DEF 14A 1 formdef14a.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a)

of the Securities Exchange Act of 1934

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[ ] Preliminary Proxy Statement	[ ]	Confidential, for use of the Commission only (as permitted by Rule
		14a-6(e)(2)).
[X] Definitive Proxy Statement

[ ] Definitive additional materials.

[ ] Soliciting material under Rule 14a-12.

TRXADE GROUP, INC.

(Name of Registrant as Specified in Charter)

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TRXADE GROUP, INC.

NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS

To be held on May 27, 2021

To our stockholders:

Notice is hereby given of the 2021 annual meeting of stockholders of Trxade Group, Inc. (the “Company”) to be held on Thursday, May 27, 2021 at 10A.M. local time at the Company’s corporate offices: 3840 Land O’ Lakes Blvd, Land O’ Lakes, Florida 34639 (the “Annual Meeting” or the “Meeting”), for the following purposes:

	1.	To elect five directors to the Board of Directors (the “Board”) each to serve a term of one year and until their respective successors have been elected and qualified, or until their earlier resignation or removal. The Board intends to present for election the following five nominees: Suren Ajjarapu, Prashant Patel, Donald G. Fell, Charles L. Pope, and Christine L. Jennings.

	2.	*To approve an amendment to our Second Amended and Restated Certificate of Incorporation to change our corporate name from “Trxade Group, Inc” to “TRxADE HEALTH, INC.”* The Board of Directors recommends that you approve and ratify the filing of a Certificate of Amendment to our Second Amended and Restated Certificate of Incorporation to change our corporate name from “Trxade Group, Inc.” to “TRxADE HEALTH, INC.”

	3.	*Approve and Ratify the Company’s Second Amended and Restated 2019 Equity Incentive Plan.* The Board of Directors recommends that you approve and ratify the Company’s Second Amended and Restated 2019 Equity Incentive Plan which amends the current Amended and Restated 2019 Equity Incentive Plan to (a) clarify that the plan includes a limitation on the number of shares of common stock that may be issued pursuant to the plan; (b) include a 25 million share limit on the number of shares of common stock issuable upon exercise of incentive stock options granted under the plan; and (c) make certain other conforming changes to the plan.

	4.	*To ratify the appointment of MaloneBailey, LLP, as the Company’s independent auditors for the fiscal year ending December 31, 2021.* The Board of Directors recommends that you approve and ratify the appointment of MaloneBailey, LLP, as the Company’s independent auditors for the fiscal year ending December 31, 2021.

	5.	*To transact such other business as may properly come before the annual meeting.*

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR ALL” FOR PROPOSAL ONE AND “FOR” THE OTHER PROPOSALS.

Any action may be taken on any one of the foregoing proposals at the Meeting on the date specified above or on any date or dates to which the Meeting may be adjourned. Common stockholders of record on the close of business on April 9, 2021 are entitled to notice of, and to vote at, the Annual Meeting and any adjournments thereof.

The Company is pleased to continue utilizing the Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their stockholders on the Internet. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials, or E-proxy notice, on or about April 16, 2021 to our stockholders of record as of the close of business on April 9, 2021. The E-proxy notice contains instructions for your use of this process, including how to access our proxy statement and annual report and how to authorize your proxy to vote online. In addition, the E-proxy notice contains instructions on how you may receive a paper copy of the proxy statement and annual report or elect to receive your proxy statement and annual report over the Internet. The Company believes these rules allow it to provide you with the information you need while lowering the costs of delivery and reducing the environmental impact of the Annual Meeting.

The enclosed proxy statement is also available at https://www.iproxydirect.com/MEDS (please note this link is case sensitive). This website also includes copies of the form of proxy and the Company’s Annual Report to stockholders for the year ended December 31, 2020. Stockholders may also request a copy of the proxy statement and the Company’s Annual Report by contacting our main office at (800) 261-0281.

As a stockholder of record, you are cordially invited to attend the meeting in person. Stockholders who do not expect to attend the Annual Meeting are encouraged to vote via the Internet, by phone or by returning a signed proxy card.

As described above, we intend to hold our annual meeting in person. However, we are monitoring the situation regarding COVID-19, taking into account guidance from public health officials. The health and well-being of our employees and stockholders is our top priority. Accordingly, we are planning for the possibility that the annual meeting may be held in a different location or solely by means of remote communication (i.e., a virtual-only meeting). We will announce any such updates as promptly as practicable, including details on how to participate, by press release, through a filing with the SEC and on our website. We encourage you to check our website prior to the meeting if you plan to attend. As always, we encourage you to vote your shares prior to the annual meeting.

Even if you plan to attend the Annual Meeting in person, we request that you submit a proxy by following the instructions on your proxy card as soon as possible and thus ensure that your shares will be represented at the Annual Meeting if you are unable to attend.

By Order of the Board of Directors,

/s/ Suren Ajjarapu

Suren Ajjarapu

Chairman

Land O’ Lakes, Florida

April 16, 2021

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to Be Held on Thursday, May 27, 2021.

Our proxy statement and annual report on Form 10-K for the year ended December 31, 2020, are available at the following cookies-free website that can be accessed anonymously: https://www.iproxydirect.com/MEDS (please note this link is case sensitive).

TABLE OF CONTENTS

GENERAL INFORMATION		1
Information Contained in This Proxy Statement		1
Important Notice Regarding the Availability of Proxy Materials		1
Record Date and Shares Entitled to Vote		1
Voting Process		2
Providing and Revoking Proxies		2
Attendance at the Annual Meeting		2
Conduct at the Meeting		3
Voting Requirements for Each of the Proposals		3
Quorum; Broker Non-Votes and Abstentions		3
Board of Directors Voting Recommendations		4
Mailing Costs and Solicitation of Proxies		4
Inspector of Voting		4
Stockholders Entitled to Vote at the Meeting		4
Voting Instructions		4
Confidential Voting		5
Stockholder of Record and Shares Held in Brokerage Accounts		5
Multiple Stockholders Sharing the Same Address		5
Voting Results		5
Reverse Stock Split		5
Company Mailing Address		6
INCORPORATION BY REFERENCE		6
VOTING RIGHTS AND PRINCIPAL STOCKHOLDERS		6
Security Ownership of Certain Beneficial Owners and Management		6
Change of Control		7
CORPORATE GOVERNANCE		8
Board Leadership Structure		8
Risk Oversight		8
Family Relationships		8
Arrangements between Officers and Directors		8
Other Directorships		9
Involvement in Legal Proceedings		9
Board of Directors and Committee Meetings		9
COMMITTEES OF THE BOARD		10
Board Committee Membership		10
Audit Committee		10
Compensation Committee		11
Compensation Committee Interlocks and Insider Participation		11
Nominating and Corporate Governance Committee		11
Executive Sessions of the Board of Directors		13
Stockholder Communications with the Board		13
Director Independence		13
Code of Ethics		13
Policy on Equity Ownership		14
Insider Trading/Anti-Hedging Policies		14
Compensation Recovery		14
INFORMATION ABOUT OUR EXECUTIVE OFFICERS		14
AUDIT COMMITTEE REPORT		15
COMPENSATION COMMITTEE REPORT		15
EXECUTIVE COMPENSATION		16
Summary Executive Compensation Table		16
Outstanding Equity Awards at Fiscal Year-End		17
Option Exercises During Fiscal 2020		17
Employment Agreements		17
DIRECTORS COMPENSATION		21
EQUITY COMPENSATION PLAN INFORMATION		22
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS		22
DELINQUENT SECTION 16(A) REPORTS		26
PROPOSAL 1. ELECTION OF DIRECTORS		26
PROPOSAL 2. APPROVAL OF THE FILING OF A CERTIFICATE OF AMENDMENT TO CHANGE THE COMPANY’S NAME FROM “TRXADE GROUP, INC.” TO “TRxADE HEALTH, INC.”		31
PROPOSAL 3. APPROVAL OF THE COMPANY’S SECOND AMENDED AND RESTATED 2019 EQUITY INCENTIVE PLAN		31
PROPOSAL 4. RATIFICATION OF APPOINTMENT OF AUDITORS		38
STOCKHOLDER PROPOSALS		39
Proposals for 2022 Annual Meeting of Stockholders and 2022 Proxy Materials		39
ADDITIONAL FILINGS		40
DOCUMENTS INCORPORATED BY REFERENCE		40
OTHER MATTERS		40
INTEREST OF CERTAIN PERSONS IN OR OPPOSITION TO MATTERS TO BE ACTED UPON		41
COMPANY CONTACT INFORMATION		41

Appendix A	Form of Certificate of Amendment (see Proposal 2)

Appendix B	Trxade Group, Inc. Second Amended and Restated 2019 Equity Incentive Plan (see Proposal 3)

	●	In person. You may vote in person at the Annual Meeting. We will give you a ballot when you arrive.

	●	Via the Internet. You may vote by proxy via the Internet by following the instructions provided in the Notice.

	●	By Telephone. If you request printed copies of the proxy materials by mail, you may vote by proxy by calling the toll-free number found on the proxy card.

	●	By Fax. If you request printed copies of the proxy materials by mail, you may vote by proxy by faxing your proxy to the number found on the proxy card.

	●	By Mail. If you request printed copies of the proxy materials by mail, you may vote by proxy by filling out the proxy card and returning it in the envelope provided.

	Proposal	Vote Required	Broker Discretionary Voting Allowed*
1	Election of directors	Plurality of Votes Cast	No
2	Approval of an amendment to our Second Amended and Restated Certificate of Incorporation to change our corporate name from “Trxade Group, Inc,” to “TRxADE HEALTH, INC.”	Majority of outstanding shares of common stock	No
3	Approve and Ratify the Company’s Second Amended and Restated 2019 Equity Incentive Plan	Majority of the votes cast on the proposal	No
4	Ratification of the appointment of MaloneBailey, LLP, as the Company’s independent auditors for the fiscal year ending December 31, 2021	Majority of the votes cast on the proposal	Yes

	●	“FOR” each of the nominees to the Board of Directors (Proposal 1).

	●	“FOR” the approval of an amendment to our Second Amended and Restated Certificate of Incorporation to change our corporate name from “Trxade Group, Inc.” to “TRxADE HEALTH, INC.” (Proposal 2).

	●	“FOR” the approval of the adoption of the Company’s Second Amended and Restated 2019 Equity Incentive Plan (Proposal 3).

	●	“FOR” the ratification of the appointment of MaloneBailey, LLP, as the Company’s independent auditors for the fiscal year ending December 31, 2021 (Proposal 4).

Name and Address of Beneficial Owner	Number of Shares Beneficially Owned		Percentage Beneficially Owned

Directors, Director Nominees and Named Executive Officers:
Suren Ajjarapu, Chairman, CEO (1)		2,220,850		27.4	%
Prashant Patel, Director, COO, and President (2)		2,085,001		25.8	%
Donald G. Fell, Director (3)		53,541		*
Howard Doss, CFO (4)		71,355		*
Michael L Peterson, Director (5)		47,093		*
Dr. Pamela Tenaerts, Director (6)		14,437		*
Charles L. Pope		-		*
Christine L. Jennings		-		*

All executive officers, directors and director nominees as a Group (eight persons)		4,492,277		53.3	%

Greater than 5% Stockholders
R.S.N, LLC (7)		500,001		6.2	%

	(1)	any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

	(2)	any conviction in a criminal proceeding or being a named subject to a pending criminal proceeding (excluding traffic violations and minor offenses);

	(3)	being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;

	(4)	being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law;

	(5)	being the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of (i) any Federal or State securities or commodities law or regulation; (ii) any law or regulation respecting financial institutions or insurance companies, including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or (iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

	(6)	being the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act), any registered entity (as defined in Section (1)(a)(40) of the Commodity Exchange Act), or any equivalent exchange, association, entity, or organization that has disciplinary authority over its members or persons associated with a member.

	Independent	Audit Committee	Compensation Committee	Nominating and Corporate Governance Committee
Suren Ajjarapu⁽¹⁾
Prashant Patel
Donald G. Fell	X	M	C	C
Michael L. Peterson⁽²⁾	X	C	M	M
Dr. Pamela Tenaerts⁽²⁾	X	M	M	M

Name	Position	Age	Officer Since
Suren Ajjarapu	Chairman, Chief Executive Officer and Secretary	50	January 2014
Prashant Patel	Director, President and Chief Operating Officer	46	January 2014
Howard A. Doss	Chief Financial Officer	67	January 2014

Name and Principal Position	Year		Salary ($)			Bonus ($)		Stock Awards ($)*			Option Awards ($)*		All Other Compensation ($)		Total ($)
Suren Ajjarapu		2020	$	285,694	⁽¹⁾	$	1,163	$	372,062	⁽⁴⁾	$	-	$	8,567	$	667,486
Chairman of the Board, Chief Executive Officer, and Director		2019	$	250,000	⁽¹⁾		-		455,842	⁽⁴⁾	$	44,000		-	$	749,842

Prashant Patel		2020	$	150,000	⁽²⁾		409		-		$	-		-	$	150,409
Chief Operating Officer, President and Director		2019	$	150,000	⁽²⁾		-		306,000	⁽⁵⁾	$	44,000		-	$	500,000

Howard A. Doss		2020	$	90,000	⁽³⁾		426		76,500		$	-		-	$	166,926
Chief Financial Officer		2019	$	60,000	⁽³⁾		-		-		$	8,800		-	$	79,750

	^*	Amounts in this column represent the aggregate grant date fair value of awards computed in accordance with Financial Accounting Standards Board Accounting Standard Codification Topic 718.
	⁽¹⁾	The amount shown reflects compensation under an at will employment agreement with the Company.
	⁽²⁾	The amount shown reflects compensation under an at will employment agreement with the Company.
	⁽³⁾	The amount shown reflects compensation under a consulting agreement with the Company.
	⁽⁴⁾	Represents the fair value of 74,484 shares of common stock of the Company which were awarded to Mr. Ajjarapu on April 14, 2020, as a bonus for fiscal 2019. Represents the fair value of 49,020 shares of common stock of the Company which were awarded to Mr. Ajjarapu, as a bonus for fiscal 2020. The shares were awarded under the Company’s 2019 Equity Incentive Plan.
	⁽⁵⁾	Represents the fair value of 50,000 shares of common stock of the Company which were awarded to Mr. Patel on April 14, 2020, as a bonus for fiscal 2019. The shares were awarded under the Company’s 2019 Equity Incentive Plan.

	Option Awards
Name	Grant Date	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable			Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)		Option Exercise Price ($)		Option Expiration Date
Howard A. Doss,	1/20/2014		50,000		—			—		6.00	1/1/2024
Chief Financial Officer	4/1/2016		2,375		125	⁽¹⁾		—		6.12	4/1/2026
	4/1/2018		4,297		1,953	⁽²⁾		—		3.00	4/1/2028
	5/13/2019		1,459		1,875	⁽³⁾		—		2.64	5/13/2029

Suren Ajjarapu, Chief Executive Officer	5/13/2019		7,292		9,375	⁽³⁾		—		2.64	5/13/2029

Patel Prashant, President and COO	5/13/2019		7,292		9,375	⁽³⁾		—		2.64	5/13/2029

⁽¹⁾	Vesting is 6.25% of the total number of shares each quarter after the vesting commencement date of July 1, 2016.
⁽²⁾	Vesting is 6.25% of the total number of shares each quarter after the vesting commencement date of July 1, 2018.
⁽³⁾	Vesting is 6.25% of the total number of shares each quarter after the vesting commencement date of July 1, 2019.

Name	Fees Earned or paid in Cash		Stock Awards⁽²⁾		Option Awards ⁽¹⁾		All Other Compensation		Total

Donald G. Fell	$	44,889		55,000	$	-	$	-	$	99,889
Michael Peterson	$	44,889		55,000	$	-	$	-	$	99,889
Dr. Pamela Tenaerts	$	30,667		55,000	$	119,638	$	-	$	205,305

⁽¹⁾	In April 2020, the Company grant Dr. Tenaerts options to purchase 16,667 shares of common stock, vesting over four years and exercisable at $7.50 per share.

⁽²⁾	In April 2020, the Company awarded 8,987 shares of restricted stock to each director equal to $55,000, which restricted stock awards will vest at the rate of 1/4^th of such awards over the following four calendar quarters, subject to such directors continued service to the Company.

Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security holders		93,154	$	4,40		1,704,548
Equity compensation plans not approved by security holders		332,663		4.45		-
Total		425,817	$	4.44		1,704,548

	(1)	fairness of the terms for the Company (including fairness from a financial point of view);

	(2)	materiality of the transaction;

	(3)	bids / terms for such transaction from unrelated parties;

	(4)	structure of the transaction;

	(5)	the policies, rules and regulations of the U.S. federal and state securities laws;

	(6)	the policies of the committee; and

	(7)	interests of each related party in the transaction.

Name	Position	Age	Director Since
Suren Ajjarapu	Chairman, Chief Executive Officer and Secretary	50	January 2014
Prashant Patel	Director, President and Chief Operating Officer	46	January 2014
Donald G. Fell	Director	74	January 2014
Charles L. Pope	Nominee Director	69	New Nominee
Christine L. Jennings	Nominee Director	75	New Nominee

Name	Positions and Offices Held	Director Since	Age
Michael L. Peterson	Director	2016	57
Dr. Pamela Tenaerts	Director	2019	56

	(i)	the adoption of a plan of merger or consolidation of the Company with any other corporation or association as a result of which the holders of the voting capital stock of the Company as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation;

	(ii)	the approval by the Board of Directors of an agreement providing for the sale or transfer (other than as security for obligations of the Company) of substantially all of the assets of the Company; or

	(iii)	in the absence of a prior expression of approval by the Board of Directors, the acquisition of more than 20% of the Company’s voting capital stock by any person within the meaning of Rule 13d-3 under the Exchange Act (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company);

	2020		2019
Audit Fees	$	71,000	$	63,000
All Other Fees		42,000		27,500
Total	$	113,000	$	90,500

(a)	No officer or director of the Company has any substantial interest in the matters to be acted upon, other than his role as an officer or director of the Company.

(b)	No director of the Company has informed the Company that he intends to oppose the action taken by the Company set forth in this proxy statement.

By Order of the Board of Directors,

/s/ Suren Ajjarapu
Suren Ajjarapu, Chairman

ARTICLE I. PREAMBLE	1

ARTICLE II. DEFINITIONS	1

ARTICLE III. ADMINISTRATION	8

ARTICLE IV. INCENTIVE STOCK OPTIONS	12

ARTICLE V. NONQUALIFIED STOCK OPTIONS	13

ARTICLE VI. INCIDENTS OF STOCK OPTIONS	14

ARTICLE VII. RESTRICTED STOCK	16

ARTICLE VIII. STOCK AWARDS	18

ARTICLE IX. PERFORMANCE SHARES	19

ARTICLE X. CHANGES OF CONTROL OR OTHER FUNDAMENTAL CHANGES	20

ARTICLE XI. AMENDMENT AND TERMINATION	22

ARTICLE XII. SECURITIES MATTERS AND REGULATIONS	22

ARTICLE XIII. SECTION 409A OF THE CODE	23

ARTICLE XIV. MISCELLANEOUS PROVISIONS	24

SEC Form DEF 14A filed by Trxade Group, Inc.