Document:

efsh_ex106.htm

EXHIBIT 10.6
  
 LEASE AGREEMENT
  
 This Lease Agreement (“Lease”) is entered into by and between the undersigned Landlord and Tenant on this the 5th day of April, 2019, in accordance with the terms and conditions hereinafter set forth.
  
 ARTICLE 1. BASIC PROVISIONS AND CERTAIN DEFINED LEASE TERMS
  
 1.1 When used herein, the following terms shall have the indicated meanings:
  
  	  
	A.	Landlord: S.H.J., L.L.C.
	  
	  
	   

	  
		Address of Landlord: 120 S. Central Ave. Suite 1800, St. Louis, MO 63105
	  
	  
	   

	  
	B.	Tenant: 1847 Goedeker Inc.
	  
	  
	   

	  
		Address of Tenant: 13850 Manchester Road, St. Louis, MO 63011
	  
	   
	   

	  
	C.	Leased Premises: Land and improvements located thereon located in the County of St. Louis and commonly known as 13850 Manchester Rd., St. Louis, Missouri 63011, which is more particularly described and/or depicted in Exhibit “A” attached hereto and incorporated herein by reference.
	  
	    
	  

	  
	D.	Lease Term: Beginning on the Commencement Date and expiring on the Termination Date.
	  
	    
	  

	  
	E.	Commencement Date: April 5, 2019.
	  
	   
	  

	  
	F.	Termination Date: Five years after commencement date unless otherwise terminated as permitted herein.
	  
	   
	  

	  
	 G.
	 Lease Year: A period of twelve (12) consecutive calendar months beginning on the Commencement Date.

	  
	   
	  

	  
	 H.
	 Rent:

	  
	   
	  

	  
	  
	 Base Rent: $540,000 per year ($45,000 per month)

	  
	   
	  

	  
	  
	 Additional Rent:

  
  	  
	(1)	Initial Tax Payment $8,617.50 to be adjusted according to Article 4.
	  
	   
	  

	  
	(2)	Initial Insurance Payment: $1,726 to be adjusted according to Article 4.

   
  	  
	I.	Security Deposit: $45,000.
	  
	   
	  

	  
	J.	Permitted Use: Operation of appliance store together with related existing display, warehouse, and office use.
	  
	  
	  

	  
	K.	Parking: Tenant shall be permitted the non-exclusive use of the parking lot located on the Leased Premises, in compliance with all laws and any reasonable rules and regulations of Landlord.

 
 1.2 Each of the foregoing Basic Provisions and Certain Defined Lease Terms shall be construed in conjunction with the references thereto contained in the other provisions of this Lease and shall be limited by such other provisions. Each reference in this Lease to any of the foregoing Basic Provisions and Certain Defined Lease Terms shall be construed to incorporate each term set forth above.
  
  	 
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 ARTICLE 2. GRANTING CLAUSE
  
 2.1 In consideration of the obligation of Tenant to pay Rent as herein provided and in consideration of the other terms, covenants and conditions hereof, Landlord hereby leases to Tenant, and Tenant hereby takes from Landlord the Leased Premises for the Lease Term, unless sooner terminated in accordance with the terms and conditions set forth below.
  
 2.2 EXCEPT AS SPECIFICALLY PROVIDED IN THIS LEASE, TENANT ACKNOWLEDGES THAT LANDLORD HAS MADE NO WARRANTIES TO TENANT AS TO THE CONDITION OF THE LEASED PREMISES, EITHER EXPRESS OR IMPLIED, THAT THE LEASED PREMISES ARE BEING LEASED TO TENANT “AS IS”, “WHERE IS” AND “WITH ALL FAULTS” AND LANDLORD EXPRESSLY DISCLAIMS ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, MARKETABILITY, OR FITNESS FOR A PARTICULAR PURPOSE.
  
 ARTICLE 3. ACCEPTANCE OF LEASED PREMISES
  
 Tenant acknowledges that (a) it has inspected and accepts the Leased Premises, (b) the buildings and improvements comprising the Leased Premises are suitable for the purposes for which they are being leased by Tenant, (c) the Leased Premises are in good and satisfactory condition, and (d) no representation as to the repair of the Leased Premises, nor promises to alter, remodel, or improve the Leased Premises have been made by Landlord, except as expressly set forth herein.
  
 ARTICLE 4. RENT, ADDITIONAL RENT, AND SECURITY DEPOSIT
  
 4.1 Rent shall accrue hereunder from the Commencement Date as set forth in the Basic Provisions and shall be payable at the address of Landlord specified above or such other place as Landlord shall designate in writing to Tenant, from time to time.
  
 4.2 Tenant shall pay to Landlord the Rent in monthly installments in the amounts specified in Section 1.1, without demand, deduction, or setoff, on or before the first day of each calendar month during the Lease Term; provided, that if the Commencement Date should fall on a date other than the first day of a calendar month, there shall be due and payable, a pro-rata portion of the Rent.
  
 4.3 In addition to and separate from the Base Rent, Tenant will be responsible for all Taxes and Insurance Premiums (as such terms are defined below) during the Lease Term and Tenant will pay to Landlord the Tax Payment and the Insurance Payment (collectively, together with any other charges due hereunder by Tenant other than Base Rent being referred to herein as “Additional Rent”) as more particularly described below. Beginning on the Commencement Date, the Tax Payment and the Insurance Payment shall be payable monthly in advance for each and every month thereafter during the Lease Term; except, however, if the Lease Term does not begin on the first day of a calendar month, Tenant shall pay a pro-rata portion of such sums for such partial month. As used herein, the following terms shall have the following meanings:
  
  	  
	A.	The term “Taxes” shall mean, all taxes, assessments, special assessments, impositions, levies, charges, excises, fees, licenses and other sums levied, assessed, charged or imposed by any governmental authority or other taxing authority or which accrue on the Leased Premises for each calendar year (or portion thereof) during the Lease Term and all penalties, interest and other charges (with respect to Taxes) payable by reason of any delay in or failure or refusal of Tenant to make timely payment as required under this Lease.
	  
	  
	  

	  
	 B.
	 The term “Insurance Premiums” shall mean, the total annual insurance premiums which accrue on all fire and extended coverage insurance, boiler insurance, public liability and property damage insurance, rent insurance and other insurance which, from time to time, may at Landlord’s election be carried by Landlord with respect to the Leased Premises during any applicable calendar year (or portion thereof) occurring during the Lease Term.

 
  	 
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 4.4 The initial monthly Tax Payment and Insurance Payment set forth in the Basic Provisions are based upon Landlord’s estimated amounts of the Taxes and Insurance Premiums for the first Lease Year, and may be increased or decreased from time to time on notice to Tenant to reflect the then current projected costs of such expenses. Landlord shall total all expenses annually, and reconcile the actual amount of such expenses against Tenant’s total payments. If Tenant’s total payments are less than the actual amount of such expenses, Tenant shall pay the difference to Landlord within five (5) days after demand. If the total payments of Tenant are more than the actual amount of such expenses, Landlord shall retain such excess and credit it against Tenant’s future liabilities for such expenses.
  
 4.5 If there is presently in effect or hereafter adopted any nature of sales tax or use tax or other tax on rents or other sums received by Landlord under this Lease (herein referred to as “Rent Sales Tax”), then in addition to all Rent and other payments to be made by tenant as provided above, Tenant will also pay Landlord a sum equal to the amount of such Rent Sales Tax. The term “Rent Sales Tax” shall not include any income taxes applicable to Landlord.
  
 4.6 Tenant agrees to deposit with Landlord on the date hereof the Security Deposit which shall be held by Landlord, without obligation for interest, as security for the performance of Tenant’s obligations under this Lease. It being understood and agreed that the Security Deposit is not an advance rental deposit or a measure of Landlord’s damages in case of Tenant’s default. Upon each occurrence of an Event of Default, Landlord may use all or part of the Security Deposit to pay past due Rent or other payments due Landlord under this Lease, and the cost of any other damage, injury, expense or liability caused by such Event of Default without prejudice to any other remedy provided herein or provided by law. On demand, Tenant shall pay Landlord the amount that will restore the Security Deposit to its original amount. If Tenant is not then in default hereunder, any remaining balance of the Security Deposit shall be returned by Landlord to Tenant after termination of this Lease. 
  
 ARTICLE 5. USE OF LEASED PREMISES
  
 5.1 The Leased Premises shall be used only for the Permitted Use. Tenant shall at its own cost and expense obtain any and all licenses and permits necessary for any such use. Tenant shall, at its own cost and expense, comply with all laws, orders, and requirements of all governmental entities with reference to the use and occupancy of the Leased Premises. Tenant shall take care of the Leased Premises and not permit any objectionable or unpleasant odors, smoke, dust, gas, noise or vibrations to emanate from the Leased Premises and not take any other action which would constitute a nuisance. Without Landlord’s prior written consent, Tenant shall not receive, store or otherwise handle any product, material, or substance which is explosive, highly inflammable or hazardous waste. Tenant will not permit the Leased Premises to be used for any purpose or in any manner (including without limitation any method of storage) which would render any insurance thereon void or the insurance risk more hazardous.
   	 
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 ARTICLE 6. MAINTENANCE AND REPAIR OF LEASED PREMISES AND ALTERATIONS
  
 6.1 Landlord shall be responsible for maintaining the structural soundness of the foundation, exterior walls (except plate glass, windows, doors, door closure devises, window and door frames, molding, locks and hardware, and interior painting or other interior treatments of exterior walls). Tenant shall be responsible for and shall keep all other components of the Leased premises in good order and repair. Landlord shall not be required to make any repairs occasioned by an act of negligence or willful misconduct by Tenant, its employees, subtenants, licensees, or concessionaires. In the event that the Leased Premises should become in need of repairs required to be made by Landlord, Tenant shall give immediate notice thereof to Landlord, and Landlord shall proceed with reasonable diligence to make such repairs. Landlord’s obligation to maintain the aforementioned items shall be limited solely to the cost of such repairs or maintenance or the curing of any defect in the same. 
  
 6.2 Landlord reserves the right to alter or modify the building of which the Leased Premises are a part when such alterations or modifications are required by governmental laws, codes, ordinances, regulations, or any other applicable authorities, including, without limitation, the Americans with Disabilities Act of 1990, as subsequently amended or modified (the “ADA”). If any such modification is predicated by Tenant’s particular use of the Leased Premises the cost shall be borne entirely by Tenant and Tenant shall reimburse Landlord for same promptly upon demand.
  
 6.3 Except for repairs and replacement required to be made by Landlord under the provisions of this Article 6 and Article 12 (Damage by Casualty), Tenant shall keep the Leased Premises in a good and clean condition, ordinary wear and tear excepted, and shall at its sole cost and expense make all needed repairs and replacements, including cracked or broken glass, any special store front, windows, doors, heating system, plumbing work, pipes and fixtures, air-conditioning equipment, roof and the interior of the Leased Premises generally and other improvements of the Tenant outside the Leased Premises, if any, together with such repairs, replacements and alterations required by any governmental authority in connection with Tenant’s use and operation of the Leased Premises. In addition, Tenant shall be responsible for maintaining in a good, neat and clean condition, reasonable wear and tear excepted, all parking, driveway and landscaped areas located at the Leased Premises. If any repairs required to be made by Tenant hereunder are not initiated and pursued diligently within ten (10) days after notice is delivered to Tenant by Landlord, Landlord may at its option make such repairs, and Tenant shall pay to Landlord upon demand the reasonable cost of such repairs. Landlord agrees to afford to Tenant the benefit of any guaranties or warranties of third parties which may be applicable to air-conditioning equipment and other machinery and equipment installed by Landlord in the Leased Premises, without recourse upon Landlord.
  
 6.4 Tenant, at its own cost and expense, shall enter into a regularly scheduled preventative maintenance/service contract with a maintenance contractor approved by Landlord for servicing all hot water, heating and air conditioning systems and equipment within the Leased Premises. The service contract must include all services suggested by the equipment manufacturer in its operations/maintenance manual and must become effective and a copy thereof delivered to Landlord within fifteen (15) days of the date Tenant takes possession of the Leased Premises.
  
 6.5 Tenant shall not make any openings in the roof or exterior walls, nor make any alterations, additions, or improvements to the Leased Premises without the prior written consent of Landlord except for the installation of unattached, removable trade fixtures which may be installed without drilling, cutting or otherwise defacing the Leased Premises. All alterations, additions, improvements and fixtures (other than unattached, movable trade fixtures of Tenant as permitted herein) upon the Leased Premises, including, but not limited to, the HVAC system, pipes, paneling or other wall covering, any linoleum or other floor covering of similar character which may be cemented or otherwise adhesively affixed to the floor of the Leased Premises, shall remain upon and be surrendered with the Leased Premises and become the property of Landlord at the expiration or earlier termination of this Lease, all without credit or compensation to Tenant, unless Landlord requests their removal, in which event Tenant shall remove the same and restore the Leased Premises to its original condition at Tenant’s sole cost and expense. In addition, Tenant shall put all plumbing or other electrical wiring connections exposed as result of the removal of Tenant’s removable trade fixtures in a safe and workmanlike manner. Tenant’s obligations under this paragraph shall survive the expiration or earlier termination of this Lease
   	 
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 6.6 All construction work done by Tenant within the Leased Premises shall be performed in a good and workmanlike manner, and in compliance with all governmental requirements and applicable law. Without limitation on the generality of the foregoing, Landlord shall have the right to require that such work be performed in accordance with rules and regulations which Landlord may from time to time reasonably prescribe. All costs of such work shall be paid promptly so as to prevent the assertion of any liens for labor or materials. Tenant agrees to indemnify Landlord and hold Landlord harmless against any loss, liability, damage or injury resulting from such work, which indemnity shall survive the expiration or earlier termination of this Lease, and Tenant shall, if requested by Landlord, furnish a reasonable bond or other security satisfactory to Landlord against any such loss, liability, damage or injury. Whenever Tenant proposes to do any construction work within the Leased Premises, it shall first furnish to Landlord plans and specifications in such detail as Landlord may request covering all such work. In no event shall any construction work be commenced within the Leased Premises without Landlord’s written approval of such plans and specifications.
  
 ARTICLE 7. LANDLORD’S RIGHT OF ACCESS
  
 7.1 Landlord and its employees, contractors, agents and representatives shall have the right to enter upon the Leased Premises during normal business hours (or at time for emergency reasons) and with at least twenty-four hours’ notice (unless for emergency reasons in which case no notice is required), for the purpose of inspecting the same, or of making repairs or additions to the Leased Premises, or of showing the Leased Premises to prospective purchasers, tenants or lenders. In an emergency, Landlord (or its agents, representatives or employees) may use any means to open any door into or in the Leased Premises without any liability therefor.
  
 ARTICLE 8. SIGNS AND ROOF
  
 8.1 Tenant shall have the right, at Tenant’s sole cost and expense, to install signage at the Premises, subject to and in compliance with any and all applicable laws and governmental requirements and shall be responsible for obtaining any necessary governmental permits or applications therefor. On or before the expiration or earlier termination of this Lease, Tenant shall remove all of Tenant’s signage and restore the Leased Premises to the condition which existed prior to the installation of such signs including, without limitation, any discoloration caused by such installation and/or removal. This obligation of Tenant shall survive the expiration or earlier termination of this Lease. Use of the roof is reserved to the Landlord, provided such use does not unreasonably interfere with Tenant’s occupancy.
  
 ARTICLE 9. UTILITIES AND LIENS
  
 9.1 Tenant shall contract in its own name for all water, gas, electricity, telephone service, sewage services, garbage services, and other utilities used in or upon the Leased Premises during the Lease Term (the “Utility Services”), and Tenant shall pay or cause to be paid when due all charges for the Utility Services. Tenant shall be liable for all maintenance and equipment with respect to the continued operation of Utility Services serving the Leased Premises during the Lease Term. Tenant agrees to indemnify and hold harmless Landlord from and against any and all claims arising from the maintenance of the Utility Services and from all costs and charges for the Utility Services provided to and consumed on the Leased Premises during the Lease Term. In the event any Utility Services are delayed, interrupted or discontinued, whether by reason of repairs, strikes, accidents, inability to obtain fuel or supplies, or other causes, no such interruption or discontinuance of such service shall be deemed an eviction, partial eviction or disturbance of Tenant’s use and possession of the Leased Premises or any part thereof, or render the Landlord liable to Tenant for any damages, or relieve Tenant from performance of Tenant’s obligations under this Lease including without limitation the obligation to pay Rent. 
   	 
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 9.2 Tenant shall not mortgage or otherwise encumber or allow to be encumbered its interest herein without obtaining the prior written consent of Landlord. Should Tenant cause any mortgage, lien or other encumbrance (hereinafter singularly or collectively referred to as “Encumbrance”) to be filed, against the Leased Premises, Tenant shall dismiss or bond against the same within thirty (30) days after the filing thereof. If Tenant fails to remove or bond against said Encumbrance within said thirty (30) days, Landlord shall have the absolute right to remove said Encumbrance by whatever measures Landlord shall deem convenient including, without limitation, payment of such Encumbrance, in which event Tenant shall reimburse Landlord, as Additional Rent, all costs expended by Landlord, including reasonable attorneys fees, in removing said Encumbrance. All of the aforesaid rights of Landlord shall be in addition to any remedies which either Landlord or Tenant may have available to them at law or in equity. 
  
 9.3 Tenant's obligations under this Article 9 shall survive the expiration or earlier termination of this Lease.
  
 ARTICLE 10. INSURANCE AND INDEMNITY
  
 10.1 Tenant shall maintain in full force and effect throughout the Lease Term the following insurance policies: (a) commercial general liability insurance in amounts of not less than a per occurrence limit of $1,000,000, and with not less than a $2,000,000 general aggregate insuring Tenant, and as additional insureds, Landlord, if any, against all liability or injury to or death of persons, or damage to property, arising from or related to the use and/or occupancy of the Leased Premises by Tenant or any of Tenant’s agents, employees, contractors or invitees; (b) contractual liability insurance coverage sufficient to cover Tenant’s indemnity obligations under the Lease; (c) all-risk property insurance covering the full replacement value of all personal property of Tenant located within the Leased Premises including, without limitation, Tenant’s equipment, inventory, trade fixtures and supplies; (d) worker’s compensation insurance in statutory form and amounts; and (e) business interruption insurance. All insurance deductibles under Tenant’s insurance coverages shall be the sole responsibility of Tenant without right of reimbursement from Landlord for any reason. Tenant’s insurance shall be primary and non-contributing with or in excess of any insurance coverage carried by Landlord. Prior to taking occupancy, Tenant shall furnish evidence satisfactory to Landlord of the maintenance of all insurance coverages required hereunder; and Tenant shall obtain a written obligation on the part of each insurance company or insurance broker to notify Landlord at least thirty (30) days before cancellation or a material change of any such insurance. Failure of Landlord to demand any insurance certificate or other evidence with these insurance requirements, or failure of Landlord to identify a deficiency from evidence that is provided by Tenant to Landlord, shall not be construed as a waiver of Tenant’s obligation to maintain such coverage. 
  
 10.2 Landlord and Tenant waive all claims, rights of recovery and causes of action that either party or any party claiming by, through or under such party may now or hereafter have by subrogation or otherwise against the other party or against any of the other party’s officers, directors, shareholders, partners or employees for any loss or damage that may occur to the Leased Premises, Tenant’s improvements or any of the contents of any of the foregoing by reason of fire or other casualty, or by reason of any other cause except gross negligence or willful misconduct (thus including simple negligence of the parties hereto or their officers, directors, shareholders, partners or employees), that was insured against under the terms of any all risk or fire or extended coverage insurance policies maintained hereunder; provided, however, that the waiver set forth in this Paragraph shall be ineffective against any insurer of Landlord or Tenant to the extent that the waiver is prohibited by the laws or insurance regulations of the state in which the Leased Premises is located or would invalidate any insurance coverage of Landlord or Tenant. Landlord and Tenant hereby agree to cause (if available) an endorsement to be issued to their respective insurance policies recognizing this waiver of subrogation
   	 
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 10.3 Except as specifically provided below, Tenant assumes liability for, and agrees to defend, indemnify, protect and hold harmless Landlord, its successors, assigns, affiliates, directors, shareholders, partners, contractors, employees and agents (all of the prior parties individually and collectively, the “Landlord’s Related Parties”) from and against, all liabilities, obligations, fines, demands, judgments, losses, damages, penalties, claims, actions, suits, costs, expenses and disbursements (including court costs and reasonable attorneys’ fees) of every kind or character (a) arising from any breach, violation or non-performance of any term, provision, covenant, agreement or condition on the part of Tenant hereunder, (b) recovered from or asserted against any of the Landlord’s Related Parties on account of injury or damage to person or property to the extent that any such damage or injury may be incident to, arise out of or be caused, by any act, omission, negligence or misconduct on the part of Tenant or any of its agents, servants, employees, contractors, or invitees or of any other person entering upon the Leased Premises under or with the express or implied invitation or permission of Tenant, or (c) arising from or arising out of the occupancy or use by Tenant, its agents, servants, employees, contractors or invitees of the Leased Premises or arising from or out of any event, circumstance, or occurrence within the Leased Premises, howsoever caused. Such indemnification of any of the Landlord’s Related Parties by Tenant shall be effective except to the extent such damage results from the gross negligence or willful misconduct of Landlord or any of its duly authorized agents or employees. Tenant’s indemnity obligations under this Paragraph shall survive the expiration or earlier termination of this Lease. The indemnification provided by this Article is subject to the Landlord’s waiver of recovery specified above, to the extent of Landlord’s recovery of loss proceeds under policies of insurance described above.
  
 ARTICLE 11. NON-LIABILITY FOR CERTAIN DAMAGES
  
 11.1 Except as specifically provided herein, Landlord and Landlord’s Related Parties shall have no responsibility or liability to Tenant, or to Tenant’s officers, directors, shareholders, partners, employees, agents, contractors or invitees, and Tenant hereby waives and releases any claims against Landlord and Landlord’s Related Parties for all bodily injury, death, property damage, business interruption, loss of profits, loss of trade secrets or other direct, consequential or special damages, including but not limited to (a) force majeure, (b) vandalism, theft, burglary, robbery, rape, murder, assault and other criminal acts (other than those committed by Landlord and its employees), (c) water leakage, the backing up of drains or flooding, or (d) the repair, replacement, maintenance, damage, or destruction of the Leased Premises. 
  
 11.2 Any and all security of any kind for Tenant, Tenant’s agents, employees or invitees, the Leased Premises, or any personal property thereon (including, without limitation, any personal property of any sublessee) shall be the sole responsibility and obligation of Tenant, and shall be provided by Tenant at Tenant’s sole cost and expense. Tenant acknowledges and agrees that the Landlord shall have no obligation or liability whatsoever with respect to the same. 
  
 ARTICLE 12. DAMAGE BY CASUALTY
  
 12.1 Tenant shall give prompt notice to Landlord of any damage caused to the Leased Premises by fire or other casualty.
   	 
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 12.2 In the event (a) the Leased Premises are totally destroyed, (b) the Leased Premises are partially destroyed but in Landlord’s reasonable opinion, cannot be restored to an economically viable and quality project, (c) the insurance proceeds payable to Landlord as result of such fire or casualty are, in Landlord’s reasonable opinion, inadequate to restore the portion remaining to an economically viable and quality project, or (d) less than 12 full calendar months remain in the Lease Term, Landlord may, at its election exercisable by the giving of notice to Tenant within sixty (60) days after the fire or casualty, terminate this Lease as of the date of such fire or casualty. Landlord shall notify Tenant within sixty (60) days after such damage as to the amount of time Landlord reasonably estimates it will take to restore the Leased Premises. If the restoration time is estimated to exceed 6 months, Tenant may elect to terminate this Lease by giving notice to Landlord no later than thirty (30) days after Landlord’s notice. If this Lease is not terminated as a result of fire or casualty, Landlord shall restore the Leased Premises to substantially the condition in which the same existed prior to the fire or casualty. Landlord’s obligation to rebuild and repair shall in any event be limited to restoring the Leased Premises to substantially the condition in which the same existed prior to such casualty, exclusive of any alterations, additions, improvements, fixtures or equipment installed by Tenant. Tenant agrees that promptly after completion of such work by Landlord, Tenant will proceed with reasonable diligence and at Tenant’s sole cost and expense, to restore, repair and replace all alterations, additions, improvements, fixtures, signs and equipment installed by Tenant. Tenant shall, subject to delays arising from the collection of insurance proceeds or from Force Majeure events, promptly re-enter the Leased Premises and commence doing business in accordance with this Lease. During the period of restoration by Landlord, Rent shall be abated to the extent that the Leased Premises are rendered untenable.
  
 12.3 Notwithstanding anything herein to the contrary, in the event the holder of any indebtedness secured by mortgage or deed of trust covering the Leased Premises requires that the insurance proceeds be applied to such indebtedness, Landlord shall have the right to terminate this Lease by delivering notice of termination to Tenant within thirty (30) days after such requirement is made known by any such holder, whereupon all rights and obligations under this Lease, except those that expressly survive termination, shall cease and terminate.
  
 ARTICLE 13. CONDEMNATION
  
 13.1 If during the Lease Term, an authority with the power of eminent domain condemns all of the Leased Premises, then this Lease shall terminate on the date such authority takes possession of the Leased Premises. If less than all the Leased Premises is condemned, then Tenant shall have the right to terminate this Lease if such portion of the improvements on the Leased Premises should be condemned in such a manner that the balance of the Leased Premises is not fit for the continued use by Tenant for the Permitted Use. Tenant shall exercise the termination rights of this Paragraph no later than thirty (30) days after the condemning authority takes possession of the portion of the Leased Premises. Immediately upon the taking of possession of the portion of the Leased Premises taken by the condemning authority, if this Lease is not terminated, the Rent shall be reduced to such extent as may be fair and reasonable under the circumstances, as reasonably determined by the parties.
  
 13.2 Upon receipt of the condemnation funds from the condemning authority, in the event Tenant does not elect to terminate this Lease pursuant to the above Paragraph, Landlord shall restore the Leased Premises remaining after the taking to substantially the same condition to which they existed prior to the taking. Any such restoration work shall be performed within a reasonable time period, done diligently and continually until completed. The Landlord’s obligation to rebuild and repair shall in any event be limited to restoring the Leased Premises to substantially the condition in which the same existed prior to such condemnation, exclusive of alterations, additions, improvements, fixtures or equipment installed by Tenant. Tenant shall, subject to delays arising from the collection of condemnation proceeds or from Force Majeure events, promptly re-enter the Leased Premises and commence doing business in accordance with this Lease. 
   	 
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 13.3 Any restoration work by Landlord on the Leased Premises performed under Article 12 or this Article 13 shall not constitute an eviction or disturbance of Tenant’s use or possession of the Leased Premises or a breach by Landlord of any of its obligations under this Lease or render Landlord liable for damages or entitle Tenant to be relieved from any of its obligations under this Lease (with the exception of a proportionate reduction in Rent) or grant Tenant any right of off-set or recoupment.
  
 13.4 All sums awarded or agreed upon between Landlord and the condemning authority for the taking of the fee and any and all improvements thereon, whether as damages or as compensation, will be the property of Landlord. All sums awarded or agreed upon between Tenant and the condemning authority for the taking of Tenant’s leasehold interest in the Leased Premises and Tenant’s removable trade fixtures, if any, and Tenant’s moving and relocation expenses, if any, will be the property of Tenant, and Tenant hereby assigns to Landlord all other proceeds awarded for the condemnation of the Leased Premises.
  
 ARTICLE 14. ASSIGNMENT AND SUBLETTING
  
 14.1 Tenant shall not assign this Lease nor sublet all or any part of the Leased Premises without the prior written consent of Landlord. Any attempted assignment, subletting, transfer or encumbrance by Tenant in violation of this Paragraph shall be void. Upon the occurrence of an Event of Default (as defined below), if all or any part of the Leased Premises are then sublet, Landlord, in addition to any other remedies provided by this Lease or provided by law, may, at its option, collect directly from the subtenant all Rent becoming due to the Tenant by reason of the subletting. 
  
 Notwithstanding the foregoing, Tenant may, without Landlord's consent, (i) assign this Lease in connection with a sale of all or substantially all of its assets or all or substantially all of its assets relating to the business conducted by Tenant on the Premises; or (ii) mortgage or otherwise pledge its leasehold interest in this Lease to its current or future lender(s) (and such mortgagee or pledgee may, without Landlord’s consent, foreclose on or otherwise transfer their interest or title herein, or have Tenant transfer its interest or title herein in lieu of foreclosure or similar proceedings, to a successor mortgagee or pledgee or a third-party purchaser).
  
 Notwithstanding any subletting, mortgaging, or assignment by Tenant or any collection of sums by Landlord from any assignee or subtenant, or for any other action or reason whatsoever, Tenant shall remain fully liable for the performance of all covenants in this Lease to be performed by the “tenant” during the Lease Term. 
  
 14.2 Landlord shall have the right to transfer, assign, or encumber in whole or in part, its rights and obligations in the Leased Premises or this Lease, or any portion thereof. In the event of the transfer and assignment by Landlord of its interest in this Lease to a person expressly assuming the Landlord’s obligations under this Lease, Landlord shall thereby be released from any further responsibility hereunder, and Tenant agrees to look solely to such successor in interest of the Landlord for performance of such obligations. 
  
 ARTICLE 15. PROPERTY TAXES AND ASSESSMENTS
  
 Tenant shall be liable for all real estate and personal property taxes levied or assessed against the Leased Premises and any personal property or fixtures placed in the Leased Premises. If any such taxes are levied or assessed against Landlord or Landlord’s property and (a) Landlord pays the same, or (b) the assessed value of Landlord’s property is increased by inclusion of such personal property and fixtures and Landlord pays the increased taxes, then, upon demand, Tenant shall pay to Landlord such taxes. Tenant’s obligation shall survive the expiration or earlier termination of this Lease.
   	 
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 ARTICLE 16. DEFAULTS AND REMEDIES
  
 16.1 Each of the following events shall be deemed to be an “Event of Default” by Tenant under this Lease:
  
 	  
	A.	Tenant shall fail to pay any installment of Rent within five (5) days after receipt of written notice from Landlord.
	  
	  
	  

	  
	B.	Any insurance required to be maintained by Tenant pursuant to this Lease shall be canceled, terminated, expire, reduced, or materially changed, except, in each case, as permitted in this Lease, for a period of five (5) days after notice from Landlord.
	  
	  
	  

	  
	C.	Tenant shall fail to comply with any term, provision, or covenant of this Lease, other than those specifically referred to in Paragraph A or B above, and shall not begin and pursue with reasonable diligence the cure of such failure within fifteen (15) days after written notice thereof to Tenant.
	  
	  
	  

	  
	D.	Tenant shall become insolvent, make an assignment for the benefit of creditors, or file a petition under any section or chapter of the Bankruptcy Code, or under any similar law or statute of the United States of America or any State thereof.
	  
	  
	  

	  
	E.	A receiver or trustee shall be appointed for the Leased Premises or for all or substantially all of the assets of Tenant.

  
 16.2 Upon the occurrence of any Event of Default, Landlord shall have the option to pursue any one or more of the following remedies in addition to all other rights, remedies and recourses afforded Landlord hereunder or by law or equity, without any notice or demand whatsoever, except as may be specifically provided herein:
  
 	  
	A.	Terminate this Lease.
	  
	  
	  

	  
	B.	Enter upon and take possession of the Leased Premises without terminating this Lease.
	  
	  
	  

	  
	C.	Enter upon the Leased Premises using whatever legal means available to Landlord, and do whatever Tenant is obligated to do under the terms of this Lease; and Tenant further agrees that Landlord shall not be liable for any damages resulting to the Tenant from such action, unless caused by the gross negligence or willful misconduct of Landlord.

  
 16.3 Upon any such Event of Default, Tenant shall immediately upon demand surrender the Leased Premises to Landlord, and if Tenant fails so to do, Landlord, without waiving any other remedy it may have, may enter upon and take possession of the Leased Premises and expel or remove Tenant and any other person who may be occupying such Leased Premises or any part thereof using whatever legal means available to Landlord. Pursuit of any remedy herein provided shall not constitute a forfeiture or violation of any of the terms, provisions and covenants herein contained. Forbearance by Landlord to enforce one or more of the remedies herein provided upon an Event of Default shall not be deemed or construed to constitute a waiver of such default.
  
 16.4 If Landlord terminates this Lease, at Landlord’s option, Tenant shall be liable for and shall pay to Landlord, the sum of all Rent and other payments owed to Landlord hereunder accrued to the date of such termination, plus, as liquidated damages, an amount equal to (a) the present value (using the current “prime” interest rate quoted in the Wall Street Journal, or should such index no longer exist, a comparable index) of the total Rent and other payments owed hereunder for the remaining portion of the Lease Term, calculated as if the Lease Term expired on the date set forth in Section 1.1, (b) less the then fair market rental of the Leased Premises for such period, similarly discounted. Tenant’s obligations under this Paragraph shall survive the expiration or earlier termination of this Lease.
   	 
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 16.5 If Landlord repossesses the Leased Premises without terminating the Lease, Tenant, at Landlord’s option, shall be liable for and shall pay Landlord on demand all Rent and other payments owed to Landlord hereunder, accrued to the date of such repossession, plus all amounts required to be paid by Tenant to Landlord until the date of expiration of the Lease Term as stated in Section 1.1, diminished by all amounts received by Landlord through reletting of the Leased Premises during such remaining term (but only to the extent of the Rent herein reserved). Actions to collect amounts due by Tenant to Landlord under this Paragraph may be brought from time to time, on one or more occasions, without the necessity of Landlord’s waiting until expiration of the Lease Term. Tenant’s obligations under this Paragraph shall survive the expiration or earlier termination of this Lease. 
  
 16.6 If Landlord repossesses the Leased Premises pursuant to the authority herein granted, then Landlord shall have the right to (i) keep in place and use, or (ii) remove and store, all of the furniture, fixtures and equipment at the Leased Premises, including that which is owned by or leased to Tenant at all times prior to any foreclosure thereon by Landlord or repossession thereof by any lessor thereof or third party having a lien thereon. Landlord also shall have the right to relinquish possession of all or any portion of such furniture, fixtures, equipment and other property to any person (“Claimant”) who presents to Landlord a copy of any instrument represented by Claimant to have been executed by Tenant (or any predecessor of Tenant) granting Claimant the right under various circumstances to take possession of such furniture, fixtures, equipment or other property, without the necessity on the part of Landlord to inquire into the authenticity or legality of such instrument.
  
 16.7 Upon termination of this Lease or upon termination of Tenant’s right to possession of the Leased Premises, Landlord may, but shall not be obligated to, attempt to relet the Leased Premises. If Landlord does elect to relet, Landlord may relet such portion of the Leased Premises, for such period, to such tenant, and for such use and purpose as Landlord, in the exercise of its reasonable discretion, may choose. Tenant shall not be entitled to the excess of any rent obtained by reletting over the Rent herein reserved.
  
 16.8 The rights, remedies and recourses of Landlord for an Event of Default shall be cumulative and no right, remedy or recourse of Landlord, whether exercised by Landlord or not, shall be deemed to be in exclusion of any other.
  
 16.9 Provisions of this Lease may not be waived orally or impliedly, but only by the party entitled to the benefit of the provision evidencing the waiver in writing. Thus, neither the acceptance of Rent by Landlord following an Event of Default (whether known to Landlord or not), nor any other custom or practice followed in connection with this Lease, shall constitute a waiver by Landlord of such Event of Default or any other or future Event of Default. Further, the failure by Landlord to complain of any action or inaction by Tenant, or to assert that any action or inaction by Tenant constitutes (or would constitute, with the giving of notice and the passage of time) an Event of Default, regardless of how long such failure continues, shall not extinguish, waive or in any way diminish the rights, remedies and recourses of Landlord with respect to such action or inaction. No waiver by Landlord of any provision of this Lease or of any breach by Tenant of any obligation of Tenant hereunder shall be deemed to be a waiver of any other provision hereof, or of any subsequent breach by Tenant of the same or any other provision hereof. Landlord’s consent to any act by Tenant requiring Landlord’s consent shall not be deemed to render unnecessary the obtaining of Landlord’s consent to any subsequent act of Tenant. No act or omission by Landlord (other than Landlord’s execution of a document acknowledging such surrender) or Landlord’s agents, including the delivery of the keys to the Leased Premises, shall constitute an acceptance of a surrender of the Leased Premises.
   	 
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 16.10 Upon any Event of Default, Tenant shall also pay to Landlord all reasonable costs and expenses incurred by Landlord, including court costs and expenses incurred by Landlord, in (a) retaking or otherwise obtaining possession of the Leased Premises, (b) removing and storing Tenant’s or any other occupant’s property, (c) repairing, restoring, or otherwise putting the Leased Premises into as good a condition as that in which it was originally delivered to Tenant, (d) reletting all or any part of the Leased Premises, (e) paying or performing the underlying obligation which Tenant failed to pay or perform, or (f) enforcing any of Landlord’s rights, remedies or recourses arising as a consequence of the Event of Default. Tenant’s obligations under this Paragraph shall survive the expiration or earlier termination of this Lease.
  
 16.11 If Tenant shall fail to pay any installment of Rent within five (5) days after receipt of written notice from Landlord more than two (2) times within a Lease Year, Tenant agrees to pay a late fee of $30 per day for each day after the due date that rent is not delivered to Landlord.
  
 16.12 Landlord shall be in default hereunder only if Landlord has failed, within thirty (30) days from the receipt by Landlord of notice from Tenant of any alleged default by Landlord, to begin and pursue with reasonable diligence the cure of any alleged and actual default of Landlord hereunder. Unless or until Landlord fails to commence cure any default after the receipt of such notice and the passage of such time, Tenant shall not have any remedy or cause of action by reason thereof. In the event of any default by Landlord, Tenant’s exclusive remedy shall be an action for damages or a suit for specific performance (Tenant hereby waiving the benefit of any laws granting Tenant a lien upon the property of Landlord and/or upon Rent due to Landlord or the right to terminate this Lease). The obligations of Tenant to pay Rent and to perform the other undertakings of Tenant hereunder constitute independent unconditional obligations to be performed at the times specified hereunder, regardless of any breach or default by Landlord hereunder. Tenant shall have no right, and Tenant hereby waives and relinquishes all rights which Tenant might otherwise have, to withhold, deduct from or offset against any Rent or other sums to be paid to Landlord by Tenant. Landlord’s obligations hereunder shall be construed as covenants, not conditions.
  
 16.13 If Landlord defaults under this Lease and, as a consequence of the default, Tenant recovers a money judgment against Landlord and/or any of the Landlord Related Parties, the judgment shall be satisfied only out of, and Tenant hereby agrees to look solely to, the interest of Landlord and/or any of the Landlord Related Parties in the Leased Premises as the same may then be encumbered, and neither Landlord nor any Landlord Related Parties shall otherwise be liable for any deficiency. In no event shall Tenant have the right to levy execution against any property of Landlord or any of the Landlord Related Parties other than their interest in the Leased Premises. Under no circumstances whatsoever shall Landlord or any Landlord Related Party ever be liable hereunder in any capacity for consequential damages or special damages. The foregoing limitations shall survive the expiration or earlier termination of this Lease.
  
 ARTICLE 17. SURRENDER AND HOLDING OVER
  
 17.1 Upon the expiration or termination of the Lease Term for whatever cause, or upon the exercise by Landlord of its right to re-enter the Leased Premises without terminating this Lease, Tenant shall immediately, quietly and peaceably surrender to Landlord possession of the Leased Premises in “broom clean” and good order, condition and repair, except only for ordinary wear and tear, and damage by casualty not covered by Section 6.4. If Tenant fails to surrender possession as herein required, Landlord may initiate any and all legal action as Landlord may elect to dispossess Tenant and all of its property, and all persons or entities claiming by, through or under Tenant and all of their property, from the Leased Premises, and may remove from the Leased Premises and store (without any liability for loss, theft, damage or destruction thereto) any such property at Tenant’s cost and expense. If Tenant fails to surrender possession of the Leased Premises in the condition herein required, Landlord may, at Tenant’s expense, restore the Leased Premises to such condition. 
   	 
	12
	 
 
	 

  
 17.2 For so long as Tenant remains in possession of the Leased Premises after the expiration or termination of the Lease Term, or exercise by Landlord of its re-entry right, Tenant shall be deemed to be occupying the Leased Premises as a tenant-at-sufferance, subject to all of the obligations of Tenant under this Lease, except that the daily Rent shall be twice the per day Rent in effect immediately prior to such expiration, termination or exercise by Landlord. No such holding over shall extend the Lease Term. Tenant shall be liable to Landlord for all loss or damage on account of any such holding over against Landlord’s will after the termination of this Lease, whether such loss or damage may be contemplated at this time or not. 
  
 17.3 Tenant’s obligations under this Article 17 shall survive the expiration or earlier termination of this Lease.
  
 ARTICLE 18. SUBORDINATION AND ESTOPPEL
  
 18.1 Tenant accepts this Lease subject and subordinate to any mortgage, deed of trust, or other lien presently existing or hereafter placed upon the Leased Premises, and to any renewals and extensions thereof; but Tenant agrees that any such mortgagee shall have the right at any time to subordinate such mortgage, deed of trust or other lien to this Lease on such terms and subject to such conditions as such mortgagee may deem appropriate in its discretion. Landlord is hereby irrevocably vested with full power and authority, if it so elects at any time, to subordinate this Lease to any mortgage, deed of trust, or other lien hereafter placed upon the Leased Premises. Tenant agrees, upon demand to execute such further instruments subordinating this Lease as Landlord may reasonably request, to evidence such subordination. In the event that Tenant should fail to execute any such instrument promptly as reasonably requested, Tenant hereby irrevocably constitutes Landlord its attorney-in-fact to execute such instrument in Tenant’s name, place and stead. Upon the written request of any person or party succeeding to the interest of Landlord under this Lease, Tenant shall automatically become the tenant of and attorn to such successor in interest without any change in any of the terms of this Lease. In the event the Leased Premises is encumbered by any mortgage, deed of trust, or other lien, Tenant shall have the right to request that Landlord use reasonable efforts to obtain a non-disturbance agreement on said lien holder’s standard form. 
  
 18.2 Landlord and Tenant shall promptly execute and deliver to each other within twenty (20) days of request, a certificate stating:
  
  	  
	A.	Whether or not the Lease is in full force.
	  
	  
	  

	  
	B.	Whether or not the Lease has been modified or amended in any respect, and submit such copies of such modifications or amendments, if any.
	  
	  
	  

	  
	C.	Whether or not there are any existing defaults under the Lease as far as the party executed the certificate knows and specifying the nature of such defaults, if any.
	  
	  
	  

	  
	D.	Such other information to the responding party’s knowledge as may be reasonably requested.

 
  	 
	13
	 
 
	 

  
 ARTICLE 19. NOTICES
  
 19.1 Except as otherwise provided herein, all notices, demands, requests, and other communications required or permitted hereunder shall be given in writing and sent by personal delivery, or expedited delivery service with proof of delivery, or United States mail, postage prepaid, registered or certified mail, return receipt requested, addressed to the addressee at such party’s address set forth in Section 1.1 above, or to such other address as such party may specify by written notice, sent in accordance with this Paragraph at least ten (10) days prior to the date of the giving of such notice. Any such notice or communication shall be deemed to have been given and received either at the time of personal delivery, or in the case of mail, three (3) days after the date of deposit in an official depository of the United States mail, or in the case of delivery service, upon receipt. To the extent actual receipt is required, rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was received shall be deemed to be receipt of the notice, demand, request or other communication sent. 
  
 ARTICLE 20. ENVIRONMENTAL COVENANTS/INDEMINTY
  
 20.1 Tenant covenants that (1) no activity will be conducted on the Leased Premises that will produce any Substance (as defined below), except for such activities that are part of the ordinary course for the Permitted Use provided the Permitted Use is conducted in accordance with all Environmental Laws (as defined below); (2) the Leased Premises will not be used in any manner for the storage of any Substances except for the temporary storage of such materials that are used in the ordinary course of the Permitted Lease (the “Permitted Materials”) provided such Permitted Materials are properly stored in a manner and location meeting all Environmental Laws; (3) no portion of the Leased Premises will be used as a landfill or a dump; (4) Tenant will not install any underground tanks of any type; (5) Tenant will not allow any surface or subsurface conditions to exist or come into existence that constitute, or with the passage of time may constitute a public or private nuisance; (6) Tenant will not permit any Substances to be brought onto the Leased Premises, except for the Permitted Materials, and if so brought or found located thereon, the same shall be removed, with proper disposal, and all required cleanup procedures shall be diligently undertaken pursuant to all Environmental Laws. The term “Substances”, as used in this Lease shall mean pollutants, contaminants, toxic or hazardous wastes, or any other substances, the use, storage, handling, disposal, transportation or removal of which is regulated, restricted prohibited or penalized by any “Environmental Law”, which term shall mean any federal, state or local law, ordinance or other statute of a governmental or quasi-governmental authority relating to pollution or protection of the environment and shall specifically include, but not be limited to, any “hazardous substance” as that term is defined under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and any amendments or successors in function thereto. Landlord or Landlord’s representative shall have the right but not the obligation to enter the Leased Premises for the purpose of inspecting the storage, use and disposal of Permitted Materials to ensure compliance with all Environmental Laws. Tenant shall be responsible for obtaining any required permits and paying any fees and providing any testing required by any governmental agency or Environmental Law. Should it be determined, in Landlord’s sole opinion, that Permitted Materials are being improperly stored, used, or disposed of, then Tenant shall immediately take such corrective action as requested by Landlord. Should Tenant fail to take such corrective action within 24 hours, Landlord shall have the right to perform such work and Tenant shall promptly reimburse Landlord for any and all costs associated with said work. If at any time during or after the Lease Term the Leased Premises are found to be so contaminated or subject to said conditions, Tenant shall diligently institute proper and thorough cleanup procedures at Tenant’s sole cost, and Tenant agrees to indemnify and hold Landlord harmless from all claims, demands, actions, liabilities, costs, expenses, damages, fines, reimbursement, restitution, response costs, cleanup costs, and obligations (including investigative responses and attorney’s fees) of any nature arising from or as a result of the use of the Leased Premises during the Lease Term in violation of the covenants of this Section 20.1. The foregoing indemnification obligations of Tenant and the responsibilities of Tenant under this Section 20.1 shall survive the expiration or earlier termination of this Lease.
   	 
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 ARTICLE 21. MISCELLANEOUS
  
 21.1 Nothing herein contained shall be deemed or construed by the parties hereto, nor by any third party, as creating the relationship of principal and agent or of partnership or of joint venture between the parties hereto. It is expressly understood and agreed that the parties have no relationship other than the relationship of landlord and tenant. 
  
 21.2 The captions used in this Lease are for convenience only and do not in any way limit or amplify the terms and provisions hereof.
  
 21.3 Time is of the essence with respect to each date or time specified in this Lease by which an event is to occur. Notwithstanding the foregoing, whenever a period of time is herein prescribed for action to be taken by Landlord or Tenant, neither shall be liable or responsible for, and there shall be excluded from the computation of any such period of time, any delays due to strikes, riots, acts of God, shortages of labor or materials, war, governmental laws, regulations, or restrictions or any other causes of any kind whatsoever which are beyond the reasonable control of Landlord or Tenant; provided, however, the foregoing shall not apply to any payment of money.
  
 21.4 The laws of the State of Missouri shall govern the interpretation, validity, performance, and enforcement of this Lease. If any provision of this Lease should be held to be invalid or unenforceable, the validity and enforceability of the remaining provisions of this Lease shall not be affected thereby.
  
 21.5 Landlord hereby covenants and agrees that if Tenant shall timely perform all of the covenants and agreements herein required to be performed on the part of Tenant, Tenant shall, subject to the terms of this Lease, at all times during the continuance of this Lease have the peaceable and quiet enjoyment and possession of the Leased Premises.
  
 21.6 Words of any gender used in this Lease shall be held and construed to include any gender and words in the singular number shall be held to include the plural, unless the context otherwise requires.
  
 21.7 This Lease, together with the attached Exhibits, contains the entire agreement between the parties, and supersedes any prior understandings or written or oral agreements between the parties. No amendment, modification or alteration of this Lease shall be effective to change, modify or terminate this Lease in whole or in part unless such agreement is in writing and duly signed by the party against whom enforcement of such change, modification or termination is sought.
  
 21.8 The terms, provisions and covenants contained in this Lease shall apply to, inure to the benefit of and be binding upon the parties hereto and their respective successors in interest and permitted assigns. All rights, powers, privileges, immunities and duties of Landlord under this Lease, including but not limited to any notices required or permitted to be delivered by Landlord to Tenant hereunder, may, at Landlord’s option, be exercised or performed by an agent of Landlord or Landlord’s attorney. All rights, powers, privileges, immunities and duties of Tenant under this Lease, including but not limited to any notices required or permitted to be delivered by Tenant to Landlord hereunder, may, at Tenant’s option, be exercised or performed by an agent of Tenant or Tenant’s attorney.
  
 21.9 Each party warrants and represents that it has not incurred or authorized any brokerage commission, finder’s fees or similar payments in connection with this Lease, and agrees to defend, indemnify and hold the other party harmless from and against any claim for brokerage commission, finder’s fees or similar payment arising by virtue of authorization of such party, or any affiliate of such party, in connection with this Lease.
  
 21.10 Any amount due from Tenant to Landlord which is not paid within five (5) days after when due shall bear interest at the lesser of the maximum rate allowed by law, or 18% per annum, from the date such payment is due until paid, but the payment of such interest shall not excuse or cure the default in payment. 
   	 
	15
	 
 
	 

  
 21.11 Each party warrants and represents to the other party that (a) it is duly organized, legally existing, and in good standing in its state of formation; (b) it has full right and authority to execute, deliver and perform this Lease; and (c) the person executing this Lease on its behalf was authorized to do so.
  
 21.12 Neither this Lease (including any Exhibit hereto) nor any memorandum hereof shall be recorded without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed.
  
 21.13 This Lease may be executed in multiple counterparts (including by means of facsimile or portable document format (pdf) signature pages), each of which shall be an original, but all of which shall constitute but one instrument. This Lease, to the extent signed and delivered by means of a facsimile machine or electronic transmission in portable document format (pdf), shall be treated in all manner and respects as an original thereof and shall be considered to have the same binding legal effects as if it were the original signed version thereof delivered in person. At the request of any party hereto, the other party shall re-execute original forms hereof and deliver them to the other parties. No party hereto shall raise the use of a facsimile machine or electronic transmission in portable document format (pdf) to deliver a signature or the fact that any signature or document was transmitted or communicated through the use of a facsimile machine or electronic transmission in portable document format (pdf) as a defense to the formation of a contract, and each such party forever waives any such defense.
  
 21.14 Both parties waive trial by jury and agree all disputes are to be resolved by an arbitration proceeding to be held and conducted in the County of St. Louis, State of Missouri in accordance with the provisions of Chapter 435 of the revised statutes of Missouri. 
  
 [Remainder of Page Left Intentionally Blank. Signature Page(s) to Follow.]
   	 
	16
	 
 
	 

  
 IN WITNESS WHEREOF, the parties have caused this Lease to be signed effective as of the date and year first set forth above.
  
  	LANDLORD:		TENANT:	
	  
			   
		
	 S.H.J., L.L.C. 
		 1847 GOEDEKER INC. 
	
				    
		
	 By:
	/s/ Steve Goedeker		 By:
	/s/ Robert D. Barry	
	 Name:
	Steve Goedeker		Name:	Robert D. Barry	
	 Title:
	 Member
		 Title:
	 Chief Financial Officer
	
	   
	  
	   
	  

	 Date: April 5, 2019
		 Date: April 5, 2019
	

  
  	 
	17
	 
 
	 

  
 EXHIBIT “A”
  
 LEASED PREMISES
  
 
  
  
  
  
  	 
	18efsh_ex107.htm

EXHIBIT 10.7
  
 MANAGEMENT SERVICES AGREEMENT
  
 BY AND BETWEEN
  
 1847 GOEDEKER INC.
  
 AND
  
 1847 PARTNERS LLC
  
 Dated as of April 5, 2019
  
  	 
	1
	 
 
	 

  
 MANAGEMENT SERVICES AGREEMENT
  
 MANAGEMENT SERVICES AGREEMENT (as amended, revised, supplemented or otherwise modified from time to time, this “Agreement”), dated as of April 5, 2019, by and between 1847 GOEDEKER INC., a Delaware corporation (the “Company”), and 1847 PARTNERS LLC, a Delaware limited liability company (the “Manager”). Each party hereto shall be referred to as, individually, a “Party” and, collectively, the “Parties.” 
  
 BACKGROUND
  
 The Board of Directors of the Company has determined that it would be in the best interests of the Company to appoint the Manager to perform the Services (as such term is defined herein) and, therefore, the Company has agreed to appoint the Manager to perform the Services on the terms and subject to the conditions set forth herein. The Manager has agreed to act as Manager and to perform the Services on the terms and subject to the conditions set forth herein.                                                                                                     
  
 The Manager also acts as an external manager for 1847 Holdings LLC (the “Parent”), the Company’s parent entity, pursuant to the Management Services Agreement by and between the Manager and the Parent, dated as of April 15, 2013, as amended (the “Parent MSA”). This Agreement is an Offsetting Management Services Agreement as defined and referenced in the Parent MSA.                                  
  
 AGREEMENT
  
 NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained herein, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties hereto agree as follows:
  
 ARTICLE I
  
 DEFINITIONS
  
 For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; any reference to an “Article,” “Section” or an “Exhibit” refers to an Article, Section or an Exhibit, as the case may be, of this Agreement; and the words “herein,” “hereinafter,” “hereof,” “hereto” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision:
  
 “Affiliate” means, with respect to any Person, (i) any Person directly or indirectly controlling, controlled by or under common control with such Person or (ii) any officer, director, general member, member or trustee of such Person. For purposes of this definition, the terms “controlling,” “controlled by” or “under common control with” shall mean, with respect to any Persons, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, or the power to elect at least 50% of the directors, managers, general members, or Persons exercising similar authority with respect to such Person.
  
  	 
	2
	 
 
	 

  
 “Agreement” has the meaning set forth in the preamble of this Agreement.
  
 “Board of Directors” means the Board of Directors of the Company or any committee thereof that has been duly authorized by the Board of Directors to make a decision on the matter in question or bind the Company as to the matter in question.
  
 “Business Day” means any day other than a Saturday, a Sunday or a day on which banks in the City of New York are required, permitted or authorized, by applicable law or executive order, to be closed for regular banking business.
  
 “Commencement Date” means the date of this Agreement.
  
 “Company” has the meaning set forth in the preamble of this Agreement.
  
 “Company Information” means any information concerning the Company or any of the Subsidiaries of the Company and their respective financial condition, business or operations that (i) relates to earnings, (ii) is competitively sensitive, (iii) relates to trade secrets, (iv) is proprietary or (v) is similar to any of the foregoing information.
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
  
 “Federal Securities Laws” means, collectively, the Securities Act, the Exchange Act and the rules and regulations promulgated thereunder.
  
 “Fiscal Quarter” means each fiscal quarter of the Company for purposes of the Parent’s reporting obligations under the Exchange Act.
  
 “Fiscal Year” means each fiscal year of the Company for purposes of the Parent’s reporting obligations under the Exchange Act.
  
 “GAAP” means generally accepted accounting principles in effect in the United States, consistently applied.
  
 “Gross Income” has the meaning set forth in Section 61(a) of the Internal Revenue Code of 1986, as amended.
  
 “Incur” means, with respect to any Indebtedness or other obligation of a Person, to create, issue, acquire (by conversion, exchange or otherwise), assume, suffer, guarantee or otherwise become liable in respect of such Indebtedness or other obligation.
  
  	 
	3
	 
 
	 

  
 “Indebtedness” means, with respect to any Person, (i) any liability for borrowed money, or under any reimbursement obligation relating to a letter of credit, (ii) all indebtedness (including bond, note, debenture, purchase money obligation or similar instrument) for the acquisition of any businesses, properties or assets of any kind (other than property, including inventory, and services purchased, trade payables, other expenses accruals and deferred compensation items arising in the Ordinary Course of Business), (iii) all obligations under leases that have been or should be, in accordance with GAAP, recorded as capital leases, (iv) any liabilities of others described in the preceding clauses (i) to (iii) (inclusive) that such Person has guaranteed or for which such Person is otherwise legally obligated, and (without duplication) any amendment, supplement, modification, deferral, renewal, extension or refunding of any liability of the types referred to in clauses (i) through (iv) above.
  
 “Indemnified Parties” has the meaning set forth in Article IX hereof.
  
 “Losses” has the meaning set forth in Article IX hereof.
  
 “Management Fee” has the meaning set forth in Section 7.1(a) hereof.
  
 “Management Fee Payment Date” means the first Business Day of each Fiscal Quarter or, in the case of the Fiscal Quarter in which this Agreement is terminated, the Termination Date.
  
 “Manager” has the meaning set forth in the preamble of this Agreement.
  
 “Non-Critical Services” means any Services other than the Services for which the Manager was engaged by the Company in light of the experience and expertise of the employees of the Manager.
  
 “Ordinary Course of Business” means, with respect to any Person, an action taken by such Person if such action is (i) consistent with the past practices of such Person and is taken in the normal day-to-day business or operations of such Person and (ii) which is not required to be specifically authorized or approved by the board of directors of such Person.
  
 “Parent” has the meaning set forth in the recitals to this Agreement.
  
 “Parent Management Fee” has the meaning set forth in Section 7.1(a) hereof.
  
 “Parent MSA” has the meaning set forth in the recitals to this Agreement.
  
 “Party” and “Parties” have the meaning set forth in the preamble of this Agreement.
  
 “Person” means any individual, company (whether general or limited), limited liability company, corporation, trust, estate, association, nominee or other entity.
  
 “Securities Act” means the Securities Act of 1933, as amended.
  
 “Services” has the meaning set forth in Section 3.1(b) hereof.
  
 “Subsidiary” means, with respect to any Person, any corporation, company, joint venture, limited liability company, association or other entity in which such Person owns, directly or indirectly, more than 50% of the outstanding voting equity securities or interests, the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such entity.
  
 “Termination Date” means the date upon which this Agreement is terminated pursuant Article VIII hereof.
  
  	 
	4
	 
 
	 

  
 ARTICLE II
  
 APPOINTMENT OF THE MANAGER
  
 Section 2.1 Appointment
  
 The Company hereby agrees to, and hereby does, appoint the Manager to perform the Services as set forth in Section 3.1 herein and in accordance with the terms and conditions of this Agreement.
  
 Section 2.2 Term
  
 The Manager shall provide Services to the Company from the Commencement Date until the termination of this Agreement in accordance with Article VIII hereof.
  
 ARTICLE III
  
 OBLIGATIONS OF THE PARTIES
  
 Section 3.1 Obligations of the Manager
  
 (a) Subject always to the oversight and supervision of the Board of Directors and the terms and conditions of this Agreement, the Manager shall during the term of this Agreement perform the Services as set forth in Section 3.1(b) below and comply with the operational objectives and business plans of the Company in existence from time to time. The Company shall promptly provide the Manager with all stated operational objectives and business plans of the Company approved by the Board of Directors and any other available information reasonably requested by the Manager.
  
 (b) The Manager agrees and covenants that it shall perform, or cause to be performed, the following services hereunder (as may be modified from time to time pursuant to Section 3.3 hereof, the “Services”):
  
 (i) conduct general and administrative supervision and oversight of the Company’s day-to-day business and operations, including, but not limited to, recruiting and hiring of personnel, administration of personnel and personnel benefits, development of administrative policies and procedures, establishment and management of banking services, managing and arranging for the maintaining of liability insurance, arranging for equipment rental, maintenance of all necessary permits and licenses, acquisition of any additional licenses and permits that become necessary, participation in risk management policies and procedures; and
  
  	 
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 (ii) oversee and consult with respect to the Company’s business and operational strategies, the implementation of such strategies and the evaluation of such strategies, including, but not limited to, strategies with respect to capital expenditure and expansion programs, acquisitions or dispositions and product or service lines.
  
 (c) In connection with the performance of the Services under this Agreement, the Manager shall have all necessary power and authority to perform, or cause to be performed, such Services on behalf of the Company.
  
 (d) In connection with the performance of its obligations under this Agreement, the Manager is not permitted to engage in any activities that would cause it to become an “investment adviser” as defined in Section 202(a)(11) of the Investment Advisers Act of 1940, as amended, or any successor provision thereto.
  
 (e) While the Manager is providing the Services under this Agreement, the Manager shall also be permitted to provide services, including services similar to the Services covered hereby, to other Persons, including Affiliates of the Manager. This Agreement and the Manager's obligation to provide the Services under this Agreement shall not create an exclusive relationship between the Manager and its Affiliates, on the one hand, and the Company and its Subsidiaries, on the other.
  
 Section 3.2 Obligations of the Company
  
 (a) The Company shall, and the Company shall cause its Subsidiaries to, do all things reasonably necessary on their part as requested by the Manager consistent with the terms of this Agreement to enable the Company to fulfill its obligations under this Agreement.
  
 (b) The Company shall, and the Company shall cause its Subsidiaries to, take reasonable steps to ensure that:
  
 (i) the officers and employees of the Company and its Subsidiaries, as the case may be, act in accordance with the terms of this Agreement and the reasonable directions of the Manager in fulfilling the Manager’s obligations hereunder and allowing the Manager to exercise its powers and rights hereunder; and
  
 (ii) the Company and its Subsidiaries provide to the Manager alt reports (including monthly management reports and all other relevant reports) that the Manager may reasonably require and on such dates as the Manager may reasonably require.
  
 Section 3.3 Change of Services
  
 (a) The Company and the Manager shall have the right at any time during the term of this Agreement to change the Services provided by the Manager and such changes shall in no way otherwise affect the rights or obligations of any Party hereunder.
  
  	 
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 (b) Any change in the Services shall be authorized in writing and evidenced by an amendment to this Agreement, as provided in Section 12.9 hereof. Unless otherwise agreed in writing, the provisions of this Agreement shall apply to all changes in the Services.
  
 ARTICLE IV
  
 POWERS OF THE MANAGER
  
 Section 4.1 Powers of the Manager
  
 (a) The Manager shall have no power to enter into any contract for or on behalf of the Company or otherwise subject it to any obligation, such power to be the sole right and obligation of the Company, acting through its Board of Directors and/or the Company’s officers.
  
 (b) Subject to Section 4.2 and for purposes other than to delegate its duties and powers to perform the Services hereunder, the Manager shall have the power to engage any agents (including real estate agents and managing agents), valuers, contractors and advisors (including operational, accounting, financial, tax and legal advisors) that it deems necessary or desirable in connection with the performance of its obligations hereunder, which costs therefor shall be subject to reimbursement in accordance with Section 7.2 hereto.
  
 Section 4.2 Delegation
  
 The Manager may delegate or appoint:
  
 (a) Any of its Affiliates as its agent, at its own cost and expense, to perform any or all of the Services hereunder; or
  
 (b) Any Person, whether or not an Affiliate of the Manager, as its agent, at its own cost and expense, to perform those Services hereunder which, in the sole discretion of the Manager, are Non­Critical Services; provided, however, that, in each case, the Manager shall not be relieved of any of its obligations or duties owed to the Company hereunder as a result of such delegation. The Manager shall be permitted to share Company Infom1ation with its appointed agents subject to appropriate, reasonable and customary confidentiality arrangements. For the avoidance of doubt, any reference to Manager herein shall include its delegates or appointees pursuant to this Section 4.2.
  
 Section 4.3 Manager’s Obligations, Duties and Powers Exclusive
  
 The Company agrees that during the term of this Agreement, the obligations, duties and powers imposed on and granted to the Manager under Article III and this Article IV are to be performed or held exclusively by the Manager, subject to Section 4.2 hereof, and the Company shall not, either directly or indirectly, through its employees, Board of Directors or any other Person, as the case may be, perfo1m any of the Services except in circumstances where it is necessary to do so to comply with applicable law or as otherwise agreed by the Manager.
  
  	 
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 ARTICLE V
  
 INSPECTION OF RECORDS
  
 Section 5.1 Books and Records of the Company
  
 At all reasonable times and on reasonable notice, the Manager and any Person authorized by the Manager shall have access to, and the right to inspect, for any reasonable purpose, during the term of this Agreement and for a period of five (5) years after termination hereof, the books, records and data stored in computers and all documentation of the Company pertaining to all Services performed, or to be performed, by the Manager or the Management Fee paid, or to be paid, by the Company to the Manager, in each case, hereunder. There shall be no cost or expense charged by any Party to another Party pursuant to the exercise of any right under this Section 5.1.
  
 Section 5.2 Books and Records of the Manager
  
 At all reasonable times and on reasonable notice, the Company and any Person authorized by the Company shall have access to, and the right to inspect the books, records and data stored in computers and all documentation of the Manager pertaining to all Services performed, or to be performed, by the Manager or the Management Fee paid, or to be paid, by the Company to the Manager, in each case, hereunder. There shall be no cost or expense charged by any Party to another Party pursuant to the exercise of any right under this Section 5.2.
  
 ARTICLE VI
  
 AUTHORITY OF THE COMPANY AND THE MANAGER
  
 Each Party represents and warrants to the other that it is duly authorized with full power and authority to execute, deliver and perform its obligations and duties under this Agreement. The Company represents and warrants that the engagement of the Manager has been duly authorized by the Board of Directors and is in accordance with all governing documents of the Company.
  
  	 
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 ARTICLE VII
  
 MANAGEMENT FEE; EXPENSES
  
 Section 7.1 Management Fee
  
 (a) Subject to the terms and conditions set forth in this Section 7.1, for the term of this Agreement, as payment to the Manager for performing Services hereunder during any Fiscal Quarter or any part thereof, the Company shall pay a quarterly management fee (the “Management Fee”) to the Manager on each Management Fee Payment Date equal to the greater of $62,500 or 2% of Adjusted Net Assets (as defined in the Parent MSA) of the Company; provided, however, that (i) with respect to the Fiscal Quarter in which the Commencement Date occurs, the Management Fee with respect to such Fiscal Quarter or part thereof shall be equal to the product of (x) the Management Fee, multiplied by (y) a fraction, the numerator of which is the number of days from and including the Commencement Date to and including the last day of such Fiscal Quarter and the denominator of which is the number of days in such Fiscal Quarter, (ii) with respect to the Fiscal Quarter in which this Agreement is terminated, the Management Fee with respect to such Fiscal Quarter or part thereof shall be equal to the product of (x) the Management Fee, multiplied by (y) a fraction, the numerator of which is the number of days from and including the first day of such Fiscal Quarter to but excluding the date upon which this Agreement is terminated and the denominator of which is the number of days in such Fiscal Quarter, (iii) if the aggregate amount of Management Fees paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to any Fiscal Year exceeds, or is expected to exceed, 9.5% of the Parent’s Gross Income with respect to such Fiscal Year, then the Manager agrees that the Management Fee to be paid by the Company for any remaining Fiscal Quarters in such Fiscal Year shall be reduced, on a pro rata basis determined by reference to the management fees to be paid to the Manager by all of the Subsidiaries of the Parent, until the aggregate amount of the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to such Fiscal Year, does not exceed 9.5% of the Parent’s Gross Income with respect to such Fiscal Year, and (iv) if the aggregate amount the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to any Fiscal Quarter exceeds, or is expected to exceed, the aggregate amount of the management fee (before any adjustment thereto) calculated and payable under the Parent MSA (the “Parent Management Fee”) with respect to such Fiscal Quarter, then the Manager agrees that the Management Fee to be paid by the Company for such Fiscal Quarter shall be reduced, on a pro rata basis, until the aggregate amount of the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to such Fiscal Quarter, does not exceed the Parent Management Fee calculated and payable with respect to such Fiscal Quarter. The Management Fee shall be paid in U.S. dollars by wire transfer in immediately available funds to an account or accounts designated by the Manager from time to time.
  
 (b) If the Company does not have sufficient liquid assets to timely pay the entire amount of the Management Fee due on any Management Fee Payment Date, the Company shall liquidate assets or Incur Indebtedness in order to pay such Management Fee in full on such Management Fee Payment Date; provided, however, that if the Management Fee due on any Management Fee Payment Date cannot be paid by the Company as the result of subordination provisions or other restrictions contained in financing or other agreements between the Company and its senior lenders or the senior lenders of any of its affiliates, then the Management Fee shall accrue and be paid as soon as the Company is able to pay the Management Fee without violation such subordination provision or other restrictions.
  
  	 
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 (c) Notwithstanding the foregoing, payment of the Management Fee shall be subordinated to the payment of interest on the Buyer Note, as defined in that certain Asset Purchase Agreement, dated January 18, 2019, between the Company and Goedeker Television Co. (the “APA”), such that no payment of the Management Fee may be made if the Company is in default under the Buyer Note with regard to interest payments and, for the avoidance of doubt, such payment of the Management Fee will be contingent on the Company being in good standing on all associated loan covenants. In addition, during the period that that any amounts are owed under the Buyer Note or the Earn-Out (as defined in the APA), the annual Management Fee shall be capped at $250,000.
  
 (d) In addition, payment of the Management Fee is subject to the provisions of (i) the Management Fee Subordination Agreement, dated as of the date hereof, between Burnley Capital LLC and the Manager and (ii) and the Management Fee Subordination Agreement, dated as of the date hereof, between Small Business Community Capital, L.P. and the Manager.
  
 Section 7.2 Reimbursement of Expenses
  
 (a) Subject to Section 7.2(b), the Company shall reimburse the Manager for all costs and expenses of the Company, including all out-of-pocket costs and expenses, that are actually Incurred by the Manager or its Affiliates on behalf of the Company in connection with performing Services hereunder, and all costs and expenses the reimbursement of which is specifically approved by the Board of Directors.
  
 (b) Notwithstanding the foregoing or anything else to the contrary herein, neither the Company nor any Subsidiary of the Company shall be obligated or responsible for reimbursing or otherwise paying for any costs or expenses relating to the Manager's overhead or to the Manager’s conduct or maintenance of its business and operations as a provider of management services.
  
 (c) Any such reimbursement shall be made upon demand by the Manager in U.S. dollars by wire transfer in immediately available funds to an account or accounts designated by the Manager from time to time.
  
 ARTICLE VIII
  
 TERMINATION; RESIGNATION AND REMOVAL OF THE MANAGER
  
 Section 8.1 Resignation by the Manager
  
 The Manager may resign at any time upon sixty (60) days’ prior written notice to the Company, which right shall not be contingent upon the finding of a replacement manager. However, if the Manager resigns, until the date on which the resignation becomes effective, the Manager shall, upon request of the Board of Directors, use reasonable efforts to assist the Board of Directors to find a replacement manager at no cost and expense to the Company.
  
 Section 8.2 Removal of the Manager
  
 The Manager may be removed by the Company at any time upon sixty (60) days’ prior written notice to the Manager, which right shall not be contingent upon the finding of a replacement manager.
  
  	 
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 Section 8.3 Termination
  
 Subject to Section 12.4, this Agreement shall terminate upon the effective date of the resignation or removal of the Manager in accordance with Section 8.1 or Section 8.2 hereof.
  
 Section 8.4 Directions
  
 After a written notice of termination has been given under this Article VIII, the Company may direct the Manager to undertake any actions necessary to transfer any aspect of the ownership or control of the assets of the Company to the Company or to any nominee of the Company and to do all other things necessary to bring the appointment of the Manager to an end, and the Manager shall comply with all such reasonable directions. 1n addition, the Manager shall, at the Company’s expense, deliver to any new manager or the Company any books or records held by the Manager under this Agreement and shall execute and deliver such instruments and do such things as may reasonably be required to permit new management of the Company to effectively assume its responsibilities.
  
 Section 8.5 Payments Upon Termination
  
 Notwithstanding anything in this Agreement to the contrary, the fees, costs and expenses payable to the Manager pursuant to Article VII hereof shall be payable to the Manager upon, and with respect to, the termination of this Agreement pursuant to this Article VIII. All payments made pursuant to this Section 8.5 shall be made in accordance with Article VII hereof.
  
 ARTICLE IX 
  
 INDEMNITY
  
 The Company shall indemnify, reimburse, defend and hold harmless the Manager and its Affiliates and their respective successors and permitted assigns, together with their respective employees, officers, members, managers, directors, agents and representatives (collectively the “Indemnified Parties”), from and against all losses (including lost profits), costs, damages, injuries, taxes, penalties, interests, expenses, obligations, claims and liabilities joint or severable) of any kind or nature whatsoever (collectively “Losses”) that are Incurred by such Indemnified Parties in connection with, relating to or arising out of (i) the breach of any term or condition of this Agreement, or (ii) the performance of any Services hereunder; provided, however, that the Company shall not be obligated to indemnify, reimburse, defend or hold harmless any Indemnified Party for any Losses Incurred, by such Indemnified Party in connection with, relating to or arising out of:
  
 (a) a breach by such Indemnified Party of this Agreement;
  
 (b) the gross negligence, willful misconduct, bad faith or reckless disregard of such Indemnified Party in the performance of any Services hereunder; or
  
 (c) fraudulent or dishonest acts of such Indemnified Party with respect to the Company or any of its Subsidiaries.
  
  	 
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 The rights of any Indemnified Party referred to above shall be in addition to any rights that such Indemnified Party shall otherwise have at law or in equity.
  
 Without the prior written consent of the Company, no Indemnified Party shall settle, compromise or consent to the entry of any judgment in, or otherwise seek to terminate any, claim, action, proceeding or investigation in respect of which indemnification could be sought hereunder unless (a) such Indemnified Party indemnifies the Company from any liabilities arising out of such claim, action, proceeding or investigation, (b) such settlement, compromise or consent includes an unconditional release of the Company and Indemnified Party from all liability arising out of such claim, action, proceeding or investigation and (c) the parties involved agree that the terms of such settlement, compromise or consent shall remain confidential.
  
 ARTICLE X 
  
 LIMITATION OF LIABILITY OF THE MANAGER
  
 Section 10.1 Limitation of Liability
  
 The Manager shall not be liable for, and the Company shall not take, or permit to be taken, any action against the Manager to hold the Manager liable for, any error of judgment or mistake of law or for any loss suffered by the Company or its Subsidiaries (including, without limitation, by reason of the purchase, sale or retention of any security or assets) in connection with the performance of the Manager’s duties under this Agreement, except for a loss resulting from gross negligence, willful misconduct, bad faith or reckless disregard on the part of the Manager in the performance of its duties and obligations under this Agreement, or its fraudulent or dishonest acts with respect to the Company or any of its Subsidiaries.
  
 Section 10.2 Reliance of Manager
  
 The Manager may take and may act and rely upon:
  
 (a) the opinion or advice of legal counsel, which may be in-house counsel to the Company or the Manager, any U.S.-based law firm, or other legal counsel reasonably acceptable to the Board of Directors, in relation to the interpretation of this Agreement or any other document (whether statutory or otherwise) or generally in connection with the Company;
  
 (b) advice, opinions, statements or information from bankers, accountants, auditors,
  
 (c) valuation consultants and other Persons consulted by the Manager who are in each case believed by the Manager in good faith to be expert in relation to the matters upon which they are consulted; and
  
 (d) any other document provided to the Manager in connection with the Company upon which it is reasonable for the Manager to rely.
  
 The Manager shall not be liable for anything done, suffered or omitted by it in good faith in reliance upon such opinion, advice, statement, information or document.
  
  	 
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 ARTICLE XI 
  
 LEGAL ACTIONS
  
 The Manager shall notify the Company promptly of any claim made by any third party in relation to the assets of the Company ai1d shall send to the Company any notice, claim, summons or writ served on the Manager concerning the Company.
  
 The Manager shall not, without the prior written consent of the Board of Directors, purport to accept or admit any claims or liabilities of which it receives notification on behalf of the Company or make any settlement or compromise with any third party in respect of the Company.
  
 ARTICLE XII 
  
 MISCELLANEOUS
  
 Section 12.1 Obligation of Good Faith; No Fiduciary Duties
  
 The Manager shall perform its duties under this Agreement in good faith and for the benefit of the Company. The relationship of the Manager to the Company is as an independent contractor and nothing in this Agreement shall be construed to impose on the Manager any express or implied fiduciary duties.
  
 Section 12.2 Binding Effect
  
 This Agreement shall be binding upon, shall inure to the benefit of and be enforceable by the Parties hereto and their respective successors and permitted assigns.
  
 Section 12.3 Compliance
  
 (a) The Manager shall (and must ensure that each of its officers, agents and employees) comply with any law, including the Federal Securities Laws and the securities laws of any applicable jurisdiction, in each case, as in effect from time to time, to the extent that it concerns the functions of the Manager under this Agreement.
  
 (b) The Manager shall maintain management systems, policies and internal controls and procedures that reasonably ensure that the Manager and its employees comply with the terms and conditions of this Agreement, as well as comply with the internal policies, controls and procedures established by the Company from time to time, including, without limitation, those relating to trading policies, conflicts of interest and similar corporate governance measures.
  
  	 
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 Section 12.4 Effect of Termination; Survival
  
 This Agreement shall be effective as of the date first above written and shall continue in full force and effect thereafter until termination hereof in accordance with Article VIII. The obligations of the Company set forth in Articles VII, VIII and IX and Sections 10.1, 12.5, 12.7, 12.8, 12.9, 12.17 and 12.20 hereof shall survive such termination of this Agreement, subject to applicable law. 
  
 Section 12.5 Notices
  
 Any notice or other communication required or permitted under this Agreement shall be deemed to have been duly given (a) five (5) Business Days following deposit in the mails if sent by registered or certified mail, postage prepaid, (b) when sent, if sent by facsimile transmission, if receipt thereof is confirmed by telephone, (c) when delivered, if delivered personally to the intended recipient and (d) two Business Days following deposit with a nationally recognized overnight courier service, in each case addressed as follows:
  
 If to the Company, to:
  
 13850 Manchester Rd.
 Ballwin, MO 63011
 Attn: Robert D. Barry
 Facsimile: 917-793-5950
  
 If to the Manager, to:
  
 c/o The 1847 Companies LLC 
 590 Madison Avenue, 21st Floor 
 New York, NY 10022
 Attn: Ellery W. Roberts
 Facsimile: 917-793-5950
  
 with a copy (which shall not constitute notice) to:
  
 Bevilacqua PLLC
 1050 Connecticut Avenue, NW, Suite 500
 Washington, DC 20036
 Attn: Louis A. Bevilacqua
 Facsimile: 202-869-0889
  
 or to such other address or facsimile number as any such Party may, from time to time, designate in writing to all other Parties hereto, and any such communication shall be deemed to be given, made or served as of the date so delivered or, in the case of any communication delivered by mail, as of the date so received.
  
  	 
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 Section 12.6 Headings
  
 The headings in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect.
  
 Section 12.7 Applicable Law
  
 This Agreement, the legal relations between and among the Parties and the adjudication and the enforcement thereof shall be governed by and interpreted and construed in accordance with the laws of the State of New York, without regard to the conflicts of law provisions thereof to the extent such principles or rules would require or permit the application of the laws of another jurisdiction.
  
 Section 12.8 Submission to Jurisdiction; Waiver of Jury Trial
  
 Subject to Section 12.20 hereof, each of the Parties hereby irrevocably acknowledges and agrees that any legal action or proceeding brought with respect to any of the obligations arising under or relating to this Agreement shall be brought only in the courts of the State of New York, County of New York or in the United States District Court for the Southern District of New York and each of the Parties hereby irrevocably submits to and accepts with regard to any such action or proceeding, for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each Party hereby further irrevocably waives any claim that any such courts lack jurisdiction over such Party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Agreement or the transactions contemplated hereby brought in any of the aforesaid courts, that any such court lacks jurisdiction over such Party. Each Party irrevocably consents to the service of process in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party, at its address for notices set forth in Section 12.5 hereof, such service to become effective ten (10) days after such mailing. Each Party hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any action or proceeding commenced hereunder or under any other documents contemplated hereby that service of process was in any way invalid or ineffective. The foregoing shall not limit the rights of any Party to serve process in any other manner permitted by applicable law. The foregoing consents to jurisdiction shall not constitute general consents to service of process in the State of New York for any purpose except as provided above and shall not be deemed to confer rights on any Person other than the respective Parties.
  
 Each of the Parties hereby waives any right it may have under the laws of any jurisdiction to commence by publication any legal action or proceeding with respect this Agreement. To the fullest extent permitted by applicable law, each of the Parties hereby irrevocably waives the objection which it may now or hereafter have to the laying of the venue of any suit, action or proceeding arising out of or relating to this Agreement in any of the courts referred to in this Section 12.8 and hereby further irrevocably waives and agrees not to plead or claim that any such court is not a convenient forum for any such suit, action or proceeding.
  
  	 
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 The Parties agree that any judgment obtained by any Party or its successors or assigns in any action, suit or proceeding referred to above may, in the discretion of such Party (or its successors or assigns), be enforced in any jurisdiction, to the extent permitted by applicable law.
  
 The Parties agree that the remedy at law for any breach of this Agreement may be inadequate and that should any dispute arise concerning any matter hereunder, this Agreement shall be enforceable in a court of equity by an injunction or a decree of specific performance. Such remedies shall, however, be cumulative and nonexclusive, and shall be in addition to any other remedies which the Parties may have.
  
 Each Party hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any litigation as between the Parties directly or indirectly arising out of, under or in connection with this Agreement or the transactions contemplated hereby or disputes relating hereto. Each Party (a) certifies that no representative, agent or attorney of any other Party has represented, expressly or otherwise, that such other Party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it and the other Parties have been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this Section 12.8.
  
 Section 12.9 Amendment; Waivers
  
 No term or condition of this Agreement may be amended, modified or waived without the prior written consent of the Party against whom such amendment, modification or waiver will be enforced.
  
 Any waiver granted hereunder shall be deemed a specific waiver relating only to the specific event giving rise to such waiver and not as a general waiver of any term or condition hereof.
  
 Section 12.10 Remedies to Prevailing Party
  
 If any action at law or equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs, and necessary disbursements in addition to any other relief to which such party may be entitled.
  
 Section 12.11 Severability
  
 Each provision of this Agreement is intended to be severable from the others so that if, any provision or term hereof is illegal, invalid or unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability shall not affect or impair the validity of the remaining provisions and terms hereof; provided, however, that the provisions governing payment of the Management Fee described in Article VII hereof are not severable.
  
  	 
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 Section 12.12 Benefits Only to Parties
  
 Nothing expressed by or mentioned in this Agreement is intended or shall be construed to give any Person, other than the Parties and their respective successors or permitted assigns and the Indemnified Parties, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained, terms Agreement and all conditions and provisions hereof being intended to be and being for the sole and exclusive benefit of the Parties and their respective successors and permitted assigns, and for the benefit of no other Person.
  
 Section 12.13 Further Assurances
  
 Each Party hereto shall take any and all such actions, and execute and deliver such further agreements, consents, instruments and any other documents as may be necessary from time to time to give effect to the provisions and purposes of this Agreement.
  
 Section 12.14 No Strict Construction
  
 The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by all Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.
  
 Section 12.15 Entire Agreement
  
 This Agreement constitutes the sole and entire agreement of the Parties with regards to the subject matter of this Agreement. Any written or oral agreements, statements, promises, negotiations or representations not expressly set fo1ih in this Agreement are of no force and effect.
  
 Section 12.16 Assignment
  
 This Agreement shall not be assignable by either party except by the Manager to any Person with which the Manager may merge or consolidate or to which the Manager transfers substantially all of its assets, and then only in the event that such assignee assumes all of the obligations to the Company and the Subsidiaries of the Company hereunder.
  
 Section 12.17 Confidentiality
  
 (a) The Manager shall not, and the Manager shall cause its Affiliates and their respective agents and representatives not to, at any time from and after the date of this Agreement, directly or indirectly, disclose or use any confidential or proprietary information, including Company Information, involving or relating to (x) the Company, including any information contained in the books and records of the Company and (y) the Subsidiaries of the Company, including any information contained in the books and records of any such Subsidiaries; provided, however, that disclosure and use of any information shall be permitted (i) with the prior written consent of the Company, (ii) as, and to the extent, expressly permitted by this Agreement or any other agreement between the Manager and the Company or any of the Company’s Subsidiaries (but only to the extent that such information relates to such Subsidiaries), (iii) as, and solely to the extent, necessary or required for the performance by the Manager, any of its Affiliates or its delegates, of any of their respective obligations under this Agreement, (iv) as, and to the extent, necessary or required in the operation of the Company's business or operations in the Ordinary Course of Business, (v) to the extent such information is generally available to, or known by, the public or otherwise has entered the public domain (other than as a result of disclosure in violation of this Section 12.17 by the Manager or any of its Affiliates), (vi) as, and to the extent, necessary or required by any governmental order, applicable law or any governmental authority, subject to Section 12.17(d), and (vii) as, and to the extent, necessary or required or reasonably appropriate in connection with the enforcement of any right or remedy relating to this Agreement or any other agreement between the Manager and the Company or any of the Company’s Subsidiaries.
  
  	 
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 (b) The Manager shall produce and implement policies and procedures that are reasonably designed to ensure compliance by the Manager’s directors, officers, employees, agents and representatives with the requirements of this Section 12.17.
  
 (c) For the avoidance of doubt, confidential information includes business plans, financial information, operational information, strategic information, legal strategies or legal analysis, formulas, production processes, lists, names, research, marketing, sales information and any other information similar to any of the foregoing or serving a purpose similar to any of the foregoing with respect to the business or operations of the Company or any of its Subsidiaries. However, the Parties are not required to mark or otherwise designate information as “confidential or proprietary information,” “confidential” or “proprietary” in order to receive the benefits of this Section 12.17.
  
 (d) In the event that the Manager is required by governmental order, applicable law or any governmental authority to disclose any confidential information of the Company or any of its Subsidiaries that is subject to the restrictions of this Section 12.17, the Manager shall (i) notify the Company or any of its Subsidiaries in writing as soon as possible, unless it is otherwise affirmatively prohibited by such governmental order, applicable law or such governmental authority from notifying the Company or any such Subsidiaries, as the case may be, (ii) cooperate with the Company or any such Subsidiaries to preserve the confidentiality of such confidential information consistent with the requirements of such governmental order, applicable law or such governmental authority and (iii) use its reasonable best efforts to limit any such disclosure to the minimum disclosure necessary or required to comply with such governmental order, applicable law or such governmental authority, in each case, at the cost and expense of the Company.
  
 (e) Nothing in this Section 12.17 shall prohibit the Manager from keeping or maintaining any copies of any records, documents or other information that may contain information that is otherwise subject to the requirements of this Section 12.17, subject to its compliance with this Section 12.17.
  
 (f) The Manager shall be responsible for any breach or violation of the requirements of this Section 12.17 by any of its agents or representatives. 
  
 Section 12.18 Counterparts
  
 This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.
  
 Section 12.19 Designation
  
 This Agreement is an “Offsetting Management Services Agreement” as such term is defined and used pursuant to the Parent MSA, and the Management Fee is an “Offsetting Management Fee” as such term is defined and used pursuant to the Parent MSA.
  
 Section 12.20 Dispute Resolution
  
 All disputes arising out of this Agreement or relating to the performance of either Party of its obligations hereunder, which disputes the Parties are unable to resolve directly between themselves, shall be settled by arbitration in New York, New York (unless the Company and the Manager agree upon another location) before three arbitrators in accordance with the rules then in effect of the American Arbitration Association.
  
  
 * * *
  
  	 
	18
	 
 
	 

  
 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.
  
  	 	 1847 GOEDEKER INC.
	
	 	 	 	 
		By:	/s/ Robert D. Barry 	
	  
	 Name:
	 Robert D. Barry
	 
	 	Title: 	 President
	 
	 	 	 	 
	  
	 1847 PARTNERS LLC
	  

	  
	  
	  
	  

	  
	 By: 
	 /s/ Ellery W. Roberts  
	  

	  
	 Name: 
	 Ellery W. Roberts
	  

	  
	 Title: 
	 Manager
	  

  
  
 [Signature Page to Management Services Agreement] 
  
  
  	 19

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