Item 1.03 Bankruptcy or Receivership.
On August 31, 2022, in the matter KEYBANK NATIONAL ASSOCIATION vs. NYM HOLDING,
INC., IFRESH, INC., NEW YORK MART 8 AVE., INC., NEW YORK MART EAST BROADWAY
INC., NEW YORK SUPERMARKET EAST BROADWAY INC., NEW YORK MART GROUP INC., MING'S
SUPERMARKET, INC., NEW YORK MART MOTT ST., INC., NEW YORK MART ROOSEVELT, INC.,
NEW YORK MART SUNRISE, INC., ZEN MKT QUINCY, INC., STRONG AMERICA LIMITED,
IFRESH E. COLONIAL INC., IFRESH GLEN COVE INC., IFRESH BELLAIRE, INC., NEW YORK
MART AVE U 2ND INC., NEW YORK MART CT, INC., NEW YORK MART N. MIAMI INC., and
NYM MILFORD, LLC (C.A. No. 22-1134 (UNA)), the United States District Court of
District of Delaware (the "Court") issued an Order Appointing Receiver (the
"Order"), upon a motion made by Keybank National Association ("Keybank") which
was consented to by all the above-captioned defendants (the "Defendants"), for
the appointment and creation of a receiver to take exclusive custody, control
and management of certain collateral (the "Receivership Assets") made by the
Defendants in favor of KeyBank pursuant to a certain pledge agreement and
security agreement in connection with a loan arrangement with Keybank (the
"Loan").
Pursuant to the Order, effective as of September 6, 2022 (the "Effective Date"),
the Court appointed Cynthia Romano, acting on behalf of CohnReznick LLP, as
receiver (the "Receiver") to take exclusive custody, control, and management of
the Receivership Assets, which include: (i) all the Collateral as defined in the
Pledge Agreement, dated February 27, 2017, made by iFresh Inc. (the "Company" or
"Registrant") in favor of KeyBank; (ii) all the Collateral as defined in the
Pledge Agreement, dated December 23, 2016, made by NYM HOLDING, INC. ("NYMH") in
favor of KeyBank; (iii) all the Collateral as defined in the Security Agreement,
dated December 23, 2016, made by the Defendants (other than the Company and NYM
Milford LLC ("NYM Milford") in favor of KeyBank; and (iv) all the Premises as
defined in the Open-End Mortgage Deed and Security Agreement, dated May 20,
2019, made by NYM Milford in favor of KeyBank. As of the Effective Date, the
Receiver shall have exclusive operational control of the businesses of the
Receivership Defendants, which are all the Defendants excluding the Company,
relating to the Receivership Assets (the "Receivership Businesses") in
accordance with the terms of the Order and until such time as provided by the
Order (the "Receivership"). The Receivership Assets are placed in custodia legis
and are subject to the exclusive jurisdiction of the Court.
The Order also specifies that the Receivership Assets shall not include (i) 100%
of the stock of (x) E Compass, a shell company with no subsidiaries, or (y) I
Fresh (BVI) Co, Ltd., a holding company with three direct or indirect
subsidiaries, Xiamen DL Medical Technology Co, Ltd., Hubei Rongentang Wine Co,
Ltd., and Jiuxiang Blue Sky Technology (Beijing) Co, Ltd. (collectively and
including such subsidiaries, the "Sister Companies"), in each case, owned by the
Company; (ii) the Sister Companies' assets; (iii) any assets of the Company that
are not Receivership Assets; or (iv) any causes of action held by the Company;
and the Receivership shall not include any businesses of the Company or the
Sister Companies (collectively, the "Excluded Businesses").
The Receiver was granted all the rights, duties, and responsibilities of a
court-appointed receiver, including without limitation, custody, control,
management, and sale of any part of or all the Receivership Assets and the
Receivership Businesses, provided that no Receivership Asset subject to a lien
or security interest in favor of Keybank shall be sold without the prior written
consent of Keybank.
Pursuant to the Order, the Defendants and each of their respective current and
former owners, directors, officers, members, managers, employees, affiliates,
successors, assigns, attorneys, accountants, agents, independent contractors,
creditors, and other representatives, or any other persons or entities acting in
concert or participating with any Defendant, and all those who are under the
Defendants' direction or control (collectively, the "Defendant Parties"), are
directed to fully and immediately cooperate with the Receiver to ensure an
orderly transfer of the custody, control, and management of the Receivership
Assets, and the operational control of the Receivership Businesses, to the
Receiver, including, without limitation, turning over any Receivership Assets in
their possession or control to the Receiver and providing the Receiver with any
information and documents in their possession or control relevant to the
Receivership Assets and/or the Receivership Businesses. Any entity or person
that willfully interferes with the authority of the Receiver as set forth in the
Order or any subsequent order of the Court shall be subject to all appropriate
penalties provided for under the laws of the State of Delaware and the United
States, and any such conduct may be punishable as a contempt of Court.
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Pursuant to the Order, all Defendant Parties, creditors, claimants, bodies
politic, parties in interest, and their respective attorneys, agents, employees,
and all other persons, firms, and corporations are jointly and severally
enjoined and stayed from commencing or continuing any action at law or suit or
proceeding in equity to foreclose any lien or enforce any claim against the
Receivership Assets, the books, records, revenues, profits, and related assets
of the Receivership Businesses, or against the Receiver in any court; provided,
however, that (a) the Company may commence actions at law, suits, and
proceedings related to causes of action held by the Company; (b) certain
Defendant Parties are presently party to existing actions at law, suits, and
proceedings against other Defendant Parties, and all such Defendant Parties may
continue such existing actions at law, suits, and proceedings; and (c) certain
Defendant Parties may commence additional actions against other Defendant
Parties, and all such Defendant Parties may continue such additional actions,
provided that, in each case, such actions at law, suits, and proceedings do not
seek relief contrary to the terms of the Order.
The Receiver's rights and duties with respect to the Receivership Assets and the
Receivership and as Receiver shall cease and terminate only upon further order
of the Court, which may be entered into with the consent of the Receiver,
Plaintiff, and all of the Defendants or at requested by the Receiver, Keybank or
the Defendants. At termination, to the extent not transferred as part of a sale
of the Receivership Assets, the Receiver shall, among other things, transfer all
other property to the respective Receivership Defendant owning such property.
Nothing in the Order modifies, amends, or limits in any way whatsoever the
rights of KeyBank under the Loan to approve sales, to credit bid, to receive
payment of all proceeds arising from the sale of any or all the Receivership
Assets prior to all other creditors, and to refuse to release its interest in
the Receivership Assets.
This description of the Order is not complete and is qualified in its entirety
by reference to the text of the Order, a copy of which is filed as Exhibit 3.1
to this Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Exhibit Description
3.1 Order Appointing Receiver dated August 31, 2022
104 Cover Page Interactive Data File - the cover page XBRL tags are embedded
within the Inline XBRL document.
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