UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

 Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934 

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HF FOODS GROUP INC

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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April 30, 2019

Dear Stockholder:

You are cordially invited to attend the 2019 Annual Meeting of Stockholders of HF Foods Group Inc., on Thursday, May 30, 2019, at 10:00 a.m., local time, at our headquarters located at 6001 W. Market Street, Greensboro, NC 27409.

The Notice of Annual Meeting of Stockholders and Proxy Statement on the following pages describe the matters to be presented at the meeting.

It is important that your shares be represented at the meeting, regardless of the number of shares you hold and whether or not you plan to attend the meeting in person. Accordingly, please exercise your right to vote by signing, dating and returning your proxy card in the enclosed envelope or voting by internet as described in the Proxy Statement. Your shares will be voted in accordance with the instructions you have given in your proxy.

Our board of directors and management look forward to seeing you at the meeting. Thank you for your continued support.

Sincerely yours,

Zhou Min Ni
Chairman of the Board and Chief Executive Officer

HF Foods Group Inc.
6001 W. Market Street
Greensboro, NC 27409

Notice of Annual Meeting of Stockholders
Thursday, May 30, 2019

To Our Stockholders:

The Annual Meeting of Stockholders of HF Foods Group Inc., a Delaware corporation (the “Company”), will be held on Thursday, May 30, 2019, at 10:00 a.m., local time, at our headquarters located at 6001 W. Market Street, Greensboro, NC 27409, for the following purposes:

1. To elect five members of the board of directors to serve until the 2020 Annual Meeting of Stockholders and until their successors have been duly elected and qualified;

2. To ratify the selection of Friedman LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2019;

3. To approve, on an advisory basis, our executive compensation;

4. To approve, on an advisory basis, the frequency of the advisory approval of our executive compensation; and

5. To transact such other business as may properly come before the meeting or any continuation, adjournment or postponement thereof.

All stockholders are invited to attend the meeting. Holders of record of the Company’s common stock at the close of business on April 16, 2019, are entitled to notice of, and to vote at, the meeting.

	By Order of the Board of Directors
	Zhou Min Ni
	Chairman of the Board of Directors and Chief
	Executive Officer
Greensboro, NC
April 30, 2019

WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE SUBMIT YOUR PROXY AS SOON AS

POSSIBLE SO THAT YOUR SHARES WILL BE REPRESENTED AT THE MEETING.

TABLE OF CONTENTS

GENERAL INFORMATION ABOUT THE ANNUAL MEETING AND VOTING	1
PRINCIPAL STOCKHOLDERS	5
PROPOSAL 1: ELECTION OF DIRECTORS	6
CORPORATE GOVERNANCE	8
CERTAIN RELATIONSHIPS AND TRANSACTIONS WITH RELATED PERSONS	10
EXECUTIVE COMPENSATION	15
DIRECTOR COMPENSATION	16
EQUITY COMPENSATION PLAN INFORMATION	17
PROPOSAL 2: RATIFICATION OF THE SELECTION OF FRIEDMAN LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2019.	18
REPORT OF THE AUDIT COMMITTEE	19
PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION	20
PROPOSAL 4: ADVISORY VOTE ON FREQUENCY OF THE ADVISORY APPROVAL OF OUR EXECUTIVE COMPENSATION	21
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE	22
STOCKHOLDER PROPOSALS	22
STOCKHOLDER COMMUNICATIONS	23
OTHER MATTERS	23
ANNUAL REPORT ON FORM 10-K	23
WHERE YOU CAN FIND MORE INFORMATION	23

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HF Foods Group Inc.
6001 W. Market Street

Greensboro, NC 27409

PROXY STATEMENT
2019 ANNUAL MEETING OF STOCKHOLDERS

The enclosed proxy is solicited by the board of directors of HF Foods Group Inc. (the “Company,” “we” or “us”) for use at the 2019 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Thursday, May 30, 2019, at 10:00 a.m., local time, at our headquarters located at 6001 W. Market Street, Greensboro, NC 27409, and at any continuation, adjournment or postponement thereof.

GENERAL INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

Who Can Attend and Vote

Only holders of our common stock of record at the close of business on April 16, 2019, the record date, are entitled to notice of and to vote at the Annual Meeting, and at any continuation(s), postponement(s) or adjournment(s) thereof. As of the record date, 22,167,486 shares of our common stock, par value $.0001 per share (“common stock”), were issued and outstanding. Holders of our common stock are entitled to one vote per share for each proposal presented at the Annual Meeting. The common stock does not have cumulative voting rights.

Voting Your Shares

If you are a registered holder, meaning that you hold our stock directly (not through a bank, broker or other nominee), you may vote in person at the Annual Meeting or by completing, dating and signing the proxy and promptly returning it, or electronically through the internet by following the instructions included on your proxy card. All signed, returned proxies that are not revoked will be voted in accordance with the instructions contained therein. Signed proxies that give no instructions as to how they should be voted on a particular proposal at the Annual Meeting will be counted as votes “for” such proposal or, in the case of the election of directors, as a vote “for” election of the five nominees presented by the board of directors, and in the case of the preferred frequency of our “say-on-pay” voting, as a vote to select “every year” as the frequency.

If your shares are held through a bank, broker or other nominee, you are considered the beneficial owner of those shares. You may be able to vote by telephone or electronically through the internet in accordance with the voting instructions provided by that nominee. You must obtain a legal proxy from the nominee that holds your shares if you wish to vote in person at the Annual Meeting.

Applicable stock exchange rules restrict when brokers who are record holders of shares may exercise discretionary authority to vote those shares in the absence of instructions from beneficial owners. Brokers are not permitted to vote on non-discretionary items such as director elections, executive compensation, and other significant matters absent instructions from the beneficial owner. As a result, if you are a street name stockholder, and you do not give voting instructions, the holder of record will not be permitted to vote your shares with respect to Proposal No. 1—Election of Directors, Proposal, No. 3—Advisory Vote on Executive Compensation, or Proposal No. 4—Advisory Vote on Frequency Of Future “Say-On-Pay” Advisory Votes and your shares will be considered “broker non-votes” with respect to these proposals. Although any broker non-votes would be counted as present at the Annual Meeting for purposes of determining a quorum, they will be treated as not entitled to vote with respect to each of Proposal Nos. 1, 3 and 4. If you are a street name stockholder, and you do not give voting instructions, the record holder will be entitled to vote your shares with respect to Proposal No. 2—Ratification of the Appointment of Friedman LLP as our Independent Registered Public Accounting Firm for the Year Ending December 31, 2019 in its discretion.

In the event that sufficient votes in favor of the proposals are not received by the date of the Annual Meeting, the Chairman of the Annual Meeting may adjourn the Annual Meeting to permit further solicitations of proxies.

The internet voting procedures are designed to authenticate stockholders’ identities, to allow stockholders to give their voting instructions and to confirm that stockholders’ instructions have been recorded properly. Stockholders voting via the internet should understand that there may be costs associated with electronic access. These charges include usage charges from internet access providers. The stockholder will bear the cost of these charges.

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Procedural Matters

If you are a registered stockholder, you may vote your shares or submit a proxy to have your shares voted by one of the following methods:

● By Internet. You may submit a proxy electronically via the internet by following the instructions provided on the proxy card. Please have your proxy card in hand when you access the website. Internet voting facilities will close at 11:59 p.m. ET on May 29, 2019.

● By Mail. You may submit a proxy by signing, dating and returning your proxy card in the provided pre-addressed envelope in accordance with the enclosed instructions. We encourage you to sign and return the proxy or voter instruction card even if you plan to attend the Annual Meeting so that your shares will be voted even if you are unable to attend.

● In Person. If you plan to attend the Annual Meeting and vote in person, we will provide you with a ballot at the Annual Meeting. You may vote in person at the Annual Meeting by completing a ballot; however, attending the Annual Meeting without completing a ballot will not count as a vote.

If your shares are held in street name, you will receive instructions from the holder of record that you must follow in order for your shares to be voted. Internet voting will also be offered to stockholders owning shares through most banks and brokers.

Quorum

The presence at the Annual Meeting in person or by proxy of holders of a majority of our common stock outstanding and entitled to vote at the Annual Meeting will constitute a quorum.

Required Vote, Abstentions and Broker Non-Votes

Only stockholders of record at the close of business on April 16, 2019 have the right to vote at the Annual Meeting. The proposals at the Annual Meeting will require the following votes:

● Directors will be elected by a plurality of all votes cast. You may vote “FOR ALL NOMINEES,” “WITHHOLD FOR ALL NOMINEES” or “FOR ALL EXCEPT” for the director nominees. Withheld votes and broker non-votes will have no effect on Proposal No. 1.

● Ratification of the selection of Friedman LLP as our independent registered public accounting firm will require the affirmative vote of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on this matter. You may vote “FOR,” “AGAINST” or “ABSTAIN” on the proposal to ratify the selection of Friedman LLP as our independent registered public accounting firm. Abstentions will have the same effect as a vote against Proposal No. 2. We do not expect any broker non-votes in connection with respect to Proposal No. 2.

● Approval, on an advisory basis, of our executive compensation will require the affirmative vote of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on this matter. You may vote “FOR,” “AGAINST” or “ABSTAIN” on the proposal to approve, on an advisory basis, our executive compensation. Abstentions will have the same effect as a vote against Proposal No. 3 and broker non-votes will have no effect on Proposal No. 3.

● The frequency of advisory approval of our executive compensation will be approved, on an advisory basis, based upon which option receives the highest number of votes cast by stockholders. You may vote “1 YEAR,” “2 YEARS,” “3 YEARS” or “ABSTAIN” on the proposal to approve, on an advisory basis, the frequency of advisory approval of our executive compensation. Abstentions and broker non-votes will have no effect on Proposal No. 4.

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A “withheld vote,” in the case of the proposal regarding the election of directors, or an “abstention,” in the case of the proposal regarding the ratification of the selection of our independent registered public accounting firm, the proposal regarding the approval, on an advisory basis, of our executive compensation, or the proposal regarding the approval, on an advisory basis, of the frequency of advisory votes of our executive compensation, represents a stockholder’s affirmative choice to decline to vote on a proposal.

Generally, “broker non-votes” occur when shares held by a broker in street name for a beneficial owner are not voted with respect to a particular proposal because the broker (1) has not received voting instructions from the beneficial owner and (2) lacks discretionary voting power to vote those shares. A broker is entitled to vote shares held for a beneficial owner on routine matters, such as the ratification of the appointment of our independent registered public accounting firm, without instructions from the beneficial owner of those shares. As a result, we do not expect any broker non-votes in connection with the ratification of our independent registered public accounting firm.

Default Voting

A proxy that is properly completed and returned will be voted at the Annual Meeting in accordance with the instructions on the proxy. If you properly complete and return a proxy, but do not indicate any contrary voting instructions, your shares will be voted in accordance with the board’s recommendations, which are as follows:

● FOR the election of the five persons named in this proxy statement as the board’s nominees for election as directors;

● FOR the ratification of the selection of Friedman LLP as our independent registered public accounting firm for the year ending December 31, 2019;

● FOR the approval, on an advisory basis, of our executive compensation;

● FOR the approval, on an advisory basis, of holding the advisory vote on our executive compensation every year; and

● FOR approval of authority to transact such other business as may properly come before the Annual Meeting.

If any other business properly comes before the stockholders for a vote at the Annual Meeting, your shares will be voted at the discretion of the holders of the proxy. The board knows of no matters, other than those previously stated herein, to be presented for consideration at the Annual Meeting.

How to Revoke

Any person giving a proxy in the form accompanying this proxy statement has the power to revoke it at any time before its exercise. The proxy may be revoked by filing with the Secretary of the Company an instrument of revocation or a duly executed proxy bearing a later date, or by electing to vote in person at the Annual Meeting. A stockholder who attends the Annual Meeting need not revoke the proxy and vote in person unless he or she wishes to do so. The mere presence at the Annual Meeting of the person appointing a proxy does not, however, revoke the appointment. If you are a stockholder whose shares are not registered in your own name, you will need additional documentation from your record holder to vote personally at the Annual Meeting.

Expenses of Solicitation

We will bear all costs incurred in the solicitation of proxies, including the preparation, printing and mailing of the Notice of Annual Meeting of Stockholders, proxy statement and the related materials. In addition to solicitation by mail, our directors, officers and employees may solicit proxies personally or by telephone, e-mail, facsimile or other means, without additional compensation.

Stockholder List

A list of stockholders entitled to vote at the Annual Meeting will be available for inspection at the Annual Meeting and at our headquarters located at 6001 W. Market Street, Greensboro, NC 27409 beginning May 20, 2019, during normal business hours for examination by any stockholder registered on our stock ledger as of the record date for any purpose germane to the Annual Meeting.

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Householding/Delivery of Documents to Stockholders

The SEC rules permit registrants to adopt a procedure called “householding.” Under this procedure, stockholders of record who have the same address and last name will receive only one set of proxy materials, unless one or more of these stockholders notifies the registrant that they wish to continue receiving individual sets. This procedure reduces printing costs and postage fees incurred by the registrant.

We have not adopted this householding procedure with respect to our record holders; however, a number of brokerage firms have instituted householding which may impact certain beneficial owners of our common stock. If your family has multiple accounts by which you hold common stock, you may have received a householding notification from your broker. Please contact your broker directly if you have any questions, require additional copies of the proxy materials, or wish to revoke your decision to household, and thereby receive multiple sets. Those options are available to you at any time.

Beginning on or about April 30, 2019, we mailed to our stockholders our Annual Report on Form 10-K for the year ended December 31, 2018, which includes our audited consolidated financial statements, together with these proxy materials.

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PRINCIPAL STOCKHOLDERS

Common Stock

The following table sets forth, as of April 16, 2019, information with respect to the securities holdings of all persons that we, pursuant to filings with the SEC and our stock transfer records, have reason to believe may be deemed the beneficial owner of more than 5% of our common stock. The following table also sets forth, as of such date, the beneficial ownership of our common stock by all of our current officers and directors, both individually and as a group.

The beneficial owners and amount of securities beneficially owned have been determined in accordance with Rule 13d-3 under the Exchange Act and, in accordance therewith, include all shares of our common stock that may be acquired by such beneficial owners within 60 days of April 16, 2019 upon the exercise or conversion of any options, warrants or other convertible securities. This table has been prepared based on 22,167,486 shares of common stock outstanding on April 16, 2019.

Name and Address of Beneficial Owner (1)	Amount and Nature of Beneficial Ownership			Percent of Class
Zhou Min Ni		6,689,896			30.2	%
Chan Sin Wong		0	(2)		0
Ren Hua Zheng		33,031			*
Hong Wang		0			0
Zhehui Ni		0			0
Caixuan Xu		0			0
All directors and executive officers as a group (6 individuals)		6,722,927			30.3	%
Five Percent Holders:
Irrevocable Trust for Raymond Ni (3)		5,591,553			25.2	%
Irrevocable Trust for Amanda Ni (3)		798,793			3.6	%
Irrevocable Trust for Ivy Ni (3)		798,793			3.6	%
Irrevocable Trust for Tina Ni (3)		798,793			3.6	%
HT Group Holding, L.L.C. (4)		1,897,134			8.6	%
Wah Lam (5)		1,397,888			6.3	%

*	Less than 1%
(1)	Unless otherwise indicated, the address of each person listed below is c/o HF Foods Group Inc., 6001 W. Market Street, Greensboro, NC 27509.
(2)	Does not include shares beneficially owned by Zhou Min Ni, Chan Sin Wong’s husband.
(3)	Jian Ming Ni has voting and dispositive power over the shares owned by Irrevocable Trust for Raymond Ni, Irrevocable Trust for Amanda Ni, Irrevocable Trust for Ivy Ni and Irrevocable Trust for Tina Ni. The business address for the four trusts is 810 Northern Shore Point, Greensboro, NC.
(4)	Xiao Yong Zhang has voting and dispositive power over the shares owned by HT Group Holding, L.L.C. Its business address is 4417 Shenandoah St., Dallas, TX.
(5)	The business address of Wah Lam is 601 SW 33rd Ave, Ocala, FL.

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PROPOSAL 1: ELECTION OF DIRECTORS

Our board of directors is presently comprised of five members who hold office until each director’s successor is elected and qualified, or until such director’s earlier resignation or removal. Each nominee for director has been nominated for a one-year term to serve until the 2020 Annual Meeting of Stockholders and until their successors are elected and have qualified.

Our independent directors have recommended Zhou Min Ni, Chan Sin Wong, Ren Hua Zheng, Hong Wang, and Zhehui Ni, as nominees to our board of directors. If elected at the Annual Meeting, each of the nominees would serve until the 2020 Annual Meeting of Stockholders and until his or her successor is duly elected and qualified, or until such director’s earlier death, resignation or removal.

The nominees have consented to being nominated and have expressed their intention to serve if elected. We have no reason to believe that the nominees will be unable to serve if elected to office and, to our knowledge, the nominees intend to serve the entire term for which election is sought. In the event any of the nominees should become unable to serve, or for good cause will not serve, as a director, it is intended that votes will be cast for a substitute nominee designated by the board of directors or the board of directors may elect to reduce its size. Only the nominees or substitute nominees designated by the board of directors will be eligible to stand for election as directors at the Annual Meeting.

Nominees for Board of Directors

We believe that our board of directors should be composed of individuals with sophistication and experience in many substantive areas that impact our business. We believe that experience, qualifications, or skills in the following areas are most important: procurement and distribution of food and related products particularly those used by Chinese restaurants; delivery and logistics; customer service; restaurant industry management; technology and automation; accounting and finance; strategic planning; human resources and development practices; and board practices of other corporations. We believe that our current board members possess the professional and personal qualifications necessary for board service, and have highlighted particularly noteworthy attributes for each board member below. The principal occupation, business experience for at least the past five years, and the age as of April 16, 2019, of each director nominee is included below.

Zhou Min Ni, 50, together with his wife, Chan Sin Wong, founded the Company. Mr. Ni has served as Chairman and Chief Executive Officer of the Company for over 20 years since he founded the business in 1997. From 1997 to the present, Mr. Ni has been responsible for the supervision of the Company’s strategy development, financing, acquisition, business expansion, inventory procurement and vendor management. Under his leadership, the Company developed into a well-recognized foodservice distributor operating three distribution centers serving over 3,200 Chinese/Asian restaurants in ten states in Southeastern America. We believe Mr. Zhou Min Ni’s qualification to sit on our board of directors includes his extensive knowledge of the Company and the foodservice distribution industry serving Chinese/Asian restaurants, his 20 years of management and leadership experience in the Company, and his connections in Chinese/Asian American business society.

Chan Sin Wong, 53, the wife of Zhou Min Ni, co-founded the Company in 1997. She has served as Director and President of the Company for over 20 years since she co-founded HF Group in 1997. From 1997 to the present, Ms. Wong has been responsible for the operation and supervision of the Company, including sales, inventory, logistics distribution, human resources, regulations and legal compliance. She also led the development of the Company’s logistics and distribution network. We believe Ms. Wong’s qualification to sit on our board of directors includes her knowledge of the Company, her extensive expertise in Company operations, and established relationships with service providers.

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Ren Hua Zheng, 48, has served as a director since June 2017. Mr. Zheng founded Hope Kitchen Cabinets and Stone Supply LLC, a cabinet decoration company in the United States, and has served as its Manager since January 2006. Mr. Zheng has served as Property Manager of H&C Brother LLC, Orland Property LLC, B&J Investment LLC, and 5904 5th Ave LLC since January 1999. We believe Mr. Zheng’s qualification to sit on our board of directors includes his business experience in the areas of strategy implementation, sales and marketing, staff training, cost analysis, and financial budget supervision in enterprise operation.

Dr. Hong Wang, 60, has served as a Professor of Management Information Systems North Carolina A&T State University since 2005 and a Visiting Professor at Yunnan University of Finance and Economics in China since June, 2012, Dalian Maritime University in China since June 2012, and Henan Polytechnic University in China since June 2015. Dr. Wang has over 30 years of university teaching experience and has taught Management Sciences, Operations Research, Optimization, Business Environment, Management Concepts, Strategic Management, Engineering Economy, in addition to various Information Systems courses at both graduate and undergraduate levels. Dr. Wang is active in professional and community services. He has served in multiple cities in the US for several terms as president of local Chinese Associations, on various boards, as a principal of Chinese schools, as session chair of academic conferences, and as a journal referee. He also helped several Chinese universities to establish international programs in collaboration with US universities. Dr. Wang received his Ph.D. in Management Information Systems/Decision Sciences from Ohio State University. We believe Dr. Wang’s qualification to sit on our board of directors includes his knowledge of management, operations, optimization, business environment, and economic engineering.

Zhehui Ni, 35, has served as vice president of Shanghai Electric Investment Company since 2014, charged with strategic and financial investment. She worked as an associate at Haixiahuifu Investment Company from 2011 to 2013 and worked as a senior consultant in Deloitte Touche Tohmatsu Shanghai Office from 2007 to 2011. Ms. Ni is experienced in equity investment, corporate finance and investment-related tax structuring. Ms. Ni received a master’s degree and bachelor’s degree in international economical law from Shanghai Jiaotong University. She is a certified public accountant and certified tax accountant, and passed the bar exam in the People’s Republic of China. We believe Ms. Ni’s qualification to sit on our board of directors includes her knowledge in accounting, financial reporting, equity investment, corporate finance, and investment-related tax structuring.

Required Vote

Approval of this proposal requires the affirmative vote of a plurality of the shares of common stock present in person or by proxy and entitled to vote on this proposal at the Annual Meeting. This means that the five nominees receiving the highest number of affirmative “FOR” votes will be elected as directors. Votes withheld and broker non-votes are not considered to be votes cast and, accordingly, will have no effect on the outcome of the vote on this proposal.

The board of directors recommends a vote FOR each of the director nominees.

Non-Director Executive Officers and Significant Employee

The following sets forth information regarding our non-director executive officer as of April 16, 2019:

Name	Age	Positon
Caixuan Xu	42	Chief Financial Officer

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Caixuan Xu, 42, has been employed by the Company since February 1, 2019 has served as the Chief Financial Officer of the Company since April 1, 2019, and has nearly 20 years of accounting and financial management experience. Prior to joining the Company, Ms. Xu served as the Vice President of Finance of Ninestar (Lexmark) since June 2018. Ms. Xu served as the Finance Director (Greater China CFO) for Red Hat from June 2017 until June 2018, and as the Chief Financial Officer of Shouqi Car Rental in Beijing, China from December 2016 through June 2017. Prior to that, she spent five years in finance positions with Lenovo in Morrisville, NC and Beijing, China, most recently as Senior Finance Manager and Controller. Before joining Lenovo, Ms. Xu held finance and auditor positions with Credit Suisse and PwC in Durham and Raleigh, NC, which followed her earlier career in public accounting firms (PwC and Tin Wha CPAs) in Beijing, China. Ms. Xu earned a BS in Accounting from The Central University of Finance and Economics in Beijing, China, and a Master’s Degree in Business Administration from the Freeman School of Business in New Orleans, LA. She is a CPA, certified in both North Carolina and Beijing, China (inactive), and has passed all three levels of the Chartered Financial Analyst (CFA) exams.

CORPORATE GOVERNANCE

Director Independence

As required under the Nasdaq Capital Market listing rules (“Listing Rules”), a majority of the members of a listed company’s board of directors must qualify as “independent,” as affirmatively determined by the board of directors. Our board considered certain relationships between our directors and us when determining each director’s status as an “independent director” under Rule 5605(a)(2) of the Listing Rules. Based upon such definition and SEC regulations, we have determined that Ren Hua Zheng, Dr. Hong Wang and Zhehui Ni are “independent” under the Listing Rules.

Board Leadership Structure and Role in Risk Oversight

We do not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as our board believes it is in the best interests of the Company to make that determination based on the position and direction of the Company and the membership of the board. The board has determined that having our Chief Executive Officer serve as Chairman is in the best interest of our stockholders at this time. This structure makes the best use of the Chief Executive Officer’s extensive knowledge of the Company and our industry, as well as fostering greater communication between our management and the board.

Our corporate governance guidelines provide that the board of directors is responsible for reviewing the process for assessing the major risks facing us and the options for their mitigation. This responsibility is largely satisfied by our audit committee, which is responsible for reviewing and discussing with management and our independent registered public accounting firm our major risk exposures and the policies management has implemented to monitor such exposures, including our financial risk exposures and risk management policies.

Committees of the Board of Directors

Audit Committee

Our audit committee is comprised of Dr. Hong Wang (Chair), Zhehui Ni and Ren Hua Zheng, all of whom meet the independence standards for purposes of serving on an audit committee under the Listing Rules and the Exchange Act. Our audit committee (i) assists the board of directors in its oversight of the integrity of our financial statements, compliance with legal and regulatory requirements, and corporate policies and controls, (ii) has the sole authority to retain and terminate our independent registered public accounting firm, approve all auditing services and related fees and the terms thereof, and pre-approve any non-audit services to be rendered by our independent registered public accounting firm, and (iii) is responsible for confirming the independence and objectivity of our independent registered public accounting firm. Our independent registered public accounting firm has unrestricted access to our audit committee. Our board of directors has determined that Ren Hua Zheng qualifies as an “audit committee financial expert,” as such term is defined in Item 407 of Regulation S-K.

Our audit committee operates under a written charter that is reviewed annually. The charter is available on our website at https://hffoodsgroup.com. The audit committee held one meeting during the year ended December 31, 2018.

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Compensation Committee

Our compensation committee is comprised of Dr. Hong Wang (Chair), Ren Hua Zheng and Zhehui Ni, all of whom meet the independence standards under the Listing Rules and the Exchange Act. The compensation committee’s duties include overseeing our overall compensation philosophy, policies and programs. This includes reviewing and analyzing the design and function of our various compensation components, establishing salaries, incentives and other forms of compensation for officers and non-employee directors, and administering our equity incentive plan. In fulfilling its responsibilities, the compensation committee has the authority to delegate any or all of its responsibilities to a subcommittee of the compensation committee.

Our compensation committee operates under a written charter that is reviewed annually. The charter is available on our website at https://hffoodsgroup.com. The compensation committee held one meeting during the year ended December 31, 2018.

Director Nominations

We do not have a standing nominating committee, though we intend to form a corporate governance and nominating committee as and when required to do so by law or the Listing Rules. In accordance with Rule 5605(e)(2) of the Listing Rules, a majority of the independent directors may recommend a director nominee for selection by the board of directors. The board of directors believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving director nominees without the formation of a standing nominating committee. In accordance with Rule 5605(e)(1)(A) of the Listing Rules, all such directors are independent. As there is no standing nominating committee, we do not have a nominating committee charter in place.

The board of directors will also consider director candidates recommended for nomination by our stockholders during such times as they are seeking proposed nominees to stand for election at the next annual meeting of stockholders (or, if applicable, a special meeting of stockholders). Our stockholders that wish to nominate a director for election to the Board should follow the procedures set forth below under the caption “Stockholder Recommendations for Nominations to the Board of Directors”.

Considerations in Evaluating Director Nominees

In selecting nominees for director, without regard to the source of the recommendation, our independent directors use a variety of methods for identifying and evaluating director nominees. In its evaluation of director candidates, our independent directors may consider, among other things, the current size and composition of our board of directors, the needs of our board of directors, and the respective committees of our board of directors. Some of the qualifications that our independent directors may consider include, without limitation, issues of character, integrity, judgment, diversity of experience, independence, area of expertise, corporate experience, length of service, leadership skills, potential conflicts of interest, and other commitments. Director candidates must have sufficient time available in the judgment of our independent directors to perform all board of director and committee responsibilities. In addition, our independent directors consider all applicable statutory and regulatory requirements and the requirements of any exchange upon which our common stock is listed or to which it may apply in the foreseeable future.

Although our board of directors does not maintain a specific policy with respect to board diversity, we believe that our board of directors should be a diverse body, and our independent directors consider a broad range of backgrounds and experiences in reviewing candidates for nomination to the board of directors. In making determinations regarding nominations of directors, our independent directors may take into account the benefits of diverse viewpoints. Our independent directors also consider these and other factors as it oversees the annual board of director and committee evaluations. After completing its review and evaluation of director candidates, our independent directors recommend to our full board of directors the director nominees for selection.

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Stockholder Recommendations for Nominations to the Board of Directors

We will consider directors candidates recommended by stockholders so long as such recommendations comply with our certificate of incorporation, our bylaws, and applicable laws, rules and regulations, including those promulgated by the SEC. Our independent directors will evaluate such recommendations in accordance with our charter, bylaws, policies and procedures for director candidates, and the regular director nominee criteria described above. This process is designed to ensure that our board of directors includes members with diverse backgrounds, skills and experience, including appropriate financial and other expertise relevant to our business. Eligible stockholders wishing to recommend a candidate for nomination should contact our Secretary in writing. Such recommendations must include information about the candidate, evidence of the recommending stockholder’s ownership of our common stock, and written consent from the candidate confirming willingness to serve on our board of directors, if elected. Our independent directors have discretion to decide which individuals to recommend for nomination as directors.

Director Attendance

During 2018, the board of directors held three meetings. Each of our directors attended at least 75% of all meetings of the board of directors and any committees on which such director was a member.

Although we do not have a specific director attendance policy, directors are encouraged to attend the annual meetings of stockholders.

Code of Ethics

We have adopted a Code of Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. Our Code of Ethics is designed to deter wrongdoing and promote: (i) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (ii) full, fair, accurate, timely and understandable disclosure in reports and documents that we file with, or submit to, the SEC and in our other public communications; (iii) compliance with applicable governmental laws, rules, and regulations; (iv) the prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and (v) accountability for adherence to the code.  We intend to disclose amendments or waivers of the Code of Ethics on our website within four business days.  Any person may obtain a copy of our Code of Ethics free of charge by sending a written request for such to the attention of the Chief Financial Officer of the Company, 6001 W. Market Street, Greensboro, NC 27409.

CERTAIN RELATIONSHIPS AND TRANSACTIONS WITH RELATED PERSONS

Mr. Zhou Min Ni, the Chief Executive Officer, Chairman of the Board of Directors, and beneficial owner of 30.2% of the Company’s outstanding shares of common stock, and certain of his immediate family members have ownership interests in various companies (the “Related Parties”) involved in (i) the distribution of food and related products to restaurants and other retailers and (ii) the supply of fresh food, frozen food, and packaging supplies to distributers.  

The Company purchases products from and sells products to some of these Related Parties which at times also involve making advance payments to, or receiving advance payments from, these Related Parties. Prices paid for these goods are based on the prices published by the particular Related Party. The Board of Directors has analyzed the prices paid to these Related Parties as well as the level of service, reliability, delivery terms, and historical performance of these Related Parties and has concluded that such prices and terms are substantially equivalent to, or more advantageous than, prices and terms the Company would receive in arm’s length transactions from third parties that have no relationship with the Company and are capable of providing the same level of service. Sales to Related Parties consist primarily of sales to distributers. These sales permit the Company to purchase certain items from manufacturers in larger quantities which at times, results in better purchase prices for the Company. The Company also leases to a Related Party, on commercially reasonable terms, a warehouse and distribution facility near Savannah, Georgia, which promotes a relationship that helps the Company source a reliable supply of fresh and frozen seafood. In addition to these factors, the Board of Directors believes that Mr. Zhou Min Ni’s extensive experience and contacts in the foodservice industry, including the numerous companies in which he has an ownership interest, provide valuable insight into industry trends and access to products, pricing and customers that the Company would not otherwise be exposed to.

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The Company has also made loans to certain Related Parties. Set forth below is the outstanding amount due under each loan and the amount of principal and interest payments received in each of the last two years.

Related Party sales transactions

The Company makes sales to various Related Parties in the ordinary course of business. The total sales made to Related Parties were $18,147,003 and $18,449,864 for the years ended December 31, 2018 and 2017, respectively. Set forth below is a breakdown of sales to Related Parties and by footnote reference, a description of the relationship between each Related Party and Zhou Min Ni:

		For The Years Ended December 31,
#	Name of Related Party	2018		2017
(1)	Eagle Food Service LLC	$	6,315,926	$	7,146,894
(2)	Eastern Fresh LLC		5,025,528		4,819,421
(3)	N&F Logistic Inc.		2,948,031		2,253,248
(4)	Heng Feng Food Service Inc.		1,769,125		1,940,294
(5)	Allstate Trading Company Inc.		17,959		617,495
(6)	Fortune One Foods Inc.		895,031		574,805
(7)	Enson Trading LLC		568,971		570,235
(8)	Enson Seafood GA Inc.		514,554		527,471
(9)	UGO USA Inc.		39,186		—
(10)	Enson Philadelphia Inc.		49,027		—
(11)	Others		3,655		—
	Total	$	18,147,003	$	18,449,864

(1)	Tina Ni, the daughter of Mr. Zhou Min Ni, owns a 50% equity interest in Eagle Food Service LLC.
(2)	Mr. Zhou Min Ni owns a 30% equity interest in Eastern Fresh LLC.
(3)	Mr. Zhou Min Ni owns a 25% equity interest in N&F Logistic, Inc.
(4)	Mr. Zhou Min Ni owns a 45% equity interest in Hengfeng Food Service Inc.
(5)	Mr. Zhou Min Ni owns a 40% equity interest in Allstate Trading Company Inc.
(6)	N&F Logistic, Inc., one of HF Group’s related parties owns a 70% equity interest in Fortune One Foods Inc. See note 3 above.
(7)	Mr. Zhou Min Ni owns a 25% equity interest in Enson Trading LLC.
(8)	Mr. Zhou Min Ni owns a 50% equity interest in Enson Seafood GA Inc.
(9)	Mr. Zhou Min Ni owns a 30% equity interest in UGO USA Inc.
(10)	Mr. Zhou Min Ni owns a 25% equity interest in Enson Philadelphia Inc.
(11)	Represents nominal sales to two additional Related Parties.

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The Company also periodically receives advances from Related Parties for sales transactions in the ordinary course of business. These advances are interest free and due upon demand. The balances for advances from Related Parties in connection with the above sales transactions amounted to $166,490 and $1,350,296 as of December 31, 2018 and 2017, respectively. Set forth below is a breakdown of advances from Related Parties:

(1)	Name of Related Party	As of December 31, 2018		As of December 31, 2017
	Enson Trading LLC		-	$	242,492
	N&F Logistic, Inc.		166,490		322,333
	Heng Feng Food Service Inc.		-		785,471
	Total	$	166,490	$	1,350,296

(1) Please see footnotes in the table above for a description of the relationship between the Related Party and Mr. Zhou Min Ni.

Related Party purchase transactions

The Company makes purchases from various Related Parties in the ordinary course of business. The total purchases made from Related Parties were $31,676,828 and $32,221,005 for the years ended December 31, 2018 and 2017, respectively. Set forth below is a breakdown of purchases from Related Parties and by footnote reference, a description of the relationship between each Related Party and Zhou Min Ni:

		For The Years Ended December 31,
#	Name of Related Party	2018		2017
(1)	Golden Poultry, LLC	$	5,641,599	$	7,065,901
(2)	Eastern Fresh LLC		7,140,754		6,486,180
(3)	Fujian RongFeng Plastic Co., Ltd.		5,350,755		4,644,437
(4)	NC Good Taste Noodle Inc.		3,881,433		4,060,177
(5)	Fuzhou (Hanfeng) Information Tec.		3,130,875		2,832,933
(6)	Fortune One Foods Inc.		-		1,318,459
(7)	N&F Logistic, Inc.		1,206,106		1,273,190
(8)	Collegepoint Distribution, LLC		-		1,100,100
(9)	Enson Seafood GA Inc		664,770		926,427
(10)	New Day Top Trading Inc.		-		761,020
(11)	Enson Trading LLC		415,462		616,639
(12)	Ocean Pacific Seafood Group		687,225		524,722
(13)	Allstate Trading Company Inc.		43,212		327,821
(14)	Eagle Food Service LLC		270,368		149,714
(15)	Han Feng Global Inc. d/b/a NSG International		119,092		86,092
(16)	Great Wall Seafood Florida Inc.		-		23,542
(17)	UGO USA INC.		710,224		19,151
(18)	iUnited Services		-		4,500
(19)	Revolution Automotive, LLC		2,122,240		—
(20)	First Choice Seafood Inc.		292,514		—
	Total	$	31,676,828	$	32,221,005

(1)	Mr. Zhou Min Ni owns a 40% equity interest in Golden Poultry, LLC.
(2)	Mr. Zhou Min Ni owns a 30% equity interest in Eastern Fresh LLC.
(3)	Mr. Zhou Min Ni is the legal representative in Fujian RongFeng Plastic Co., Ltd.
(4)	Mr. Jian Ming Ni owns a 66.6% equity interest in NC Good Taste Noodle Inc.
(5)	Mr. Zhou Min Ni owns a 100% equity interest in Fuzhou (Hanfeng) Information Tec.
(6)	N&F Logistic, Inc., one of HF Group’s related parties, owns a 70% equity interest in Fortune one Foods Inc.
(7)	Mr. Zhou Min Ni owns a 25% equity interest in N&F Logistic, Inc.

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(8)	Mr. Zhou Min Ni owns a 33.3% equity interest in Collegepoint Distribution, LLC.
(9)	Mr. Zhou Min Ni owns a 50% equity interest in Enson Seafood GA, Inc.
(10)	Amanda Ni, the daughter of Mr. Zhou Min Ni, owns a 19% equity interest in New Day Top Trading Inc.
(11)	Mr. Zhou Min Ni owns a 25% equity interest in Enson Trading LLC.
(12)	Mr. Zhou Min Ni owns a 25% equity interest in Ocean Pacific Seafood Group.
(13)	Mr. Zhou Min Ni owns a 40% equity interest in Allstate Trading Company Inc.
(14)	Tina Ni, the daughter of Mr. Zhou Min Ni, owns a 50% equity interest in Eagle Food Service LLC.
(15)	Mr. Zhou Min Ni owns a 30% equity interest in Han Feng Global Inc. d/b/a NSG International.
(16)	Mr. Zhou Min Ni owns a 30% equity interest in Great Wall Seafood Florida Inc.
(17)	Mr. Zhou Min Ni owns a 30% equity interest in UGO USA Inc.
(18)	Mr. Zhou Min Ni owns a 37% equity interest in iUnited Services.
(19)	Raymond Ni, the son of Mr. Zhou Min Ni, owns 100% of Revolution Automotive, LLC.
(20)	Mr. Zhou Min Ni owns a 25% equity interest in First Choice Seafood Inc.

The Company periodically provides purchase advances to various suppliers, including suppliers that are the Related Parties. These advances are made in the ordinary course of business and are considered fully realizable. The balances for advances to suppliers that are Related Parties in connection with the purchase transactions described above amounted to $1,526,482 and $3,248,309 as of December 31, 2018 and 2017, respectively. Set forth below is a breakdown of advances to suppliers that are Related Parties:

	Name of Related Party	As of December 31, 2018		As of December 31, 2017
(1)	Enson Seafood GA Inc.	$	—	$	2,978,161
(1)	Ocean Pacific Seafood Group		208,960		145,888
(2)	Han Feng Information Tech. Jinhua Inc.		—		5,167
(1)	Han Feng Global Inc. d/b/a NSG International		—		119,093
(3)	Revolution Industry LLC		329,394		—
(4)	First Choice Seafood Inc.		988,128		—
	Total	$	1,526,482	$	3,248,309

(1)	Please see footnotes in the table above for a description of the relationship between the Related Party and Mr. Zhou Min Ni.
(2)	Mr. Zhou Min Ni owns 37% of this entity.
(3)	Raymond Ni, the son of Mr. Zhou Min Ni, owns 100% of this entity.
(4)	First Choice Seafood Inc. is owned by Enson Seafood GA Inc.

Long-term notes receivables due from Related Parties

The Company had a promissory note dated May 31, 2017 from Eastern Fresh LLC in the original principal amount of $1,000,000 which accrued interest at the rate of 5% per year. The balance was paid in full as of March 31, 2018 and we received $22,646 of interest during the life of this loan.

On January 1, 2018, the $550,000 due from Enson Seafood as of December 31, 2017 was converted into promissory note payable accruing interest at the rate of 5% per annum. The principal plus all accrued and unpaid interest was initially due no later than December 31, 2019. On March 1, 2019, the Company and Enson Seafood extended the expiration date of the note until February 29, 2024 and Mr. Zhou Min Ni agreed to personally guarantee the note. 

On September 30, 2018, the Company signed a promissory note agreement with Enson Seafood in the principal amount of $2,000,000. The note accrues interest at the rate of 5% per annum on the unpaid balance, compounded monthly. The principal plus all accrued and unpaid interest was initially due no later than September 30, 2019, with an option to renew, and required Enson Seafood to make monthly payments of $171,215 for 12 months. On March 1, 2019, the Company and Enson Seafood extended the expiration date of the note until February 29, 2024 and Mr. Zhou Min Ni agreed to personally guarantee the note.  

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On January 1, 2018, the outstanding balance of $5,993,552 due from NSG International as of December 31, 2017 was converted into a promissory note payable accruing interest at the rate of 5% per annum. The principal plus all accrued and unpaid interest is due no later than December 31, 2019.

On March 1, 2018, the Company signed promissory note agreement with Revolution Automotive in the principal amount of $483,628. The loan accrues interest at the rate of 5% per annum and is due no later than April 30, 2023. Revolution Automotive is required to make monthly payments of $5,000 for 60 months, including interest, with final payment of $284,453 due at maturity.

As of December 31, 2018, the outstanding loans to various Related Parties consisted of the following:

(1)	Name of Related Party	As of December 31, 2018		As of December 31, 2017
	Enson Seafood GA Inc.	$	1,987,241	$	550,000
	Han Feng Global Inc. d/b/a NSG International		6,092,397		5,993,552
	Eastern Fresh LLC		—		316,504
	Revolution Automotive LLC		461,311		—
	Total	$	8,540,949	$	6,860,056

(1) Please see footnotes in the tables above for a description of the relationship between the Related Party and Zhou Min Ni.

We received the following amounts of principal and interest payments on account of loans to Related Parties in the years ended December 31, 2018 and 2017:

		As of December 31, 2018				As of December 31, 2017
(1)	Name of Related Party	Principal		Interest		Principal		Interest
	Enson Seafood GA Inc.		—		—		—		—
	Han Feng Global Inc. d/b/a NSG International		200,000		—		—		—
	Eastern Fresh LLC		316,504		1,853		683,496		20,793
	Revolution Automotive LLC		24,230		15,770		—		—
	Total		540,734		17,623		683,496		20,793

(1) Please see footnotes in the tables above for description of the relationship between the Related Party and Zhou Min Ni.

Real Estate Lease

HG Realty, LLC a subsidiary of the Company, leases a warehouse to Enson Seafood GA Inc. under an operating lease agreement dated January 1, 2018 which expires on December 31, 2027. Rental income received under this lease during the years ended December 31, 2018 and 2017 was $480,000 and $490,000, respectively. Mr. Zhou Min Ni owns a 50% equity interest in Enson Seafood GA, Inc.

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EXECUTIVE COMPENSATION

The following table sets forth a summary of the compensation paid to or accrued by our chief executive officer and the most highly compensated executive officer other than our chief executive officer whose total compensation exceeded $100,000 for the fiscal years ended December 31, 2018 and 2017:

Summary Compensation Table Summary Compensation Table

Name	Year	Salary ($)		Total ($)
Zhou Min Ni	2018		400,000		400,000
Chairman and Chief Executive Officer	2017		240,000		240,000
Chan Sin Wong	2018		400,000		400,000
Director and Chief Operating Officer	2017		240,000		240,000

Narrative Disclosure to Summary Compensation Table

Compensation for our executives is comprised of solely of base salary. We do use a prescribed formula to establish pay levels. Rather, the board of directors and compensation committee considers changes in the business, external market factors and our financial position each year when determining pay levels for the named executive officers.

The committee generally seeks to set a named executive officer’s targeted total cash compensation opportunity within a range that is the average of the applicable peer company and/or general industry compensation survey data, adjusted as appropriate for individual performance and internal pay equity and labor market conditions.

Each executive’s base salary is supplemented by various benefit plans that provide health, life, accident, disability and severance benefits, most of which are the same as the benefits provided to all of our employees.

Employment Agreements

On August 22, 2018, we entered into an employment agreement with Zhou Min Ni to serve as our Chief Executive Officer until August 31, 2023. The agreement automatically renews for subsequent one-year terms, unless the employment relationship is terminated by either party, or modified in accordance with the terms and conditions of the agreement. Under the agreement, Zhou Min Ni’s initial annual base salary was $400,000, subject to adjustment by the Board. In addition to the base salary, an annual bonus may be awarded to Zhou Min Ni on the basis of the Company achieving certain corporate and strategic performance goals, as determined by the Board in its sole discretion. The employment agreement contains a standard and customary confidentiality provision as well as a covenant not to compete which prohibits Zhou Min Ni from doing business with any current or prospective customer of the Company or engaging in a business competitive with that of the Company during the term of his employment. This agreement also contains a number of termination and change in control provisions as described under the captions “Termination Arrangements” and “Change in Control Arrangements” below.

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On August 22, 2018, we entered into an employment agreement with Chan Sin Wong to serve as our Chief Operating Officer until August 31, 2023. The agreement automatically renews for subsequent one-year terms, unless the employment relationship is terminated by either party, or modified in accordance with the terms and conditions of the agreement. Under the agreement, Chan Sin Wong’s initial annual base salary was $400,000, subject to adjustment by the Board. In addition to the base salary, an annual bonus may be awarded to Chan Sin Wong on the basis of the Company achieving certain corporate and strategic performance goals, as determined by the Board in its sole discretion. The employment agreement contains a standard and customary confidentiality provision as well as a covenant not to compete which prohibits Chan Sin Wong from doing business with any current or prospective customer of the Company or engaging in a business competitive with that of the Company during the term of his employment. This agreement also contains a number of termination and change in control provisions as described under the captions “Termination Arrangements” and “Change in Control Arrangements” below.

Termination Arrangements

Under our employment agreements with Zhou Min Ni and Chan Sin Wong, we may terminate such executive’s employment due to death, total disability or for cause, as such terms may be defined under such employment agreements, without the acceleration of benefits or additional benefits other than accrued pay. If we terminate such executive’s employment without cause or an executive terminates such executive’s employment for good reason, as such terms are defined under such employment agreements, then we are required to pay to such executive all accrued pay, an amount equal to two times such executive’s then-current base salary and accelerate vesting of any outstanding equity grants.

Change in Control Provisions

Our 2018 Omnibus Equity Incentive Plan (the “Plan”) provides for the acceleration of the vesting of unvested equity awards upon a “Change in Control” of the Company. A Change in Control is defined in the Plans to include (i) a sale or transfer of substantially all of the Company’s assets; (ii) the dissolution or liquidation of the Company; (iii) a merger or consolidation to which the Company is a party and after which the prior shareholders of the Company hold less than 50% of the combined voting power of the surviving corporation’s outstanding securities; or (iv) the incumbent directors cease to constitute at least a majority of the Board of Directors. In the event of a “Change In Control,” the Plan provides for the immediate vesting of all equity awards issued thereunder.

Our employment agreements with Zhou Min Ni and Chan Sin Wong contain a change in control provision that is triggered if such executive is not offered continued employment with us or any successor, or within 90 days following such change of control, we or any successor terminate such executive’s employment without cause or such executive terminates employment for good reason, as defined in such employment agreements. If this occurs, then we will pay to such executive his or her base salary and benefits earned but unpaid through the date of termination, and any prorated bonus earned during the then current bonus year, plus two times such executive’s then current base salary.

Outstanding Equity Awards at December 31, 2018

We have not granted any equity awards to any named executive officer as of December 31, 2018.

DIRECTOR COMPENSATION 

The following table sets forth for each director, information regarding their compensation for the year ended December 31, 2018:

Name (1)	Fees ($)		Total ($)
Ren Hua Zheng		10,000		10,000
Dr. Hong Wang		10,000		10,000
Zhehui Ni		10,000		10,000

(1) Zhou Min Ni and Chan Sin Wong have been omitted from this table because they do not receive any additional compensation for serving on the Board of Directors.

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Narrative Disclosure to Director Compensation Table

We pay our non-employee directors $5,000 per calendar quarter. We reimburse directors for any out-of-pocket expenses incurred in connection with attending board or committee meetings.

EQUITY COMPENSATION PLAN INFORMATION

The following table provides certain information with respect to all of our equity compensation plans in effect as of December 31, 2018.

	Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)		Weighted- average exercise price of outstanding options, warrants and rights (b)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
Equity compensation plans approved by security holders		0	$	—		3,000,000
Equity compensation plans not approved by security holders		0	$	—		—
Total		0	$	—		3,000,000

On August 10, 2018, our stockholders adopted the HF Food Group Inc. 2018 Omnibus Equity Incentive Plan (the “Plan”). The Plan reserves 3,000,000 shares of common stock for issuance of awards to employees, non-employee directors, and consultants and is administered by the Compensation Committee of the Board. The Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, other stock awards, and performance awards that may be settled in stock, or other property. The term of stock options granted may not exceed ten years and exercise prices may not be less than 100% of the fair market value of the common stock subject to the stock option on the date of grant. If an equity award granted under the Plan, or any portion thereof, expires, is forfeited or otherwise terminates without all of the shares covered by the equity award having been issued, such expiration, termination or settlement will not reduce or otherwise offset the number of shares available for issuance under the Plan. In the event of a change in control, an equity award under the Plan may be subject to additional acceleration of vesting and exercisability. Unless terminated sooner by our board of directors, the Plan will automatically terminate on August 9, 2028. As of December 31, 2018, there were no equity awards granted under the Plan and all 3,000,000 shares were available for future grants.

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PROPOSAL 2: RATIFICATION OF THE SELECTION OF Friedman LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2019.

The audit committee has appointed Friedman LLP (“Friedman”) to audit and report on the consolidated financial statements of the Company and its subsidiaries for the fiscal year ending December 31, 2019. Friedman served as our independent registered public accounting firm for the fiscal year ended December 31, 2018.

The board of directors is submitting the selection of Friedman for ratification at the Annual Meeting. The submission of this matter for ratification by stockholders is not legally required, but our board of directors and the audit committee believe the submission provides an opportunity for stockholders through their vote to communicate with the board and the audit committee about an important aspect of corporate governance. If the stockholders do not ratify the selection of Friedman, the audit committee will reconsider, but will not be required to rescind, the selection of that firm as our independent registered public accounting firm. Representatives of Friedman will attend the Annual Meeting and may make a statement if they wish. They will be available to answer appropriate questions at the Annual Meeting.

The audit committee has the authority and responsibility to retain, evaluate and replace our independent registered public accounting firm. The stockholders’ ratification of the appointment of Friedman does not limit the authority of the audit committee to change our independent registered public accounting firm, as it deems necessary or appropriate, at any time.

Audit and Related Fees

The following table presents fees for professional audit services performed by Friedman for the audit of our annual financial statements for the years ended December 31, 2018 and 2017. We did not pay any fees to Freidman for audit-related services or tax services in the years ended December 31, 2018 and 2017.

	2018		2017
Audit Fees	$	385,000	$	350,000
Audit-Related Fees		—		—
Tax Fees		—		—
Total Fees	$	385,000	$	350,000

Audit Fees consist of fees billed for professional services rendered for the audit of our financial statements and review of the interim financial statements included in quarterly reports and services that are normally provided by our auditors in connection with statutory and regulatory filings or engagements. Audit fees also include fees for services provided in connection with review of documents filed with the SEC.

As previously reported in the Company’s Current Report on From 8-K dated January 2, 2018, the Company engaged Friedman as its independent registered public accounting firm on January 2, 2018. The Company’s previous independent registered public accounting firm Marcum LLP (“Marcum”) was dismissed on the same date. The decision to engage Friedman and to dismiss Marcum was approved by the Audit Committee.

The audit report of Marcum on the Company’s financial statements for the year ended December 31, 2016 did not contain any adverse opinion or disclaimer of opinion, and was not qualified or modified as to uncertainty, audit scope or accounting principles, except that Marcum’s report noted that there was substantial doubt about the Company’s ability to continue as a going concern. This report was issued prior to the business combination of the Company and HF Group Holding Corporation.

For the year ended December 31, 2016 and the subsequent period through January 2, 2018, there were no disagreements between Marcum and the Company on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Marcum would have caused Marcum to make reference to the subject matter of the disagreements in connection with its reports.

For the year ended December 31, 2016 and the subsequent period through January 2, 2018, there were no “reportable events” (defined below) requiring disclosure pursuant to Item 304(a)(1)(v) of Regulation S-K. As used herein, the term “reportable event” means any of the items listed in paragraphs (a)(1)(v)(A)-(D) of Item 304 of Regulation S-K.

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On January 2, 2018, the Company engaged Friedman as its principal accountant. During the year ended December 31, 2016 and the subsequent period through January 2, 2018, neither the Company nor anyone on its behalf consulted Friedman 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 the Company’s consolidated financial statements, and neither a written report nor oral advice was provided to the Company that Friedman concluded was an important factor considered by the Company 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 (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304 of Regulation S-K) or a reportable event.

Audit Committee Pre-Approval Procedures

The audit committee of our board of directors consists of Dr. Hong Wang (Chairman), Zhehui Ni and Ren Hua Zheng. The audit committee approves the engagement of our independent auditors to render audit and non-audit services before they are engaged. All of the fees for 2018 and 2017 shown above were pre-approved by the audit committee.

The audit committee pre-approves all audit and other permitted non-audit services provided by our independent auditors. Pre-approval is generally provided for up to one year, is detailed as to the particular category of services and is subject to a monetary limit. Our independent auditors and senior management periodically report to the audit committee the extent of services provided by the independent auditors in accordance with the pre-approval, and the fees for the services performed to date. The audit committee may also pre-approve particular services on a case-by-case basis.

Our audit committee will not approve engagements of our independent registered public accounting firm to perform non-audit services for us if doing so will cause our independent registered public accounting firm to cease to be independent within the meaning of applicable SEC rules. In addition, our audit committee considers, among other things, whether our independent registered public accounting firm is able to provide the required services in a more or less effective and efficient manner than other available service providers.

Required Vote

Approval of Proposal 2 requires the affirmative vote of a majority of the shares of common stock present in person or by proxy and entitled to vote on this proposal at the Annual Meeting. As a result, abstentions will have the same effect as votes against this proposal. We do not expect any broker non-votes in connection with this proposal.

The board of directors recommends a vote FOR the proposal to ratify the selection of Friedman as our independent registered public accounting firm for the fiscal year ending December 31, 2019.

REPORT OF THE AUDIT COMMITTEE

This report of the audit committee is required by the SEC and, in accordance with the SEC’s rules, will not be deemed to be part of or incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act or under the Exchange Act, except to the extent that we specifically incorporate this information by reference, and will not otherwise be deemed “soliciting material” or “filed” under either the Securities Act or the Exchange Act.

Our management is responsible for the preparation, presentation and integrity of our financial statements for the appropriateness of the accounting principles and reporting policies that we use, and for establishing and maintaining adequate internal control over financial reporting. Friedman, our independent registered public accounting firm for 2018, was responsible for performing an independent audit of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 (the “Form 10-K”), and expressing an opinion on the conformity of those financial statements with generally accepted accounting principles.

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In connection with the preparation of our audited financial statements for the year ended December 31, 2018, the audit committee:

● reviewed and discussed the audited financial statements with management;

● discussed with Friedman, our independent registered public accounting firm, the matters required to be discussed under applicable standards of the of the Public Company Accounting Oversight Board (“PCAOB”); and

● received the written disclosures and the letter from Friedman, our independent registered public accounting firm, required by the applicable requirements of the PCAOB regarding Friedman’s communications with the audit committee concerning independence, discussed with Friedman its independence, and satisfied itself as to their independence.

Based upon the review and discussions described above, the audit committee recommended to the board of directors that the audited financial statements be included in the Form 10-K for filing with the SEC.

THE AUDIT COMMITTEE

Dr. Hong Wang

Zhehui Ni

Ren Hua Zheng

PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION

General

In accordance with Section 14A of the Exchange Act and Rule 14a-21(a) promulgated thereunder, our stockholders are entitled to vote at the Annual Meeting to approve the compensation of our named executive officers, commonly known as a “Say-on-Pay”, as disclosed in this proxy statement in accordance with the standards established under Item 402 of Regulation S-K under the Exchange Act. However, the stockholder vote on executive compensation is an advisory vote only, and it is not binding on us, our board of directors, or any of our board committees.

Although the vote is non-binding, our board of directors and the compensation committee value the opinions of our stockholders and will consider the outcome of the vote when making future compensation decisions affecting our executive officers.

We design our executive compensation program to implement our core objectives of attracting and retaining superior executive talent, motivating and rewarding executives whose knowledge, skills and performance are critical to our business, ensuring executive compensation is aligned with our corporate strategies and business objectives, and aligning executives’ incentives with the creation of stockholder value.

Resolution

Our stockholders are being asked to approve by advisory vote the following resolution relating to the compensation of our named executive officers as described in this proxy statement:

“RESOLVED that the Company’s stockholders hereby approve the compensation paid to the Company’s executive officers named in the Summary Compensation Table of this proxy statement, as that compensation is disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the various compensation tables and the accompanying narrative discussion included in this proxy statement.”

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The vote on this resolution is not intended to address any specific element of compensation; rather the vote relates to the compensation of our named executive officers, as described in this proxy statement in accordance with the compensation disclosure rules of the SEC.

Required Vote

Approval of Proposal 3 requires the affirmative vote of a majority of the shares of common stock present in person or by proxy and entitled to vote on this proposal at the Annual Meeting. As a result, abstentions will have the same effect as votes against this proposal and broker non-votes will have no effect on this proposal.

The board of directors recommends an advisory vote FOR the resolution to approve the executive compensation as disclosed in this proxy statement.

PROPOSAL 4: ADVISORY VOTE ON FREQUENCY OF THE ADVISORY APPROVAL OF OUR EXECUTIVE COMPENSATION

In accordance with Section 14A of the Exchange Act and Rule 14a-21(b) promulgated thereunder, we are asking our stockholders to indicate, in a non-binding advisory vote, whether future advisory votes to approve the compensation of the named executive officers should be held every year, every two years, or every three years.

Our board of directors has determined that our stockholders should have the opportunity to vote on the compensation of our named executive officers every year. The board believes that giving the stockholders the right to cast an advisory vote every year on the compensation of our named executive officers will provide stockholders with the opportunity to give us timely input on our executive compensation program.

Stockholders can specify one of four choices when voting on this proposal: every one year, every two years, every three years, or abstain. By voting on this proposal, stockholders are not voting to approve or disapprove the board’s recommendation. The frequency — every “one year,” “two years” or “three years” — receiving the highest number of votes will be determined to be the preferred frequency of holding future advisory votes on named executive officer compensation.

As this is an advisory vote, the results will not be binding on us or on the compensation committee of the board, and the board may decide that it is in the best interests of the stockholders and the Company to hold an advisory vote on our named executive officer compensation more or less frequently than the option selected by our stockholders. We will provide our stockholders with the opportunity to vote on the frequency of advisory votes on our named executive officers’ compensation at our annual meetings at least once every six calendar years.

Resolution

Under this Proposal No. 4, stockholders may vote to have the “say-on-pay” vote every one year, every two years, every three years, or abstain from voting in response to the resolution set forth below.

“RESOLVED, that the stockholders determine, on an advisory basis, whether the preferred frequency of an advisory vote on the executive compensation of the Company’s named executive officers as set forth in the Company’s proxy statement should be every year, every two years, or every three years.”

You are not voting in this proposal to approve or disapprove our board’s recommendation. Instead, you may cast your vote on your preferred voting frequency by choosing the option of one year, two years, three years, or abstain from voting when you vote in response to this proposal.

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Required Vote

The frequency receiving the highest number of votes of the shares of common stock present in person or by proxy and entitled to vote on this proposal at the Annual Meeting will be determined to be the preferred frequency under Proposal 4. Abstentions and broker non-votes will have no effect on this proposal.

The board of directors recommends that stockholders vote for “One Year” on the advisory vote on frequency of advisory approval of executive compensation.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Reports of all transactions in our common stock by officers, directors and ten percent (10%) stockholders are required to be filed with the SEC pursuant to Section 16(a) of the Exchange Act. Based solely on our review of copies of the reports received, or representations of such reporting persons, we believe that during the year ended December 31, 2018, all Section 16(a) filing requirements applicable to our officers, directors and ten percent (10%) stockholders were satisfied in a timely fashion.

STOCKHOLDER PROPOSALS

Stockholder Proposals to Be Included in the Company’s Proxy Statement

Pursuant to and subject to the requirements of Rule 14a-8 under the Exchange Act, stockholders may present proposals for inclusion in our proxy statement and for consideration at the next annual meeting of stockholders by submitting their proposals to us in a timely manner. In order to be included for the 2020 Annual Meeting, stockholder proposals must be received by us at our principal executive offices located at 6001 W. Market Street, Greensboro, NC 27409 no later than December 31, 2019, and must otherwise comply with the requirements of Rule 14a-8.

Stockholder Proposals Not to Be Included in the Company’s Proxy Statement

Stockholders wishing to present proposals for action at an annual meeting apart from proposals pursuant to Rule 14a-8 must give timely notice of the proposed business to the Secretary at the executive offices referred to above. For each matter the stockholder proposes to bring before the meeting, the notice to the Secretary must include: (i) a brief description of the business proposed to be brought before the meeting; (ii) the name and address, as they appear in our books, of the stockholder proposing such business; (iii) the class and number of shares of Company stock that are beneficially owned by the stockholder; and (iv) any material interest of the stockholder in such business.

Stockholders wishing to present nominees for election as a director must provide timely notice of such proposed nominee to the Secretary at the executive officers referred to above. The notice must set forth: (i) the name, age, business address and, if known, residence address of each such nominee; (ii) principal occupation or employment of each such nominee; (iii) the number of shares of stock of the Company that are beneficially owned by each such nominee; and (iv) any other information concerning such nominee that must be disclosed as to nominees in proxy solicitations pursuant to Regulation 14A under the Exchange Act. In addition, as to the stockholder giving the notice, the notice must include: (1) the name and record address of such stockholder; and (2) the class and number of shares of Company stock beneficially owned by such stockholder. Our independent directors will consider all director candidates recommended by any stockholder on the same basis as candidates recommended by the board and other sources.

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STOCKHOLDER COMMUNICATIONS

The board of directors has established a process for stockholders to send communications to it. Stockholders who wish to communicate with the board of directors, or specific individual directors, may do so by directing correspondence addressed to such directors or director in care of Caixuan Xu, our Chief Financial Officer, at the principal executive offices of the Company at 6001 W. Market Street, Greensboro, NC 27409. Such correspondence shall prominently display the fact that it is a stockholder-board communication and whether the intended recipients are all or individual members of the board of directors. The Chief Financial Officer has been authorized to screen commercial solicitations and materials that pose security risks, are unrelated to the business or governance of the Company, or are otherwise inappropriate. The Chief Financial Officer shall promptly forward any and all such stockholder communications to the entire board of directors or the individual director as appropriate.

OTHER MATTERS

The Notice of Annual Meeting of Stockholders provides for the transaction of such other business as may properly come before the Annual Meeting. As of the date of this proxy statement, the board of directors has not been advised of any other matters to be presented for discussion at the Annual Meeting. However, the enclosed proxy gives discretionary authority to the persons named in the proxy in the event that any other matters should be properly presented to the stockholders.

ANNUAL REPORT ON FORM 10-K

Our Annual Report on Form-10-K, including the financial statements and management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2018, is being sent to stockholders of record as of April 16, 2019 with this proxy statement. The Annual Report on Form 10-K is not to be regarded as proxy soliciting material or as a communication by means of which any solicitation is to be made. Stockholders of record as of April 16, 2019, and beneficial owners of our common stock on that date, may obtain from us without charge additional copies of our Annual Report on Form 10-K filed with the Securities and Exchange Commission, exclusive of the exhibits thereto, by a request in writing. If requested, we will provide stockholders with copies of any exhibits to the Form 10-K upon the payment of a fee covering our reasonable expenses in furnishing the exhibits. Any requests from a beneficial owner of our common stock must set forth a good faith representation that, as of the record date for this solicitation, April 16, 2019, the person making the request was the beneficial owner of our common stock. Such written requests should be directed to us at, 6001 W. Market Street, Greensboro, NC 27409, Attention: Chief Financial Officer.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other information with the SEC under the Exchange Act. We make available free of charge on or through our website, https://hffoodsgroup.com, our reports and other information filed with or furnished to the SEC and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The SEC’s website, www.sec.gov, also contains reports, proxy statements and other information about issuers, like us, who file electronically with the SEC.

By Order of the Board of Directors

Zhou Min Ni

Chairman and Chief Executive Officer

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