272 Capital and B. Riley Financial Issue Joint Letter to Tile Shop Holdings Board of Directors

·4 min read

Two Shareholders Represent More Than 10% Combined Ownership of TTSH

Calls on Board to Up-List TTSH to a Major Stock Exchange

Intends to Run a Proxy Contest to Replace Directors if the Company Does Not Up-List

272 Capital, LP and B. Riley Financial, Inc., two significant shareholders of Tile Shop Holdings, Inc. (OTCMKTS: TTSH), today announced they have sent a public letter to the Board of Directors of Tile Shop urging the Board to take action and up-list TTSH to a major stock exchange. Full text of the letter follows:

January 28, 2021

Tile Shop Holdings, Inc.
c/o Board of Directors
14000 Carlson Parkway
Plymouth, MN 55441

To the Members of the Board of Directors,

272 Capital, LP ("272 Capital"), together with B. Riley Financial, Inc., collectively represent more than 10% of the outstanding common stock shares (the "Shares") of Tile Shop Holdings, Inc. ("TTSH" or the "Company").

TTSH remains significantly undervalued and we believe that up-listing the Shares of the Company on a major stock exchange would unlock both immediate and long-term value for all shareholders.

272 Capital previously sent a public letter to the Company’s Board of Directors (the "Board") on October 27, 2020 (the "October 27 Letter") calling on the Board to up-list to a major exchange and citing its belief that such action "will result in a significantly higher share price for the shareholders and a lower cost of capital for the Company". A full copy of the October 27 Letter can be found here.

In the three months since 272 Capital sent the October 27 Letter, the Board has issued no response, publicly or privately, and has not engaged in any dialogue with 272 Capital despite many attempts at constructive discussion by 272 Capital including outreach to individual members of the Board and the CEO. Shareholders were also not permitted to ask questions during the Company’s Q3 ’20 earnings call. The Company’s continued disregard of shareholder sentiment and lack of response is simply unacceptable.

We are not alone in our desire to see the Company up-list. Since the October 27 Letter, multiple shareholders have expressed strong support for an up-listing to unlock shareholder value.

With no dialogue or transparency from the Board and Company, we remain puzzled as to why the Board would not proceed with an up-listing. TTSH meets all qualifications to be up-listed and there are little to no incremental expenses involved. As expressed in the October 27 Letter, an up-listing is likely to have a significant positive impact on the share price and liquidity of the stock and be of benefit to shareholders, employees, and the Company’s cost of capital.

With the Board's continued refusal to engage, we intend to run an opposing slate of Directors at the upcoming annual meeting to give all shareholders the opportunity to have a say on the future of the Company.

We continue to welcome an open and constructive dialogue should the Company wish to have one.

Sincerely,

Wes Cummins

Bryant Riley

Chief Executive Officer

Chairman and Co-Chief Executive Officer

272 Capital, LP

B. Riley Financial, Inc.

About 272 Capital, LP

272 Capital LP is a registered investment adviser which seeks to provide attractive risk adjusted returns through a long/short equity strategy with low net exposure. 272 Capital invests primarily in individual publicly traded equity securities based mostly in the US through a rigorous bottom-up fundamental research investment process.

About B. Riley Financial, Inc.

B. Riley Financial (NASDAQ: RILY) provides collaborative financial services solutions tailored to fit the capital raising, business, operational, and financial advisory needs of its clients and partners. B. Riley operates through several subsidiaries which offer a diverse range of complementary end-to-end capabilities spanning investment banking and institutional brokerage, private wealth and investment management, corporate advisory, restructuring, due diligence, forensic accounting, litigation support, appraisal and valuation, and auction and liquidation services. Certain registered affiliates of B. Riley originate and underwrite senior secured loans for asset-rich companies. B. Riley also makes proprietary investments in companies and assets with attractive return profiles. For more information about B. Riley and its affiliated companies, visit www.brileyfin.com.

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Contacts

272 Capital LP
Wes Cummins
wes@272.capital
(214) 556-2465

B. Riley Financial
Investor Relations
ir@brileyfin.com
(310) 966-1444