Document:

Exhibit 101

		

			Exhibit 10.1

		

		

			 

		

			
					
						﻿

					
					
						 

					
						 

					
						  952-797-4349

					
						: Jamie.elliott@tileshop.com

					
						 

					
						 

				
	
					
						 

					
					
						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.
		

		 

 

		
		

		
			(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.

		

		

		 

 

		
		

		
			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

				

		
			﻿
		

		
			 
		

		

		

		 

 

		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
		

		
			 
		

		

		

		 

 

		(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
		

		
			 
		

		

		

		 

 

		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
		

		
			 
		

		

		

		 

 

		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.
		

		
			 
		

		

		

		 

 

		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.
		

		

		

		 

 

		
		

		
			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
		

		

		

		 

 

		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]
		

		

		

		 

 

		
		

		
			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
		

		
			﻿Exhibit 10.2

 

Execution Version

  

AMENDMENT NO. 1, dated
as of November 9, 2020 (this “Amendment”), to the TRANSACTION SUPPORT
AGREEMENT, dated as of July 25, 2020 (the “Agreement”), by and among SCHULTZE SPECIAL PURPOSE ACQUISITION
SPONSOR, LLC, a Delaware limited liability company (“Sponsor”), CLEVER LEAVES INTERNATIONAL INC., a corporation
organized under the laws of British Colombia, Canada (the “Company”), CLEVER LEAVES HOLDINGS INC., a corporation
organized under the laws of British Columbia, Canada (“Holdco”), and SCHULTZE SPECIAL PURPOSE ACQUISITION CORP.,
a Delaware corporation (“SPAC”).

 

WITNESSETH:

 

WHEREAS, the parties
hereto have entered into the Agreement; and

 

WHEREAS, the parties
hereto wish to amend the Agreement as set forth in this Amendment.

 

NOW, THEREFORE, in
consideration of the rights and obligations contained herein, and for other good and valuable consideration, the adequacy of which
is hereby acknowledged, the parties hereto agree as follows:

 

Section 1. Amendments to the Agreement.

 

(a) Exhibit A to the Agreement is hereby
amended by deleting Exhibit A in its entirety and replacing it with new Exhibit A attached hereto.

 

(b) The following “WHEREAS”
clause shall be inserted immediately following the second “WHEREAS” clause of the recitals:

 

“WHEREAS, as of the date hereof, Sponsor owns
beneficially and of record 4,150,000 SPAC Warrants (the “Sponsor Warrants”), and pursuant to, and in connection
with, the Merger, the Sponsor Warrants shall be converted into the right to receive 4,150,000 Holdco Warrants; and”

 

(c) Section 2 of the Agreement is hereby
amended and restated in its entirety to read as follows:

 

“2. Company Earn-Out.

 

(a) For purposes of this
Section 2:

 

(i) “Earn-Out
Shares” means the First Level Earn-Out Shares and the Second Level Earn-Out Shares, as the case may be.

 

(ii) “Earn-Out
Targets” means the First Earn-Out Target and the Second Earn-Out Target, as the case may be.

 

(iii) “First
Earn-Out Target” means that the closing price per share of Holdco Common Shares on the Trading Market as reported by
Bloomberg Financial L.P. using the AQR function equals or exceeds Twelve Dollars Fifty Cents ($12.50) for any twenty (20) trading
days within any consecutive thirty (30)-trading-day period commencing after Closing.

 

     

     

    

 

(iv) “First
Level Earn-Out Shares” means seven hundred twenty thousand (720,000) Holdco Common Shares.

 

(v) “First
Target Expiration Date” means the second (2nd) anniversary of the Closing.

 

(vi) “Second
Earn-Out Target” means that the closing price per share of Holdco Common Shares on the Trading Market as reported by
Bloomberg Financial L.P. using the AQR function equals or exceeds Fifteen Dollars ($15.00) for any twenty (20) trading days within
any consecutive thirty (30)-trading-day period commencing after Closing.

 

(vii) “Second
Level Earn-Out Shares” means seven hundred twenty thousand (720,000) Holdco Common Shares.

 

(viii)
“Second Target Expiration Date” means the fourth (4th) anniversary of the Closing.

 

(ix) “Trading
Market” means the stock market on which the Holdco Common Shares shall be trading at the time of determination.

 

(b) The parties
hereto hereby agree that, in connection with the Closing, Holdco shall adopt an equity incentive plan (the “Earnout Plan”)
for the benefit of service providers of Holdco and its subsidiaries, the share reserve of which shall be composed only of the Earn-Out
Shares. Under the Earnout Plan, the Holdco board of directors or any committee thereof may issue the Earn-Out Shares in the form
of awards of stock options, restricted share units or restricted shares, subject to applicable vesting conditions determined by
the Holdco board of directors or any committee thereof; provided, however, that no First Level Earn-Out Shares subject to such
awards shall be issued unless and until the First Earn-Out Target shall have been achieved prior to or on the First Target Expiration
Date and no Second Level Earn-Out Shares shall be issued with respect to such awards unless and until the Second Earn-Out Target
shall have been achieved prior to or on the Second Target Expiration Date.

 

(c) The Earn-Out
Shares and the Earn-Out Targets shall be adjusted to reflect appropriately the effect of any stock splits, reverse splits, stock
dividends, reorganizations, reclassifications or any similar event with respect to Holdco Common Shares, occurring on or after
the date hereof and prior to the time any such Earn-Out Shares are issued to certain shareholders of the Company.

 

    2

     

    

 

(d) The obligations
specified in this Section 2 shall be applicable only in connection with the Transactions contemplated by the BCA, and this
Section 2 shall be void and of no force and effect if the BCA shall be terminated or the Closing shall not occur for any
reason.”

 

(d) The following Section 3 shall be inserted
in its entirety immediately following Section 2 of the Agreement:

 

“3. Surrender of Sponsor Warrants.

 

(a) The Sponsor
hereby agrees that, subject to, and conditioned upon, the occurrence of the Closing and effective as of immediately prior to the
Merger Effective Time, the Sponsor shall automatically be deemed to irrevocably transfer, surrender and forfeit for no consideration
all warrants then in its possession, other than the Sponsor Warrant Amount and the Working Capital Warrants (as defined in the
SPAC Warrant Amendment), if any, issued to Sponsor in full satisfaction of the Sponsor Loans in accordance with Section 7.02(b)(vi)
of the BCA (the “Sponsor Loans Working Capital Warrants” and together with the Sponsor Warrant Amount, the “Excluded
Warrants”), and that from and after such time such warrants (other than the Excluded Warrants) shall be deemed to be
cancelled and no longer outstanding. Each of the parties shall take all reasonably necessary actions required to reflect the surrender
and forfeiture of such warrants (other than the Excluded Warrants) as of immediately prior to the Merger Effective Time in the
books and records of the SPAC’s warrant agent. For the avoidance of doubt, neither the Sponsor Warrant Amount nor the Sponsor
Loans Working Capital Warrants shall be surrendered, forfeited or cancelled pursuant to this Section 3.

 

(b) For purposes
of this Section 3:

 

(i) “Available
Cash Amount” means, after giving effect to the exercise of Redemption Rights and payments related thereto, the aggregate
amount of cash held either in or outside the Trust Account, including the aggregate amount of the PIPEs, including, for the avoidance
of doubt, the aggregate amount of the Agreed PIPE (as defined in the BCA) (excluding any PIK Amount) consummated prior to, or as
of, the closing of the transactions contemplated by the BCA.

 

(ii) “PIK
Amount” means the accrued payment-in-kind interest on the Secured Convertible Notes (as defined in the BCA), which shall
be invested into the Agreed PIPE.

 

(iii) “Sponsor
Warrant Amount” means a number of Holdco Warrants (rounded down to the nearest whole warrant) equal to (A) 1,245,000
plus (B) the quantity of (1) 2,905,000 multiplied by (2) the quotient obtained by dividing (I) the quantity
of (x) the Available Cash Amount minus (y) $25,000,000 by (II) $20,000,000; provided that in no event shall the Sponsor
Warrant Amount be less than 1,245,000 warrants or greater than 4,150,000 warrants. An illustrative calculation of the Sponsor Warrant
Amount is set forth on Exhibit B hereto.

 

(e)
Exhibit B attached to this Amendment shall be inserted in its entirety immediately following Exhibit A to the Agreement.

  

    3

     

    

 

Section 2. Entire
Agreement. This Amendment and the Agreement constitute the entire agreement among the parties hereto with respect to the subject
matter hereof and supersede all prior agreements and undertakings, both written and oral, among the parties hereto, or any of them,
with respect to the subject matter hereof.

 

Section 3. Effect
of Amendment No. 1.

 

(a) No Other Amendments.
Except as expressly amended by this Amendment, the Agreement shall continue in full force and effect and is hereby ratified and
confirmed and this Amendment will not constitute any other modification, amendment or waiver to the Agreement.

 

(b) References.
On and after the date hereof, each reference in the Agreement to “this Agreement,” “hereunder,” “hereof,”
“herein” or words of like import referring to the Agreement, and each reference in any other document relating to the
“Transaction Support Agreement,” the “Agreement,” “thereunder,” “thereof,” or words
of like import referring to the Agreement, means and references the Agreement as amended hereby.

 

Section 4. Authorization.
Each party hereby represents to the other parties hereto that this Amendment has been duly authorized, executed and delivered by
such party and constitutes a valid and binding obligation of such party enforceable against such party in accordance with its terms.

 

Section 5. Governing
Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to
contracts executed in and to be performed in that State.

 

Section 6. Counterparts.
This Amendment may be executed and delivered (including by facsimile or portable document format (pdf) transmission) in one or
more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to
be an original but all of which taken together shall constitute one and the same agreement.

 

[Signature Page Follows]

 

    4

     

    

 

IN WITNESS WHEREOF
the parties hereto have hereunto caused this Amendment to be duly executed as of the date first set forth above.

 

	 	SCHULTZE SPECIAL PURPOSE ACQUISITION SPONSOR, LLC
	 	 
	 	By: Schultze Asset Management, LP
	 	By: Schultze Asset Management GP, LLC
	 	 
	 	By 	/s/  George J. Schultze
	 	Name:	George J. Schultze
	 	Title:	Managing Member
	 	 	 
	 	SCHULTZE SPECIAL PURPOSE ACQUISITION CORP.
	 	 	 
	 	By 	/s/  George J. Schultze
	 	Name:	George J. Schultze
	 	Title:	Chief Executive Officer and President
	 	 	 
	 	CLEVER LEAVES HOLDINGS INC.
	 	 	 
	 	By 	/s/  Kyle Detwiler
	 	Name:	Kyle Detwiler
	 	Title:	Director
	 	 	 
	 	CLEVER LEAVES INTERNATIONAL INC.
	 	 	 
	 	By 	/s/  Kyle Detwiler
	 	Name:	Kyle Detwiler
	 	Title:	Chief Executive Officer

 

[Signature Page
to Amendment No. 1 to the Transaction Support Agreement]

 

    5

     

    

 

EXHIBIT A

 

ESCROW AGREEMENT AMENDMENT

 

Effective as of the
Closing, Section 3.2 of the Escrow Agreement shall be deleted in its entirety and replaced with the following:

 

(a) Forfeiture
of Sponsor Upfront Shares; Release of Sponsor Upfront Escrow Shares and SPAC Director Shares.  Except as otherwise set forth
herein, the Escrow Agent shall hold the shares remaining after any cancellation required pursuant to Section 3.1. Effective
immediately prior to the consummation of the transactions contemplated by the BCA (as defined below), Sponsor shall forfeit and
surrender the Shares Forfeiture Amount, the Escrow Agent shall release such forfeited shares of Common Stock to the Company for
cancellation. Of such remaining shares, the Sponsor Upfront Escrow Shares including the SPAC Director Shares shall be held pursuant
to this Section 3.2(a) and the Sponsor Earn-Out Shares shall be held pursuant to Section 3.2(b). The Sponsor Upfront
Escrow Shares and the SPAC Director Shares shall be held for a period expiring on the earlier of (I) one (1) year following the
date of the consummation of the transactions contemplated by the Business Combination Agreement, dated as of July 25, 2020, by
and among the Company, Clever Leaves Holdings, Inc., Novel Merger Sub Inc. and Clever Leaves International Inc. (the “BCA”)
and (II) the date on which the closing price of the shares of Common Stock on the Trading Market as reported by Bloomberg Financial
L.P. using the AQR function equals or exceeds Twelve Dollars Fifty Cents ($12.50) per share (as adjusted for stock splits, stock
dividends, reorganizations, and recapitalizations) for any twenty (20) trading days within any consecutive thirty (30)-trading-day
period commencing after the 180th day after the consummation of the transactions contemplated by the BCA (such period,
the “Initial Stockholder Upfront Escrow Period”). Upon expiration of the Initial Stockholder Upfront Escrow
Period, the Escrow Agent shall disburse and release to the Initial Stockholders all Sponsor Upfront Escrow Shares and SPAC Director
Shares held with respect to such Initial Stockholders (and any applicable stock power), upon receipt of a written notice executed
by Sponsor (with evidence a copy of such written notice shall have been delivered to Holdco), in form reasonably acceptable to
the Escrow Agent, certifying the expiration of the Initial Stockholder Upfront Escrow Period and the number of Sponsor Upfront
Escrow Shares and SPAC Director Shares to be disbursed and released to each Initial Stockholder. The Escrow Agent shall have no
further duties under this Section 3.2(a) with respect to the Sponsor Upfront Escrow Shares and the SPAC Director Shares
after the disbursement of the Sponsor Upfront Escrow Shares to the Initial Stockholders.

 

(b) Release
of Sponsor Earn-Out Shares. The Escrow Agent shall hold, disburse and release the Sponsor Earn-Out Shares as follows:

 

(i) The Escrow Agent
shall hold the First Level Earn-Out Shares until the closing price per share of the shares of Common Stock equals or exceeds the
First Earn-Out Target at any time prior to or on the First Target Expiration Date. The Escrow Agent shall disburse and release
to Sponsor all First Level Earn-Out Shares (and any applicable stock power), upon receipt of a written notice executed by Sponsor
(with evidence a copy of such written notice shall have been delivered to Holdco), in form reasonably acceptable to the Escrow
Agent, certifying the achievement of the First Earn-Out Target (the “First Earn-Out Target Release Notice”).
In the event that the First Earn-Out Target Release Notice is not delivered on or prior to the First Target Expiration Date, then
the Escrow Agent shall automatically disburse and release the First Level Earn-Out Shares (and any applicable stock power) to Holdco
for cancellation. The Escrow Agent shall have no further duties under this Section 3.2(b)(i) with respect to the First Level
Earn-Out Shares after the disbursement of the First Level Earn-Out Shares to Sponsor or Holdco, as the case may be.

 

    6

     

    

 

(ii) Additionally,
the Escrow Agent shall hold the Second Level Earn-Out Shares until the closing price per share of the shares of Common Stock equals
or exceeds the Second Earn-Out Target at any time prior to or on the Second Target Expiration Date. The Escrow Agent shall disburse
and release to Sponsor all Second Level Earn-Out Shares (and any applicable stock power), upon receipt of written notice executed
by Sponsor (with evidence a copy of such written notice shall have been delivered to Holdco), in form reasonably acceptable to
the Escrow Agent, certifying the achievement of the Second Earn-Out Target (the “Second Earn-Out Target Release Notice”).
In the event that the Second Earn-Out Target Release Notice is not delivered on or prior to the Second Target Expiration Date,
then the Escrow Agent shall automatically disburse and release the Second Level Earn-Out Shares (and any applicable stock power)
to Holdco for cancellation. The Escrow Agent shall have no further duties under this Section 3.2(b)(ii) with respect to
the Second Level Earn-Out Shares after the disbursement of the Second Level Earn-Out Shares to Sponsor or Holdco, as the case may
be.

 

(iii) The Earn-Out
Shares and the Earn-Out Targets shall be adjusted to reflect appropriately the effect of any stock splits, reverse splits, stock
dividends, reorganizations, reclassifications and other similar events with respect to the Holdco Common Shares, occurring on or
after the date hereof and prior to the time any such Earn-Out Shares are released to Sponsor or returned to Holdco, as the case
may be.

 

(iv) For purposes of
this Section 3.2:

 

(1) “Available
Cash Amount” means, after giving effect to the exercise of Redemption Rights and payments related thereto, the aggregate
amount of cash held either in or outside the Trust Account, including the aggregate amount of the PIPEs, including, for the avoidance
of doubt, the aggregate amount of the Agreed PIPE (as defined in the BCA) (excluding any PIK Amount) consummated prior to, or as
of, the closing of the transactions contemplated by the BCA.

 

(2) “Closing”
shall have the meaning set forth in the BCA.

 

(3) “Earn-Out
Shares” means the First Level Earn-Out Shares and the Second Level Earn-Out Shares, as the case may be.

 

(4) “Earn-Out
Targets” means the First Earn-Out Target and the Second Earn-Out Target, as the case may be.

 

(5) “First Earn-Out
Target” means that the closing price per share of Common Stock on the Trading Market as reported by Bloomberg Financial
L.P. using the AQR function equals or exceeds Twelve Dollars Fifty Cents ($12.50) for any twenty (20) trading days within any consecutive
thirty (30)-trading-day period commencing after Closing

 

    7

     

    

 

(6) “First Level
Earn-Out Shares” means the number of Holdco Common Shares equal to Fifty Percent (50%) of the Sponsor Earn-Out Shares.

 

(7) “First Target
Expiration Date” means the second (2nd) anniversary of the Closing.

 

(8) “Maximum
Upfront Shares Amount” means 1,168,421 Holdco Common Shares. For the avoidance of doubt, the Company may issue up to
the aggregate amount of 2,631,579 shares of Common Stock at $9.50 (or higher) per share for a PIPE in the amount of twenty-five
million dollars ($25,000,000) and such issuance pursuant to such PIPE shall in no event reduce the Maximum Upfront Shares Amount.

 

(9) “Minimum
Upfront Shares Amount” means 460,000 Holdco Common Shares.

 

(10) “Net Capital”
means an aggregate amount equal to (A) the Available Cash Amount, minus (B) SPAC’s good faith estimate of the SPAC
Transaction Expenses (as defined in the BCA) delivered to the Company pursuant to Section 3.01(b) of the BCA.

 

(11) “PIK Amount”
means the accrued payment-in-kind interest on the Secured Convertible Notes (as defined in the BCA), which shall be invested into
the Agreed PIPE.

 

(12) “Second
Earn-Out Target” means that the closing price per share of Common Stock on the Trading Market as reported by Bloomberg
Financial L.P. using the AQR function equals or exceeds Fifteen Dollars ($15.00) for any twenty (20) trading days within any consecutive
thirty (30)-trading-day period commencing after Closing.

 

(13) “Second
Level Earn-Out Shares” means the number of Holdco Common Shares equal to Fifty Percent (50%) of the Sponsor Earn-Out
Shares.

 

(14) “Second
Target Expiration Date” means the fourth (4th) anniversary of the Closing.

 

(15) “Shares
Forfeiture Amount” means a number of shares of Common Stock equal to (A) 3,250,000 minus (B) the Sponsor Upfront
Escrow Shares minus (C) the Sponsor Earn-Out Shares, if any.

 

(16) “SPAC Director
Shares” means 60,000 Sponsor Upfront Escrow Shares held by members of the Board of Directors of SPAC.

 

(17) “Sponsor
Earn-Out Shares” means a number of shares of Common Stock (rounded down to the nearest whole share) equal to (A) the
Sponsor Earn-Out Value, divided by (C) $5.00; provided that the number of Sponsor Earn-Out Shares shall not be less
than zero or greater than 1,300,000.

 

    8

     

    

 

(18) “Sponsor
Earn-Out Value” means an amount equal to (A) the Sponsor Value, minus (B) the Sponsor Upfront Shares Value.

 

(19) “Sponsor
Upfront Escrow Shares” means a number of shares of Common Stock (rounded down to the nearest whole share) equal to (A)
the Sponsor Value, divided by (B) $10.00; provided that the number of Sponsor Upfront Escrow Shares shall not be
less than the Minimum Upfront Shares Amount or greater than the Maximum Upfront Shares Amount.

 

(20) “Sponsor
Upfront Shares Value” means an amount equal to (A) the Sponsor Upfront Escrow Shares, multiplied by (B) $10.00.

 

(21) “Sponsor
Value” means an amount equal to (A) the Net Capital, multiplied by (B) twenty percent (20%).

 

(22) “Trading
Market” means the stock market on which the shares of Common Stock shall be trading at the time of determination.

 

Effective as of the
closing of the transactions contemplated by the BCA, a new Exhibit B shall be inserted in its entirety after Exhibit A to
the Escrow Agreement, as amended, which is an illustrative calculation of (a) Net Capital, (b) Shares Forfeiture Amount, (c) Sponsor
Earn-Out Shares, (d) Sponsor Earn-Out Value, (e) Sponsor Upfront Escrow Shares, (f) Sponsor Upfront Shares Value and (g) Sponsor
Value.

 

Effective as of the
Closing, the following Section 3.3 shall be inserted in its entirety immediately following Section 3.2 of the Escrow
Agreement, as amended.

 

3.3 Effective as of
the closing of the transactions contemplated by the BCA, the shares of Common Stock held in escrow pursuant to the terms of this
Agreement shall become common shares of Holdco (“Holdco Common Shares”) in accordance with the terms and conditions
of the BCA. Effective as of the Closing of the transactions contemplated by the BCA and for purposes of this Agreement, references
to shares of “Common Stock” in this Agreement are hereby deemed to refer to Holdco Common Shares. Effective as of the
closing of the transactions contemplated by the BCA, Holdco shall be deemed to be “the Company” for all purposes of
this Agreement.

 

    9

     

    

 

EXHIBIT B

 

ILLUSTRATIVE CALCULATION OF (A) NET CAPITAL,
(B) SHARES FORFEITURE AMOUNT, (C) SPONSOR EARN-OUT SHARES, (D) SPONSOR EARN-OUT VALUE, (E) SPONSOR UPFRONT ESCROW SHARES, (F) SPONSOR
UPFRONT SHARES VALUE, (G) SPONSOR VALUE AND (H) SPONSOR WARRANT AMOUNT.

 

See attached.

 

 

10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00316-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00316-of-00352.parquet"}]]