Tile Shop Holdings reached a tentative settlement with shareholders angered by its plan to delist from the Nasdaq stock market, a deal that removed some uncertainty for the company and lifted its share price this week.

Under the agreement, the Plymouth-based retailer agreed to set up a $12 million fund to settle with investors whose share value was destroyed when the company announced the delisting plan last October.

It also agreed to continue to disclose quarterly results to investors for at least the next three years.

The company notified securities regulators of the tentative agreement late Monday. Tile Shop shares rose 19% on Tuesday to $1.60 and have held relatively steady since, closing at $1.56 Friday.

Tile Shop, which operates 142 stores in 31 states, surprised investors when its board of directors last Oct. 22 decided to delist the firm from the Nasdaq, a step known as "going dark."

The move forced most institutional shareholders to sell their holdings in the company since many such investors have rules prohibiting ownership in firms that don't meet certain levels of disclosure. As a result, Tile Shop's shares lost more than two-thirds of their value in one day.

That drop affected the holdings of not just outside investors but store managers and other Tile Shop employees with stock incentives.

Within days, a group of outside investors led by Peter Kamin, a Florida investor with a record of turning companies around, moved to quickly buy a controlling stake in the company.

That sparked a lawsuit by K-Bar Holdings and Wynnefield Capital Inc., which accused the Kamin-led group of working with the firm's founder and then-chief executive Robert Rucker to devalue Tile Shop at the expense of other shareholders. A Delaware state court judge subsequently ordered Kamin and other defendants to stop buying shares in Tile Shop.

As part of the settlement announced this week, the sides agreed that shares purchased by Kamin and several other investors from late October through early November will be voted in proportion as those of shares held by outside shareholders.

Rucker left the company in February and wrote a letter to investors that described his disagreements with its new directors and executives.

Also as part of the settlement announced this week, two new directors on the Tile Shop board, Mark Bonney, a South Carolina-based finance executive, and Linda Solheid, a former executive of Golden Valley-based Room & Board, will form an independent transaction committee.