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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 9, 2017 (November 7, 2017)
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1847 Holdings LLC |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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333-193821 |
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38-3922937 |
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(State or other jurisdiction of incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
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590 Madison Avenue, 21st Floor New York, NY 10022 |
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(Address of principal executive offices) |
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(212) 521-4052 |
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(Registrant's telephone number, including area code) |
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Not Applicable |
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(Former name or former address, if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
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Item 1.01 Entry into a Material Definitive Agreement.
As previously reported on July 10, 2017 by 1847 Holdings LLC (the “Company”), on July 7, 2017, 1847 Fitness, Inc. (“1847 Fitness”), a subsidiary of the Company, entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Central Florida Health Clubs, LLC d/b/a Gold’s Gym Orlando, a Florida limited liability company (“CFHC”), CLFL, LLC d/b/a Gold’s Gym Clermont, a Florida limited liability company (“CLFL”), MTDR LLC d/b/a Gold’s Gym Mt. Dora, a Florida limited liability company (“MTDR”), SCFL, LLC d/b/a Gold’s Gym St. Cloud, a Florida limited liability company (“SCFL,” and together with CFHC, CLFL, MTDR, the “Companies”), and the other parties set forth in Exhibit A to the Purchase Agreement (the “Sellers”), pursuant to which 1847 Fitness will acquire all of the issued and outstanding equity interests in the Companies for an aggregate purchase price of (i) $14,000,000 in cash (subject to adjustment as described therein), (ii) the Gross-Up Amount (as defined below); (iii) 135 shares of the common stock, $0.001 par value, of 1847 Fitness (the “Shares”), constituting 13.5% of the capital stock of 1847 Fitness, and (iv) the issuance of promissory notes in the aggregate principal amount of $1,000,000, in the form and upon such terms as are mutually agreed upon by the parties before the closing date. The “Gross-Up Amount” means, the amount the cash portion of the purchase price will be increased, up to a maximum of $238,000, if, subsequent to the date of the Purchase Agreement and prior to the closing date, any Seller who receives Shares determines that he or it will incur a federal tax liability resulting from the receipt of Shares as a portion of the purchase price.
On November 7, 2017, 1847 Fitness, the Companies and the Sellers entered into Amendment No. 1 to the Membership Interest Purchase Agreement (“Amendment”). Pursuant to the Amendment, (i) the cash portion of the purchase price is increased by an amount equal to the aggregate amounts actually paid by MTDR and CLFL to third parties on or prior to the closing date for certain renovations; provided, however, that the amount of such increase shall not exceed $100,000 in the aggregate; and provided, further, that the amount of such increase shall be reduced, on a dollar for dollar basis, to the extent that the Sellers directly receive the benefit of any of the annual fee billings due from MTDR’s and CLFL’s members in mid-January 2018; and (ii) as a condition to closing, among others, 1847 Fitness will have received a cash loan from the Company of at least $6,407,407.
The cash portion of the purchase price is subject to a post-closing working capital adjustment provision. The Purchase Agreement contains customary representations, warranties and covenants and will be subject to customary closing conditions.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are filed herewith:
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Exhibit No. |
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Description of Exhibit |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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1847 HOLDINGS LLC |
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Date: November 9, 2017 |
By: |
/s/ Ellery W. Roberts |
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Name: |
Ellery W. Roberts |
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Title: |
Chief Executive Officer |
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EXHIBIT 10.1
EXECUTION COPY
AMENDMENT NO. 1
TO THE
MEMBERSHIP INTEREST PURCHASE AGREEMENT
AMENDMENT NO. 1 TO THE MEMBERSHIP INTEREST PURCHASE AGREMENT, dated November 7, 2017 among 1847 Fitness, Inc., a Delaware corporation (the “ Buyer ”), Central Florida Health Clubs, LLC d/b/a Gold’s Gym Orlando, a Florida limited liability company (“ CFHC ”), CLFL, LLC d/b/a Gold’s Gym Clermont, a Florida limited liability company (“ CLFL ”), MTDR LLC d/b/a Gold’s Gym Mt. Dora, a Florida limited liability company (“ MTDR ”), SCFL, LLC d/b/a Gold’s Gym St. Cloud, a Florida limited liability company (“ SCFL ,” and together with CFHC, CLFL, MTDR, each a “ Company ” and collectively, the “ Companies ”), and the Sellers listed on the signature page hereto (the “ Sellers ” and collectively with the Buyer and the Companies, the “ Parties ”).
BACKGROUND
A. The Parties have previously entered into that certain Membership Interest Purchase Agreement, dated as of July 7, 2017 (the “ Membership Interest Purchase Agreement ”).
B. The Parties desire to amend the Membership Interest Purchase Agreement to provide for an adjustment to the Cash Portion of the Purchase Price to account for certain renovations at MTDR and CLFL occurring before the Closing.
C. Pursuant to Section 8.3 of the Membership Interest Purchase Agreement, the Membership Interest Purchase Agreement may be amended by the Parties only by an instrument in writing signed on behalf of the Buyer, the Companies and the Sellers.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree to the following:
1. Definitions . All capitalized terms used herein without definition shall have the meanings ascribed to them in the Membership Interest Purchase Agreement, as applicable.
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2. Amendments . A. The following new subsection (e) is hereby added at the end of Section 2.2 of the Membership Interest Purchase Agreement:
“(e) Adjustment for Certain Locker Room Renovations . The Cash Portion shall be increased by an amount equal to the aggregate amounts actually paid by MTDR and CLFL to third parties on or prior to the Closing Date for locker room renovations (collectively, the “ Renovation Payments ”); provided , however , that the amount of such increase shall not exceed One Hundred Thousand Dollars ($100,000) in the aggregate; and provided , further , that the amount of such increase shall be reduced, on a dollar for dollar basis, to the extent that the Sellers directly receive the benefit of any of the Annual Fee Billings due from MTDR’s and CLFL’s members in mid-January, 2018. At Closing, Sellers shall provide Buyer with reasonable documentation evidencing that such Renovation Payments have been made. After Closing, Buyer shall be solely responsible for the payment of any remaining amounts due to third parties in connection with the completion of such locker room renovations.”
B. Section 7.2(h) as set forth in the Membership Interest Purchase Agreement, shall be amended and restated in its entirety to read as follows:
“(h) The Buyer shall have received a cash loan, from 1847 Holdings in the amount of at least $6,407,407; and any Seller who receives Buyer Shares shall have entered into a stockholders’ agreement with 1847 Holdings, being the only other stockholders of the Buyer, in form and substance reasonably satisfactory to such Sellers, which provides, inter alia, that such Sellers shall have no obligation, directly or indirectly, to personally guaranty any amount(s) of the Buyer’s indebtedness.”
3. Effect of Amendment . Except as amended as set forth above, the Membership Interest Purchase Agreement shall continue in full force and effect.
4. Counterparts . This Amendment may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g. , www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
5. Governing Law . This Amendment will be governed by, and construed and enforced in accordance with, the Laws of the State of Florida, without giving effect to any choice of Law or conflict of Law provision or rule that would cause the application of the Laws of any jurisdiction other than the State of Florida.
[ Remainder of Page Intentionally Left Blank ]
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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment No. 1 to the Membership Interest Purchase Agreement as of the date first written above.
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BUYER :
1847 FITNESS, INC. |
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By: |
/s/ Ellery W. Roberts |
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Name: |
Ellery W. Roberts |
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Title: |
Chief Executive Officer |
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COMPANIES :
CENTRAL FLORIDA HEALTH CLUBS, LLC |
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By: |
/s/ Pleasant A. Lewis III |
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Name: |
Pleasant A. Lewis III |
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Title: |
Manager |
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CLFL, LLC |
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By: |
/s/ Pleasant A. Lewis III |
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Name: |
Pleasant A. Lewis III |
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Title: |
Manager |
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MTDR LLC |
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By: |
/s/ Pleasant A. Lewis III |
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Name: |
Pleasant A. Lewis III |
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Title: |
Manager |
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SCFL, LLC |
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By: |
/s/ Pleasant A. Lewis III |
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Name: |
Pleasant A. Lewis III |
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Title: |
Manager |
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SELLERS : |
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/s/ Pleasant A. Lewis III |
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PLEASANT A. LEWIS III |
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/s/ Kenneth L. Cummings |
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KENNETH L. CUMMINGS |
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GGWH INVESTOR GROUP, LLC |
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By: |
/s/ Brett Bossung |
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Name: |
Brett Bossung |
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Title: |
Authorized Signatory |
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GGWH-CLE INVESTOR GROUP, LLC |
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By: |
/s/ Brett Bossung |
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Name: |
Brett Bossung |
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Title: |
Authorized Signatory |
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GGWH-MTDR, LLC |
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By: |
/s/ Brett Bossung |
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Name: |
Brett Bossung |
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Title: |
Authorized Signatory |
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GGWH-STC, LLC |
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By: |
/s/ Brett Bossung |
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Name: |
Brett Bossung |
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Title: |
Authorized Signatory |
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