As of the date of this
prospectus supplement, the aggregate market value of our outstanding shares of common stock held by non-affiliates was approximately
$10,267,573.05 based on 14,798,497 outstanding shares of common stock, of which 3,259,547 shares are held by non-affiliates,
and a per share price of $3.15, which was the last reported price on the NASDAQ Capital Market of our common stock on August 17,
2018.
1
We have offered $554,560.00 of securities pursuant to General Instruction I.B.6. of Form S-3 during the
prior 12 calendar month period that ends on and includes the date of this prospectus supplement.
THE
OFFERING
Issuer:
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iFresh
Inc.
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Securities
offered by us pursuant to this prospectus supplement:
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350,000
Shares of common stock
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Offering
price
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$700,000.00
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Shares
of common stock outstanding before this offering:
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14,
798,497 (1)
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Common
stock outstanding after this offering
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15,148,497
(1)
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Use
of proceeds:
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We
intend to use the net proceeds from this offering for general corporate purposes. See “Use of Proceeds” on page
S-4 of this prospectus supplement.
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Transfer
agent and registrar:
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Continental
Stock Transfer and Trust Company
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Risk
factors:
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Investing
in our securities involves a high degree of risk. For a discussion of factors you should consider carefully before deciding
to invest in our shares of common stock, see the information contained in or incorporated by reference under the heading “Risk
Factors” beginning on page S-2 of this prospectus supplement, on page 5 of the accompanying prospectus, and in
the other documents incorporated by reference into this prospectus supplement.
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NASDAQ
Capital Market Symbol:
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IFMK
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(1)
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The number of shares of our common stock to be outstanding immediately after this offering is based on 14,798,497 shares of common stock outstanding as of August 17, 2018, which excludes, as of such date, 61,950 shares of common stock issuable under our 2017 Omnibus Equity Incentive Plan but includes the up to 500,000 shares issuable pursuant to the agreement between iFresh, Inc. and Uzi Einy dated August 15, 2018.
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RISKS
RELATED TO THIS OFFERING
Since
our management will have broad discretion in how we use the proceeds from this offering, we may use the proceeds in ways with
which you disagree.
Our
management will have significant flexibility in applying the net proceeds of this offering. You will be relying on the judgment
of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment
decision, to influence how the proceeds are being used. It is possible that the net proceeds will be invested in a way that does
not yield a favorable, or any, return for us. The failure of our management to use such funds effectively could have a material
adverse effect on our business, financial condition, operating results, and cash flow.
Because
we are a small company, the requirements of being a public company, including compliance with the reporting requirements of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the requirements of the Sarbanes-Oxley Act and
the Dodd-Frank Act, may strain our resources, increase our costs and distract management, and we may be unable to comply with
these requirements in a timely or cost-effective manner.
As
a public company with listed equity securities, we must comply with the federal securities laws, rules, and regulations, including
certain corporate governance provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and the Dodd-Frank
Act, related rules and regulations of the SEC and the NASDAQ, with which a private company is not required to comply. Complying
with these laws, rules and regulations occupies a significant amount of the time of our Board of Directors and management and
significantly increases our costs and expenses. Among other things, we must:
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maintain
a system of internal control over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley
Act and the related rules and regulations of the SEC and the Public Company Accounting Oversight Board;
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comply
with rules and regulations promulgated by the NASDAQ;
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prepare
and distribute periodic public reports in compliance with our obligations under the federal securities laws;
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maintain
various internal compliance and disclosures policies, such as those relating to disclosure controls and procedures and insider
trading in our common stock;
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involve
and retain to a greater degree outside counsel and accountants in the above activities;
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maintain
a comprehensive internal audit function; and
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maintain
an investor relations function.
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Future
sales of our common stock, whether by us or our stockholders, could cause our stock price to decline.
If
our existing shareholders sell, or indicate an intent to sell, substantial amounts of our common stock in the public market, the
trading price of our common stock could decline significantly. Similarly, the perception in the public market that our shareholders
might sell shares of our common stock could also depress the market price of our common stock. A decline in the price of shares
of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or
other equity securities. In addition, the issuance and sale by us of additional shares of our common stock or securities convertible
into or exercisable for shares of our common stock, or the perception that we will issue such securities, could reduce the trading
price for our common stock as well as make future sales of equity securities by us less attractive or not feasible.
Investors
in this offering will experience immediate and substantial dilution.
Because the price per
share of our common stock being offered is substantially higher than the net tangible book value per share of our common stock,
you will suffer substantial dilution in the net tangible book value of our common stock. The Company will receive a total of $695,000.00,
after deducting estimated offering and expenses. The Company will issue 350,000 shares to the investor. Based on our net tangible
book value of the common stock per share as of August 17, 2018, if you purchase shares of our common stock in this offering, you
will suffer immediately dilution of $0.0728 per share in the net tangible book value of the common stock. This calculation includes
the up to 500,000 shares issuable pursuant to the agreement between iFresh, Inc. and Uzi Einy dated August 15, 2018.
Securities
analysts may not cover our common stock and this may have a negative impact on the market price of our common stock.
The
trading market for our common stock will depend, in part, on the research and reports that securities or industry analysts publish
about us or our business. We do not have any control over independent analysts (provided that we have engaged various non-independent
analysts). We do not currently have and may never obtain research coverage by independent securities and industry analysts. If
no independent securities or industry analysts commence coverage of us, the trading price for our common stock would be negatively
impacted. If we obtain independent securities or industry analyst coverage and if one or more of the analysts who covers us downgrades
our common stock, changes their opinion of our shares or publishes inaccurate or unfavorable research about our business, our
stock price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly,
demand for our common stock could decrease and we could lose visibility in the financial markets, which could cause our stock
price and trading volume to decline.
You
may experience future dilution as a result of future equity offerings or other equity issuances.
We
may in the future issue additional shares of our common stock or other securities convertible into or exchangeable for shares
of our common stock. We cannot assure you that we will be able to sell shares of our common stock or other securities in any other
offering or other transactions at a price per share that is equal to or greater than the price per share paid by investors in
this offering. The price per share at which we sell additional shares of our common stock or other securities convertible into
or exchangeable for our common stock in future transactions may be higher or lower than the price per share in this offering.
The
price of our common stock may be volatile or may decline, which may make it difficult for investors to resell shares of our common
stock at prices they find attractive.
The
trading price of our common stock may fluctuate widely as a result of a number of factors, many of which are outside our control.
In addition, the stock market is subject to fluctuations in the share prices and trading volumes that affect the market prices
of the shares of many companies. These broad market fluctuations could adversely affect the market price of our common stock.
Among the factors that could affect our stock price are:
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actual
or anticipated quarterly fluctuations in our operating results and financial condition, and, in particular, further deterioration
of asset quality;
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changes
in revenue or earnings estimates or publication of research reports and recommendations by financial analysts;
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failure
to meet analysts’ revenue or earnings estimates;
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speculation
in the press or investment community;
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strategic
actions by us or our competitors, such as acquisitions or restructurings;
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actions
by institutional shareholders;
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fluctuations
in the stock price and operating results of our competitors;
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general
market conditions and, in particular, developments related to market conditions for the financial services industry;
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proposed
or adopted regulatory changes or developments;
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anticipated
or pending investigations, proceedings or litigation that involve or affect us; or
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domestic
and international economic factors unrelated to our performance.
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The
stock market has experienced significant volatility recently. As a result, the market price of our common stock may be volatile.
In addition, the trading volume in our common stock may fluctuate more than usual and cause significant price variations to occur.
The trading price of the shares of our common stock and the value of our other securities will depend on many factors, which may
change from time to time, including, without limitation, our financial condition, performance, creditworthiness and prospects,
future sales of our equity or equity related securities, and other factors identified below in “Forward-Looking Statements.”
Accordingly,
the shares of our common stock that an investor purchases, whether in this offering or in the secondary market, may trade at a
price lower than that at which they were purchased, and, similarly, the value of our other securities may decline. Current levels
of market volatility are unprecedented. The capital and credit markets have been experiencing volatility and disruption for more
than a year. In some cases, the markets have produced downward pressure on stock prices and credit availability for certain issuers
without regard to those issuers’ underlying financial strength.
A
significant decline in our stock price could result in substantial losses for individual shareholders and could lead to costly
and disruptive securities litigation.
Our
certificate of incorporation allows for our board to create new series of preferred stock without further approval by our stockholders,
which could adversely affect the rights of the holders of our common stock.
Our
board of directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our board of
directors has the authority to issue up to 1,000,000 shares of our preferred stock without further stockholder approval. As a
result, our board of directors could authorize the issuance of preferred stock that would grant to holders the preferred right
to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common
stock and the right to the redemption of the shares, together with a premium, prior to the redemption of our common stock. In
addition, our board of directors could authorize the issuance of a series of preferred stock that has greater voting power than
our common stock or that is convertible into our common stock, which could decrease the relative voting power of our common stock
or result in dilution to our existing stockholders. Although we have no present intention to issue any additional shares of preferred
stock or to create any additional series of preferred stock, we may issue such shares in the future.
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (the “SEC”)
using a “shelf” registration process. Under this shelf registration process, we may offer from time to time securities
having a maximum aggregate offering price of $50,000,0000. Each time we offer securities, we will prepare and file with the SEC
a prospectus supplement that describes the specific amounts, prices and terms of the securities we offer. The prospectus supplement
also may add, update or change information contained in this prospectus or the documents incorporated herein by reference. You
should read carefully both this prospectus and any prospectus supplement together with additional information described below
under the caption “Where You Can Find More Information.”
This
prospectus does not contain all the information provided in the registration statement we filed with the SEC. For further information
about us or our securities offered hereby, you should refer to that registration statement, which you can obtain from the SEC
as described below under “Where You Can Find More Information.”
You
should rely only on the information contained or incorporated by reference in this prospectus or any prospectus supplement. We
have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent
information, you should not rely on it. This prospectus is not an offer to sell securities, and it is not soliciting an offer
to buy securities, in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing
in this prospectus or any prospectus supplement, as well as information we have previously filed with the SEC and incorporated
by reference, is accurate as of the date of those documents only. Our business, financial condition, results of operations and
prospects may have changed since those dates.
We
may sell securities through underwriters or dealers, through agents, directly to purchasers or through any combination of these
methods. We and our agents reserve the sole right to accept or reject in whole or in part any proposed purchase of securities.
The prospectus supplement, which we will prepare and file with the SEC each time we offer securities, will set forth the names
of any underwriters, agents or others involved in the sale of securities, and any applicable fee, commission or discount arrangements
with them. See “Plan of Distribution.”
Unless
otherwise mentioned or unless the context requires otherwise, when used in this prospectus, the terms “iFresh”, “Company”,
“we”, “us”, and “our” refer to iFresh Inc. and its subsidiaries.
i
PROSPECTUS
SUMMARY
The
following summary, because it is a summary, may not contain all the information that may be important to you. This prospectus
incorporates important business and financial information about the Company that is not included in, or delivered with, this prospectus.
Before making an investment, you should read the entire prospectus and any amendment carefully. You should also carefully read
the risks of investing discussed under “Risk Factors” and the financial statements included in our other filings with
the SEC, including in our most recent Quarterly Report on Form 10-Q for the quarter and nine months ended December 31, 2017, which
we filed with the SEC on February 14, 2018 and our Annual Report on Form 10-K for the fiscal year ended March 31, 2017, which
we filed with the SEC on June 29, 2017. This information is incorporated by reference into this prospectus, and you can obtain
it from the SEC as described below under the headings “Where You Can Find Additional Information About Us” and “Incorporation
of Certain Documents by Reference.”
We
will provide to each person, including any beneficial owner, to whom a prospectus is delivered, a copy of any or all of the information
that has been incorporated by reference in the prospectus but not delivered with the prospectus. You may request a copy of these
filings, excluding the exhibits to such filings which we have not specifically incorporated by reference in such filings, at no
cost, by writing us at the following address: 2-39 54th Avenue, Long Island City, NY 11101, Attn: Secretary of the Company.
THE
OFFERING
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (the “SEC”)
utilizing a shelf registration process. Under this shelf registration process, we may sell any combination of:
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debt
securities, in one or more series;
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warrants
to purchase any of the securities listed above;
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subscription
rights; and/or
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units
consisting of one or more of the foregoing.
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in
one or more offerings up to a total dollar amount of $50,000,000. This prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information
about the terms of that specific offering and include a discussion of any risk factors or other special considerations that apply
to those securities. The prospectus supplement may also add, update or change information contained in this prospectus. You should
read both this prospectus and any prospectus supplement together with the additional information described under the heading “Where
You Can Find Additional Information About Us.”
OUR
COMPANY
General
We
were formerly a special purpose company incorporated under the laws of the Cayman Islands on September 23, 2014 under the name
E-Compass Acquisition Corp. (“E-Compass”) in order to serve as a vehicle for the acquisition of an operating business
in the e-commerce and consumer retail industry. On February 10, 2017, pursuant to the terms of a merger agreement, dated as of
July 25, 2016 (the “Merger Agreement”), through a series of transactions, we merged with our wholly owned subsidiary
to reincorporate into Delaware and then acquired NYM Holding, Inc.(“NYM”), and as a result, NYM became our direct
wholly-owned subsidiary (the “Transactions”).
We,
through our wholly owned subsidiary, NYM, are a fast growing Asian/Chinese grocery supermarket chain in the North Eastern U.S.
providing food and other merchandise hard to find in mainstream grocery stores. Since NYM was formed in 1995, it has targeted
the Chinese and other Asian populations (collectively, the “Asian Americans”) in the U.S. with a deep cultural understanding
of its consumers’ unique consumption habits. iFresh currently has eight retail supermarkets across New York, Massachusetts
and Florida, with over 6,862,000 sales transactions in the fiscal year ended March 31, 2017. In addition to retail supermarkets,
iFresh operates two in-house wholesale businesses, Strong America Inc. (“Strong America”) and New York Mart Group
(“NYMG”), that offer more than 6,000 wholesale products and service to iFresh retail supermarkets and over 1,000 external
customers including wholesale stores, retail supermarkets and restaurants. iFresh has a stable supply of food from farms in New
Jersey and Florida, ensuring reliable supplies of popular vegetables, fruits and seafood. iFresh’s wholesale businesses
and long term relationships with various farms insulate iFresh from supply interruptions, allowing it remain competitive even
during difficult markets.. Our principal executive offices are located at 2-39 54th Avenue, Long Island City, NY 11101. Our telephone
number is (718) 628-6200. Our website is located at http://www.ifreshmarket.com.
Stores
and Operation
iFresh
offers well-assorted, high-quality and globally-sourced food products in its stores, with a special focus on perishable categories
and hard-to-find products important to its target customers.
Store
Layout
We
believe that iFresh’s cultural advantage is unique in comparison with its mainstream peers. iFresh’s ability to identify,
source, merchandise and market differentiated Asian and Chinese products that sharply meet the need of its target customers are
critical to its success. Its centralized merchandising team rigorously rotates, updates and re-evaluates its existing merchandise
offerings and regularly tests new products in retailing stores to excite its customers and to better understand customer preference.
iFresh maintains a consistent flow of new products in its stores and keeps its product assortment fresh and relevant.
iFresh
plans to use consistent decoration across all stores to emphasis iFresh’s brand and evoke a feeling of trustworthiness and
consistent high-quality. It puts special focus on seafood and produce because their price and quality are key determining factors
of Chinese or Asian customers’ shopping experience. Perishables in aggregate make up approximately 60% of store selling
space on average. To optimize usage of available space, iFresh places popular items such as bok choy, lychee, longyan in most
noticeable areas, and prices them competitively to attract customer traffic. The idea is to adopt a standardized product display
with flexible arrangements customized to the shopping habits of local consumers.
iFresh
has a significant focus on perishable product categories which include vegetables, seafood, fruit, meat and prepared foods. In
fiscal year ended on March 31, 2017, the perishable categories contributed approximately 64% to iFresh’s total net sales,
similar to 60.2% for the year ended March 31, 2016, in alignment with the space occupancy of perishables. iFresh’s focus
on perishables came from its years of research and analysis of target customer’s shopping preferences. This also echoed
well with conclusions given in Nielsen report that Asian and Chinese Americans prefer to buy fresh and shop for seafood and vegetables
most often.
With
respect to non-perishables, iFresh has over 6,600 grocery products on shelf ranging from cooking utensils, canned foods, Chinese
and Asian seasonings and spices, to domestic and imported snacks. With a small-box format, iFresh is highly selective in its grocery
offerings and is flexible enough to remove unprofitable or poor-selling items quickly. 95% of iFresh’s imported groceries
are sourced from China, Thailand and Taiwan to meet the diverse demand of not only Chinese Americans but targeted customers originated
from east and south-east Asia. In fiscal year ended on March 31, 2017, the non-perishable grocery category contributed approximately
36% to iFresh’s total Net Sales and realized a markup of 29% on average for the year ended March 31, 2017.
Management
and sale of Perishables
Vegetables
— All iFresh stores receive deliveries of vegetables every day and are required to sell out all vegetables on daily
basis. iFresh discounts its vegetables after 7:00 p.m., which significantly lowers the storage cost and worn-and-torn rate and
improves profitability. In addition, to lower the worn-out rate of green-leaf vegetables due to customer rummage, iFresh usually
packs and sells such vegetables in bags. iFresh also displays and sells different kinds of vegetables according to their characteristics.
For example, Chinese yams need to be displayed on wood shreds to keep them fresh, while winter melons are typically sold in pieces
due to their large size.
Seafood
—
As an established procedure, in-house merchants of iFresh collect live seafood from wharfs and markets at midnight
on a daily basis. The purchases are immediately distributed to all retailing stores via iFresh’s in-house cold chain systems
in which hibernation technology keeps seafood alive and ensures their freshness and high-quality. iFresh discounts remaining stock
after 7pm, to make space for new deliveries, reduce storage costs and maintain its standard for freshness and quality.
Meat
—
Since iFresh can sell more body parts of an animal than a mainstream grocery store, the sales it generates from a whole pig,
chicken or cattle are much higher than that of mainstream groceries, which leads to higher margin in meat and meat products sales.
Fruit
—
Almost all of the iFresh’s unique fruit species are seasonal offerings and the quality and price are decisive to customer
traffic during high season. Financially, the unique fruit species are sold at higher unit prices and generally offer higher profit
margins. iFresh benefits from its long-standing relationship with farm vendors to stay competitive in high seasons and enjoy better
sourcing price and higher profit margin from fruit sales.
Hot
Food
— Hot food options vary among iFresh’s different store locations. iFresh provides prepared Chinese cuisines
which require specific cooking utensils and are thus not easily made at home by customers, such as Char Siu, qingtuan, roasted
duck, roasted goose, as well as an assortment of dim sums. In addition, iFresh adjusts its hot food offerings periodically based
on the responses from customers. As a commitment to freshness and quality, all prepared food in iFresh are made and sold on a
daily basis. Leftovers are sold at a discount after 7:00 p.m.
Pricing
Strategy
In
general, iFresh’s pricing strategy is to provide premium products at reasonable prices. iFresh believes pricing should be
based on the quality of products and the shopping experience rather than promotional pricing to drive sales. Its goal is to deliver
a sense of value to and foster a relationship of trust with its target and loyal customers.
iFresh
adopts different pricing strategies for different food categories. For best sellers such as seafood and core produce such as swimming
shrimp and bok choy, iFresh prices competitively and aims to attract consumer traffic. For groceries and dry foods which are usually
imported and have a long shelf life, iFresh prices at a premium (average markup of 40%). Due to changes in market conditions and
seasonal supply, iFresh’s pricing for seafood and produce are more volatile when compared with other categories. Despite
the effects of seasonality, iFresh is able to maintain competitive pricing even in high seasons thanks to its long-standing relationship
with its farm partners.
Marketing
and advertising
iFresh
believes its unique offerings, competitive price of popular produce, and word-of–mouth are major drivers of store sales.
Apart from word-of-mouth, iFresh advertises using in-store tastings, in-store weekly promotion signage, cooking demonstrations
and product sampling. iFresh also promotes its stores on its official website, uses an electronic newsletter, and/or inserts sales
flyers in local Chinese newspapers or magazines on a monthly or weekly basis. iFresh’s online business is marketed mainly
on its official website and on WeChat, the most widely-used mobile social app among Chinese immigrants. As of the fiscal years
ended March 31, 2017 and 2016, iFresh recognized $533,536 and $572,885 for marketing and advertising expenses, respectively. Overall,
iFresh utilized a mixed marketing and advertising methods to enhance iFresh brand and sales, to regularly communicate with its
target customers and to strengthen its ability to market new and differentiated products.
Store
Staffing and Operations
iFresh
adopts a systematic approach to support operations and the sustainable development of stores. The comprehensive support includes,
but is not limited to, employee training and scheduling, store design, layout, product sourcing and inventory management systems,
especially focusing on perishables. The support enables iFresh to lower worn-and-tear rate, to enhance operating margins and profit
and to help build iFresh’s image of a Chinese supermarket chain committed to freshness and high-quality.
Each
iFresh retail supermarket is operated with high autonomy. A store manager oversees the general operation and an assistant manager
is also appointed to assist the supervision. To ensure expertise in management and high quality of offerings, department managers
are also appointed by category at each store. The department managers in each store generally include a vegetable manager, a fruit
manager, a seafood manager, a meat manager, a grocery manager and a hot food manager. Since a department manager shoulders the
detailed management for the specific category he or she is in charge of, he or she is commonly experienced in this category or
has been with iFresh for years and exhibited superior performance. As a group, the store manager and store department managers
help to ensure the quality of iFresh’s offerings.
Competition
Food
retail is a large and highly competitive industry, but we believe that the market participants in the Chinese supermarket industry,
a niche market are highly fragmented and immature. Currently, iFresh faces competition from smaller or dispersed competitors focusing
on the niche market of Chinese and other Asian consumers. However, with the rapid growth of the Chinese and other Asian population
and their consumption power, other competitors may also begin operating in this niche market in the future. Those competitors
include: (i) national conventional supermarkets, (ii) regional supermarkets, (iii) national superstores, (iv) alternative food
retailers, (v) local foods stores, (vi) small specialty stores, and (vii) farmers’ markets.
Properties
Our
headquarters has been located in Long Island City since 1999. The head office is leased at current market rate from a real estate
company in which our Chief Executive Officer, Long Deng, has a significant equity interest. The headquarter and the attached warehouse
spaces are located in a desirable area in New York City’s up and coming Hunters Point neighborhood . The space can be easily
rented to or sold to any third party if not used by us. All of our retail supermarkets lease operating space from various third
parties with which we maintain long-term leases averaging approximately 11.9 years. Five of the ten current leases have remaining
periods of at least 10 years; and the rest five current leases come with a renewal option ranging from 10 to 20 years. New York
Mart Group rents 20,000 square feet of storage from third parties, while Strong America rents 60,000 square feet of storage from
a real estate company in which Long Deng, iFresh’s Director, Chief Executive Officer and Chief Operating Officer, has a
significant equity and control.
Employees
As
of March 31, 2017, we had approximately 480 employees, 435 of whom are full-time employees and the remaining 55 of whom work part-time.
We have 60 employees who have worked for it for 10 years or more. Our employees are not unionized nor, to our knowledge, are there
any plans for them to unionize. We have never experienced a strike or significant work stoppage. iFresh regards its employee relations
to be good.
RATIO
OF EARNINGS TO FIXED CHARGES
Not
applicable to smaller reporting companies.
DESCRIPTIONS
OF THE SECURITIES WE MAY OFFER
The
descriptions of the securities contained in this prospectus, together with any applicable prospectus supplement, summarize all
the material terms and provisions of the various types of securities that we may offer. We will describe in the applicable prospectus
supplement relating to a particular offering the specific terms of the securities offered by that prospectus supplement. We will
indicate in the applicable prospectus supplement if the terms of the securities differ from the terms we have summarized below.
We will also include in the prospectus supplement information, where applicable, material United States federal income tax considerations
relating to the securities.
We
may sell from time to time, in one or more offerings:
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shares
of our common stock
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shares
of preferred stock;
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debt
securities, in one or more series;
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warrants
to purchase any of the securities listed above;
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Subscription
rights; and/or
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units
consisting of one or more of the foregoing.
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This
prospectus may not be used to consummate a sale of securities unless it is accompanied by a prospectus supplement.
CAPITAL
STOCK
General
The
following description of common stock and preferred stock, together with the additional information we include in any applicable
prospectus supplement, summarizes the material terms and provisions of the common stock and preferred stock that we may offer
under this prospectus, but it is not complete. For the complete terms of our common stock and preferred stock, please refer to
our articles of incorporation, as may be amended from time to time, and our bylaws, as amended from time to time. The Delaware
General Corporation Law may also affect the terms of these securities. While the terms we have summarized below will apply generally
to any future common stock or preferred stock that we may offer, we will describe the specific terms of any series of these securities
in more detail in the applicable prospectus supplement. If we so indicate in a prospectus supplement, the terms of any common
stock we offer under that prospectus supplement may differ from the terms we describe below.
As
of April 2, 2018, our authorized capital stock consists of 1,000,000 shares of preferred stock, $0.0001 par value per share, none
of which is issued and outstanding; and 100,000,000 shares of common stock, $0.0001 par value per share, of which 14,282,497 shares
are issued and outstanding.
The
authorized and unissued shares of our common stock and preferred stock are available for issuance without further action by our
stockholders, unless such action is required by applicable law or the rules of The NASDAQ Capital Market, or any stock exchange
on which our securities may be listed at such time. Unless approval of our stockholders is so required, our board of directors
will not seek stockholder approval for the issuance and sale of our common stock or preferred stock.
Common
Stock
Each
outstanding share of common stock is entitled to one vote, either in person or by proxy, on all matters that may be voted upon
by their holders at meetings of the stockholders.
Holders
of our common stock:
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(i)
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have
equal ratable rights to dividends from funds legally available therefore, if declared by the Board of Directors;
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(ii)
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are
entitled to share ratably in all our assets available for distribution to holders of common stock upon our liquidation, dissolution
or winding up;
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(iii)
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do
not have preemptive, subscription or conversion rights; and
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(iv)
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are
entitled to one non-cumulative vote per share on all matters on which stockholders may vote at all meetings of our stockholders.
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The
holders of shares of our common stock do not have cumulative voting rights, which means that the holder or holders of more than
fifty percent (50%) of outstanding shares voting for the election of directors can elect all of our directors if they so choose
and, in such event, the holders of the remaining shares will not be able to elect any of the our directors.
Our
common stock is listed on The NASDAQ Capital Market under the symbol “IFMK.” The transfer agent and registrar for
our common stock is Continental Stock Transfer and Trust Company, 17 Battery Place, New York, New York 10004.
Preferred
Stock
Our
board of directors is authorized to issue up to the total of 1,000,000 shares of preferred stock, without any further action by
the stockholders. Our board of directors may also divide the shares of preferred stock into series and fix and determine the relative
rights and preferences of the preferred stock, such as the designation of series and the number of shares constituting such series,
dividend rights, redemption and sinking fund provisions, liquidation and dissolution preferences, conversion or exchange rights
and voting rights, if any. Issuance of preferred stock by our board of directors will result in such shares having dividend and/or
liquidation preferences senior to the rights of the holders of our common stock and could dilute the voting rights of the holders
of our common stock. Once designated by our board of directors, each series of preferred stock will have specific financial and
other terms that will be described in a prospectus supplement. The description of the preferred stock that is set forth in any
prospectus supplement is not complete without reference to the documents that govern the preferred stock. These include our articles
of incorporation, as amended, and any certificates of designation that our Board of Directors may adopt. Prior to the issuance
of shares of each series of preferred stock, the board of directors is required by the Delaware General Corporation Law and our
articles of incorporation to adopt resolutions and file a certificate of designations with the Secretary of State of the State
of Delaware. The certificate of designations fixes for each class or series the designations, powers, preferences, rights, qualifications,
limitations and restrictions, including, but not limited to, some or all of the following:
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the
number of shares constituting that series and the distinctive designation of that series, which number may be increased or
decreased (but not below the number of shares then outstanding) from time to time by action of the board of directors;
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the
dividend rate and the manner and frequency of payment of dividends on the shares of that series, whether dividends will be
cumulative, and, if so, from which date;
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whether
that series will have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting
rights;
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whether
that series will have conversion privileges, and, if so, the terms and conditions of such conversion, including provision
for adjustment of the conversion rate in such events as the board of directors may determine;
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whether
or not the shares of that series will be redeemable, and, if so, the terms and conditions of such redemption;
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whether
that series will have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount
of such sinking fund;
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whether
or not the shares of the series will have priority over or be on a parity with or be junior to the shares of any other series
or class in any respect;
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the
rights of the shares of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the
corporation, and the relative rights or priority, if any, of payment of shares of that series; and
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any
other relative rights, preferences and limitations of that series.
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All
shares of preferred stock offered hereby will, when issued, be fully paid and non-assessable, including shares of preferred stock
issued upon the exercise of preferred stock warrants or subscription rights, if any.
Although
our board of directors has no intention at the present time of doing so, it could authorize the issuance of a series of preferred
stock that could, depending on the terms of such series, impede the completion of a merger, tender offer or other takeover attempt.
DEBT
SECURITIES
The
following description, together with the additional information we include in any applicable prospectus supplements, summarizes
the material terms and provisions of the debt securities that we may offer under this prospectus. While the terms we have summarized
below will generally apply to any future debt securities we may offer under this prospectus, we will describe the particular terms
of any debt securities that we may offer in more detail in the applicable prospectus supplement. The terms of any debt securities
we offer under a prospectus supplement may differ from the terms we describe below. As of the date of this prospectus, we have
no outstanding registered debt securities.
We
will issue senior notes under a senior indenture, which we will enter into with the trustee to be named in the senior indenture.
We will issue subordinated notes under a subordinated indenture, which we will enter into with the trustee to be named in the
subordinated indenture. We have filed forms of these documents as exhibits to the registration statement of which this prospectus
is a part. We use the term “indentures” to refer to both the senior indenture and the subordinated indenture.
The
indentures will be qualified under the Trust Indenture Act of 1939. References to the Trust Indenture Act of 1939 include all
amendments thereto. We use the term “debenture trustee” to refer to either the senior trustee or the subordinated
trustee, as applicable.
The
following summaries of material provisions of the senior notes, the subordinated notes and the indentures are subject to, and
qualified in their entirety by reference to, all the provisions of the indenture applicable to a particular series of debt securities,
and all supplements thereto. We urge you to read the applicable prospectus supplements related to the debt securities that we
sell under this prospectus, as well as the complete indentures that contain the terms of the debt securities. Except as we may
otherwise indicate, the terms of the senior and the subordinated indentures are identical.
General
The
terms of each series of debt securities will be established by or pursuant to a resolution of our board of directors and set forth
or determined in the manner provided in an officers’ certificate or by a supplemental indenture. Debt securities may be
issued in separate series without limitation as to aggregate principal amount. We may specify a maximum aggregate principal amount
for the debt securities of any series. In addition, the particular terms of each series of debt securities will be described in
a prospectus supplement relating to such series, including any pricing supplement. The prospectus supplement will set forth, among
other things:
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the
principal amount being offered, and, if a series, the total amount authorized and the total amount outstanding;
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any
limit on the amount that may be issued;
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whether
or not we will issue the series of debt securities in global form and, if so, the terms and who the depositary will be;
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whether
and under what circumstances, if any, we will pay additional amounts on any debt securities held by a person who is not a
U.S. person for tax purposes, and whether we can redeem the debt securities if we have to pay such additional amounts;
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the
annual interest rate, which may be fixed or variable, or the method for determining the rate, the date interest will begin
to accrue, the dates interest will be payable and the regular record dates for interest payment dates or the method for determining
such dates;
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the
terms of the subordination of any series of subordinated debt, if applicable;
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the
place where payments will be payable;
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restrictions
on transfer, sale or other assignment, if any;
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our
right, if any, to defer payment of interest and the maximum length of any such deferral period;
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the
date, if any, after which, the conditions upon which, and the price at which we may, at our option, redeem the series of debt
securities pursuant to any optional or provisional redemption provisions, and any other applicable terms of those redemption
provisions;
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the
date, if any, on which, and the price at which we are obligated, pursuant to any mandatory sinking fund or analogous fund
provisions or otherwise, to redeem, or at the holder’s option to purchase, the series of debt securities and the currency
or currency unit in which the debt securities are payable;
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whether
the indenture will restrict our ability and/or the ability of our subsidiaries to, among other things:
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incur
additional indebtedness;
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issue
additional securities;
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pay
dividends and make distributions in respect of our capital stock and the capital stock of our subsidiaries;
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place
restrictions on our subsidiaries’ ability to pay dividends, make distributions or transfer assets;
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make
investments or other restricted payments;
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sell
or otherwise dispose of assets;
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enter
into sale-leaseback transactions;
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engage
in transactions with stockholders and affiliates;
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issue
or sell stock of our subsidiaries; or
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effect
a consolidation or merger;
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whether
the indenture will require us to maintain any interest coverage, fixed charge, cash flow-based, asset-based or other financial
ratios;
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information
describing any book-entry features;
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provisions
for a sinking fund purchase or other analogous fund, if any;
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whether
the debt securities are to be offered at a price such that they will be deemed to be offered at an “original issue discount”
as defined in paragraph (a) of Section 1273 of the Internal Revenue Code;
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the
procedures for any auction and remarketing, if any;
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the
denominations in which we will issue the series of debt securities, if other than denominations of $1,000 and any integral
multiple thereof;
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if
other than dollars, the currency in which the series of debt securities will be denominated; and
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any
other specific terms, preferences, rights or limitations of, or restrictions on, the debt securities, including any events
of default that are in addition to those described in this prospectus or any covenants provided with respect to the debt securities
that are in addition to those described above, and any terms that may be required by us or advisable under applicable laws
or regulations or advisable in connection with the marketing of the debt securities.
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Conversion
or Exchange Rights
We
will set forth in the prospectus supplement the terms on which a series of debt securities may be convertible into or exchangeable
for common stock, preferred stock or other securities of ours or a third party, including the conversion or exchange rate, as
applicable, or how it will be calculated, and the applicable conversion or exchange period. We will include provisions as to whether
conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which
the number of our securities or the securities of a third party that the holders of the series of debt securities receive upon
conversion or exchange would, under the circumstances described in those provisions, be subject to adjustment, or pursuant to
which those holders would, under those circumstances, receive other property upon conversion or exchange, for example in the event
of our merger or consolidation with another entity.
Consolidation,
Merger or Sale
The
indentures in the forms initially filed as exhibits to the registration statement of which this prospectus is a part do not contain
any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise dispose of all or substantially
all of our assets. However, any successor of ours or the acquirer of such assets must assume all of our obligations under the
indentures and the debt securities.
If
the debt securities are convertible for our other securities, the person with whom we consolidate or merge or to whom we sell
all of our property must make provisions for the conversion of the debt securities into securities that the holders of the debt
securities would have received if they had converted the debt securities before the consolidation, merger or sale.
Events
of Default Under the Indenture
The
following are events of default under the indentures in the forms initially filed as exhibits to the registration statement with
respect to any series of debt securities that we may issue:
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if
we fail to pay interest when due and payable and our failure continues for 90 days and the time for payment has not been extended
or deferred;
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if
we fail to pay the principal, sinking fund payment or premium, if any, when due and payable and the time for payment has not
been extended or delayed;
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if
we fail to observe or perform any other covenant contained in the debt securities or the indentures, other than a covenant
specifically relating to another series of debt securities, and our failure continues for 90 days after we receive notice
from the debenture trustee or holders of at least 25% in aggregate principal amount of the outstanding debt securities of
the applicable series; and
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if
specified events of bankruptcy, insolvency or reorganization occur.
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If
an event of default with respect to debt securities of any series occurs and is continuing, other than an event of default specified
in the last bullet point above, the debenture trustee or the holders of at least 25% in aggregate principal amount of the outstanding
debt securities of that series, by notice to us in writing, and to the debenture trustee if notice is given by such holders, may
declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately. If an event of default
specified in the last bullet point above occurs with respect to us, the principal amount of and accrued interest, if any, of each
issue of debt securities then outstanding shall be due and payable without any notice or other action on the part of the debenture
trustee or any holder.
The
holders of a majority in principal amount of the outstanding debt securities of an affected series may waive any default or event
of default with respect to the series and its consequences, except defaults or events of default regarding payment of principal,
premium, if any, or interest, unless we have cured the default or event of default in accordance with the indenture. Any waiver
shall cure the default or event of default.
Subject
to the terms of the indentures, if an event of default under an indenture shall occur and be continuing, the debenture trustee
will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of
the holders of the applicable series of debt securities, unless such holders have offered the debenture trustee reasonable indemnity.
The holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to the debenture trustee, or exercising any trust
or power conferred on the debenture trustee, with respect to the debt securities of that series, provided that:
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the
direction so given by the holder is not in conflict with any law or the applicable indenture; and
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subject
to its duties under the Trust Indenture Act of 1939, the debenture trustee need not take any action that might involve it
in personal liability or might be unduly prejudicial to the holders not involved in the proceeding.
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A
holder of the debt securities of any series will only have the right to institute a proceeding under the indentures or to appoint
a receiver or trustee, or to seek other remedies if:
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the
holder has given written notice to the debenture trustee of a continuing event of default with respect to that series;
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the
holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series have made written
request, and such holders have offered reasonable indemnity, to the debenture trustee to institute the proceeding as trustee;
and
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the
debenture trustee does not institute the proceeding and does not receive from the holders of a majority in aggregate principal
amount of the outstanding debt securities of that series other conflicting directions within 90 days after the notice, request
and offer.
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These
limitations do not apply to a suit instituted by a holder of debt securities if we default in the payment of the principal, premium,
if any, or interest on, the debt securities.
We
will periodically file statements with the debenture trustee regarding our compliance with specified covenants in the indentures.
Modification
of Indenture; Waiver
We
and the debenture trustee may change an indenture without the consent of any holders with respect to specific matters, including:
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to
fix any ambiguity, defect or inconsistency in the indenture;
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to
comply with the provisions described above under “
—
Consolidation, Merger or Sale”;
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to
comply with any requirements of the SEC in connection with the qualification of any indenture under the Trust Indenture Act
of 1939;
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to
evidence and provide for the acceptance of appointment by a successor trustee;
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to
provide for uncertificated debt securities and to make all appropriate changes for such purpose;
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to
add to, delete from, or revise the conditions, limitations and restrictions on the authorized amount, terms or purposes of
issuance, authorization and delivery of debt securities or any series, as set forth in the indenture;
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to
provide for the issuance of and establish the form and terms and conditions of the debt securities of any series as provided
under “
—
General” to establish the form of any certifications required to be furnished pursuant to
the terms of the indenture or any series of debt securities, or to add to the rights of the holders of any series of debt
securities;
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to
add to our covenants such new covenants, restrictions, conditions or provisions for the protection of the holders, to make
the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions
or provisions an event of default, or to surrender any of our rights or powers under the indenture; or
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to
change anything that does not materially adversely affect the interests of any holder of debt securities of any series.
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In
addition, under the indentures, the rights of holders of a series of debt securities may be changed by us and the debenture trustee
with the written consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities
of each series that is affected. However, we and the debenture trustee may only make the following changes with the consent of
each holder of any outstanding debt securities affected:
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extending
the fixed maturity of the series of debt securities;
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reducing
the principal amount, reducing the rate of or extending the time of payment of interest, or reducing any premium payable upon
the redemption of any debt securities; or
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reducing
the percentage of debt securities, the holders of which are required to consent to any amendment, supplement, modification
or waiver.
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Discharge
Each
indenture provides that we can elect to be discharged from our obligations with respect to one or more series of debt securities,
except that the following obligations, among others survive until the maturity date or the redemption date:
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register
the transfer or exchange of debt securities of the series;
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replace
stolen, lost or mutilated debt securities of the series;
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maintain
paying agencies;
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hold
monies for payment in trust; and
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appoint
any successor trustee;
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and
the following obligations survive the maturity date or the redemption date:
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recover
excess money held by the debenture trustee; and
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compensate
and indemnify the debenture trustee.
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As
more fully set forth in the indentures, in order to exercise our rights to be discharged, we must either deliver for cancellation
all securities of a series to the debenture trustee or must deposit with the debenture trustee money or government obligations
sufficient to pay all the principal of, any premium, if any, and interest on, the debt securities of the series on the dates payments
are due.
Form,
Exchange and Transfer
We
will issue the debt securities of each series only in fully registered form without coupons and, unless we otherwise specify in
the applicable prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indentures provide that
we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited
with, or on behalf of, The Depository Trust Company, New York, New York, known as DTC, or another depositary named by us and identified
in a prospectus supplement with respect to that series. See “Legal Ownership of Securities” for a further description
of the terms relating to any book-entry securities.
At
the option of the holder, subject to the terms of the indentures and the limitations applicable to global securities described
in the applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for
other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject
to the terms of the indentures and the limitations applicable to global securities set forth in the applicable prospectus supplement,
holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or
with the form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of the
security registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the
debt securities that the holder presents for transfer or exchange, we will make no service charge for any registration of transfer
or exchange, but we may require payment of any taxes or other governmental charges.
We
will name in a board resolution the security registrar, and any transfer agent in addition to the security registrar, that we
initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the designation
of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required
to maintain a transfer agent in each place of payment for the debt securities of each series.
If
we elect to redeem the debt securities of any series, we will not be required to:
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issue,
register the transfer of, or exchange any debt securities of any series being redeemed in part during a period beginning at
the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities that may be selected
for redemption and ending at the close of business on the day of the mailing; or
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register
the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion
of any debt securities we are redeeming in part.
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Information
Concerning the Debenture Trustee
The
debenture trustee, other than during the occurrence and continuance of an event of default under an indenture, undertakes to perform
only those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the
debenture trustee must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own
affairs. Subject to this provision, the debenture trustee is under no obligation to exercise any of the powers given it by the
indentures at the request of any holder of debt securities unless it is offered reasonable security and indemnity against the
costs, expenses and liabilities that it might incur.
Payment
and Paying Agents
Unless
we otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on
any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered
at the close of business on the regular record date for the interest.
We
will name in the applicable board resolution any other paying agents that we initially designate for the debt securities of a
particular series. We will maintain a paying agent in each place of payment for the debt securities of a particular series.
All
money we pay to a paying agent or the debenture trustee for the payment of the principal of or any premium or interest on any
debt securities that remains unclaimed at the end of two years after such principal, premium or interest has become due and payable
will be repaid to us, and the holder of the debt security thereafter may look only to us for payment thereof.
Governing
Law
The
indentures and the debt securities will be governed by and construed in accordance with the laws of the State of New York, except
to the extent that the Trust Indenture Act of 1939 is applicable.
Subordination
of Subordinated Debt Securities
The
subordinated debt securities will be subordinate and junior in priority of payment to certain of our other indebtedness to the
extent described in a prospectus supplement. The indentures in the forms initially filed as exhibits to the registration statement
of which this prospectus is a part do not limit the amount of indebtedness that we may incur, including senior indebtedness or
subordinated indebtedness, and do not limit us from issuing any other debt, including secured debt or unsecured debt.
WARRANTS
As
of April 4, 2018, we had no issued and outstanding warrants.
The
following description, together with the additional information we may include in any applicable prospectus supplement, summarizes
the material terms and provisions of the warrants that we may offer under this prospectus and any related warrant agreement and
warrant certificate. While the terms summarized below will apply generally to any warrants that we may offer, we will describe
the specific terms of any series of warrants in more detail in the applicable prospectus supplement. If we indicate in the prospectus
supplement, the terms of any warrants offered under that prospectus supplement may differ from the terms described below. Specific
warrant agreements will contain additional important terms and provisions and will be incorporated by reference as an exhibit
to the registration statement which includes this prospectus.
General
We
may issue warrants for the purchase of common stock, preferred stock and/or debt securities in one or more series. We may issue
warrants independently or together with common stock, preferred stock and/or debt securities, and the warrants may be attached
to or separate from these securities.
We
will evidence each series of warrants by warrant certificates that we may issue under a separate agreement. We may enter into
a warrant agreement with a warrant agent. Each warrant agent may be a bank that we select which has its principal office in the
United States. We may also choose to act as our own warrant agent. We will indicate the name and address of any such warrant agent
in the applicable prospectus supplement relating to a particular series of warrants.
We
will describe in the applicable prospectus supplement the terms of the series of warrants, including:
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the
offering price and aggregate number of warrants offered;
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if
applicable, the designation and terms of the securities with which the warrants are issued and the number of warrants issued
with each such security or each principal amount of such security;
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if
applicable, the date on and after which the warrants and the related securities will be separately transferable;
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in
the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one
warrant and the price at, and currency in which, this principal amount of debt securities may be purchased upon such exercise;
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in
the case of warrants to purchase common stock or preferred stock, the number or amount of shares of common stock or preferred
stock, purchasable upon the exercise of one warrant and the price at which and currency in which these shares may be purchased
upon such exercise;
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the
manner of exercise of the warrants, including any cashless exercise rights;
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the
warrant agreement under which the warrants will be issued;
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the
effect of any merger, consolidation, sale or other disposition of our business on the warrant agreement and the warrants;
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anti-dilution
provisions of the warrants, if any;
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the
terms of any rights to redeem or call the warrants;
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any
provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants;
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the
dates on which the right to exercise the warrants will commence and expire or, if the warrants are not continuously exercisable
during that period, the specific date or dates on which the warrants will be exercisable;
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the
manner in which the warrant agreement and warrants may be modified;
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the
identities of the warrant agent and any calculation or other agent for the warrants;
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federal
income tax consequences of holding or exercising the warrants;
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the
terms of the securities issuable upon exercise of the warrants;
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any
securities exchange or quotation system on which the warrants or any securities deliverable upon exercise of the warrants
may be listed or quoted; and
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any
other specific terms, preferences, rights or limitations of or restrictions on the warrants.
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Before
exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such
exercise, including:
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in
the case of warrants to purchase debt securities, the right to receive payments of principal of, or premium, if any, or interest
on, the debt securities purchasable upon exercise or to enforce covenants in the applicable indenture; or
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in
the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or, payments upon
our liquidation, dissolution or winding up or to exercise voting rights, if any.
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Exercise
of Warrants
Each
warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise
price that we describe in the applicable prospectus supplement. Unless we otherwise specify in the applicable prospectus supplement,
holders of the warrants may exercise the warrants at any time up to 5:00 P.M. eastern time on the expiration date that we set
forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become
void.
Holders
of the warrants may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together
with specified information, and paying the required exercise price by the methods provided in the applicable prospectus supplement.
We will set forth on the reverse side of the warrant certificate, and in the applicable prospectus supplement, the information
that the holder of the warrant will be required to deliver to the warrant agent.
Upon
receipt of the required payment and the warrant certificate properly completed and duly executed at the corporate trust office
of the warrant agent or any other office indicated in the applicable prospectus supplement, we will issue and deliver the securities
purchasable upon such exercise. If fewer than all of the warrants represented by the warrant certificate are exercised, then we
will issue a new warrant certificate for the remaining amount of warrants.
Enforceability
of Rights By Holders of Warrants
Any
warrant agent will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship
of agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue
of warrants. A warrant agent will have no duty or responsibility in case of any default by us under the applicable warrant agreement
or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us.
Any holder of a warrant may, without the consent of the related warrant agent or the holder of any other warrant, enforce by appropriate
legal action the holder’s right to exercise, and receive the securities purchasable upon exercise of, its warrants in accordance
with their terms.
Warrant
Agreement Will Not Be Qualified Under Trust Indenture Act
No
warrant agreement will be qualified as an indenture, and no warrant agent will be required to qualify as a trustee, under the
Trust Indenture Act. Therefore, holders of warrants issued under a warrant agreement will not have the protection of the Trust
Indenture Act with respect to their warrants.
Governing
Law
Each
warrant agreement and any warrants issued under the warrant agreements will be governed by New York law.
Calculation
Agent
Any
calculations relating to warrants may be made by a calculation agent, an institution that we appoint as our agent for this purpose.
The prospectus supplement for a particular warrant will name the institution that we have appointed to act as the calculation
agent for that warrant as of the original issue date for that warrant, if any. We may appoint a different institution to serve
as calculation agent from time to time after the original issue date without the consent or notification of the holders. The calculation
agent’s determination of any amount of money payable or securities deliverable with respect to a warrant will be final and
binding in the absence of manifest error.
SUBSCRIPTION
RIGHTS
General
We
may issue subscription rights to purchase common stock or preferred stock. Subscription rights may be issued independently or
together with any other offered security and may or may not be transferable by the person purchasing or receiving the subscription
rights. In connection with any subscription rights offering to our shareholders, we may enter into a standby underwriting arrangement
with one or more underwriters pursuant to which such underwriters will purchase any offered securities remaining unsubscribed
for after such subscription rights offering. In connection with a subscription rights offering to our shareholders, we will distribute
certificates evidencing the subscription rights and a prospectus supplement to our shareholders on the record date that we set
for receiving subscription rights in such subscription rights offering.
The
applicable prospectus supplement will describe the following terms of subscription rights in respect of which this prospectus
is being delivered:
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the
title of such subscription rights;
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the
securities for which such subscription rights are exercisable;
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the
exercise price for such subscription rights;
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the
number of such subscription rights issued to each shareholder;
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the
extent to which such subscription rights are transferable;
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if
applicable, a discussion of the material Israeli and United States federal income tax considerations applicable to the issuance
or exercise of such subscription rights;
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the
date on which the right to exercise such subscription rights shall commence, and the date on which such rights shall expire
(subject to any extension);
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the
extent to which such subscription rights include an over-subscription privilege with respect to unsubscribed securities;
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if
applicable, the material terms of any standby underwriting or other purchase arrangement that we may enter into in connection
with the subscription rights offering; and
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any
other terms of such subscription rights, including terms, procedures and limitations relating to the exchange and exercise
of such subscription rights.
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Exercise
of Subscription Rights
Each
subscription right will entitle the holder of the subscription right to purchase for cash such amount of common stock or preferred
stock at such exercise price as shall be set forth in, or be determinable as set forth in, the prospectus supplement relating
to the subscription rights offered thereby. Subscription rights may be exercised at any time up to the close of business on the
expiration date for such subscription rights set forth in the prospectus supplement. After the close of business on the expiration
date, all unexercised subscription rights will become void.
Subscription
rights may be exercised as set forth in the prospectus supplement relating to the subscription rights offered thereby. Upon receipt
of payment and the subscription rights certificate properly completed and duly executed at the corporate trust office of the subscription
rights agent or any other office indicated in the prospectus supplement, we will forward, as soon as practicable, the common stock
or preferred stock purchasable upon such exercise. We may determine to offer any unsubscribed offered securities directly to persons
other than shareholders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant
to standby underwriting arrangements, as set forth in the applicable prospectus supplement.
UNITS
We
may issue units comprised of one or more of the other securities described in this prospectus or in any prospectus supplement
in any combination. Each unit will be issued so that the holder of the unit is also the holder, with the rights and obligations
of a holder, of each security included in the unit. The unit certificate may provide that the securities included in the unit
may not be held or transferred separately, at any time or at any time before a specified date or upon the occurrence of a specified
event or occurrence.
The
applicable prospectus supplement will describe:
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the
designation and terms of the units and of the securities comprising the units, including whether and under what circumstances
those securities may be held or transferred separately;
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any
provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units;
and
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whether
the units will be issued in fully registered or global form.
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PLAN
OF DISTRIBUTION
We
may sell the securities being offered pursuant to this prospectus to or through underwriters, through dealers, through agents,
or directly to one or more purchasers or through a combination of these methods. The applicable prospectus supplement will describe
the terms of the offering of the securities, including:
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the
name or names of any underwriters, if, and if required, any dealers or agents;
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the
purchase price of the securities and the proceeds we will receive from the sale;
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any
underwriting discounts and other items constituting underwriters’ compensation;
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any
discounts or concessions allowed or reallowed or paid to dealers; and
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any
securities exchange or market on which the securities may be listed or traded.
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We
may distribute the securities from time to time in one or more transactions at:
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a
fixed price or prices, which may be changed;
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market
prices prevailing at the time of sale;
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prices
related to such prevailing market prices; or
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Only
underwriters named in the prospectus supplement are underwriters of the securities offered by the prospectus supplement.
If
underwriters are used in an offering, we will execute an underwriting agreement with such underwriters and will specify the name
of each underwriter and the terms of the transaction (including any underwriting discounts and other terms constituting compensation
of the underwriters and any dealers) in a prospectus supplement. The securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by one or more investment banking firms or others, as designated.
If an underwriting syndicate is used, the managing underwriter(s) will be specified on the cover of the prospectus supplement.
If underwriters are used in the sale, the offered securities will be acquired by the underwriters for their own accounts and may
be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or
at varying prices determined at the time of sale. Any public offering price and any discounts or concessions allowed or reallowed
or paid to dealers may be changed from time to time. Unless otherwise set forth in the prospectus supplement, the obligations
of the underwriters to purchase the offered securities will be subject to conditions precedent, and the underwriters will be obligated
to purchase all of the offered securities, if any are purchased.
We
may grant to the underwriters options to purchase additional securities to cover over-allotments, if any, at the public offering
price, with additional underwriting commissions or discounts, as may be set forth in a related prospectus supplement. The terms
of any over-allotment option will be set forth in the prospectus supplement for those securities.
If
we use a dealer in the sale of the securities being offered pursuant to this prospectus or any prospectus supplement, we will
sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to
be determined by the dealer at the time of resale. The names of the dealers and the terms of the transaction will be specified
in a prospectus supplement.
We
may sell the securities directly or through agents we designate from time to time. We will name any agent involved in the offering
and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement.
We
may authorize agents or underwriters to solicit offers by institutional investors to purchase securities from us at the public
offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery
on a specified date in the future. We will describe the conditions to these contracts and the commissions we must pay for solicitation
of these contracts in the prospectus supplement.
In
connection with the sale of the securities, underwriters, dealers or agents may receive compensation from us or from purchasers
of the securities for whom they act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the
securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions
from the underwriters or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that
participate in the distribution of the securities, and any institutional investors or others that purchase securities directly
for the purpose of resale or distribution, may be deemed to be underwriters, and any discounts or commissions received by them
from us and any profit on the resale of the common stock or preferred stock by them may be deemed to be underwriting discounts
and commissions under the Securities Act.
We
may provide agents, underwriters and other purchasers with indemnification against particular civil liabilities, including liabilities
under the Securities Act, or contribution with respect to payments that the agents, underwriters or other purchasers may make
with respect to such liabilities. Agents and underwriters may engage in transactions with, or perform services for, us in the
ordinary course of business.
To
facilitate the public offering of a series of securities, persons participating in the offering may engage in transactions that
stabilize, maintain, or otherwise affect the market price of the securities. This may include over-allotments or short sales of
the securities, which involves the sale by persons participating in the offering of more securities than have been sold to them
by us. In exercising the over-allotment option granted to those persons. In addition, those persons may stabilize or maintain
the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling
concessions allowed to underwriters or dealers participating in any such offering may be reclaimed if securities sold by them
are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain
the market price of the securities at a level above that which might otherwise prevail in the open market. Such transactions,
if commenced, may be discontinued at any time. We make no representation or prediction as to the direction or magnitude of any
effect that the transactions described above, if implemented, may have on the price of our securities.
Unless
otherwise specified in the applicable prospectus supplement, any common stock sold pursuant to a prospectus supplement will be
eligible for listing on The NASDAQ Capital Market, subject to official notice of issuance. Any underwriters to whom securities
are sold by us for public offering and sale may make a market in the securities, but such underwriters will not be obligated to
do so and may discontinue any market making at any time without notice.
In
order to comply with the securities laws of some states, if applicable, the securities offered pursuant to this prospectus will
be sold in those states only through registered or licensed brokers or dealers. In addition, in some states securities may not
be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or
qualification requirement is available and complied with.
LEGAL
MATTERS
Certain
legal matters governed by the laws of the State of New York and of Delaware with respect to the validity of the offered securities
will be passed upon for us by Loeb & Loeb LLP, New York, New York.
EXPERTS
The
audited consolidated financial statements as of March 31, 2017, and for each of the years in the two-year period ended March 31,
2017 incorporated herein by reference from the Company’s Annual Reports on Form 10-K have been audited by Friedman LLP,
an independent registered public accounting firm, as stated in its report, which is incorporated by reference and has been so
incorporated in reliance upon the report of such firm given upon its authority as experts in accounting and auditing.