Directors are elected by the affirmative vote of a plurality of the votes cast at the Annual Meeting. The eight (8) nominees receiving the most “FOR” votes among votes properly cast in person or by proxy will be elected to the Board as directors. You may vote “FOR” or “ABSTAIN” on each of the nominees for election as director. Shares represented by a properly submitted Proxy Card will be voted on Proposal No. 1 “FOR” the election of the nominees named herein to the Board at the Annual Meeting, unless otherwise marked. A broker non-vote or a properly executed proxy marked “ABSTAIN” with respect to the election of a director will not be voted with respect to such director. A properly executed proxy marked “ABSTAIN” with respect to the election of a director will be counted for purposes of determining whether there is a quorum. A broker non-vote will not be counted for purposes of determining whether there is a quorum.

THE BOARD RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH NAMED NOMINEE LISTED ON THE PROXY CARD OR VOTING INSTRUCTION FORM TO SERVE ON OUR BOARD

PROPOSAL NO. 2 - RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The audit committee of our Board has engaged Friedman LLP as our independent registered public accounting firm for the year ending December 31, 2021, and is seeking ratification of such selection by our stockholders at the Annual Meeting. Friedman LLP has audited our financial statements since the year ended December 31, 2020. Representatives of Friedman LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

Neither our Bylaws nor other governing documents or law require stockholder ratification of the selection of Friedman LLP as our independent registered public accounting firm. However, the audit committee is submitting the selection of Friedman LLP to our stockholders for ratificationadoption and approval at the Special Meeting.

To potentially improve the marketability and liquidity of the Common Stock.   Our Board of Directors believes that the increased market price of the Common Stock expected as a matterresult of good corporate practice. Ifimplementing the Reverse Split could improve the marketability and liquidity of the Common Stock and encourage interest and trading in the Common Stock.

To improve the perception of the Common Stock as an investment security.   The Board believes that effecting the Reverse Split is one potential means of increasing the share price of the Common Stock to improve the perception of the Common Stock as a viable investment security. Lower-priced stocks have a perception in the investment community as being risky and speculative, which may negatively impact not only the price of the Common Stock, but also our stockholders fail to ratifymarket liquidity.

Certain Risks Associated with the selection, the audit committee will reconsider whether or not to retain Friedman LLP. Reverse Split

Even if the selectionReverse Split is ratified, the audit committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if they determine that such a change would be in the best interestseffected, some or all of the company and our stockholders.

Changeexpected benefits discussed above may not be realized or maintained. The market price of Independent Registered Public Accounting Firm

On December 9, 2020, we dismissed our prior independent registered public accounting firm, Sadler, Gibb & Associates, LLC, and engaged Friedman LLP. The dismissal of Sadler, Gibb & Associates, LLC and engagement of Friedman was approved by the audit committee.

The audit reports of Sadler, Gibb & Associates, LLCCommon Stock will continue to be based, in part, on our financial statements for the period from April 6, 2019 through December 31, 2019performance and for our predecessor Goedeker Television Co. for the year ended December 31, 2018 and for the period from January 1, 2019 through April 5, 2019 did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles.

During the fiscal years ended December 31, 2019 and 2018 and the subsequent interim period through December 9, 2020, there were no (i) disagreements with Sadler, Gibb & Associates, LLC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures which, if not resolved to its satisfaction, would have caused it to make referenceother factors unrelated to the subject matternumber of shares outstanding. The Reverse Split will reduce the number of outstanding shares of the disagreement in connection with its reports, or (ii) “reportable events” as defined in Item 304(a)(1)(v) of Regulation S-K.

During the fiscal years ended December 31, 2019 and 2018 and the subsequent interim period through December 9, 2020, neither the Company nor anyone on its behalf has consulted with Friedman LLP regarding either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements, and neither a written report nor oral advice was provided to us that Friedman concluded was an important factor considered by us in reaching a decision as to any accounting, auditing or financial reporting issue, or (ii) any matter that was either the subject of a “disagreement” or a “reportable event,” as such terms are defined in Regulation S-K Item 304(a)(1)(iv) and (v), respectively.

Principal Accountant Fees and Services

The following is a summary of the fees billed to us for professional services rendered for the fiscal years ended December 31, 2020 and 2019:

“Audit Fees” consisted of fees billed for professional services rendered by the principal accountant for the audit of our annual consolidated financial statements and review of the consolidated financial statements included in our Form 10-K and 10-Q or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements. Total audit fees for the year ended December 31, 2020 was $200,000 for Friedman LLP and $49,674 for Sadler, Gibb & Associates, LLC. Total audit fees for the year ended December 31, 2019 was $300,000 for Friedman LLP and $79,500 for Sadler, Gibb & Associates, LLC.

“Audit-Related Fees” consisted of fees billed for assurance and related services by the principal accountant that were reasonably related to the performance of the audit or review of our financial statements and are not reported under the paragraph captioned “Audit Fees” above. Total audit fees related for the year ended December 31, 2020 was $125,000 for Friedman LLP and $192,000 for Sadler, Gibb & Associates, LLC. Total audit fees related for the year ended December 31, 2019 was $150,000 for Friedman LLP and $0 for Sadler, Gibb & Associates, LLC.

“Tax Fees” consisted of fees billed for professional services rendered by the principal accountant for tax returns preparation.

“All Other Fees” consisted of fees billed for products and services provided by the principal accountant, other than the services reported above.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm

Our audit committee charter provides that the audit committee must pre-approve all audit and permissible non-audit services to be provided by the independent registered public accounting firm. These services may include audit services, audit-related services, tax services and other services. Pre-approval would generally be requested annually, with any pre-approval detailed as to the particular service, which must be classified in one of the four categories of services listed above. The audit committee may also, on a case-by-case basis, pre-approve particular services that are not contained in the annual pre-approval request. In connection with this pre-approval policy, the audit committee also considers whether the categories of pre-approved services are consistent with the rules on accountant independence of the SEC and the Public Company Accounting Oversight Board, or the PCAOB. The audit committee has pre-approved all services performed since our policy on pre-approval of audit and non-audit services was adopted.

In order for Proposal No. 2 to be approved, holders of a majority of the shares present or represented by proxy at the Annual Meeting and entitled to vote must vote “FOR” Proposal No. 2. You may vote “FOR”, “AGAINST” or “ABSTAIN” on Proposal No. 2. Abstentions will have the same effect as a vote “AGAINST” this Proposal. Shares underlying broker non-votes are not entitled to vote at the Annual Meeting, and, therefore broker non-votes will have no effect on the result of the vote, and they will not be considered present for the purpose of determining the presence of a quorum.

THE BOARD RECOMMENDS A VOTE “FOR” THIS PROPOSAL NO. 2

PROPOSAL NO. 3 - CHARTER AMENDMENT

Overview

On November 2, 2021, our Board approved an amendment to our amended and restated certificate of incorporation (the “Certificate of Incorporation”) to increaseCommon Stock without reducing the number of shares of common stock that we are authorized to issue from 200,000,000 shares to 250,000,000 shares. A copy of the proposed amendment is attached hereto as Annex A.

The Charter Amendment will become effective upon filing with the Delaware Secretary of State’s Office,available but unissued Common Stock, which will occur promptly followingalso have the Annual Meeting if this Proposal No. 3 is approved ateffect of increasing the Annual Meeting.

Reasons for the Charter Amendment

The primary purposenumber of the Charter Amendment is to replenish the pool of available shares for our future issuance. Our current Certificate of Incorporation authorizes the Company to issue 200,000,000 shares of common stock. Prior to our acquisition of Appliances Connection and concurrent public offering in May 2021, we had approximately 192.4 million shares of common stockCommon Stock available for future issuances. In connection with these transactions, we issued 99,007,084 sharesissuance. The issuance of common stock and warrants for the purchase of 93,111,111, significantly reducing this pool of available shares.

As of November 1, 2021, there were 106,387,332 shares of common stock issued and outstanding. We have also reserved 92,514,423 shares of common stock for issuance under outstanding warrants, 573,421 shares of common stock for issuance under outstanding options and 426,579 additional shares of common stockCommon Stock may have a dilutive effect on the ownership of existing stockholders. The current economic environment in which we operate, the debt we carry, along with otherwise volatile equity market conditions, could limit our ability to raise new equity capital in the future.

Criteria to be Used for Determining the Reverse Split Ratio to Implement

In determining which Reverse Split ratio to implement, if any, following receipt of stockholder approval of the Reverse Split Proposal, our Board may consider, among other things, various factors, such as:

Effects of Reverse Split

After the effective date of the Reverse Split, each stockholder will own a reduced number of shares of Common Stock. However, the Reverse Split will affect all of our stockholders uniformly and will not affect any stockholder’s percentage ownership interests in the Company, except to the extent that the Reverse Split results in any of our stockholders owning a fractional share as described below. Voting rights and other rights and preferences of the holders of Common Stock will not be affected by the Reverse Split (other than as a result of the rounding up or payment of cash in lieu of issuing fractional shares). For example, a holder of 2% of the voting power of the outstanding shares of Common Stock immediately prior to the Reverse Split would continue to hold 2% of the voting power of the outstanding shares of Common Stock immediately after the Reverse Split (assuming there is no impact as a result of the rounding up or payment of cash in lieu of issuing fractional shares). The number of stockholders of record will not be affected by the Reverse Split.

The principal effects of the Reverse Split would be that:

After the effective date of the Reverse Split, the Common Stock would have a new committee on uniform securities identification procedures number, or CUSIP number, a number used to identify the Common Stock.

The Common Stock is currently registered under Section 12(b) of the Securities Exchange Act, and we are subject to the periodic reporting and other requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act. The implementation of the Reverse Split will not affect the registration of the Common Stock under the 2020 Plan,Exchange Act. The Common Stock would continue to be listed on NYSE American under the symbol “POL” immediately following the Reverse Split. 

Effective Date

The Reverse Split would become effective as of the filing of a Certificate of Amendment with the office of the Secretary of State of the State of Delaware, or such later date and time as is set forth in the Certificate of Amendment, which date and time we planrefer to increaseherein as described in Proposal No. 4. As a result, we have only 98,245 shares available for future issuance.

We believe that the Charter Amendment will provide us with increased flexibility in meeting future corporate needs and requirements by providing additional authorizedReverse Split Effective Time. At the Reverse Split Effective Time, shares of common stock, whichCommon Stock issued and outstanding immediately prior thereto will be available for issuance from timecombined, automatically and without any action on the part of us or our stockholders, into a reduced number of shares of Common Stock in accordance with the Reverse Split ratio determined by our Board within the limits set forth herein and stockholders who otherwise would be entitled to timereceive fractional shares because they hold a number of shares not evenly divisible by the Reverse Split ratio will, as determined by the Board, either (a) be issued an additional fraction of a share of Common Stock to round up to the next whole share or (b) receive cash in lieu of fractional shares.

Effect on Beneficial Holders (i.e., Stockholders Who Hold in “Street Name”)

If the proposed Reverse Split is approved and effected, we intend to treat Common Stock held by stockholders in “street name,” through a bank, broker or other nominee, in the same manner as stockholders whose shares are registered in their own names. Banks, brokers or other nominees will be instructed to effect the Reverse Split for any proper corporate purpose, withouttheir customers holding common stock in “street name.” However, these banks, brokers or other nominees may have different procedures than registered stockholders for processing the expense and delay associatedReverse Split. If you hold shares of Common Stock with a special stockholders’ meeting, except where required by applicable rules, regulationsbank, broker or other nominee and laws. However, we have no current plansany questions in this regard, you are encouraged to issue additional commoncontact your bank, broker or other nominee.

Effect on Registered “Book-Entry” Holders (i.e., Stockholders That are Registered on the Transfer Agent’s Books and Records but do not Hold Certificates)

Some of our registered holders of Common Stock may hold some or all of their shares electronically in book-entry form with our transfer agent, American Stock Transfer & Trust Company. These stockholders do not have stock at this time, except in connectioncertificates evidencing their ownership of Common Stock. They are, however, provided with future grants undera statement reflecting the 2020 Plan, the limit of which will be 9,992,979 additional shares if stockholders approve Proposal No. 4 at the Annual Meeting (or in connection with potential issuancesnumber of shares upon exerciseregistered in their names. If a stockholder holds registered shares in book-entry form with our transfer agent, no action needs to be taken to receive post-Reverse Split shares. If a stockholder is entitled to post-Reverse Split shares, a statement will automatically be sent to the stockholder’s address of currently outstanding options and warrants).

Possible Effects ofrecord indicating the Amendments to our Current Charter

Release No. 34-15230 of the staff of the SEC requires disclosure and discussion of the effects of any stockholder proposal that may be used as an anti-takeover device.

The proposed increase in the authorized number of shares of our common stockCommon Stock held following the Reverse Split.

STOCKHOLDERS SHOULD NOT DESTROY ANY PRE-SPLIT STOCK CERTIFICATE AND SHOULD NOT SUBMIT ANY CERTIFICATES UNTIL THEY ARE REQUESTED TO DO SO.

Accounting Consequences

The par value of the Common Stock would remain unchanged at $0.0001 per share, if the Reverse Split is effected.

The Company’s stockholders’ equity in its consolidated balance sheet would not change in total. However, the Company’s stated capital (i.e., $0.0001 par value times the number of shares issued and outstanding), would be proportionately reduced based on the reduction in shares of Common Stock outstanding. Additional paid in capital would be increased by an equal amount, which would result in no overall change to the balance of stockholders’ equity.

Additionally, net income or loss per share for all periods would increase proportionately as a result of the Reverse Split since there would be a lower number of shares outstanding. We do not anticipate that any other material accounting consequences would arise as a result of the Reverse Split.

Potential Anti-Takeover Effect

Even though the Reverse Split would result in an increased proportion of unissued authorized shares to issued shares, which could, under certain circumstances, have an anti-takeoveranti-takeover effect in(for example, by permitting issuances that additional shares could be issued (within the limits imposed by applicable law) in one or more transactions that could make a change in control or takeover of us more difficult. For example, additional shares could be issued by us so as towould dilute the stock ownership or voting rights of personsa person seeking to effect a change in the composition of the Board or contemplating a tender offer or other transaction for the combination of us with another company), the Reverse Split is not being proposed in response to any effort of which we are aware to accumulate shares of Common Stock or obtain control of us, even ifnor is it part of a plan by management to recommend a series of similar amendments to the persons seeking to obtain control offers an above-market premium that is favored by a majority of the independent stockholders. Similarly, the issuance of additional shares to certain persons allied withBoard and our management could have the effect of making it more difficult to remove our current management by diluting the stock ownership or voting rights of persons seeking to cause such removal. We have no plans or proposals to adopt other provisions or enter into other arrangements that may have material antistockholders.

-takeoverNo Appraisal Rights consequences. This proposal is not being presented with the intent that it be utilized as a type of anti-takeover device.

Our stockholders should recognize that, as a result of this proposal, they will own a fewer percentage of shares with respectare not entitled to our total authorized shares than they presently own and will be diluted as a result of any issuance of shares by us indissenters’ or appraisal rights under the future.

There are currently no specific plans, arrangements, commitments or understandings for the issuanceGeneral Corporation Law of the additional sharesState of common stock which are proposed to be authorized (exceptDelaware with respect to the proposed amendment to our Certificate of Incorporation to effect the 2020 Plan as described in Proposal No. 4).Reverse Split.

No Dissenters’ Rights

Under Delaware law, holders of our common stock are not entitled to dissenter’s rights of appraisal with respect to the approval of this Proposal No. 3.

Vote Required

In order for Proposal No. 3 to be approved, holders of a majorityMaterial U.S. Federal Income Tax Considerations of the outstanding shares of our common stock must vote “FOR” Proposal No. 3. You may vote “FOR”, “AGAINST” or “ABSTAIN” on Proposal No. 3. Shares represented by a properly submitted Proxy Card will be voted “FOR” Proposal No. 3 unless otherwise marked. Abstentions and broker non-votes will have the same effect as a vote “AGAINST” this Proposal.

THE BOARD RECOMMENDS A VOTE “FOR” THIS PROPOSAL NO. 3

PROPOSAL NO. 4 - PLAN AMENDMENTReverse Split

Overview

We are asking our stockholders to approve an amendment of the 2020 Plan. The purpose of the 2020 Plan is to grant restricted stock, stock options and other forms of incentive compensation to our officers, employees, directors and consultants.

The 2020 Plan was first adopted by the Board and approved by our stockholders on April 21, 2020 and became effective on July 30, 2020. On April 9, 2021, the Board and our stockholders approved an amendment of the 2020 Plan, which became effective on May 13, 2021. On November 2, 2021, the Board approved a second amendment of the 2020 Plan, subject to the requisite approval of our stockholders at the Annual Meeting and effective upon such approval. We are seeking stockholder approval of this amendment in order to:

•  increase the number of shares of our common stock authorized for issuance under the 2020 Plan from 1,000,000 shares to 11,000,000 shares; and

•  eliminate the fungible share counting provision for new awards, so that each share underlying new awards, regardless of type, will reduce the available number of shares of common stock under the 2020 Plan by one share and all shares underlying forfeited, expired or terminated awards granted on or after the effective date of the amendment will be returned to the share reserve in the same manner.

A copy of the proposed amendment is attached hereto as Annex B.

Background for Proposed Increase in Share Reserve and Removal of Fungible Share Counting Provision

We are seeking stockholder approval of the amendment of the 2020 Plan to increase the number of shares of common stock reserved under the 2020 Plan from 1,000,000 shares to 11,000,000 shares and remove the fungible share counting provision contained in the 2020 Plan, under which shares of our common stock subject to “full value” awards (i.e., awards other than stock options and stock appreciation rights) are counted against the 2020 Plan’s share reserve as two shares for every one share of common stock underlying the award.

As November 1, 2021, we have issued 216,800 restricted shares and have options for the purchase of 573,421 shares outstanding under the 2020 Plan. Therefore, as a result of the fungible share counting provision, we have no shares available for future awards under the 2020 Plan. We view the use of equity compensation as essential to attract, retain, motivate and reward key employees, directors and consultants as well as to align their interests with those of our stockholders. With the removal of the fungible share counting provision, and the proposed addition of 10,000,000 shares, the total number of shares of common stock that would remain available for new awards under the amended 2020 Plan, subject to stockholder approval, would be approximately 9,992,979 shares (plus any shares returned to the share reserve due to forfeited or canceled awards, etc.).

Various factors have contributed to the depletion of the share reserve under the 2020 Plan sooner than expected. These factors include our stock price and volatility, new hire equity grants, and the use of the fungible share counting provision that reduces the share reserve by two shares for each share subject to a full value award. In addition, following our initial public offering in August 2020, our compensation philosophy has evolved to include a broader group of high performing employees receiving bonus compensation in the form of equity-based awards, thereby linking the interests of a greater number of employees with those of our stockholders.

We believe that the 2020 Plan helps to strengthen the incentive for participants to achieve the objectives of the Company and its stockholders and contribute to our growth and success. The Company has a standing practice of linking employee compensation to corporate performance because we believe this increases employee motivation to improve profitability and stockholder value. We believe these additional shares are necessary to further our goals and to sustain equity compensation as an integral component of our compensation philosophy. In addition, the grant of equity awards as a form of compensation helps to allow us to manage cash resources.

As amended, the 2020 Plan would remove the two-for-one fungible share counting provision for new awards. This means that all awards granted under the amended 2020 Plan would be counted against the 2020 Plan’s share limit as one share for every share underlying the award. Given that the Company’s current practice generally is to grant full value awards, we do not believe that continuing to include the fungible share counting provision is necessary. Because the two-for-one formula was in place with respect to previously granted awards, any forfeitures, cancellations or other terminations of a full value award granted prior to approval of the amendment at the Annual Meeting would be returned back to the 2020 Plan’s share reserve as two shares for every one share underlying the award to reflect the fungible share counting formula in place at the time the award was granted.

If our stockholders approve the amendment, we anticipate that the shares of common stock that will be available for new awards under the 2016 Plan will provide the Company with flexibility to continue to grant equity awards for approximately two to three years. However, this is only an estimate based on current circumstances and a number of variables could result in a shorter or longer period, such as our stock price, the number of employees receiving awards, future hiring activity, the extent to which vesting conditions for awards are satisfied, changes in how we approached the balance between cash and equity-based compensation, and other changes in our compensation strategy and equity grant practices.

We believe that the use of equity compensation continues to be a critical and powerful tool to compete for and attract, retain and motivate talented employees. If the amendment of the 2020 Plan is not approved by our stockholders, there will be no shares under the 2020 Plan for equity awards in the coming years which we anticipate would materially affect our ability to attract and retain highly qualified individuals and place us at a considerable disadvantage.

Significant Features of the Plan

The following is a summarydiscussion summarizes certain material U.S. federal income tax considerations of the 2020 Plan with the amendment submitted for stockholder approval. The summary describes the principal features of the 2020 Plan, but it is qualified in its entirety by referenceReverse Split that would be expected to the full text of the 2020 Plan.

Awards that may be granted include: (a) incentive stock options, (b) non-qualified stock options, (c) stock appreciation rights, (d) restricted awards, (e) performance share awards, and (f) performance compensation awards. These awards offer our officers, employees, consultants and directors the possibility of future value, depending on the long-term price appreciationapply generally to U.S. Holders (as defined below) of our common stock and the award holder’s continuing service with the Company.

Stock options give the option holder the right to acquire from us a designated number of shares of common stock at a purchase price that is fixed upon the grant of the option. The exercise price will not be less than the market price of the common stock on the date of grant. Stock options granted may be either tax-qualified stock options (so-called “incentive stock options”) or non-qualified stock options.

Stock appreciation rights (“SARs”) which may be granted alone or in tandem with options, have an economic value similar to that of options. When a SAR for a particular number of shares is exercised, the holder receives a payment equal to the difference between the market price of the shares on the date of exercise and the exercise price of the shares under the SAR. Again, the exercise price for SARs normally is the market price of the shares on the date the SAR is granted. Under the 2020 Plan, holders of SARs may receive this payment – the appreciation value – either in cash or shares of common stock valued at the fair market value on the date of exercise. The form of payment will be determined by us.

Restricted shares are shares of common stock awarded to participants at no cost. Restricted shares can take the form of awards of restricted stock, which represent issued and outstanding shares of our common stock subject to vesting criteria, or restricted stock units, which represent the right to receive shares of our common stock subject to satisfaction of the vesting criteria. Restricted shares are forfeitable and non-transferable until the shares vest. The vesting date or dates and other conditions for vesting are established when the shares are awarded.

The 2020 Plan also provides for performance compensation awards, representing the right to receive a payment, which may be in the form of cash, shares of common stock, or a combination, based on the attainment of pre-established goals.

All of the permissible types of awards under the 2020 Plan are described in more detail as follows:

Purposes of 2020 Plan: The purposes of the 2020 Plan are to attract and retain officers, employees and directors for the Company and its subsidiaries; motivate them by means of appropriate incentives to achieve long-range goals; provide incentive compensation opportunities; and further align their interests with those of our stockholders through compensation thatCommon Stock. This summary is based on our common stock.

Administration of the 2020 Plan: The 2020 Plan is administered by our compensation committee (the “Administrator”). Among other things, the Administrator has the authority to select persons who will receive awards, determine the types of awards and the number of shares to be covered by awards, and to establish the terms, conditions, performance criteria, restrictions and other provisions of awards. The Administrator has authority to establish, amend and rescind rules and regulations relating to the 2020 Plan.

Eligible Recipients: Persons eligible to receive awards under the 2020 Plan will be those officers, employees, consultants, and directors of the Company and its subsidiaries who are selected by the Administrator.

Shares Available Under the 2020 Plan: If stockholders approve this Proposal 4 at the Annual Meeting, the maximum number of shares of our common stock that may be delivered to participants under the 2020 Plan will be increased from 1,000,000 to 11,000,000 shares, subject to adjustment for certain corporate changes affecting the shares, such as stock splits.

The 2020 Plan currently includes a fungible share counting provision under which the share reserve is reduced by one share for each share subject to options or SARs, and by two shares for each share subject to all other stock awards. If stockholders approve this Proposal 4 at the Annual Meeting, the amended 2020 Plan will remove the fungible share counting provision for purposes of new awards so that the share reserve will be reduced by one share for each share subject to a stock award, regardless of the type of award.

Shares of common stock covered by awards that expire, lapse or are forfeited, repurchased, canceled, or otherwise terminated without the delivery of the full number of covered shares generally will be available for further awards under the 2020 Plan to the extent of such expiration, forfeiture, cancellation, etc. If stockholders approve this Proposal 4 at the Annual Meeting, the number of shares that again become available for awards under the 2020 Plan will be added back to the share reserve on a one-for-one basis, except that shares of common stock subject to awards granted under the 2020 Plan prior to approval at the Annual Meeting (other than stock options or stock appreciation rights) will be added back as two shares for each share subject to such stock award. Shares subject to an award that is settled in cash will not again be made available for grants under the 2020 Plan.

Stock Options:

General. Subject to the provisions of the 2020 Plan, the Administrator has the authority to determine all grants of stock options. That determination will include: (i) the number of shares subject to any option; (ii) the exercise price per share; (iii) the expiration date of the option; (iv) the manner, time and date of permitted exercise; (v) other restrictions, if any, on the option or the shares underlying the option; and (vi) any other terms and conditions as the Administrator may determine.

Option Price. The exercise price for stock options will be determined at the time of grant. Normally, the exercise price will not be less than the fair market value on the date of grant. As a matter of tax law, the exercise price for any incentive stock option awarded may not be less than the fair market value of the shares on the date of grant. However, incentive stock option grants to any person owning more than 10% of our voting stock must have an exercise price of not less than 110% of the fair market value on the grant date.

Exercise of Options. An option may be exercised only in accordance with the terms and conditions for the option agreement as established by the Administrator at the time of the grant. The option must be exercised by notice to us, accompanied by payment of the exercise price. Payments may be made in cash or, at the option of the Administrator, by actual or constructive delivery of shares of common stock to the holder of the option based upon the fair market value of the shares on the date of exercise.

Expiration or Termination. Options, if not previously exercised, will expire on the expiration date established by the Administrator at the time of grant. In the case of incentive stock options, such term cannot exceed ten years provided that in the case of holders of more than 10% of our voting stock, such term cannot exceed five years. Options will terminate before their expiration date if the holder’s service with the Company or a subsidiary terminates before the expiration date. The option may remain exercisable for specified periods after certain terminations of employment, including terminations as a result of death, disability or retirement, with the precise period during which the option may be exercised to be established by the Administrator and reflected in the grant evidencing the award.

Incentive and Non-Qualified Options. As described elsewhere in this summary, an incentive stock option is an option that is intended to qualify under certaincurrent provisions of the Internal Revenue Code of 1986, as amended, (the “Code”), for more favorable tax treatment than applies to non-qualified stock options. Any option that does not qualify as an incentive stock option will be a non-qualified stock option. Underor the Code, certain restrictions applyexisting Treasury Regulations under the Code and current administrative rulings and court decisions, all of which are subject to incentive stock options. For example, the exercise price for incentive stock optionschange or different interpretation. Any change, which may or may not be less thanretroactive, could alter the fair market valuetax consequences to us or our stockholders as described in this summary. No ruling from the U.S. Internal Revenue Service, or the IRS, has been or will be requested in connection with the Reverse Split and there can be no assurance that the IRS will not challenge the statements and conclusions set forth below or a court would not sustain any such challenge.

No attempt has been made to comment on all U.S. federal income tax consequences of the shares on the grant date and the term of the option may not exceed ten years. In addition, an incentive stock option may not be transferred, other than by will or the laws of descent and distribution, and is exercisable during the holder’s lifetime only by the holder. In addition, no incentive stock options may be granted to a holder that is first exercisable in a single year if that option, together with all incentive stock options previously granted to the holder that also first become exercisable in that year, relate to shares having an aggregate fair market value in excess of $100,000, measured at the grant date.

Stock Appreciation Rights: Awards of SARs may be granted alone or in tandem with stock options. SARs provide the holder with the right, upon exercise, to receive a payment, in cash or shares of stock, having a value equal to the excess of the fair market value on the exercise date of the shares covered by the award over the exercise price of those shares. Essentially, a holder of a SAR benefits when the market price of the common stock increases, to the same extent that the holder of an option does, but, unlike an option holder, the SAR holder need not pay an exercise price upon exercise of the award.

Stock Awards: Stock awards can also be granted under the 2020 Plan. A stock award is a grant of shares of common stock or of a right to receive shares in the future. These awards will be subject to such conditions, restrictions and contingencies as the Administrator shall determine at the date of grant. Those may include requirements for continuous service and/or the achievement of specified performance goals.

Cash Awards: A cash award is an awardReverse Split that may be relevant to particular U.S. Holders, including holders: (i) who are subject to special tax rules such as dealers, brokers and traders in securities, mutual funds, regulated investment companies, real estate investment trusts, insurance companies, banks or other financial institutions or tax-exempt entities; (ii) who acquired their shares in connection with stock options, stock purchase plans or other compensatory transactions; (iii) who hold their shares as a hedge or as part of a hedging, straddle, “conversion transaction”, “synthetic security”, integrated investment or any risk reduction strategy; (iv) who are partnerships, limited liability companies that are not treated as corporations for U.S. federal income tax purposes, S corporations, or other pass-through entities or investors in such pass-through entities; (v) who do not hold their shares as capital assets for U.S. federal income tax purposes (generally, property held for investment within the formmeaning of cash or shares of common stock or a combination, based on the attainment of pre-established performance goals and other conditions, restrictions and contingencies identified by the Administrator.

Section 162(m)1221 of the Code: Section 162(m) of the Code limits publicly-held companies to an annual deductionCode); (vi) who hold their shares through individual retirement or other tax-deferred accounts; or (vii) who have a functional currency for United States federal income tax purposes other than the U.S. dollar.

In addition, the following discussion does not address state, local or foreign tax consequences of $1.0 millionthe Reverse Split, the Medicare tax on net investment income, U.S. federal estate and gift tax, the alternative minimum tax, the rules regarding qualified small business stock within the meaning of Section 1202 of the Code, or any other aspect of any U.S. federal tax other than the income tax. The discussion assumes that for compensation paid to eachU.S. federal income tax purposes the Reverse Split will not be integrated or otherwise treated as part of their chief executive officer and their three highest compensated executive officersa unified transaction with any other transaction. Furthermore, the following discussion does not address the tax consequences of transactions effectuated before, after or at the same time as the Reverse Split, whether or not they are in connection with the Reverse Split.

For purposes of this discussion, a U.S. Holder means a beneficial owner of Common Stock who is: (i) an individual who is a citizen or resident of the United States; (ii) a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in the United States or under the laws of the United States or any subdivision thereof; (iii) an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or (iv) a trust (other than a grantor trust) if (A) a court within the chief executive officer) determined atUnited States is able to exercise primary supervision over the endadministration of each year, referred to as covered employees.

Performance Criteria: Under the 2020 Plan,trust and one or more performance criteria will be used byU.S. persons have the Administrator in establishing performance goals. Any one or moreauthority to control all substantial decisions of the performance criteriatrust or (B) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

HOLDERS OF THE COMPANY’S COMMON STOCK ARE ADVISED AND EXPECTED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE SPLIT IN LIGHT OF THEIR PERSONAL CIRCUMSTANCES AND THE CONSEQUENCES OF THE REVERSE SPLIT UNDER STATE, LOCAL AND FOREIGN TAX LAWS.

Tax Consequences of the Reverse Split

Reservation of Right to Abandon Reverse Split

The Board of Directors reserves the right to abandon the Reverse Split without further action by our stockholders at any time before the effectiveness of the filing with the Secretary of State of the State of Delaware of the Certificate of Amendment, even if the authority to effect the Reverse Split has been approved by our stockholders at the Special Meeting.

Vote Required; Board Recommendation

You may vote in favor of or against this proposal or you may abstain from voting.

Approval of the Reverse Split Proposal will require the affirmative vote of a majority of the votes cast on such proposal. Abstentions and broker non-votes (if any) will have no effect on the approval of the Reverse Split Proposal. The Reverse Split Proposal is a routine matter. If you own shares through a bank, broker or other holder of record, those shares may be usedvoted on an absolutethe Reverse Split Proposal by such bank, broker or relative basisother holder of record and therefore we do not expect any broker non-votes.

THE BOARD RECOMMENDS A VOTE “FOR” APPROVAL OF AN AMENDMENT OF THE COMPANY’S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE COMPANY’S OUTSTANDING COMMON STOCK AT AN EXCHANGE RATIO BETWEEN 1-FOR-25 AND 1-FOR-75, AS DETERMINED BY THE COMPANY’S BOARD OF DIRECTORS

PROPOSAL 2 – ADJOURNMENT PROPOSAL

Overview

The Adjournment Proposal, if adopted, will allow us to measureadjourn the performanceSpecial Meeting from time to time, to a later date or dates, if necessary or appropriate, under certain circumstances, including for the purpose of thefurther solicitation of proxies. The Company as the Administrator may deem appropriate, or as compared to the performance of a group of comparable companies, or published or special indexintends that the Administrator deems appropriate. In determining the actual size of an individual performance compensation award, the Administrator may reduce or eliminate the amount of the award through the use of negative discretion if, in its sole judgment, such reduction or elimination is appropriate. The Administrator shall not have the discretionAdjournment Proposal will only be presented to (i) grant or provide payment in respect of performance compensation awards if the performance goals have not been attained or (ii) increase a performance compensation award above the maximum amount payable under the 2020 Plan.

Other Material Provisions: Awards will be evidenced by a written agreement, in such form as may be approved by the Administrator. In the event of various changes to the capitalization of the Company, such as stock splits, stock dividends and similar re-capitalizations, an appropriate adjustment will be made by the Administrator

to the number of shares covered by outstanding awards or to the exercise price of such awards. The Administrator is also permitted to include in the written agreement provisions that provide for certain changes in the awardour stockholders in the event of a change of control of the Company, including acceleration of vesting. Except asthat there are insufficient votes for, or otherwise determined by the Administrator at the date of grant, awards will not be transferable, other than by will or the laws of descent and distribution. Prior to any award distribution, we are permitted to deduct or withhold amounts sufficient to satisfy any employee withholding tax requirements. Our board also has the authority, at any time, to discontinue the granting of awards. The Board also has the authority to alter or amend the 2020 Plan or any outstanding award or may terminate the 2020 Plan as to further grants, provided that no amendment will, withoutin connection with, the approval of the Reverse Split Proposal.

We are asking our stockholders to the extent that such approval is required by law or the rules of an applicable exchange, increase the number of shares available under the 2020 Plan, change the persons eligible for awards under the 2020 Plan, extend the time within which awards may be made, or amend the provisions of the 2020 Plan related to amendments. No amendment that would adversely affect any outstanding award made under the 2020 Plan can be made without the consent ofauthorize the holder of such award.

New Plan Benefits

Future awards, if any that will be madeproxy solicited by our board of directors to eligible persons undervote in favor of adjourning the 2020 Plan are subject to the discretionSpecial Meeting and any later adjournments of the AdministratorSpecial Meeting. If our stockholders approve the Adjournment Proposal, we could adjourn the Special Meeting, and therefore, we cannot currently determineany adjourned session of the benefits orSpecial Meeting, to use the additional time to solicit additional proxies in favor of the Reverse Split Proposal, including the solicitation of proxies from stockholders that have previously voted against the Reverse Split Proposal. Among other things, approval of the Adjournment Proposal could mean that, even if proxies representing a sufficient number of shares subjectvotes against any of the proposals have been received, we could adjourn the Special Meeting without a vote on the Reverse Split Proposal and seek to awards that may be granted inconvince the future to our employees, consultants and non-employee directors under the 2020 Plan.

No Dissenters’ Rights

Under Delaware law, holders of our common stock are not entitledthose shares to dissenter’s rightschange their votes to votes in favor of appraisal with respect to the approval of thisthe Reverse Split Proposal.

Vote Required; Board Recommendation

Approval of the Adjournment Proposal No. 4.

Vote Required

In order for Proposal No. 4 to be approved,requires the affirmative vote of the holders of a majority of the shares of Common Stock present and entitled to vote on the matter either in person or represented by proxy at the Annual Meeting and entitled to vote must vote “FOR” Proposal No. 4. You may vote “FOR”, “AGAINST” or “ABSTAIN” on Proposal No. 4. Shares represented by a properly submitted Proxy CardSpecial Meeting. Abstentions will be voted “FOR” Proposal No. 4 unless otherwise marked. Abstentions have the same effect as a vote “AGAINST” thisvotes “against” the Adjournment Proposal. Shares underlying broker non-votes will not be entitled to vote at the Annual Meeting, and therefore broker non-votesA “broker non-vote” will have no effect on the resultoutcome of the vote and they will not be considered present for the purpose of determining the presence of a quorum.Adjournment Proposal.

THE BOARD RECOMMENDS A VOTE “FOR” THIS PROPOSAL NO. 4TO APPROVE THE ADJOURNMENT PROPOSAL.

Our Board has determined that each member of the audit committee is an independent director under NYSE American rules and under Rule 10A-3 under the Exchange Act. All members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and NYSE American. Our Board has determined that Mr. Crosnoe is an “audit committee financial expert” as defined by applicable SEC rules and has the requisite financial sophistication as defined under the applicable NYSE American rules and regulations. The audit committee met three times in 2020 following our initial public offering in August 2020.

Compensation Committee

The compensation committee assists the Board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. A copy of its charter may be found on our IR site at https://investor.goedekers.com/governance/governance-documents/.

The compensation committee is responsible for, among other things: (i) reviewing and approving the remuneration of our executive officers; (ii) making recommendations to the Board regarding the compensation of our independent directors; (iii) making recommendations to the Board regarding equity-based and incentive compensation plans, policies and programs; and (iv) reviewing and assessing annually the compensation committee’s performance and the adequacy of its charter.

Our Board has determined that each member of the compensation committee is independent under the applicable rules and regulations of NYSE American, is an outside director within the meaning of Section 162(m) of the Code, and is a “non-employee director” as defined under Rule 16b-3 of the Exchange Act. The compensation committee met once in 2020 following our initial public offering in August 2020.

Nominating and Corporate Governance Committee

The nominating and corporate governance committee assists the Board in selecting individuals qualified to become directors and in determining the composition of the Board and its committees. A copy of its charter may be found on our IR site at https://investor.goedekers.com/governance/governance-documents/.

The nominating and corporate governance committee is responsible for, among other things: (i) identifying and evaluating individuals qualified to become members of the Board by reviewing nominees for election to the board submitted by stockholders and recommending to the Board director nominees for each annual meeting of stockholders and for election to fill any vacancies on the Board; (ii) advising the Board with respect to Board organization, desired qualifications of Board members, the membership, function, operation, structure and composition of committees (including any committee authority to delegate to subcommittees), and self-evaluation and policies; (iii) advising on matters relating to corporate governance and monitoring developments in the law and practice of corporate governance; (iv) overseeing compliance with the our code of ethics; and (v) approving any related party transactions.

Our Board has determined that each member of the nominating and corporate governance committee is an independent director under the applicable rules and regulations of NYSE American. The nominating and corporate governance committee did not meet in 2020.

Strategic Planning Committee

The Strategic Planning Committee focuses on initiatives that enable the Company to continue advancing the integration of the Company following the business combination with Appliances Connection and advising on the best ways to grow market share. The Strategic Planning Committee was formed in August 2021.

Director Nomination Process

The nominating and corporate governance committee’s methods for identifying candidates for election to our Board (other than those proposed by our stockholders, as discussed below) will include the solicitation of ideas for possible candidates from a number of sources—members of our Board, our executives, individuals personally known to the members of our Board, and other research. The nominating and corporate governance committee may also, from time-to-time, retain one or more third-party search firms to identify suitable candidates.

In making director recommendations, the nominating and corporate governance committee may consider some or all of the following factors: (i) the candidate’s judgment, skill, experience with other organizations of comparable purpose, complexity and size, and subject to similar legal restrictions and oversight; (ii) the interplay of the candidate’s experience with the experience of other Board members; (iii) the extent to which the candidate would be a desirable addition to the Board and any committee thereof; (iv) whether or not the person has any relationships that might impair his or her independence; and (v) the candidate’s ability to contribute to the effective management of the Company, taking into account the needs of the Company and such factors as the individual’s experience, perspective, skills and knowledge of the industry in which we operate.

A stockholder may nominate one or more persons for election as a director at any annual meeting of stockholders if the stockholder complies with the notice and information provisions contained in our Bylaws. Such notice must be in writing to the Company not less than 90 days and not more than 120 days prior to the anniversary date of the preceding year’s annual meeting of stockholders or as otherwise required by requirements of the Exchange Act. As provided in our Bylaws, in the event an annual meeting has not been previously held, such notice must be received not later than the close of business on the 10th day following the date on which public announcement of the date of the annual meeting is first made. In addition, stockholders furnishing such notice must be a holder of record on both (i) the date of delivering such notice and (ii) the record date for the determination of stockholders entitled to vote at such meeting.

Stockholder Communications with the Board

Stockholders and other interested parties may communicate with the Board, or any individual member of the Board, at the following address:

1847 Goedeker Inc.

3817 Millstone Parkway

St. Charles, MO 63301

Attention: Secretary

Communications must state the number of shares owned by the person making the communication, if any. Our Secretary will review and forward such communication to all of the members of the Board or to the individual director(s) to whom the communication is addressed unless the communication is unduly frivolous, hostile, threatening or similarly inappropriate, in which case, our Secretary may disregard the communication in his or her discretion.

Code of Ethics

We have adopted a code of ethics that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer. Such code of ethics addresses, among other things, honesty and ethical conduct, conflicts of interest, compliance with laws, regulations and policies, including disclosure requirements under the federal securities laws, and reporting of violations of the code.

A copy of the code may be found on our IR site at https://investor.goedekers.com/governance/governance-documents/. We intend to make all required disclosures regarding any amendments to, or waivers from, any provisions of the code at the same location of our website.

Audit Committee Report

The material in this report is not “soliciting material,” is not deemed “filed” with the SEC, and is not to be incorporated by reference into any filing of 1847 Goedeker Inc. under the Securities Act of 1933, as amended, or the Exchange Act.

The primary purpose of the audit committee is to oversee our financial reporting processes on behalf of our Board. The audit committee’s functions are more fully described in its charter, which is available on our IR site under the link for “Governance.” Management has the primary responsibility for our financial statements and reporting processes, including our systems of internal controls. Friedman LLP, our independent registered public

accounting firm for fiscal year 2020, is responsible for expressing an opinion on the conformity of our audited financial statements with accounting principles generally accepted in the United States and the effectiveness of our internal control over financial reporting.

The audit committee is also responsible for appointment, compensation, retention and oversight of the work of the independent auditor, including pre-approving any audit and non-audit service provided to the company by the independent auditor, periodically reviewing and evaluating the performance of the lead audit partner, as well as reviewing and considering the selection of the lead audit partner. The audit committee also periodically considers whether there should be a rotation of our independent registered public accounting firm. In addition to Friedman LLP’s independence from the Company and management, the audit committee also considers several other factors in deciding whether to re-engage Friedman LLP, including: the quality of its staff, work and quality control; its policies related to independence; its global reach; and its capability and expertise to perform an audit of our financial statements and internal control over financial reporting, given the breadth and complexity of its business and global footprint.

In fulfilling its oversight responsibilities, the audit committee reviewed with management and Friedman LLP the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020.

The audit committee also discussed with Friedman LLP the matters that are required to be discussed by the PCAOB, as adopted in Auditing Standard No. 1301, Communications with Audit Committees. Friedman LLP has also provided the audit committee the written disclosures and the letter required by applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the audit committee concerning independence, and the audit committee has discussed with Friedman LLP that firm’s independence. The audit committee has concluded that Friedman LLP’s provision of audit and non-audit services to the Company and its affiliates is compatible with Friedman LLP’s independence. Finally, the audit committee discussed with Friedman LLP, with and without management present, the scope and results of Friedman LLP’s audit of such financial statements.

Based on these reviews and discussions, the audit committee has recommended to our Board that such audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2020 for filing with the SEC. The audit committee also has engaged Friedman LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2021 and is seeking ratification of such selection by the stockholders.

Members of the audit & risk oversight committee at the time of the filing of the Annual Report who approved this report:

Clark R. Crosnoe

Glyn C. Milburn

EXECUTIVE OFFICERS

The following table sets forth our executive officers and their respective ages and positions with us as of the Record Date.

Each of Messrs. Roberts and Albert Fouerti also serve on our Board and their biographical information can be found above under the heading “Proposal No. 1 - Election of Directors”. The biographical information for our other executive officers is set forth below.

Maria Johnson. Ms. Johnson has served as our Chief Financial Officer since July 2021. She is an accomplished finance executive with over 20 years of professional experience spanning across various industries and areas of expertise, including business strategy, finance transformation, financial planning and analysis, accounting and controls, GAAP, IFRS, tax, treasury, audit and compliance, risk management, and international business. Throughout her career, Ms. Johnson held leadership roles within some of the best-in-class finance organizations, including Hewlett Packard, PepsiCo and ExxonMobil, and partnered with several private equity firms in driving value creation through process optimization and finance and organizational transformation of mid-market companies in technology, media and fashion space. Most recently, she served as the Chief Financial Officer of E3 Investment Group, a private equity firm, since December 2019. Prior to that, she served as the Chief Financial Officer of John Hardy, a global omni channel luxury jewelry brand, from January 2018 to December 2019, as the Vice President of Finance of Cheetah Digital, a leading digital marketing solution provider, from April 2017 to January 2018 and as the Director of Financial Planning & Analysis of PepsiCo from March 2015 to April 2017. Ms. Johnson holds an MBA in Finance from the University of Texas at Austin Red McCombs School of Business, an MA in Speech Communications from the Texas State University, and a BA in International Business from the State Academy of Management. She is a Certified Public Accountant and a Certified Internal Auditor.

Robert D. Barry. Mr. Barry has served as our Chief Accounting Officer since July 2021 and previously served as our Chief Financial Officer from our inception in January 2019 until his appointment as of Chief Accounting Officer. He has served on the board of directors of our former parent company, 1847 Holdings LLC, since January 2014. From April 2013 until August 2016, Mr. Barry was Chief Executive Officer and Chief Financial Officer of Pawn Plus Inc., a chain of five retail pawn stores in suburban Philadelphia and one pawn store in northeastern Ohio. Prior to that, Mr. Barry served as Executive Vice President and Chief Financial Officer of Regional Management Corp., a consumer loan company based in Greenville, South Carolina, from March 2007 to January 2013. Prior to joining Regional Management Corp., Mr. Barry was the Managing Member of AccessOne Mortgage Company, LLC in Raleigh, North Carolina, from 1997 to 2007. During this time, he also served as part-time Chief Financial Officer for Patriot State Bank, in Fuquay-Varina, North Carolina, from March 2006 to March 2007 and Nuestro Banco, Raleigh, North Carolina, from July 2006 to March 2007. Prior to his time at AccessOne, Mr. Barry was Executive Vice President and Chief Financial Officer for Regional Acceptance Corporation, a consumer finance company based in Greenville, North Carolina and prior to that he was a financial institutions partner in the Raleigh, North Carolina office of KPMG LLP. Mr. Barry is a Certified Public Accountant licensed in North Carolina and Georgia.

Thomas S. Harcum. Mr. Harcum has served as our Chief Marketing Officer and Chief Technology Officer since January 2020. He has almost 20 years of experience in marketing and technology in several fields, including pharmaceuticals and publishing. Particularly, Mr. Harcum’s expertise includes direct to consumer e-commerce, lead generation and cost center management and P&L responsibilities for marketing funnel management, customer acquisition, telephony, product development, technology management, project management, development lifecycle and brand management. Previously, he was the Senior Director of Marketing for firstSTREET from October 2012 to December 2019. Mr. Harcum has a B.A. from Virginia Commonwealth University.

Elie Fouerti. Mr. Fouerti has served as the Vice President of our subsidiary ACI since June 2021. He has served as the Vice President of ACI’s various subsidiaries (collectively, Appliances Connection) since 1999. Along with his brother, Albert Fouerti, they have created a successful independent online retailer of appliances. Mr. Fouerti helped his brother in developing a process for delivering bulky items across the United States, paving the way for a new era of ordering appliances online. We believe Mr. Fouerti is qualified to serve as a member of ACI’s management team because of his extensive experience building and leading the Appliances Connection business from its founding and his insight into our industry and business as Appliances Connection’s co-founder and Chief Financial Officer.

COMPENSATION

Summary Compensation Table

The following table sets forth information concerning all cash and non-cash compensation awarded to, earned by or paid to the named persons for services rendered in all capacities during the noted periods. No other executive officers received total annual salary and bonus compensation in excess of $100,000.

of his employment effective as of August 30, 2021. Under the separation and release agreement, we agreed, subject to Mr. Moore’s compliance with each and every provision of the separation and release agreement, to pay Mr. Moore a severance payment equal to one year of his base salary at his current level ($650,000 per year), less applicable statutory deductions and authorized withholdings, payable in equal installments on our regular payroll dates during the period commencing on September 1, 2021 and ending on August 31, 2021. We also agreed to continue to pay our share of Mr. Moore’s health care costs under our medical, dental or vision plan in which Mr. Moore participates for a period beginning as of September 1, 2021 and ending as of August 31, 2022; provided, however, that Mr. Moore will be responsible for the full amount of the applicable employee contribution as determined and periodically modified by us. The separation and release agreement includes a customary release of claims by Mr. Moore in favor of the Company and its affiliates, as well as customary confidentiality and non-disparagement provisions.

On April 21, 2020, we entered into an employment letter agreement with Robert D. Barry setting forth the terms of the compensation for his services as Chief Financial Officer (and now Chief Accounting Officer) of the Company. This employment letter agreement became effective upon closing of our initial public offering on August 4, 2020. Pursuant to the employment letter agreement, Mr. Barry is entitled to an annual base salary of $250,000 and an annual incentive bonus of up to 50% of base to the extent that we achieve certain annual EBITDA objectives to be established by our compensation committee. Mr. Barry is also entitled to a 15% discount on all purchases from the Company. He is also eligible to participate in all employee benefit plans, including health insurance, commensurate with his position. Mr. Barry’s employment is at-will and may be terminated by us at any time. Mr. Barry may terminate his employment upon 90 days’ notice. If we terminate Mr. Barry’s employment without cause, he is entitled to six months of base compensation, which will be paid in a lump sum upon termination. The employment letter agreement contains restrictive covenants prohibiting Mr. Barry from (i) owning or operating a business that competes with the Company during the term of his employment and for a period of one year following the termination of his employment or (ii) soliciting our employees for a period of two years following the termination of his employment.

On December 13, 2019, we entered into an employment offer letter with Thomas S. Harcum setting forth the terms of the compensation for his services as Chief Marketing Officer and Chief Technology Officer of the Company, effective as of January 6, 2020. Pursuant to the employment offer letter, Mr. Harcum is entitled to an annual base salary of $140,000 and an annual incentive bonus of up to 20% of base to the extent that we achieve certain annual EBITDA objectives to be established by our compensation committee. He is also eligible to participate in all employee benefit plans, including health insurance, commensurate with his position. Mr. Harcum’s employment is at-will and may be terminated by us at any time.

Retirement Benefits

We have not maintained, and do not currently maintain, a defined benefit pension plan or nonqualified deferred compensation plan. We currently make available a retirement plan intended to provide benefits under Section 401(k) of the Code, pursuant to which employees, including the executive officers named above, can make voluntary pre-tax contributions. We currently match 100% of elective deferrals up to 3% of compensation and 50% of elective deferrals for next 2% of compensation. These matching contributions vest 100% following 60 days of the participant’s employment. All contributions under the plan are subject to certain annual dollar limitations, which are periodically adjusted for changes in the cost of living. See the Summary Compensation Table for matches made for the executive officers named above.

Potential Payments Upon Termination or Change in Control

As described under “—Employment and Separation Agreements” above, Mr. Moore is entitled to severance as described in the separation and release agreement and Mr. Barry is entitled severance as described in his employment agreement if his employment is terminated without cause.

In the event of a change in control (as defined in the 2020 Plan), which includes in the event that incumbent directors cease for any reason to constitute at least a majority of the Board (unless the nomination of new directors

is approved by at least two-thirds of the incumbent directors), all options issued to the executive officers named above shall become immediately vested and exercisable with respect to 100% of the shares subject to the options. As a result, if the Kanen Nominees are elected to the Board at the Annual Meeting, all options issued to the executive officers will become fully vested unless the nomination of the Kanen Directors is approved by at least two-thirds of the incumbent directors.

Outstanding Equity Awards at Fiscal Year End

The following table includes certain information with respect to the value of all unexercised options and unvested shares of restricted stock previously awarded to the executive officers named above at the fiscal year ended December 31, 2020.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

The following includes a summary of transactions since the beginning of our 2019 fiscal year, or any currently proposed transaction, in which we were or are to be a participant and the amount involved exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years, and in which any related person had or will have a direct or indirect material interest (other than compensation described under “Compensation”). We believe the terms obtained or consideration that we paid or received, as applicable, in connection with the transactions described below were comparable to terms available or the amounts that would be paid or received, as applicable, in arm’s-length transactions.

Management Services Agreement

On April 5, 2019, we entered into a management services agreement with 1847 Partners LLC, our manager, which is owned and controlled by Ellery W. Roberts, our Chairman, pursuant to which we appointed our manager to provide certain services to us for a quarterly management fee equal to $62,500. Under certain circumstances specified in the management services agreement, our quarterly fee may be reduced if similar fees payable to our manager by subsidiaries of our former parent company, 1847 Holdings LLC, exceed a threshold amount.

Pursuant to the management services agreement, we must also reimburse our manager for all costs and expenses which are specifically approved by our Board, including all out-of-pocket costs and expenses, that are actually incurred by our or our affiliates on our behalf in connection with performing services under the management services agreement.

The services provided by our manager include: conducting general and administrative supervision and oversight of our 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 overseeing and consulting with respect to our 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.

We expensed $125,000 in management fees for the six months ended June 30, 2021 and 2020 and $250,000 and $183,790 for the years ended December 31, 2020 and 2019, respectively.

Advances

As of December 31, 2019, our manager had funded $33,738 to us in related party advances. These advances were unsecured, bore no interest, and did not have formal repayment terms or arrangements. These advances were repaid from the proceeds of our initial public offering in August 2020.

Related Party Note

A portion of the purchase price for our acquisition of Goedeker Television Co. (“Goedeker Television”) was paid by our issuance to Steve Goedeker, as representative of Goedeker Television, of a 9% subordinated promissory note in the principal amount of $4,100,000. Michael Goedeker, our director, President and Chief Operating Officer until March 2020 and a significant stockholder, was also a director, officer and principal stockholder of Goedeker Television.

As of December 31, 2019, the balance of the note was $3,300,444. On June 2, 2020, the parties entered into an amendment and restatement of the note that became effective as of the closing of our initial public offering on August 4, 2020, pursuant to which (i) the principal amount of the existing note was increased by $250,000, (ii) upon the closing of the initial public offering, we agreed to make all payments of principal and interest due under the note through the date of the closing, and (iii) from and after the closing, the interest rate of the note was increased from 9% to 12%. In accordance with the terms of the amended and restated note, we used a portion of the proceeds from the initial public offering to pay $1,083,842 of the balance of the note representing a $696,204 reduction in the principal balance and interest accrued through August 4, 2020 of $387,638. We repaid this note in August 2020.

Securities Purchase Agreement

On April 5, 2019, the Company, 1847 Goedeker Holdco Inc. (“Holdco”) (our direct parent company at such time) and 1847 Holdings LLC (Holdco’s parent company at such time) entered into a securities purchase agreement with Leonite Capital LLC (“Leonite”), pursuant to which the Company, Holdco and 1847 Holdings LLC issued to Leonite a secured convertible promissory note in the aggregate principal amount of $714,286. As additional consideration for the purchase of the note, (i) 1847 Holdings LLC issued to Leonite 50,000 common shares (valued at $137,500), (ii) 1847 Holdings LLC issued to Leonite a five-year warrant to purchase 200,000 common shares at an exercise price of $1.25 per share (subject to adjustment), which may be exercised on a cashless basis, and (iii) Holdco issued to Leonite shares of common stock equal to a 7.5% non-dilutable interest in Holdco. As of December 31, 2019, the balance of the note was $584,943. As a result of this transaction, Leonite became a related party.

On May 11, 2020, the Company, Holdco, 1847 Holdings LLC and Leonite entered into a first amendment to secured convertible promissory note, pursuant to which the parties agreed (i) to extend the maturity date of the note to October 5, 2020, (ii) that our failure to repay the note on the original maturity date of April 5, 2020 shall not constitute and event of default under the note and (iii) to increase the principal amount of the note by $207,145, as a forbearance fee.

On August 4, 2020, we used a portion of the proceeds from our initial public offering to repay the note in full.

Related Party Leases

On June 2, 2021, our subsidiary 1 Stop Electronics Center, Inc. entered into a lease agreement with 1870 Bath Ave. LLC, an entity that is owned by Albert Fouerti, a member of our Board and the President of ACI and Appliances Connection, and Elie Fouerti, the Vice President of ACI and Appliances Connection, for our premises located at 1870 Bath Avenue, Brooklyn, NY. The lease is for a term of ten (10) years and provides for a base rent of $74,263 per month during the first year with annual increases to $96,896.37 during the last year of the term. 1 Stop Electronics Center, Inc. is also responsible for all property taxes, insurance costs and the utilities used on the premises. The lease contains customary events of default.

On June 2, 2021, our subsidiary Joe’s Appliances LLC entered into a lease agreement with 812 5th Ave Realty LLC, an entity that is owned by Albert Fouerti and Elie Fouerti, for our premises located at 7812 5th Avenue, Brooklyn, NY. The lease is for a term of ten (10) years and provides for a base rent of $6,365.40 per month during the first year with annual increases to $8,305.40 during the last year of the term. Joe’s Appliances LLC is also responsible for all property taxes, insurance costs and the utilities used on the premises. The lease contains customary events of default.

DMI Cooperative

The Company is a member of Dynamic Marketing, Inc. (“DMI”), an appliance purchasing cooperative. DMI purchases consumer electronics and appliances at wholesale prices from various vendors, and then makes such products available to its members, including the Company, who sell such products to end consumers. DMI’s purchasing group arrangement provides its members, including the Company, with leverage and purchasing power with appliance vendors, and increases our ability to compete with competitors, including big box appliance and electronics retailers. We own an approximate 5% interest in the cooperative. Additionally, Albert Fouerti is on the board of DMI. As such, DMI is deemed to be a related party.

At June 30, 2021, vendor rebate deposits due from DMI were $10,009,836. During the three and six months ended June 30, 2021, total purchases from DMI, net of holdbacks, were $26,999,225 and $27,970,121, respectively.

At December 31, 2020 and 2019, vendor rebate deposits, net, due from DMI were $31,733,415 and $22,005,318, respectively, and vendor rebates receivable were $4,691,514 and $3,284,594, respectively. During the year ended December 31, 2020, the following transactions were carried out with DMI: total purchases $175,630,820, vendor rebates $8,222,373, interest income $968,080, consulting income $255,000, and rent expense $675,000. During the year ended December 31, 2019, the following transactions were carried out with DMI: total purchases $120,328,645, vendor rebates $3,284,594, interest income $1,428,546, consulting income $188,617, and rent expense $337,500.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT

Common Stock Ownership

The following table sets forth certain information with respect to the beneficial ownership of our common stockthe Common Stock as of November 1, 2021the Record Date for (i) each of our executive officers and directors; (ii) all of our executive officers and directors as a group; and (iii) each other stockholder known by us to be the beneficial owner of more than 5% of our outstanding common stock.Common Stock. Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o the Company, 3817 Millstone Parkway, St. Charles, MO 63301.