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August 20, 2019
Caixuan Xu
Chief Financial Officer
HF Foods Group Inc.
6001 W. Market Street
Greensboro, North Carolina 27409
Re: HF Foods Group Inc.
Preliminary Proxy Statement on Schedule 14A
Filed July 26, 2019
File No. 001-38180
Dear Ms. Xu:
We have reviewed your filing and have the following comments. In some of
our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by providing
the requested
information or advise us as soon as possible when you will respond. If you do
not believe our
comments apply to your facts and circumstances, please tell us why in your
response.
After reviewing your response to these comments, we may have additional
comments.
Preliminary Proxy Statement on Schedule 14A filed July 26, 2019
Background of the Business Combination
Background of the Merger, page 27
1. Please expand your disclosure to discuss whether other target companies
were considered
prior to, or simultaneously with, your engagement of B&R Global on or
about October 1,
2018. If applicable, please revise to discuss your reasons for not
pursuing an acquisition
with such companies. Moreover, please discuss how and why you decided to
choose
B&R Global over the other target companies that were considered.
2. Please revise your disclosure to discuss how the consideration was agreed
upon and which
party initially proposed the agreed upon consideration. Moreover, please
include a
description of the material discussions between parties related to
arriving at the agreed
upon consideration.
3. Please revise to provide more details regarding any negotiations that
ensued between your
Caixuan Xu
HF Foods Group Inc.
August 20, 2019
Page 2
company and B&R Global between January and April of 2019. In this
regard, we note
that on January 10, 2019, B&R Global engaged MPG as its legal counsel
for the
negotiation of the Merger Agreement with HF Food Group and
consummation of the
Business Combination, but that HF Group did not engage Loeb until
April 15, 2019.
The Business Combination Proposal
General Description of the Business Combination, page 27
4. We note that following the Business Combination, former stockholders
of B&R Global
will own approximately 58.1% of HF Group. Please revise your questions
and answers,
summary of the proxy statement, and risk factors sections to highlight
this fact more
prominently.
HF Group's Board's Reasons for Approval of The Merger, page 28
5. We note that your board did not obtain a fairness opinion regarding
the acquisition of
B&R Global Holdings, Inc., but that the board "determined that the
Business Combination
and the transactions contemplated thereby are fair to and in the best
interests of HF Group
and its shareholders." Please revise your disclosure in this section
to explain in detail the
factors considered by the board in determining that the Business
Combination and the
transactions contemplated thereby, including the consideration to be
paid to acquire B&R
Global Holdings, Inc., is fair and in the best interests of HF Foods
Group Inc. and its
stockholders. In addition, please revise your risk factor on page 22
to more specifically
describe the risks of not obtaining a fairness opinion.
The Amendment Proposal, page 35
6. Please unbundle this proposal into separate proposals so as to allow
shareholders to vote
separately on the authorized share increase and the supermajority
voting requirements, or
provide your analysis as to why you believe you are not required to do
so. Please refer to
Rule 14a-4(a)(3) of Regulation 14A, as well as Question 201.01 of the
Division s
Exchange Act Rule 14a-4(a)(3) Compliance and Disclosure
Interpretations.
Merger Agreement, page AnnexA
FirstName refer you to article 11 of the Merger Agreement. Please disclose
whether the
7. We LastNameCaixuan Xu
Comapany NameHF Foods Group Inc.
mandatory arbitration and jury trial waiver provisions apply to claims
under the federal
Augustsecurities laws. 2
20, 2019 Page
FirstName LastName
Caixuan Xu
FirstNameGroup Inc.
HF Foods LastNameCaixuan Xu
Comapany NameHF Foods Group Inc.
August 20, 2019
August 20, 2019 Page 3
Page 3
FirstName LastName
Second Amended and Restated Certificate of Incorporation of HF Foods Group
Inc., page
AnnexE
8. We note that your restated Certificate of Incorporation contains an
exclusive forum
provision that designates the Court of Chancery of the State of
Delaware as the sole and
exclusive forum for certain actions, including derivative actions.
Please disclose whether
this provision applies to actions arising under the Securities Act or
Exchange Act. In that
regard, we note that Section 27 of the Exchange Act creates exclusive
federal jurisdiction
over all suits brought to enforce any duty or liability created by the
Exchange Act or the
rules and regulations thereunder, and Section 22 of the Securities Act
creates concurrent
jurisdiction for federal and state courts over all suits brought to
enforce any duty or
liability created by the Securities Act or the rules and regulations
thereunder. If the
provision applies to Securities Act claims, please revise to state
that there is uncertainty as
to whether a court would enforce such provision and that investors
cannot waive
compliance with the federal securities laws and the rules and
regulations thereunder. If
this provision does not apply to actions arising under the Securities
Act or Exchange Act,
please revise to state as much. If your Certificate of Incorporation
does not clearly state
how this provision applies to claims under the federal securities
laws, tell us how you will
inform investors in future filings how the provision applies. In
addition, please provide
appropriate risk factor disclosure about your forum selection
provision.
General
9. In an appropriate place in your filing, please disclose any
substantial interest, direct or
indirect, by security holdings or otherwise of your directors,
officers, director nominees,
and associates of any of the foregoing persons. Refer to Item 5(a) of
Schedule 14A.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Please contact Danilo Castelli, Staff Attorney, at (202) 551-6521 or
Jacqueline Kaufman,
Staff Attorney, at (202) 551-3797 with any other questions.
Sincerely,
Division of
Corporation Finance
Office of
Consumer Products
cc: Giovanni Caruso