Item
1.01 Entry into a Material Definitive Agreement.
Contribution
and Spin-off Announcement:
On
October 27, 2017, RealBiz Media Group, Inc. (“RealBiz” or the “Company”) announced the execution of a
definitive agreement to spin-off the real estate division into a separate public company. The new entity will be called NestBuilder.com
Corp. (“NestBuilder”) and all stockholders of record at the time of the spin-off will receive an equivalent stock
position in the newly formed digital real estate company. The date of the spin-off will be determined following a declaration
of effectiveness by the Securities and Exchange Commission.
Under
terms of the agreement, all liabilities incurred by RealBiz prior to January 2, 2017 will be assumed by NestBuilder, leaving Verus
Foods in an excellent position to pursue its expansion plans in its global food business. As previously communicated, Alex Aliksanyan
has exclusive control and direction of the legacy Monaker lawsuits in his capacity as CEO of NestBuilder. In addition, NestBuilder
has agreed to indemnify, defend, and hold harmless RealBiz from and against all damages, costs and expenses arising out of or
resulting from the Monaker Lawsuits.
In
conjunction with these changes, Mr. Alex Aliksanyan and Mr. Tom Grbelja will leave the employ of RealBiz to become the CEO and
CFO, respectively, of NestBuilder. Concurrent with these actions, RealBiz will change its name to Verus Foods and also apply for
a new stock trading symbol. The company will apply for these changes as soon as possible and will update shareholders as execution
dates become available.
The
foregoing summary of the terms of the Contribution and Spin-off Agreement and the note are subject to, and qualified in their
entirety by, such documents attached hereto as Exhibit 10.1 and 10.2.
Securities
Purchase Agreement:
On
October 24, 2017, the Company entered into securities purchase agreements (the “Purchase Agreements”) with Crossover
Capital Fund I, LLC and Crossover Capital Fund II, LLC for the sale of $107,500 convertible note (the “Notes”), respectively.
The
Notes were issued with $7,500 original issue discounts and are due and payable on July 24, 2018. The Notes will accrue interest
at the rate of 9% per annum, unless an Event of Default (as defined in the notes) occurs, in which the Notes will accrue interest
at the rate of 18% per annum.
The
Notes shall be convertible into a number of shares of Company common stock (“Common Stock”) and are convertible beginning
on the 180
th
day following the date of issuance of the Notes. The conversion price (the “Conversion Price”)
of the Notes shall be 61% of the Market Price, defined as the average of the lowest three (3) trading prices for the Common Stock
during the fifteen (15) trading day period ending on the latest complete trading day prior to the date of conversion. The Conversion
Price is subject to adjustments as set forth in the Notes.
The
Company has the right to prepay the Notes within the 180 day period following the date of issuance of the Notes at certain prepayment
premiums ranging from 115% to 140% of the then outstanding principal and interest on the Notes.
In
connection with the sale of the Notes, the Company relied upon the exemption from registration provided by Section 4(a)(2) under
the Securities Act of 1933, as amended, for transactions not involving a public offering.
The
foregoing summary of the terms of the Purchase Agreement and the Notes are subject to, and qualified in their entirety by, such
documents attached hereto as Exhibit 10.3, 10.4, 10.5 and 10.6, respectively.
Items
2.03 and 3.02: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant;
and Unregistered Sales of Equity Securities.
The
information provided in response to Item 1.01 of this report is incorporated by reference into Items 2.03 and 3.02.