Current Report Filing (8-k)
April 26 2019 - 9:02AM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
8-K
Current
Report
Pursuant
to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported):
April 25, 2019
VERUS
INTERNATIONAL, INC.
(Exact
name of registrant as specified in its charter)
Delaware
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001-34106
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11-3820796
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(State
or other jurisdiction
of
incorporation)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
No.)
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9841
Washingtonian Boulevard, #390
Gaithersburg,
MD 20878
(Address
of principal executive offices) (zip code)
(301)
329-2700
(Registrant’s
telephone number, including area code)
(Former
name or former address, if changed since last report.)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
[ ]
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ]
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company [X]
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item
1.01 Entry into a Material Definitive Agreement
.
On
April 25, 2019 (the “Closing Date”), Verus International, Inc. (the “Company”) entered into a stock purchase
agreement (the “SPA”) with Big League Foods, Inc. (“BLF”) and James Wheeler, the sole stockholder of BLF
(the “Seller”). Pursuant to the terms of the SPA, on the Closing Date, the Seller sold all of BLF’s outstanding
capital stock, or 1,500 shares (the “Shares”) of common stock, to the Company.
On
the Closing Date, the Company paid the Seller $50,000 net of the aggregate amount of any pre-closing liabilities or obligations
of BLF (other than the Assumed Company Obligations (as defined in the SPA)) (the “Aggregate Liabilities”)
and the applicable payees thereof, the aggregate amount of the Assumed Company Obligations. Within ten business days from the
date upon which the Company delivers its first invoice for the Product (as defined in the SPA) to a customer, the Company shall
pay the Seller an additional $50,000 net of the Aggregate Liabilities and the applicable payees thereof, the aggregate amount
of the Assumed Company Obligations. In addition, the Company shall pay the Seller earnout payments (the “Earnout Payments”)
in an amount not to exceed $5 million during the period commencing on the Closing Date through the quarter including December
31, 2022 (the “Earnout Period”). During the Earnout Period the Seller shall be entitled to receive a payment for each
fiscal quarter based on the difference of the Operating Income (as defined in the SPA) minus the Earnout Commission (as defined
in the SPA) (the “Difference”). If the Difference is a positive number for the applicable fiscal quarter, the Earnout
Payment for such fiscal quarter shall equal the amount of the Earnout Commission. If the Difference is equal to zero or a negative
number for the applicable fiscal quarter, the Earnout Payment for such fiscal quarter shall be equal to the Operating Income.
During the Earnout Period, the Seller shall be entitled to receive any portion of the Earnout Commission that was excluded from
any prior Earnout Payment based on the Difference in the applicable fiscal quarter being a negative number (the “Catch-up
Payments”); provided, however, no Catch-up Payment shall be payable following the date on which the final Earnout Payment
is made for the last fiscal quarter in the Earnout Period.
Pursuant
to the terms of the SPA, prior to the six month anniversary of the Closing Date, the Company shall fund BLF in an amount of up
to $500,000. As a condition to closing, on the Closing Date, all officers and directors of BLF resigned from their positions with
BLF. In addition, in connection with the SPA, on the Closing Date, BLF entered into an employment agreement with the Seller whereby
the Seller will serve as the President of BLF.
The
foregoing description of the SPA does not purport to be complete and is subject to, and qualified in its entirety by reference
to the full text of the SPA, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item
2.01 Completion of Acquisition or Disposition of Assets.
Reference
is made to the disclosure under Item 1.01 above which is hereby incorporated in this Item 2.01 by reference.
Item
8.01 Other Events.
On
April 26, 2019, the Company issued a press release announcing the acquisition of BLF. A copy of the press release is attached
hereto as Exhibit 99.1 and is incorporated herein by reference.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
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Verus
International, Inc.
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Dated:
April 26, 2019
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/s/
Anshu Bhatnagar
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Anshu
Bhatnagar
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Chief
Executive Officer
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Verus (CE) (USOTC:VRUS)
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