Current Report Filing (8-k)
November 04 2019 - 7:01AM
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): October 30, 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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Securities
registered pursuant to Section 12(b) of the Act: None.
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
October 30, 2019 (the “Closing Date”), Verus International, Inc. (the “Company”) entered into a Contribution
and Sale Agreement (the “Agreement”) with Nutribrands Holdings, LLC, a wholly-owned subsidiary of the Company (“Nutribrands
Holdings”), South Enterprise, LLC (“South Enterprise”), the members of South Enterprise (the “SE Members”),
Nutribrands, LTDA (“Nutribrands” and together with South Enterprise, the “Companies” and each individually,
a “Company”) and the equity holders of Nutribrands (the “NB Equity Holders” and together with the SE Members,
the “Sellers”) and Rodrigo Nogueira, solely in his capacity as the Seller’s representative. Pursuant to the
terms of the Agreement, on the Closing Date, the Sellers contributed all of their limited liability interests and equity interests
(collectively, the “Interests”) in South Enterprise and Nutribrands, respectively, to Nutribrands Holdings in exchange
for 49% of the membership interests of Nutribrand Holdings (the “Nutribrand Holdings Membership Interests”). Pursuant
to the terms of the Agreement, until the five year anniversary of the Closing Date, the Companies may request that Nutribrands
Holdings make available, Working Capital (as defined in the Agreement) for Qualified Transactions (as defined in the Agreement).
Of such Working Capital, $1 million may be used by the Sellers for certain transaction fees. Furthermore, the Company has agreed
to provide certain Working Capital Financing (as defined in the Agreement) for Qualified Transactions, and to the extent that
the Company does not provide such Working Capital Financing and fails to fund the Qualified Transactions, the Sellers shall
have the right to terminate the Agreement and the Holdings LLC Agreement (as defined in the Agreement). Moreover, upon the expiration
of the Measurement Period (as defined the Agreement), if the Companies fail to meet or exceed the Projections (as defined in the
Agreement) with respect to the end of the Measurement Period, Nutribrands Holdings shall have the right to redeem or the
Company shall have the right to acquire, and the Sellers shall have the obligation to transfer, pursuant to the Holdings LLC Agreement,
the Nutribrands Holdings Membership Interests having an aggregate value (based on the value assigned to such interests on the
Closing Date) equal to the amount of the shortfall of the actual revenue of the Company for the trailing 12 month period ending
on the fifth anniversary of the Closing Date and the projected revenue for such trailing 12 month period included in the Projections.
Furthermore, pursuant to the Agreement, beginning one year after the Closing Date, until the five-year anniversary thereof, the
Sellers shall have the opportunity to receive an annual dividend of up to $4.5 million per year based upon the cumulative consolidated
financial performance of the Companies; provided, however, such dividend shall not exceed an aggregate of $18 million.
The
foregoing description of the Agreement does not purport to be complete and is subject to, and qualified in its entirety by reference
to the full text of the Agreement, 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
November 4 2019, the Company issued a press release announcing the acquisition of the Companies. 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.
(a)
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Financial
Statements of businesses acquired.
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In
accordance with Item 9.01(a)(4) of Form 8-K the financial statements required under this Item 9.01 will be filed by amendment
to this Current Report on Form 8-K no later than 75 days after the completion of the acquisition.
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(b)
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Pro
forma financial information.
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In
accordance with Item 9.01(b)(2) of Form 8-K the financial statements required under this Item 9.01 will be filed by amendment
to this Current Report on Form 8-K no later than 75 days after the completion of the acquisition.
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(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:
November 4, 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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