and AGREEMENT: As indicated
by my signature below on this letter, I acknowledge its receipt and my understanding and acceptance of its contents. I agree that
should I terminate employment with Lumber Liquidators or if my employment is terminated for cause, any monies owed for reimbursement
of expenses or other sums under this offer letter will be deducted from my final paychecks.


 


 





	Signature:  	/s/ Dennis R. Knowles	 	Date:	02/23/2016	 
	 	Dennis R. Knowles	 	 	 	 







  


		cc:	John Presley, CEO



 





	Attachments:	Confidentiality, Non-Solicitation and Non-Competition Agreement
	 	Annual Bonus Plan for Executive Management
	 	Relocation Policy for Senior Vice Presidents
	 	Relocation Expense Agreement
	 	Relocation Reimbursement Expense Form
	 	Direct Deposit Form
	 	Virginia Income Tax Withholding Form