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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT

 

SCHEDULE 14A INFORMATION

 

Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934

 

Filed by the Registrant  ☒

Filed by a Party other than the Registrant  ☐

 

Check the appropriate box:

 

Preliminary Proxy Statement

 

Confidential, for the use of the Commission only (as permitted by Rule 14a-6(e)(2))

 

Definitive Proxy Statement

 

Definitive Additional Materials

 

Soliciting Material Pursuant to §240.14a-12

 

IFRESH INC.

(Name of Registrant as Specified in its Charter)

 

 

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

 

Payment of Filing Fee (Check the appropriate box):

 

No fee required. 
   
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
   
  (1) Title of each class of securities to which transaction applies:
  (2) Aggregate number of securities to which transaction applies:
  (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
  (4) Proposed maximum aggregate value of transaction:
  (5) Total fee paid:

  

Fee paid previously with preliminary materials.
   
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-1l (a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
   
  (1) Amount Previously Paid:
  (2) Form, Schedule or Registration Statement No.:
  (3) Filing Party:
  (4) Date Filed:

 

 

 

 

 

IFRESH INC.
2-39 54th Avenue

Long Island City, New York 11101

 

March 30, 2018

 

Dear Stockholder:

 

On behalf of the Board of Directors of iFresh Inc. (the “Company” or “we”), I invite you to attend our Annual Meeting of Stockholders (the “Annual Meeting”).  We hope you can join us.  The Annual Meeting will be held:

 

  At: Loeb & Loeb LLP, 345 Park Ave, New York, New York 10154
  On: March 30, 2018
  Time: 10 a.m. local time

 

The Notice of Annual Meeting of Stockholders, the Proxy Statement and the proxy card accompany this letter and are also available, together with our Annual Report for the fiscal year ended March 31, 2017, at http://www.cstproxy.com/ifreshmarket/2018.

 

As discussed in the enclosed Proxy Statement, the Annual Meeting will be devoted to the election of directors and consideration of any other business matters properly brought before the Annual Meeting.

 

At the Annual Meeting, we will also report on important activities and accomplishments of the Company and review the Company’s financial performance and business operations.  You will have an opportunity to ask questions and gain an up-to-date perspective on the Company and its activities, and to meet certain directors and key executives of the Company.

 

We know that many of our stockholders will be unable to attend the Annual Meeting.  We are soliciting proxies so that each stockholder has an opportunity to vote on all matters that are scheduled to come before the stockholders at the Annual Meeting.  Whether or not you plan to attend, please take the time now to read the Proxy Statement and vote by submitting by mail a paper copy of your proxy or vote instructions, so that your shares are represented at the meeting.  You may also revoke your proxy or vote instructions and change your vote at any time prior to the Annual Meeting.  Regardless of the number of Company shares you own, your presence in person or by proxy is important for quorum purposes and your vote is important for proper corporate action.

 

Thank you for your continuing interest in iFresh Inc.  We look forward to seeing you at the Annual Meeting.

 

If you have any questions about the Proxy Statement, please contact us at iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101.

 

Sincerely,

 

/s/ Long Deng  
Long Deng  
Chairman and Chief Executive Officer  

 

 

 

IFRESH INC.
2-39 54th Avenue

Long Island City, New York 11101

 

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

 

TO BE HELD ON MARCH 30, 2018

 

To the Stockholders of IFRESH INC.:

 

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of IFRESH INC. (the “Company”), a Delaware corporation, will be held at the offices of Loeb & Loeb LLP, 345 Park Ave, New York, New York 10154 on Friday, March 30, 2018, at 10 a.m. local time, for the following purposes:

 

  1. To elect five directors to serve until the next Annual Meeting of Stockholders and until their respective successors have been duly elected and qualified or until his or her earlier resignation, removal or death.

 

  2. To act on such other matters as may properly come before the meeting or any adjournment or adjournments thereof.

 

The Board has fixed the close of business on March 12, 2018 as the record date for the meeting and only holders of shares of record at that time will be entitled to notice of and to vote at the Annual Meeting or any adjournment or adjournments thereof.

 

 

By Order of the Board of Directors.

 

Long Deng

Chairman and Chief Executive Officer

 

Long Island City, New York

March 30, 2018

 

 

 

IMPORTANT

 

IF YOU CANNOT PERSONALLY ATTEND THE ANNUAL MEETING, IT IS REQUESTED THAT YOU INDICATE YOUR VOTE ON THE ISSUES INCLUDED ON THE ENCLOSED PROXY AND DATE, SIGN AND MAIL IT IN THE ENCLOSED SELF-ADDRESSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES OF AMERICA.

 

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MARCH 30, 2018. THIS PROXY STATEMENT TO THE STOCKHOLDERS WILL BE AVAILABLE AT HTTP://WWW.CSTPROXY.COM/IFRESHMARKET/2018.

 

IFRESH INC.
2-39 54th Avenue

Long Island City, New York 11101

 

PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS

 

TO BE HELD MARCH 30, 2018

 

Date, Time and Place of the Annual Meeting

 

The enclosed proxy is solicited by the Board of Directors (the “Board”) of iFresh Inc. (the “Company”), a Delaware corporation, in connection with the Annual Meeting of Stockholders to be held at the offices of Loeb & Loeb LLP, 345 Park Ave, New York, New York 10154 on Friday, March 30, 2018, at 10 a.m. local time, and any adjournments thereof, for the purposes set forth in the accompanying Notice of Meeting.

 

The principal executive office of the Company is 2-39 54th Avenue Long Island City, New York 11101, and its telephone number, including area code, is (718) 628 6200.

 

Purpose of the Annual Meeting

 

At the Annual Meeting, you will be asked to consider and vote upon the following matters:

 

  1. To elect five directors to serve until the next Annual Meeting of Stockholders and until their respective successors have been duly elected and qualified or until his or her earlier resignation, removal or death.

 

  2. To act on such other matters as may properly come before the meeting or any adjournment or adjournments thereof.

 

Voting Rights and Revocation of Proxies

 

The record date with respect to this solicitation is the close of business on March 12, 2018 (the “Record Date”) and only stockholders of record at that time will be entitled to vote at the Annual Meeting and any adjournment or adjournments thereof.

 

The shares of the Company’s common stock (“Common Stock”) represented by all validly executed proxies received in time to be taken to the meeting and not previously revoked will be voted at the meeting. This proxy may be revoked by the stockholder at any time prior to its being voted by filing with the Secretary of the Company either a notice of revocation or a duly executed proxy bearing a later date. We intend to release this Proxy Statement and the enclosed proxy card to our stockholders on or about March 30, 2018.

 

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Dissenters’ Right of Appraisal

 

Holders of shares of our Common Stock do not have appraisal rights under Delaware law or under the governing documents of the Company in connection with this solicitation.

 

Outstanding Shares and Quorum

 

The number of outstanding shares of Common Stock entitled to vote at the meeting is 14,220,547. Each share of Common Stock is entitled to one vote. The presence in person or by proxy at the Annual Meeting of the holders of 7,110,274 shares, or a majority of the number of outstanding shares of Common Stock, will constitute a quorum. There is no cumulative voting. Shares that abstain or for which the authority to vote is withheld on certain matters (so-called “broker non-votes”) will be treated as present for quorum purposes on all matters. 

 

Broker Non-Votes

  

Holders of shares of our Common Stock that are held in street name must instruct their bank or brokerage firm that holds their shares how to vote their shares.  If a shareholder does not give instructions to his or her bank or brokerage firm, it will nevertheless be entitled to vote the shares with respect to “routine” items, but it will not be permitted to vote the shares with respect to “non-routine” items. In the case of a non-routine item, such shares will be considered “broker non-votes” on that proposal.

 

Proposal 1(election of directors – the only proposal discussed in this proxy statement) is a matter that we believe will be considered “non- routine.”

 

Banks or brokerages cannot use discretionary authority to vote shares on Proposal 1, if they have not received instructions from their clients.  Please submit your vote instruction form so your vote is counted.

 

Required Votes for Each Proposal to Pass

 

Assuming the presence of a quorum at the Annual Meeting:

 

Proposal   Vote Required   Broker
Discretionary Vote Allowed
Election of Directors   Plurality of the votes cast (the five directors receiving the most “For” votes)   No

 

Abstentions will have no effect on the vote for the election of director.

 

Voting Procedures

 

In voting by proxy with regard to the election of directors, you may vote in favor of all nominees, withhold your votes as to all nominees, or withhold your votes as to specific nominees.   You should specify your respective choices on the accompanying proxy card or your vote instruction form.

 

Solicitation of Proxies

 

The solicitation of proxies is made by the Company. The expenses of solicitation of proxies will be paid by the Company. We may solicit proxies by mail, and the officers and employees of the Company may solicit proxies personally or by telephone and will receive no extra compensation from such activities. The Company will reimburse brokerage houses and other nominees for their expenses incurred in sending proxies and proxy materials to the beneficial owners of shares held by them.

 

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Delivery of Proxy Materials to Households

 

Only one copy of the Company’s 2017 Annual Report and this Proxy Statement will be delivered to an address where two or more stockholders reside with the same last name or whom otherwise reasonably appear to be members of the same family based on the stockholders’ prior express or implied consent.

 

We will deliver promptly upon written or oral request a separate copy of the 2017 Annual Report and this Proxy Statement upon such request.  If you share an address with at least one other stockholder, currently receive one copy of our Annual Report and Proxy Statement at your residence, and would like to receive a separate copy of our Annual Report and Proxy Statement for future stockholder meetings of the Company, please specify such request in writing and send such written request to iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101; Attention: Secretary.

 

If you share an address with at least one other stockholder and currently receive multiple copies of Annual Report and Proxy Statement, and you would like to receive a single copy of Annual Report and Proxy Statement, please specify such request in writing and send such written request to iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101; Attention: Secretary.

 

Interest of Officers and Directors in Matters to Be Acted Upon

 

Except for the election to the Board of the two nominees set forth herein, none of our officers or directors has any interest in any of the matters to be acted upon at the Annual Meeting.

  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

The following table sets forth certain information with respect to the beneficial ownership of our voting securities by (i) any person or group owning more than 5% of any class of voting securities, (ii) each director, (iii) our Chief Executive Officer and President and (iv) all executive officers and directors as a group as of March 12, 2018.

 

Amount and Nature of Beneficial Ownership

  

Name and Address of Beneficial Owner(1)  Amount and
Nature of
Beneficial
Ownership
   Percent of
Class
 
Long Deng   11,456,000(3)   80.6%
Mei Deng   20,000    * 
Lilly Deng   11,456,000(2)(3)   80.6%
Jianming You   0    0 
Mark Fang   0    0 
Adam (Xin) He   0    0 

Jay Walder (director nominee)

   0    0 
All directors and executive officers as a group (seven individuals)   11,476,000    80.7%
           
Five Percent Holders:          
Bluejet LLC   833,333(4)   5.9%

 

* Less than one percent.
(1) Unless otherwise indicated, the business address of each of the individuals is c/o iFresh Inc. at 2-39 54th Avenue Long Island City, NY 11101.
(2) Consists of shares beneficially owned by Long Deng, Mrs. Deng’s husband.
(3) Consists of (i) 11,280,000 shares owned by Mr. Deng, and (ii) 176,000 shares Mr. Deng has the right to vote pursuant to the terms of an Escrow Agreement.
(4) Pursuant to a Schedule 13G filed by the beneficial owner dated February 27, 2017.  Pursuant to such schedule, the address of the beneficial owner is C/O Lian Fang, Withers Bergman LLP, 430 Park Avenue, 10th Floor, New York, NY 10022 and Zengxi Hao is the authorized signatory for the beneficial owner.

 

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PROPOSAL 1: ELECTION OF DIRECTORS

 

Nominees for Director

 

At the Annual Meeting, five directors are up for election, four of whom are up for re-election, with such directors to serve until the next Annual Meeting of Stockholders and until their respective successors have been elected and has qualified, or until their earlier resignation, removal or death. Adam (Xin) He has determined not to run for re-election to the Board. The Company will be looking for another candidate to replace him as the Company’s third independent director, but the Board has not yet selected a candidate.

 

If for some unforeseen reason one or more of the nominees is not available as a candidate for director, the proxies may be voted for such other candidate or candidates as may be nominated by the Board.

 

The following table sets forth the positions and offices presently held with the Company by each nominee, their age as of the Record Date. Proxies not marked to the contrary will be voted in favor of each such nominee's election.

 

Name   Age   Position
Long Deng   50   Chief Executive Officer, Chief Operating Officer and Chairman of the Board
Lilly Deng   50   Vice President of Legal and Finance, and Director
Jianming You   60   Director
Mark Fang   51   Director
Jay Walder   56   Director Nominee

 

The following is a summary of the biographical information of our director-nominees:

 

Long Deng became our Chief Executive Officer, Chief Operating Officer and a director in February 2017 in connection with the closing of the transactions (the “Transactions”) pursuant to which iFresh Inc. acquired NYM Holding, Inc. (“NYM”). Mr. Deng is the founder of NYM and has served as Chief Executive Officer, Chief Operating Officer and Director of NYM for over 20 years since he started the business in 1995. From 1995 to the present, Mr. Deng has been the sole director of NYM, responsible for the strategy, operation, and financial planning of NYM. Under his leadership, NYM has developed into a well-recognized Chinese supermarket chain in north eastern U.S. Mr. Deng is the husband of Mrs. Lilly Deng, who is a member of NYM board of directors effective upon consummation of the Business Combination. Apart from his business activities, Mr. Deng serves as the president of United States Chinese Chamber of Commerce and Co-Chair of New York State Republican Party’s Finance Committee.

 

We believe Mr. Deng, Long’s qualification to sit on our board of directors includes his extensive knowledge of NYM and the Chinese supermarket industry, his years of management and leadership experience in NYM and his connections in Chinese American business society.

 

Lilly Deng became our Vice President of Legal and Finance and a directors in February 2017 in connection with the closing of the Transactions. She joined NYM in 1995 and is Co-founder of Strong America Ltd., the first wholesale facility of NYM. Mrs. Lilly Deng currently is Vice President of Legal and Finance and oversees iFresh’s finances. Mrs. Lilly Deng is in charge of supervising financial issues and compliance with regulations. She also led the development of internal logistics management program. Mrs. Deng attended Cambridge Business College in 1993. Mrs. Lilly Deng is the wife of Mr. Long Deng.

 

We believe Mrs. Lilly Deng’s qualification to sit on our board of directors includes her knowledge of NYM, especially its wholesale business, her extensive expertise in company financial management, and established relationships with service providers.

 

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Jianming You became our director in February 2017 in connection with the closing of the Transactions. Mr. You is a famous film and television producer in China and has filmed over 1000 episodes of television dramas. Since 1993, Mr. You has served as Chairman of the Board and President of CHS Media, a film producing, importing and distribution company founded in Guangzhou, China. Since 2015, Mr. You has been the Vice Chairman of Board of Wuhan DDMC Culture Co., Ltd (formerly Wuhan Double Co., Ltd., ticker SH600136), a public company listed on Shanghai Securities Exchange operating in film production and distribution, phosphate ore trading, advertising production and distribution and student housing management. From 1985 to 1993 Mr. You worked as a director at Xiangxi TV, a director at Hunan TV Art Department and a producer and distributor at Zhongshan TV Art Center in China. Mr. Yu graduated from HuaiHua University in 1985 and later named as a tenured professor by the university.

 

We believe Mr. You’s qualification to sit on our board of directors include his seasoned professionalism in public company operation, knowledge of advertising and modern media and business connections.

 

Mark Fang became our director in May 2017. Mr. Fang is a New York attorney and the present Director of the Department of Consumer Protection in Westchester County. He previously served as the executive director of the Westchester County Human Rights Commission. Mr. Fang is also a former New York State Assistant Attorney General, Assistant District Attorney in Westchester County, and Counsel to the Consumer Affairs Committee of the New York City Council. Mr. Fang is a commissioned officer in the United States Army Reserves holding the rank of Lieutenant Colonel and a veteran of the nation’s war on terrorism.

 

We believe Mr. Fang’s qualifications to sit on our board of directors include his expertise and experience in law, regulatory and compliance systems, and issues in a full spectrum of organizations from industry to government to the military will greatly enhance the Board’s operations and oversight and benefit our company as we expand our grocery operations and create long-term value for our shareholders.

 

Jay Walder has been nominated to be our director. . He has been the Managing Member of Walder Worldwide LLC since June 2010. From December 2008 to December 2010, Mr. Walder was a Real-Estate salesperson at Nest Seekers International. From 1988 to 2008 he worked at Standard & Poors, most recently as a Sales Executive. Prior to that, he worked at ADP, Edward Blank Associates and Telspan.. Mr. Walder graduated with a degree in Political Science from the State University of New York at Stony Brook.

 

We believe Mr. Walder’s qualifications to sit on our board of directors include his experience with and connections in the New York business community.

 

Term of Office

 

If elected, the director-nominees will serve for a one-year term until the next Annual Meeting of Stockholders and until their respective successors have been elected and has qualified, or until their earlier resignation, removal or death.

 

Vote Required and Board of Directors’ Recommendation

 

The nominees receiving a plurality of the votes cast will be elected to the Board of Directors. If your shares are held in street name, your broker, bank, custodian, or other nominee holder cannot vote your shares on this proposal, unless you direct the holder how to vote, by marking your proxy card. For purposes of the election of directors, abstentions and broker non-votes will have no effect on the result of the vote.

 

The Board recommends a vote FOR the election of all the above director-nominees.

 

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DIRECTORS AND OFFICERS

 

Set forth below is certain information regarding our directors and executive officers.  The Board is comprised of five directors.

 

The following table sets forth certain information with respect to our directors and executive officers:

 

Name   Age   Position
Long Deng   50   Chief Executive Officer, Chief Operating Officer and Chairman of the Board
Alfred Chung-Chieh Ying   53   Chief Financial Officer
Lilly Deng   50   Vice President of Legal and Finance, and Director
Mei Deng   46   Vice President of Human Resources
Jianming You   60   Director
Mark Fang   51   Director
Adam Xin He   47   Director

  

All of the directors serve until the next Annual Meeting of Stockholders. Our officers serve at the discretion of the Board.

 

Set forth below is biographical information about our current executive officers other than those who are also directors. The biographical information about the directors is set forth above under the heading “Proposal 1: Election of Directors -- Nominees for Directors”

 

Mei Deng became our Vice President of Human Resources in February 2017 in connection with the closing of the Transactions. She has been the Vice President of Human Resources of NYM since January 2016. She joined Strong America as a Sales Assistant in 1998 primarily in charge of custom applications for the import of goods and materials. Ms. Deng was promoted to General Manager of Strong America in 2008. She is the sister of Mr. Deng.

 

Alfred Chung-Chieh Ying has served as our Chief Financial Officer since May 17, 2017. Mr. Ying served as investor relations director and senior adviser to the board of Safe-Run Machinery (Suzhou)Co. from December 2015 to January 2017, Overseas Investment Director for Union Life Insurance Company from October 2014 to September 2015, Vice President of equity research and investment banking at Piper Jaffrey Asia Securities Ltd./China Minsheng Banking Corp. from September 2011 to September 2014, Vice President of investor relations and M&A at Daphne International Holdings Limited from August 2007 to March 2011, Executive Vice President of equity research at Grand Cathay Securities from January 2005 to July 2007 and director, head of Asian technology research and head of Taiwan at BNP Paribas Peregrine Securities Ltd. from October 1998 to December 2004. Mr. Ying received his Master of Business Administration Degree from the University of New South Wales, Master of Science Degree in Mechanical Engineering from the National Chiao Tung University, and Bachelor of Science Degree in Mechanical Engineering from the National Cheng Kung University. 

 

Adam (Xin) He became our director in November 2017 and has elected not to stand for re-election. Mr. He has served as Chief Financial Officer of Wanda America Investment Holding Co. since May 2012, and has managed two projects for Wanda Commercial Properties Group (HKG: 3699) since February 2015. Mr. He served as Chief Financial Officer of AMC Entertainment Holdings, Inc.(NYSE: AMC) from August 2012 to February 2015, a publicly traded company principally involved in the theatrical exhibition business owning and operating 660 theatres primarily located in the United States. He served as board advisor to Professional Diversify Network (Nasdaq: IPDN) in Chicago, and an independent director for Energy Focus Inc. (Nasdaq: EFOI) in Cleveland from July 2014 to April 2015. From December 2010 to May 2012, he served as Financial Controller of Xinyuan Real Estate Co.(NYSE: XIN), a publicly traded developer of large scale, high quality residential real estate projects. Previously, Mr. He served as an auditor at Ernst & Young, LLP in New York, and held various roles at Chinatex Corporation. Mr. He obtained a Master of Science in Taxation from Central University of Finance and Economics in Beijing, and a Master of Science in Accounting from Seton Hall University in New Jersey. He is a Certified Public Accountant.

 

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We believe Mr. He’s qualifications to sit on our board of directors include his experience with public companies and background in accounting.

 

Except as noted in the biographical information of our officers and directors, there are no family relationships among our directors or officers.

 

Legal Proceedings

 

There are no material proceedings to which any director and executive officers of the Company is a party adverse to the Company or has a material interest adverse to the Company.

 

TRANSACTIONS WITH RELATED PERSONS, PROMOTERS AND CERTAIN CONTROL PERSONS

 

Management Fees, Advertising Fees and Sale of Non-Perishable and Perishable Products to Related Parties

 

The following is a detailed breakdown of significant management fees, advertising fees and sale of products for the years ended March 31, 2017and 2016to related parties which are directly or indirectly owned by Mr. Long Deng, the majority shareholder of iFresh, and not eliminated in the consolidated financial statements.

 

Year ended March 31, 2017
Related  Parties  Management Fees   Advertising Fees   Non-Perishable & Perishable Sales 
New York Mart, Inc.  $46,170   $31,289   $2,832,018 
Pacific Supermarkets Inc.   57,669    34,230    3,201,198 
NY Mart MD Inc.   45,647    -    2,634,650 
Spring Farm Inc.   -    -    6,114 
Spicy Bubbles, Inc.   -    -    102,580 
NYM Milford, LLC   -    -    79,320 
Pine Court Chinese Bistro   -    -    169,813 
    149,486   $65,519   $9,050,553 

 

Year ended March 31, 2016
Related  Parties  Management Fees   Advertising Fees   Non-Perishable & Perishable Sales 
New York Mart, Inc.  $41,216   $21,768   $1,508,394 
Pacific Supermarkets Inc.   53,648    25,656    3,251,159 
NY Mart MD Inc.   19,981    -    1,014,874 
Spring Farm Inc.   -    -    6,862 
Spicy Bubbles, Inc.   -    -    100,994 
Pine Court Chinese Bistro   -    -    320,994 
   $114,845   $47,424   $6,203,277 

 

Long-Term Operating Lease Agreement with a Related Party

 

iFresh leases a warehouse from a related party that is owned by Mr. Long Deng, the majority shareholder of iFresh, and will expire on April 30, 2026. Rent incurred to the related party was $698,000 and $588,000 for the fiscal years ended on March 31, 2017 and 2016, respectively.

 

Due to a shareholder

 

iFresh at times borrowed funds from Mr. Long Deng, the majority shareholder, before March 31, 2014 for working capital purposes. All balances due had been paid off for the year ended March 31, 2016.

 

Procedures for Approval of Related Party Transactions

 

Our Audit Committee is charged with reviewing and approving all potential related party transactions.  We have not adopted other procedures for review, or standards for approval, of such transactions, but instead review them on a case-by-case basis.

 

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SECTION 16( a ) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

 

Section 16(a) of the Securities Exchange Act of 1934 requires our officers, directors and persons who own more than ten percent of a registered class of our equity securities to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and ten percent shareholders are required by regulation to furnish us with copies of all Section 16(a) forms they file. We believe that, during the year ended March 31, 2017, all filing requirements applicable to our officers, directors and greater than ten percent beneficial owners were complied with, except that each of our officers and directors at the closing of the Business Combination filed a late Form 3 upon closing of the Business Combination.

 

DIRECTOR INDEPENDENCE

 

The Company currently has three independent directors: Mr. You, Mr. Fang and Mr. He are independent directors. Each is independent under the Nasdaq Marketplace Rules.

 

Board Leadership Structure and Role in Risk Oversight

 

One person currently holds the positions of principal executive officer and chairman of the Board of Company.  The Board does not have a policy on whether or not the roles of the Chief Executive Officer and Chairman should be separate.  Instead, the Company’s By-Laws provide that the directors may designate a Chairman of the Board from among any of the directors.  Accordingly, the Board reserves the right to vest the responsibilities of the Chief Executive Officer and Chairman in the same person or in two different individuals depending on what it believes is in the best interest of the Company.   The Board has determined that the consolidation of these roles is appropriate because it allows Mr. Deng to bring a wider perspective to the deliberations of the Board on matters of corporate strategy and policy.  The Board believes that there is no single Board leadership structure that would be most effective in all circumstances and therefore retains the authority to modify this structure to best address the Company’s and the Board’s then current circumstances as and when appropriate.

 

The Company’s management is responsible for identifying, assessing and managing the material risks facing the business. The Board and, in particular, the Audit Committee are responsible for overseeing the Company’s processes for assessing and managing risk.  Each of the Chief Executive Officer and Chief Financial Officer, with input as appropriate from other appropriate management members, report and provide relevant information directly to either the Board and/or the Audit Committee on various types of identified material financial, reputational, legal, operational, environmental and business risks to which the Company is or may be subject, as well as mitigation strategies for certain salient risks.  In accordance with NASDAQ Capital Market requirements and as set forth in its charter, the Audit Committee periodically reviews and discusses the Company’s business and financial risk management and risk assessment policies and procedures with senior management, the Company’s independent auditor.  The Audit Committee reports its risk assessment function to the Board.  The roles of the Board and the Audit Committee in the risk oversight process have not affected the Board leadership structure.  Although the board has not formally designated a lead independent director, Mr. Fang, the chairman of the audit committee, has led the executive session of the independent directors.

 

The Board of Directors held no meetings from the closing of the Business Combination on February 10, 2017 through March 31, 2017, but acted by written consent three times. During fiscal year ended March 31, 2017, no director attended fewer than 75% of the meetings of the Board of Directors and Board committees of which the director was a member.

 

It is the policy of the Board of Directors that all directors should attend the annual meeting of stockholders in person or by teleconference. Last year the Company did not hold an annual meeting as its special meeting of stockholders held to approve its business combination included a proposal providing for the election of directors.

 

Audit Committee

 

Effective August 12, 2015, we established an audit committee of the board of directors, which currently consists of Jianming You, Mark Fang and Adam (Xin) He, each of whom is an independent director under the NASDAQ’s listing standards. The audit committee’s duties, which are specified in our Audit Committee Charter, include, but are not limited to:

 

  reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommend to the board whether the audited financial statements should be included in our Form 10-K;
  discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements;
  discussing with management major risk assessment and risk management policies;
  monitoring the independence of the independent auditor;
  verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law;
  reviewing and approving all related-party transactions;
  inquiring and discussing with management our compliance with applicable laws and regulations;
  pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed;
  appointing or replacing the independent auditor;
  determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; and
  establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies.

 

A copy of the audit committee’s current charter is available at our corporate website at http://investors.ifreshmarket.com/static-files/16688175-a363-4f45-af61-5392f9665393.

8

 

 Financial Experts on Audit Committee

 

The audit committee will at all times be composed exclusively of “independent directors” who are “financially literate” as defined under NASDAQ listing standards. NASDAQ listing standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement.

 

In addition, we must certify to NASDAQ that the committee has, and will continue to have, at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication. The board of directors has determined that Adam (Xin) He qualifies as an “audit committee financial expert,” as defined under rules and regulations of the SEC.

 

Nominating Committee

 

Effective August 12, 2015, we have established a nominating committee of the board of directors, which currently consists of Jianming You, Mark Fang and Adam (Xin) He, each of whom is an independent director under NASDAQ’s listing standards. The nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors. The nominating committee considers persons identified by its members, management, shareholders, investment bankers and others.

 

Guidelines for Selecting Director Nominees

 

The guidelines for selecting nominees, which are specified in the Nominating Committee Charter, generally provide that the persons to be nominated:

 

  should have demonstrated notable or significant achievements in business, education or public service;
  should possess the requisite intelligence, education and experience to make a significant contribution to the board of directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and
  should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the shareholders.

 

A copy of the nominating committee’s current charter is available at our corporate website at http://investors.ifreshmarket.com/static-files/0d616b3f-692c-436f-887f-17404a93a1fe.

 

Stockholders who wish to recommend individuals for consideration by the Nominating Committee to become nominees for election to the Board at our next Annual Meeting of Stockholders may do so by submitting a written recommendation to the Nominating Committee, iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101; Attention: Secretary, in accordance with the procedures set forth below in this proxy statement under the heading “Stockholder Proposals.” For nominees for election to the Board proposed by stockholders to be considered, the following information concerning each nominee must be timely submitted in accordance with the required procedures:

 

  The candidate’s name, age, business address, residence address, principal occupation or employment, the class and number of shares of our capital stock the candidate beneficially owns, a brief description of any direct or indirect relationships with us, and the other information that would be required in a proxy statement soliciting proxies for the election of the candidate as a director;
  A signed consent of the nominee to being named as a nominee, to cooperate with reasonable background checks and personal interviews and to serve as a director, if elected; and
  As to the stockholder proposing such nominee, that stockholder’s name and address, the class and number of shares of our capital stock the stockholder beneficially owns, a description of all arrangements or understandings between the stockholder and the candidate and any other person or persons (including their names) pursuant to which the recommendation is being made, a list of all other companies to which the stockholder has recommended the candidate for election as a director in that fiscal year, and a representation that the stockholder intends to appear in person or by proxy at the meeting to nominate the person named in its notice.

  

Compensation Committee

 

Effective as of August 12, 2015, we established a compensation committee of the board of directors, which consists of Jianming You, Mark Fang and Adam (Xin) He, each of whom is an independent director under NASDAQ’s listing standards. The compensation committee’s duties, which are specified in our Compensation Committee Charter, include, but are not limited to:

 

  reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer’s based on such evaluation;
  reviewing and approving the compensation of all of our other executive officers;
  reviewing our executive compensation policies and plans;
  implementing and administering our incentive compensation equity-based remuneration plans;
  assisting management in complying with our proxy statement and annual report disclosure requirements;
  approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees;
  if required, producing a report on executive compensation to be included in our annual proxy statement; and
  reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.

 

A copy of the compensation committee’s current charter is available at our corporate website at http://investors.ifreshmarket.com/static-files/f0579d36-ae03-48da-a9e3-187b3da7e250.

9

 

 

Board Meetings

 

The board and its committees held the following number of meetings during the year ended March 31, 2017:

 

Board of Directors     6  
Audit Committee     5  
Compensation Committee     1  
Nominating Committee     1  

 

The meetings include meetings that were held by means of a conference telephone call, but do not include actions taken by unanimous written consent.

 

Each director attended at least 75% of the total number of meetings of the Board of Directors and those committees on which he served during the year.

 

STOCKHOLDER COMMUNICATIONS

 

Stockholders who wish to communicate with the Board or with specified members of the Board should do so by sending any communication to iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101; Attention: Secretary.

 

Any such communication should state the number of shares beneficially owned by the shareholder making the communication. Our Secretary will forward such communication to the full Board or to any individual member or members of the Board to whom the communication is directed, unless the communication is unduly hostile, threatening, illegal or similarly inappropriate, in which case the Secretary has the authority to discard the communication or take appropriate legal action regarding the communication.

 

CODE OF ETHICS

 

On August 12, 2015, our board of directors adopted a code of ethics that applies to our executive officers, directors and employees. The code of ethics codifies the business and ethical principles that governs aspects of our business. The Code of Ethics is currently available at our corporate website at http://investors.ifreshmarket.com/static-files/320e7e69-ce4e-4a7e-996b-252fd4fcf62b.

 

BOARD OF DIRECTORS COMPENSATION

 

None of our directors received compensation for the year ended March 31, 2017.

  

10

 

 

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

 

The Audit Committee, on behalf of the Board, serves as an independent and objective party to monitor and provide general oversight of the integrity of our financial statements, our independent registered public accounting firm’s qualifications and independence, the performance of our independent registered public accounting firm, our compliance with legal and regulatory requirements and our standards of business conduct. The Audit Committee performs these oversight responsibilities in accordance with its Audit Committee Charter.

 

Our management is responsible for preparing our financial statements and our financial reporting process. Our independent registered public accounting firm is responsible for expressing an opinion on the conformity of our audited financial statements to generally accepted accounting principles in the United States of America. The Audit Committee met with our independent registered public accounting firm, with and without management present, to discuss the results of their examinations and the overall quality of our financial reporting.

 

In this context, the Audit Committee has reviewed and discussed our audited financial statements for the year ended December 31, 2016 with management and with our independent registered public accounting firm. The Audit Committee has discussed with our independent registered public accounting firm the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (Communications with Audit Committees), which includes, among other items, matters related to the conduct of the audit of our annual financial statements.

 

The Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Company Accounting Oversight Board regarding such independent registered public accounting firm's communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm its independence from us and our management. In addition, the Audit Committee has considered whether the provision of non-audit services by our independent registered public accounting firm in 2016 was compatible with maintaining our registered public accounting firm’s independence and has concluded that it was.

 

Based on its review of the audited financial statements and the various discussions noted above, the Audit Committee recommended to the Board that our audited financial statements be included in our Annual Report on Form 10-K for the year ended March 31, 2017.

 

Respectfully submitted by the Audit Committee,

 

Adam (Xin) He

Jianming You

Mark Fang

 

The foregoing Audit Committee Report does not constitute soliciting material and shall not be deemed filed or incorporated by reference into any other filing of our company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except to the extent we specifically incorporate this Audit Committee Report by reference therein.

 

EXECUTIVE COMPENSATION

 

The following Summary Compensation Table summarizes the total compensation accrued for our named executive officers in each of fiscal 2017 and 2016 and should be read in conjunction with the Compensation Discussion and Analysis.

 

Name and Principal Position  Fiscal Year
Ended
March 31,
   Salary
($)
   Bonus
($)
   Stock and
Option
Awards
Number
   All Other
Compensation
($)
   Total
($)
 
Long Deng   2017    717,170                717,170 
(Director, Chief Executive Officer and Chief Operating Officer)   2016    1,067,500                1,067,500 
                              
Lilly Deng   2017    100,000                100,000 
(Vice President of Legal and Finance)   2016    115,960                115,960 
                              
Mei Deng   2017    83,200                83,200 
(Vice President of Human Resources)   2016    83,100                83,100 

 

11

 

 

Grants of Plan Based Awards

 

None of iFresh’s named executive officers participate in or have account balances in any plan based award programs.

 

Employment Agreements

 

On May 17, 2017, the Company entered into a three-year employment agreement with Mr. Ying, pursuant to which Mr. Ying will receive an annual salary of $150,000 per year and will be entitled to receive a cash bonus and 10,000 shares of the Company’s common stock upon achieving certain milestones to be determined by the Board. In the event that Mr. Ying is terminated without cause or he resigns for good reason prior to the end of the term, Mr. Ying shall be entitled to the continuation of his salary for three months and the accelerated vesting of any outstanding equity awards. In the event of a change of control of the Company pursuant to which Mr. Ying is terminated without cause or he resigns for good reason prior to the end of the term, Mr. Ying shall be entitled to a severance payment equal to three months of his base salary and the accelerated vesting of any outstanding equity awards.

 

Outstanding Equity Awards at Fiscal Year-End; Option Exercises and Stock Vested

 

As of March 31, 2017, none of iFresh’s named executive officers has ever held options to purchase interests in it or other awards with values based on the value of its interest.

 

Pension Benefits

 

None of iFresh’s named executive officers participate in or have account balances in qualified or nonqualified defined benefit plans sponsored by it.

 

Nonqualified Deferred Compensation

 

None of iFresh’s named executive officers participate in or have account balances in nonqualified defined contribution plans or other deferred compensation plans maintained by it.

 

12

 

 

ACCOUNTANT FEES AND SERVICES

 

On March 28, 2016, UHY LLP (“UHY”) resigned as the independent registered public accountants of the Company. The Company subsequently appointed Friedman LLP (“Friedman”) as the Company’s new independent registered public accountants. Aggregate fees billed to the Company by Friedman during the last two fiscal years were as follows:

 

Fees  2017   2016 
         
Audit Fees(1)        
Friedman  $300,000   $300,000 
           
Audit Related Fees          
Friedman  $10,000   $10,000 
           
Total  $310,000   $310,000 

 

(1) Audit Fees consist of fees billed for professional services rendered for the audit of the Company’s consolidated annual financial statements and review of the interim consolidated financial statements included in quarterly reports and services that are normally provided by our auditors in connection with statutory and regulatory filings or engagements.

 

Representatives of Friedman have been invited to but are not expected to be present at the Annual Meeting.

 

Pre-Approval of Services

 

In accordance with the SEC’s auditor independence rules, the Audit Committee has established the following policies and procedures by which it approves in advance any audit or permissible non-audit services to be provided to the Company by its independent auditor.

 

Prior to the engagement of the independent auditor for any fiscal year’s audit, management submits to the Audit Committee for approval lists of recurring audit, audit-related, tax and other services expected to be provided by the auditor during that fiscal year. The Audit Committee adopts pre-approval schedules describing the recurring services that it has pre-approved, and is informed on a timely basis, and in any event by the next scheduled meeting, of any such services rendered by the independent auditor and the related fees.

 

The fees for any services listed in a pre-approval schedule are budgeted, and the Audit Committee requires the independent auditor and management to report actual fees versus the budget periodically throughout the year. The Audit Committee will require additional pre-approval if circumstances arise where it becomes necessary to engage the independent auditor for additional services above the amount of fees originally pre-approved. Any audit or non-audit service not listed in a pre-approval schedule must be separately pre-approved by the Audit Committee on a case-by-case basis. Every request to adopt or amend a pre-approval schedule or to provide services that are not listed in a pre-approval schedule must include a statement by the independent auditors as to whether, in their view, the request is consistent with the SEC’s rules on auditor independence.

 

The Audit Committee will not grant approval for:

 

  any services prohibited by applicable law or by any rule or regulation of the SEC or other regulatory body applicable to the Company;
  provision by the independent auditor to the Company of strategic consulting services of the type typically provided by management consulting firms; or
  the retention of the independent auditor in connection with a transaction initially recommended by the independent auditor, the tax treatment of which may not be clear under the Internal Revenue Code and related regulations and which it is reasonable to conclude will be subject to audit procedures during an audit of the Company’s financial statements.

 

Tax services proposed to be provided by the auditor to any director, officer or employee of the Company who is in an accounting role or financial reporting oversight role must be approved by the Audit Committee on a case-by-case basis where such services are to be paid for by the Company, and the Audit Committee will be informed of any services to be provided to such individuals that are not to be paid for by the Company.

 

In determining whether to grant pre-approval of any non-audit services in the “all other” category, the Audit Committee will consider all relevant facts and circumstances, including the following four basic guidelines:

 

  whether the service creates a mutual or conflicting interest between the auditor and the Company;
  whether the service places the auditor in the position of auditing his or her own work;
  whether the service results in the auditor acting as management or an employee of the Company; and
  whether the service places the auditor in a position of being an advocate for the Company.

 

13

 

 

STOCKHOLDER PROPOSALS

 

Stockholders who wish to present proposals for inclusion in the Company’s proxy materials for the next Annual Meeting of Stockholders may do so by following the procedures prescribed in Rule 14a-8 under the Securities Exchange Act of 1934, as amended. To be eligible, the shareholder proposals must be received by our Secretary at our principal executive office on or before December 1, 2018. Under SEC rules, you must have continuously held for at least one year prior to the submission of the proposal (and continue to hold through the date of the meeting) at least $2,000 in market value, or 1%, of our outstanding stock in order to submit a proposal which you seek to have included in the Company’s proxy materials. We may, subject to SEC review and guidelines, decline to include any proposal in our proxy materials.

 

Stockholders who wish to make a proposal at the next Annual Meeting, other than one that will be included in our proxy materials, must notify us no later than February 13, 2019. If a shareholder who wishes to present a proposal fails to notify us by February 3, 2019, the proxies that management solicits for the meeting will confer discretionary authority to vote on the shareholder’s proposal if it is properly brought before the meeting.

 

OTHER BUSINESS

 

While the accompanying Notice of Annual Meeting of Stockholders provides for the transaction of such other business as may properly come before the Annual Meeting, the Company has no knowledge of any matters to be presented at the Annual Meeting other than those listed as Proposal 1 in the notice. However, the enclosed Proxy gives discretionary authority in the event that any other matters should be presented.

 

ANNUAL REPORT

 

Upon written request to Secretary, iFresh Inc., 2-39 54th Avenue Long Island City, New York 11101, we will provide without charge to each person requesting a copy of our 2017 Annual Report, including the financial statements filed therewith. We will furnish a requesting stockholder with any exhibit not contained therein upon specific request. In addition, this Proxy Statement, as well as our 2017 Annual Report, is available on our Internet website at http://www.cstproxy.com/ifreshmarket/2018.

 

  By Order of the Board of Directors.
   
  /s/ Long Deng
  Long Deng
  Chairman and Chief Executive Officer

 

Long Island City, New York

 

March 16, 2018

 

14

 

 

PROXY CARD
IFRESH INC.
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

 

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on March 30, 2018: The Proxy Statement and Annual Report to Stockholders are available at www. http://www.cstproxy.com/ifreshmarket/2018.

 

The undersigned hereby appoints Long Deng and Lilly Deng, individually, each with full power of substitution, as proxy of the undersigned to attend the Annual Meeting of Stockholders (the “Annual Meeting”) of IFRESH INC. (the “Company”), to be held on March 30, 2018 at 10 a.m. local time at the offices of Loeb & Loeb LLP, 345 Park Ave, New York, New York 10154, and any postponement or adjournment thereof, and to vote as if the undersigned were then and there personally present on all matters set forth in the Notice of Annual Meeting, dated March 16, 2018 (the “Notice”), a copy of which has been received by the undersigned, as follows:

 

1. THE ELECTION OF FIVE DIRECTORS TO SERVE ON THE BOARD OF DIRECTORS OF THE COMPANY, WITH SUCH DIRECTORS TO SERVE UNTIL THE NEXT ANNUAL MEETING OF STOCKHOLDERS AND UNTIL THEIR RESPECTIVE SUCCESSORS HAVE BEEN DULY ELECTED AND QUALIFIED OR UNTIL HIS EARLIER RESIGNATION, REMOVAL OR DEATH.    (Check one)

 

FOR all nominees listed below (except as indicated). ☐
WITHHOLD AUTHORITY to vote for all nominees listed below. ☐

 

If you wish to withhold your vote for any individual nominee, strike a line through that nominee’s name set forth below:

 

Long Deng
Lilly Deng
Jianming You
Mark Fang
Jay Walder

 

NOTE: IN HIS DISCRETION, THE PROXY HOLDER IS AUTHORIZED TO VOTE UPON SUCH OTHER MATTER OR MATTERS THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING AND ANY ADJOURNMENT(S) THEREOF.

 

 

 

 

 

 

THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFIC INDICATION ABOVE. IN THE ABSENCE OF SUCH INDICATION, THIS PROXY WILL BE VOTED FOR ALL OF THE BOARD’S NOMINEES FOR ELECTION TO THE BOARD OF DIRECTORS AND, AT THE DISCRETION OF THE PROXY HOLDER, ON ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY POSTPONEMENT OR ADJOURNMENT THEREOF.

 

Dated:  _______________________________  
  Signature of Stockholder
   
   
  PLEASE PRINT NAME
   
   
  Certificate Number(s)
   
   
  Total Number of Shares Owned

 

Sign exactly as your name(s) appears on your stock certificate(s). A corporation is requested to sign its name by its President or other authorized officer, with the office held designated. Executors, administrators, trustees, etc., are requested to so indicate when signing. If a stock certificate is registered in two names or held as joint tenants or as community property, both interested persons should sign.

 

PLEASE COMPLETE THE FOLLOWING:

 

I plan to attend the Annual Meeting (Circle one): Yes No

 

Number of attendees: ____________

 

PLEASE NOTE:

 

STOCKHOLDER SHOULD SIGN THE PROXY PROMPTLY AND RETURN IT IN THE ENCLOSED ENVELOPE AS SOON AS POSSIBLE TO ENSURE THAT IT IS RECEIVED BEFORE THE ANNUAL MEETING. PLEASE INDICATE ANY ADDRESS OR TELEPHONE NUMBER CHANGES IN THE SPACE BELOW.