Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jul. 31, 2018 | Sep. 21, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | REALBIZ MEDIA GROUP, INC | |
Entity Central Index Key | 1,430,523 | |
Document Type | 10-Q | |
Document Period End Date | Jul. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --10-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 1,500,000,000 | |
Trading Symbol | RBIZ | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jul. 31, 2018 | Oct. 31, 2017 |
Current Assets | ||
Cash | $ 136,475 | $ 251,301 |
Accounts receivable, net | 1,127,655 | 812,748 |
Inventory | 59,636 | 341,188 |
Prepaid expenses | 95,955 | |
Other assets | 8,629 | 16,621 |
Assets of discontinued operations | 122,144 | 41,674 |
Total Current Assets | 1,550,494 | 1,463,532 |
Current Liabilities | ||
Accounts payable and accrued expenses | 608,270 | 834,591 |
Interest payable | 127,782 | 22,560 |
Due to officer | 33,301 | 33,301 |
Note payable | 530,000 | |
Convertible notes payable, net | 1,349,618 | 975,250 |
Liabilities of discontinued operations | 109,883 | 396,407 |
Total Current Liabilities | 2,758,855 | 2,262,109 |
Commitments and Contingencies (Note 7) | ||
Stockholders' Deficit | ||
Common stock, $0.001 par value; 1,500,000,000 shares authorized and 1,500,000,000 and 249,369,810 shares issued and outstanding at July 31, 2018 and October 31, 2017, respectively | 1,500,000 | 249,370 |
Additional paid-in-capital | 22,246,056 | 22,409,041 |
Accumulated other comprehensive loss | 19,639 | (53,285) |
Accumulated deficit | (25,018,786) | (23,403,963) |
Total Stockholders' Deficit | (1,208,361) | (798,577) |
Total Liabilities and Stockholders' Deficit | 1,550,494 | 1,463,532 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | 44,570 | 100 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | ||
Series C Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | $ 160 | $ 160 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jul. 31, 2018 | Oct. 31, 2017 |
Convertible Preferred Stock, par value | $ 0.001 | |
Convertible Preferred Stock, shares authorized | 125,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued | 1,500,000,000 | 249,369,810 |
Common stock, shares outstanding | 1,500,000,000 | 249,369,810 |
Series A Convertible Preferred Stock [Member] | ||
Convertible Preferred Stock, par value | $ 0.001 | $ 0.001 |
Convertible Preferred Stock, shares authorized | 120,000,000 | 120,000,000 |
Convertible Preferred Stock, shares issued | 44,570,101 | 100,000 |
Convertible Preferred Stock, shares outstanding | 44,570,101 | 100,000 |
Series B Convertible Preferred Stock [Member] | ||
Convertible Preferred Stock, par value | $ 0.001 | $ 0.001 |
Convertible Preferred Stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible Preferred Stock, shares issued | ||
Convertible Preferred Stock, shares outstanding | ||
Series C Convertible Preferred Stock [Member] | ||
Convertible Preferred Stock, par value | $ 0.001 | $ 0.001 |
Convertible Preferred Stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible Preferred Stock, shares issued | 160,000 | 160,000 |
Convertible Preferred Stock, shares outstanding | 160,000 | 160,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | |
Income Statement [Abstract] | ||||
Revenue | $ 1,371,445 | $ 1,048,576 | $ 3,605,889 | $ 2,033,644 |
Cost of revenue | 1,147,231 | 827,161 | 3,112,002 | 1,769,302 |
Gross Profit | 224,214 | 221,415 | 493,887 | 264,342 |
Operating Expenses: | ||||
Salaries and benefits | 55,347 | 161,954 | 382,437 | 834,283 |
Selling and promotions expense | 965 | |||
Legal and professional fees | 44,215 | 138,876 | 251,061 | 378,233 |
General and administrative | 236,669 | 109,683 | 465,547 | 192,128 |
Total Operating Expenses | 336,231 | 410,513 | 1,099,045 | 1,405,609 |
Operating (loss) income | (112,017) | (189,098) | (605,158) | (1,141,267) |
Other Income (Expense): | ||||
Interest expense | (98,743) | (9,221) | (178,079) | (97,603) |
Other income (expense) | 92,577 | (259,276) | (23,716) | |
Default principal increase on convertible notes payable | (793,327) | (793,327) | ||
Total Other Income (Expense) | (799,493) | (9,221) | (1,230,682) | (121,319) |
Loss from continuing operations before income taxes | (911,510) | (198,319) | (1,835,841) | (1,262,586) |
Income taxes | ||||
Loss from continuing operations | (911,510) | (198,319) | (1,835,841) | (1,262,586) |
Discontinued operations (Note 8) | ||||
Income (loss) from discontinued operations | 152,422 | 38,032 | 259,186 | (4,132) |
Net loss | (759,088) | (160,287) | (1,576,655) | (1,266,718) |
Comprehensive income (loss): | ||||
Unrealized gain (loss) on currency translation adjustment | 48,148 | (6,344) | 72,924 | 32,039 |
Comprehensive loss | $ (710,940) | $ (166,631) | $ (1,503,730) | $ (1,234,679) |
Earnings (loss) per common share: | ||||
Loss from continuing operations per common share - basic and diluted | $ 0 | $ 0 | $ 0 | $ (0.01) |
Earnings (loss) from discontinued operations per common share - basic and diluted | 0 | 0 | 0 | 0 |
Loss per common share - basic and diluted | $ 0 | $ 0 | $ 0 | $ (0.01) |
Weighted average shares outstanding - basic and diluted | 827,585,586 | 241,651,943 | 486,333,398 | 224,918,972 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Cash flows from operating activities: | ||
Net loss from continuing operations | $ (1,835,841) | $ (1,262,586) |
Net income (loss) from discontinued operations | 259,186 | (4,132) |
Adjustments to reconcile net loss to net cash from operating activities: | ||
Loss on settlement of accounts payable and convertible debt | 259,276 | 23,716 |
Amortization and depreciation | 10,311 | |
Amortization of debt discount | 15,000 | 61,603 |
Legal settlement settled in shares | 330,180 | |
Gain on NestBuilder settlement | 116,136 | |
Gain on Gulf Agro transaction | 119,106 | |
Default principal increase on convertible notes payable | 793,327 | |
Stock-based compensation | 626,469 | |
Changes in operating assets and liabilities: | ||
Increase in accounts receivable | (305,488) | (619,463) |
Increase in prepaid expenses | (99,255) | |
Decrease (Increase) in inventory | 281,552 | (125,928) |
Increase in due from former officer | 85,301 | |
Decrease in other assets | (2,011) | (16,620) |
(Decrease) Increase in accounts payable and accrued expenses | (649,892) | 481,240 |
Net cash used in operating activities | (978,000) | (740,090) |
Cash flows from financing activities: | ||
Payments applied to convertible promissory notes | (118,000) | |
Proceeds from issuance of convertible promissory notes | 908,250 | 693,750 |
Net cash provided by financing activities | 790,250 | 794,360 |
Effect of exchange rate on cash and cash equivalents | 72,924 | |
Net (decrease) increase in cash | (114,826) | 54,270 |
Cash at beginning of period | 251,301 | 122,954 |
Cash at end of period | 136,475 | 177,224 |
Supplemental disclosure: | ||
Cash paid for interest | 53,508 | 51,300 |
Series A Convertible Preferred Stock [Member] | ||
Cash flows from financing activities: | ||
Proceeds from issuance of Convertible Preferred Stock | 610 | |
Series C Convertible Preferred Stock [Member] | ||
Cash flows from financing activities: | ||
Proceeds from issuance of Convertible Preferred Stock | 100,000 | |
Settlement of Loans Payable Through Issuance of Series C Convertible Preferred Stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Value | $ 25,000 | |
Shares | 25,000 | |
Settlement of Loans Payable, Accrued Interest and Professional Fees Through Issuance of Common Stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Value | $ 214,205 | $ 1,185,624 |
Shares | 99,517,696 | 69,368,539 |
Settlement of Accrued Compensation Through Issuance of Common Stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Value | $ 267,839 | |
Shares | 21,782,800 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 9 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Basis of Presentation | NOTE 1: NATURE OF BUSINESS AND BASIS OF PRESENTATION Organization and Nature of Business RealBiz Media Group, Inc., including all its subsidiaries, are collectively referred to herein as “RealBiz,” “RBIZ”, “Company,” “us,” or “we”. Through July 31, 2018, RealBiz operated two business segments – food products and real estate. On July 31, 2018, the real estate segment of the Company’s business was spun-off into a separate public company (see Note 8). As an international supplier of consumer food products, we market under our own brand primarily to supermarkets, hotels, and other members of the wholesale trade, offering frozen foods, particularly meat, poultry, seafood, vegetables, french fries, and beverages. We have a significant regional presence in the Middle East and North Africa (“MENA”) and sub-Saharan Africa (excluding Office of Foreign Assets Control (“OFAC”) restricted nations), with deep roots in the Gulf Cooperation Council (“GCC”) countries, which includes the United Arab Emirates (“UAE”), Oman, Bahrain, Qatar, Kingdom of Saudi Arabia and Kuwait. Basis of Presentation The unaudited interim consolidated financial information furnished herein reflects all adjustments, consisting only of normal recurring items, which in the opinion of management, are necessary to fairly state the Company’s financial position, results of operations and cash flows for the dates and periods presented and to make such information not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been omitted pursuant to rules and regulations of the Securities and Exchange Commission (the “SEC”); nevertheless, management of the Company believes that the disclosures herein are adequate to make the information presented not misleading. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended October 31, 2017, contained in the Company’s Annual Report on Form 10-K filed with the SEC on March 26, 2018. The results of operations for the nine months ended July 31, 2018, are not necessarily indicative of results to be expected for any other interim period or the fiscal year ending October 31, 2018. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Jul. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of unaudited consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. Significant estimates include the collectability of accounts receivable, stock-based compensation and the deferred tax asset valuation allowance. Reclassifications Certain reclassifications have been made to prior year’s consolidated financial statements to enhance comparability with the current year’s consolidated financial statements, including but not limited to presenting the spin-off of the real estate segment as discontinued operations for all periods presented. Concentrations of Credit Risk The Company’s food products accounts receivable, net and revenues are geographically concentrated with customers located in the GCC countries. In addition, significant concentrations exist with a limited number of customers. If demand for the Company’s products from these customers decreases, there may be an adverse effect on the Company’s consolidated results of operations and financial position. The Company purchases substantially all of its food products from a limited number of regions around the world or from a limited number of suppliers. The Company’s consolidated results of operations and financial position may be materially and adversely affected if there are significant price increases for these food products, the Company has difficulty obtaining these food products, or the quality of available food products deteriorates. For periods in which the prices of these food products are rising, the Company may be unable to pass on the increased cost to the Company’s customers, which would result in decreased margins. For periods in which the prices are declining, the Company may be required to write down its inventory carrying cost which, depending on the extent of the differences between market price and carrying cost, could have a material adverse effect on the Company’s consolidated results of operations and financial position. Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at July 31, 2018 and October 31, 2017. Marketable securities In January 2018, as part of the legal settlement with Monaker Group, Inc. (“Monaker”), NestBuilder received Monaker common shares valued at $32,270, which we have classified as “available for sale” securities. Pursuant to Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses and such losses traditionally have been within its expectations. At July 31, 2018, the Company determined there was no requirement for an allowance for doubtful accounts. At October 31, 2017, the allowance for doubtful accounts was $45,933. Inventory Inventory is stated at the lower of net realizable value, determined on the first-in, first-out basis, or cost. Net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion and transportation. Convertible Debt Instruments The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”). The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt. Fair Value of Financial Instruments The Company has adopted ASC topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), formerly SFAS No. 157 “Fair Value Measurements”. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also describes three levels of inputs that may be used to measure fair value: Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. Financial instruments consist principally of cash, marketable securities, accounts receivable, prepaid expenses, due from affiliates, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature. The fair value of long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. Revenue Recognition The Company recognizes revenue when all of the following criteria are met: (1) persuasive evidence an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the Company’s price to its customer is fixed or determinable and (4) collectability is reasonably assured. Share-Based Compensation The Company computes share based payments in accordance with ASC 718-10, Compensation Equity Based Payments to Non-Employees Foreign Currency Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates and profit and loss accounts have been translated using average exchange rates. Foreign currency translation gains and losses are included in the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) as a component of accumulated other comprehensive loss. Assets and liabilities of an entity that are denominated in currencies other than an entity’s functional currency are re-measured into the functional currency using end of period exchange rates or historical rates, where applicable to certain balances. Gains and losses related to these re-measurements are recorded within the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) as a component of Other Income (Expense). Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2017, 2016 and 2015 tax years may be selected for examination by the taxing authorities as the statute of limitations remains open. The Company recognizes expenses for tax penalties and interest assessed by the Internal Revenue Service and other taxing authorities upon receiving valid notice of assessments. The Company has received no such notices for the tax years ended October 31, 2017 and 2016. Earnings Per Share In accordance with the provisions of FASB ASC Topic 260, Earnings per Share In computing diluted EPS, only potential common shares that are dilutive, those that reduce EPS or increase loss per share, are included. The effect of contingently issuable shares are not included if the result would be anti-dilutive, such as when a net loss is reported. Therefore, basic and diluted EPS are computed using the same number of weighted average shares for the three and nine months ended July 31, 2018 and July 31, 2017 as we incurred a net loss for those periods. At July 31, 2018, there were outstanding warrants to purchase up to 17,786,467 shares of the Company’s common stock and approximately 369 million shares of the Company’s common stock which may dilute future EPS as a result of conversions of outstanding convertible promissory notes. Concentrations, Risks and Uncertainties The Company’s ongoing operations are related to the international food industries, and its prospects for success are tied indirectly to interest rates and the worldwide demand for the Company’s food products. Recently Issued Accounting Standards Not Yet Adopted In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which deferred the effective date of ASU 2014-09 for all entities by one year. This update is effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. ASU 2014-09 becomes effective for us beginning November 1, 2018, which is when we plan to adopt this standard. The ASU permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). The ASU also requires expanded disclosures relating to the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Additionally, qualitative and quantitative disclosures are required for customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. The Company is currently evaluating the impact of adopting ASU 2015-14 on the Company’s financial position, results of operations and cash flows. In February 2016, the FASB issued ASU 2016-02, Leases Revenue Recognition Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842) In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business Business Combinations (Topic 805) – Clarifying the Definition of a Business In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting Compensation—Stock Compensation Compensation—Stock Compensation (Topic 718)—Scope of Modification Accounting Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying unaudited consolidated financial statements. |
Going Concern
Going Concern | 9 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 3: GOING CONCERN The accompanying unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company incurred a net loss of $1,576,655 for the nine months ended July 31, 2018. At July 31, 2018, the Company had a working capital deficit of $1,208,361, net cash used in operations of $978,000, and an accumulated deficit of $25,018,786. It is management’s opinion that these facts raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the date of this filing, without additional debt or equity financing. The unaudited consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts nor to the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. In order to meet its working capital needs through the next twelve months and to fund the growth of the food business, the Company may consider plans to raise additional funds through the issuance of additional shares of common or preferred stock and/or through the issuance of debt instruments. Although the Company intends to obtain additional financing to meet its cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Jul. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 4: Segment reporting Through July 31, 2018, the Company had two reportable segments: real estate and food products. On July 31, 2018, the real estate segment was spun-off into a separate public company, leaving the Company with only the food products segment (see Note 8). |
Convertible Notes Payable
Convertible Notes Payable | 9 Months Ended |
Jul. 31, 2018 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | NOTE 5: CONVERTIBLE NOTES PAYABLE The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB ASC. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt. At July 31, 2018 and October 31, 2017, there was $1,349,618 and $975,250 of convertible notes payable outstanding, respectively, net of discounts of $7,500 and $15,000, respectively. Additionally, at July 31, 2018, the Company was in default with respect to certain convertible notes as a result of not having sufficient shares of common stock available for issuance upon the conversion of such notes and certain cross-default provisions. The default provisions include 1) default interest rates ranging from 18% to 24% per annum, 2) daily fixed dollar penalties, and 3) an increase in the total amount due calculated by multiplying the aggregate of the then outstanding principal amount of the note, together with accrued and unpaid interest thereon, plus default interest and fixed dollar penalties by 200%. As of July 31, 2018, the principal amount of the notes together with interest accrued thereon and penalties totaled $855,398, consisting of $793,327 of default principal and $62,071 of default interest. On December 21, 2017, the Company issued EMA Financial, LLC (“EMA”) a convertible note in the principal amount of $100,000 (the “EMA Note 2”). The EMA Note 2 accrues interest at a rate of 8% per annum and matures on December 21, 2018. Pursuant to the terms of the EMA Note 2, the Company may prepay the principal amount of the note together with accrued interest at any time on or prior to June 19, 2018 , subject to certain prepayment penalties. Pursuant to the terms of the EMA Note 2, the outstanding principal and accrued interest on the EMA Note 2 are convertible into shares of the Company’s common stock at the lower of: (i) the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date of such note, and (ii) 60% of either the lowest sale price for the common stock on the principal market during the fifteen consecutive trading days including and immediately preceding the conversion date, or the closing bid price, whichever is lower; provided, however provided, further that, On December 28, 2017, the Company issued Power Up Lending Group Ltd. (“Power Up”) a convertible note in the principal amount of $53,000 (the “Power Up Note 6”). The Power Up Note 6 accrues interest at a rate of 8% per annum and matures on October 5, 2018. Pursuant to the terms of the Power Up Note 6, the Company may prepay the principal amount of the note together with accrued interest at any time on or prior to June 26, 2018, subject to certain prepayment penalties. Pursuant to the terms of the Power Up Note 6, the outstanding principal and accrued interest of the Power Up Note 6 are convertible into shares of the Company’s common stock at a discount rate of 39% of the average of the lowest three trading prices for the Company’s common stock during the fifteen trading day period ending on the latest complete trading day prior to the conversion date. On January 26, 2018, the Company issued the Donald P. Monaco Insurance Trust a promissory note in the principal amount of $530,000 (the “Monaco Note”). The Monaco Note accrues interest at a rate of 12% per annum and matures on January 26, 2019. Pursuant to the terms of the Monaco Note, the Company may prepay the principal amount of the note together with accrued interest at any time prior to the date of maturity without a prepayment penalty. Pursuant to the terms of the Monaco Note, the outstanding principal and accrued interest of the Monaco Note are not convertible into shares of the Company’s common stock; provided, however, upon the Company’s failure to pay the obligations set forth in the Monaco Note on the maturity date, the holder may convert the Monaco Note into shares of the Company’s common stock at a conversion price equal to the lowest closing price of the Company’s common stock during the fifteen trading days prior to the date the holder gives notice of the default to the Company. On June 5, 2018, the Company issued Power Up a convertible note in the principal amount of $35,000 (the “Power Up Note 7”). The Power Up Note 7 accrues interest at a rate of 8% per annum and matures on March 30, 2019. Pursuant to the terms of the Power Up Note 7, the Company may prepay the principal amount of the note together with accrued interest at any time on or prior to December 2, 2018, subject to certain prepayment penalties. Pursuant to the terms of the Power Up Note 7, the outstanding principal and accrued interest of the Power Up Note 7 are convertible into shares of the Company’s common stock at a discount rate of 39% of the average of the lowest three trading prices for the Company’s common stock during the fifteen trading day period ending on the latest complete trading day prior to the conversion date. On July 5, 2018, the Company issued Power Up a convertible note in the principal amount of $53,000 (the “Power Up Note 8”). The Power Up Note 8 accrues interest at a rate of 8% per annum and matures on April 30, 2019. Pursuant to the terms of the Power Up Note 8, the Company may prepay the principal amount of the note together with accrued interest at any time on or prior to January 1, 2019, subject to certain prepayment penalties. Pursuant to the terms of the Power Up Note 8, the outstanding principal and accrued interest of the Power Up Note 8 are convertible into shares of the Company’s common stock at a discount rate of 42% of the average of the lowest two trading prices for the Company’s common stock during the fifteen trading day period ending on the latest complete trading day prior to the conversion date. On July 26, 2018, the Company issued Actus Fund, LLC (“Actus”) a convertible note in the principal amount of $137,250 (the “Actus Note 2”). The Actus Note 2 accrues interest at a rate of 8% per annum and matures on April 18, 2019. Pursuant to the terms of the Actus Note 2, the Company may prepay the principal amount of the note together with accrued interest at any time on or prior to January 22, 2019, subject to certain prepayment penalties. Pursuant to the terms of the Actus Note 2, the outstanding principal and accrued interest of the Actus Note 2 are convertible into shares of the Company’s common stock at a discount rate of 40% of the lowest trading price during the previous twenty-five trading day period ending on the latest complete trading day prior to the conversion date. During the three months ended July 31, 2018, holders of convertible notes converted an aggregate of $545,547 of outstanding principal, $31,184 of accrued interest and $11,500 of associated professional fees into an aggregate of 1,145,215,919 shares of the Company’s common stock. During the nine months ended July 31, 2018, the Company made a payment of $57,952 to Power Up to prepay the Power Up Note 3, which included a principal payment of $40,000 and an interest payment together with prepayment penalties of $17,952. |
Stockholders' Deficit
Stockholders' Deficit | 9 Months Ended |
Jul. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Deficit | NOTE 6: STOCKHOLDERS’ DEFICIT The total number of shares of all classes of stock that the Company shall have the authority to issue is 1,625,000,000 shares consisting of 1,500,000,000 shares of common stock with a $0.001 par value per shares; of which 1,500,000,000 are outstanding at July 31, 2018 and 125,000,000 shares of preferred stock, par value $0.001 per share of which (A) 120,000,000 shares have been designated as Series A Convertible Preferred of which 44,570,101 are outstanding at July 31, 2018, (B) 1,000,000 shares have been designated as Series B Convertible Preferred Stock, of which no shares are outstanding at July 31, 2018 and (C) 1,000,000 have been designated as Series C Convertible Preferred Stock, of which 160,000 shares are outstanding at July 31, 2018. At July 31, 2018, the Company does not have any shares of common stock available for issuance, which triggered a default on certain convertible notes payable (see Note 5). Common Stock During the nine months ended July 31, 2018, holders of convertible notes converted an aggregate of $767,209 principal, $43,977 of accrued interest and $16,250 of associated professional fees into an aggregate of 1,248,092,927 shares of the Company’s common stock. On January 29, 2018, the Company settled litigation with NestBuilder which resulted in the return and cancellation of 4,163,315 shares of the Company’s common stock on February 2, 2018. As of July 31, 2018, there were warrants to purchase up to 17,786,467 shares of the Company’s common stock outstanding and approximately 369 million shares of the Company’s common stock which may dilute future EPS as a result of conversions of outstanding convertible promissory notes. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jul. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 7: COMMITMENTS AND CONTINGENCIES In October 2017, we announced the execution of a definitive agreement that included significant contingencies to spin-off the real estate segment into a separate public company named NestBuilder. On July 31, 2018, all contingencies were met and all stockholders of record received, on a pro-rata basis, 1 share of NestBuilder for every 900 shares of the Company held in connection with the spin-off. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Jul. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | NOTE 8: DISCONTINUED OPERATIONS Through July 31, 2018, we operated a real estate segment which generated revenue from service fees (video creation and production and website hosting (ReachFactor)) and product sales (Nestbuilder Agent 2.0 and Microvideo app). The real estate segment was formed through the merging of three divisions: (i) our fully licensed real estate division (formerly known as Webdigs); (ii) our TV media contracts (Home Preview Channel /Extraordinary Vacation Homes) division; and (iii) our Real Estate Virtual Tour and Media group (RealBiz 360). The assets of these divisions were used to create a new suite of real estate products and services that created stickiness through the utilization of video, social media and loyalty programs. At the core of our programs was our proprietary video creation technology which allowed for an automated conversion of data (text and pictures of home listings) to a video with voice and music. We provided video search, storage and marketing capabilities on multiple platform dynamics for web, mobile and TV. Once a home, personal or community video was created using our proprietary technology, it could be published to social media, email or distributed to multiple real estate websites, broadband or television for consumer viewing. As a result of the spin-off of the real estate segment, all related assets and liabilities are disclosed net as current assets and current liabilities within the consolidated balance sheets, and all related income and expenses are disclosed net as income (loss) from discontinued operations within the consolidated statements of operations and comprehensive income (loss). The assets and liabilities associated with discontinued operations included in our Consolidated Balance Sheet were as follows: July 31, 2018 October 31, 2017 (Unaudited) Discontinued Continuing Total Discontinued Continuing Total Assets Current Assets Cash $ 80,969 $ 136,475 $ 217,444 $ 28,810 $ 251,301 $ 280,111 Marketable securities 27,727 — 27,727 — — — Accounts receivable, net 146 1,127,655 1,127,801 9,564 812,748 822,312 Inventory — 59,636 59,636 — 341,188 341,188 Prepaid expenses 3,300 95,955 99,255 3,300 — 3,300 Other assets 10,003 8,629 18,632 — 16,621 16,621 Total Current Assets $ 122,144 $ 1,428,350 $ 1,550,494 $ 41,674 $ 1,421,858 $ 1,463,532 Liabilities Current Liabilities Accounts payable and accrued expenses 109,883 608,271 718,154 396,407 834,591 1,230,998 Interest payable — 127,782 127,782 — 22,560 22,560 Due to officer — 33,301 33,301 — 33,301 33,301 Note payable — 530,000 530,000 — — — Convertible notes payable, net — 1,349,618 1,349,618 — 975,250 975,250 Total Current Liabilities $ 109,883 $ 2,648,972 $ 2,758,855 $ 396,407 $ 1,865,702 $ 2,262,109 The revenues and expenses associated with discontinued operations included in our Consolidated Statements of operations were as follows: Three months ended July 31, 2018 2017 Discontinued Continuing Total Discontinued Continuing Total Revenue $ 70,016 $ 1,371,445 $ 1,441,461 $ 106,055 $ 1,048,576 $ 1,154,631 Cost of revenue 17,200 1,147,231 1,164,431 28,320 827,161 855,481 Gross Profit 52,816 224,214 277,030 77,735 221,415 299,150 Operating Expenses: Salaries and benefits 23,482 55,347 78,829 35,187 161,954 197,141 Selling and promotions expense 26 - 26 1,301 - 1,301 Legal and professional fees 6,550 44,215 50,765 400 138,876 139,276 General and administrative 29,739 236,669 266,409 2,291 109,683 111,974 Total Operating Expenses 59,798 336,231 396,029 39,179 410,513 449,692 Operating (loss) income (6,982 ) (112,017 ) (118,999 ) 38,556 (189,098 ) (150,542 ) Other Income (Expense): Interest expense (429 ) (98,743 ) (99,172 ) (524 ) (9,221 ) (9,745 ) Other income (expense) 159,832 92,577 252,409 - - - Default principal increase on convertible notes payable - (793,327 ) (793,327 ) - - - Total Other Income (Expense) 159,403 (799,493 ) (640,089 ) (524 ) (9,221 ) (9,745 ) Income (loss) before income taxes 152,422 (911,510 ) (759,088 ) 38,032 (198,319 ) (160,287 ) Income taxes - - - - - - Net income (loss) $ 152,422 $ (911,510 ) $ (759,088 ) $ 38,032 $ (198,319 ) $ (160,287 ) Nine months ended July 31, 2018 2017 Discontinued Continuing Total Discontinued Continuing Total Revenue $ 216,316 $ 3,605,889 $ 3,822,204 $ 299,982 $ 2,033,644 $ 2,333,626 Cost of revenue 56,800 3,112,002 3,168,802 120,402 1,769,302 1,889,704 Gross Profit 159,516 493,887 653,403 179,580 264,342 443,922 Operating Expenses: Salaries and benefits 82,326 382,437 464,763 141,123 834,283 975,406 Selling and promotions expense 824 - 824 5,494 965 6,459 Legal and professional fees 82,999 251,061 334,060 20,154 378,233 398,387 General and administrative 71,714 465,547 537,261 16,181 192,128 208,309 Total Operating Expenses 237,863 1,099,045 1,336,908 182,952 1,405,609 1,588,561 Operating (loss) income (78,347 ) (605,158 ) (683,506 ) (3,372 ) (1,141,267 ) (1,144,639 ) Other Income (Expense): Interest expense (1,322 ) (178,079 ) (179,401 ) (760 ) (97,603 ) (98,363 ) Other income (expense) 338,855 (259,276 ) 79,579 - (23,716 ) (23,716 ) Default principal increase on convertible notes payable - (793,327 ) (793,327 ) - - - Total Other Income (Expense) 337,533 (1,230,682 ) (893,149 ) (760 ) (121,319 ) (122,079 ) Income (loss) before income taxes 259,186 (1,835,841 ) (1,576,655 ) (4,132 ) (1,262,586 ) (1,266,718 ) Income taxes - - - - - Net income (loss) $ 259,186 $ (1,835,841 ) $ (1,576,655 ) $ (4,132 ) $ (1,262,586 ) $ (1,266,718 ) |
Business Divestiture
Business Divestiture | 9 Months Ended |
Jul. 31, 2018 | |
Business Divestiture | |
Business Divestiture | NOTE 9: BUSINESS DIVESTITURE Effective May 1, 2018, Verus Foods MENA Limited (“Verus MENA”) sold its 25% common stock ownership in Gulf Agro Trading, LLC (“Gulf Agro”) to Verus Middle East General Trading, LLC (“VME”). As VME is a new legal entity, in consideration of its 25% common stock ownership in Gulf Agro, VME was assigned all contracts executed during a specified period of time including all future related revenue, in addition to retaining certain receivables and inventory which were previously paid to or belonged to Gulf Agro, and the forgiveness of $119,106 of payables, which resulted in a gain of $119,106 and is reflected within the other income (expense) section of our unaudited consolidated statements of operations and comprehensive income (loss). All remaining liabilities of Gulf Agro remained with Gulf Agro. This transaction benefited VME by providing VME with a broader license for product distribution, forgiveness of $119,106 of payables resulting in the aforementioned gain, and full control of all intellectual property rights. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Jul. 31, 2018 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of unaudited consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. Significant estimates include the collectability of accounts receivable, stock-based compensation and the deferred tax asset valuation allowance. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior year’s consolidated financial statements to enhance comparability with the current year’s consolidated financial statements, including but not limited to presenting the spin-off of the real estate segment as discontinued operations for all periods presented. |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company’s food products accounts receivable, net and revenues are geographically concentrated with customers located in the GCC countries. In addition, significant concentrations exist with a limited number of customers. If demand for the Company’s products from these customers decreases, there may be an adverse effect on the Company’s consolidated results of operations and financial position. The Company purchases substantially all of its food products from a limited number of regions around the world or from a limited number of suppliers. The Company’s consolidated results of operations and financial position may be materially and adversely affected if there are significant price increases for these food products, the Company has difficulty obtaining these food products, or the quality of available food products deteriorates. For periods in which the prices of these food products are rising, the Company may be unable to pass on the increased cost to the Company’s customers, which would result in decreased margins. For periods in which the prices are declining, the Company may be required to write down its inventory carrying cost which, depending on the extent of the differences between market price and carrying cost, could have a material adverse effect on the Company’s consolidated results of operations and financial position. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at July 31, 2018 and October 31, 2017. |
Marketable Securities | Marketable securities In January 2018, as part of the legal settlement with Monaker Group, Inc. (“Monaker”), NestBuilder received Monaker common shares valued at $32,270, which we have classified as “available for sale” securities. Pursuant to Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities |
Accounts Receivable | Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses and such losses traditionally have been within its expectations. At July 31, 2018, the Company determined there was no requirement for an allowance for doubtful accounts. At October 31, 2017, the allowance for doubtful accounts was $45,933. |
Inventory | Inventory Inventory is stated at the lower of net realizable value, determined on the first-in, first-out basis, or cost. Net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion and transportation. |
Convertible Debt Instruments | Convertible Debt Instruments The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”). The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company has adopted ASC topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), formerly SFAS No. 157 “Fair Value Measurements”. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also describes three levels of inputs that may be used to measure fair value: Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. Financial instruments consist principally of cash, marketable securities, accounts receivable, prepaid expenses, due from affiliates, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature. The fair value of long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when all of the following criteria are met: (1) persuasive evidence an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the Company’s price to its customer is fixed or determinable and (4) collectability is reasonably assured. |
Share-Based Compensation | Share-Based Compensation The Company computes share based payments in accordance with ASC 718-10, Compensation Equity Based Payments to Non-Employees |
Foreign Currency | Foreign Currency Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates and profit and loss accounts have been translated using average exchange rates. Foreign currency translation gains and losses are included in the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) as a component of accumulated other comprehensive loss. Assets and liabilities of an entity that are denominated in currencies other than an entity’s functional currency are re-measured into the functional currency using end of period exchange rates or historical rates, where applicable to certain balances. Gains and losses related to these re-measurements are recorded within the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) as a component of Other Income (Expense). |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2017, 2016 and 2015 tax years may be selected for examination by the taxing authorities as the statute of limitations remains open. The Company recognizes expenses for tax penalties and interest assessed by the Internal Revenue Service and other taxing authorities upon receiving valid notice of assessments. The Company has received no such notices for the tax years ended October 31, 2017 and 2016. |
Earnings Per Share | Earnings Per Share In accordance with the provisions of FASB ASC Topic 260, Earnings per Share In computing diluted EPS, only potential common shares that are dilutive, those that reduce EPS or increase loss per share, are included. The effect of contingently issuable shares are not included if the result would be anti-dilutive, such as when a net loss is reported. Therefore, basic and diluted EPS are computed using the same number of weighted average shares for the three and nine months ended July 31, 2018 and July 31, 2017 as we incurred a net loss for those periods. At July 31, 2018, there were outstanding warrants to purchase up to 17,786,467 shares of the Company’s common stock and approximately 369 million shares of the Company’s common stock which may dilute future EPS as a result of conversions of outstanding convertible promissory notes. |
Concentrations, Risks and Uncertainties | Concentrations, Risks and Uncertainties The Company’s ongoing operations are related to the international food industries, and its prospects for success are tied indirectly to interest rates and the worldwide demand for the Company’s food products. |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which deferred the effective date of ASU 2014-09 for all entities by one year. This update is effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. ASU 2014-09 becomes effective for us beginning November 1, 2018, which is when we plan to adopt this standard. The ASU permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). The ASU also requires expanded disclosures relating to the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Additionally, qualitative and quantitative disclosures are required for customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. The Company is currently evaluating the impact of adopting ASU 2015-14 on the Company’s financial position, results of operations and cash flows. In February 2016, the FASB issued ASU 2016-02, Leases Revenue Recognition Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842) In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business Business Combinations (Topic 805) – Clarifying the Definition of a Business In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting Compensation—Stock Compensation Compensation—Stock Compensation (Topic 718)—Scope of Modification Accounting Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying unaudited consolidated financial statements. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Jul. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The assets and liabilities associated with discontinued operations included in our Consolidated Balance Sheet were as follows: July 31, 2018 October 31, 2017 (Unaudited) Discontinued Continuing Total Discontinued Continuing Total Assets Current Assets Cash $ 80,969 $ 136,475 $ 217,444 $ 28,810 $ 251,301 $ 280,111 Marketable securities 27,727 — 27,727 — — — Accounts receivable, net 146 1,127,655 1,127,801 9,564 812,748 822,312 Inventory — 59,636 59,636 — 341,188 341,188 Prepaid expenses 3,300 95,955 99,255 3,300 — 3,300 Other assets 10,003 8,629 18,632 — 16,621 16,621 Total Current Assets $ 122,144 $ 1,428,350 $ 1,550,494 $ 41,674 $ 1,421,858 $ 1,463,532 Liabilities Current Liabilities Accounts payable and accrued expenses 109,883 608,271 718,154 396,407 834,591 1,230,998 Interest payable — 127,782 127,782 — 22,560 22,560 Due to officer — 33,301 33,301 — 33,301 33,301 Note payable — 530,000 530,000 — — — Convertible notes payable, net — 1,349,618 1,349,618 — 975,250 975,250 Total Current Liabilities $ 109,883 $ 2,648,972 $ 2,758,855 $ 396,407 $ 1,865,702 $ 2,262,109 The revenues and expenses associated with discontinued operations included in our Consolidated Statements of operations were as follows: Three months ended July 31, 2018 2017 Discontinued Continuing Total Discontinued Continuing Total Revenue $ 70,016 $ 1,371,445 $ 1,441,461 $ 106,055 $ 1,048,576 $ 1,154,631 Cost of revenue 17,200 1,147,231 1,164,431 28,320 827,161 855,481 Gross Profit 52,816 224,214 277,030 77,735 221,415 299,150 Operating Expenses: Salaries and benefits 23,482 55,347 78,829 35,187 161,954 197,141 Selling and promotions expense 26 - 26 1,301 - 1,301 Legal and professional fees 6,550 44,215 50,765 400 138,876 139,276 General and administrative 29,739 236,669 266,409 2,291 109,683 111,974 Total Operating Expenses 59,798 336,231 396,029 39,179 410,513 449,692 Operating (loss) income (6,982 ) (112,017 ) (118,999 ) 38,556 (189,098 ) (150,542 ) Other Income (Expense): Interest expense (429 ) (98,743 ) (99,172 ) (524 ) (9,221 ) (9,745 ) Other income (expense) 159,832 92,577 252,409 - - - Default principal increase on convertible notes payable - (793,327 ) (793,327 ) - - - Total Other Income (Expense) 159,403 (799,493 ) (640,089 ) (524 ) (9,221 ) (9,745 ) Income (loss) before income taxes 152,422 (911,510 ) (759,088 ) 38,032 (198,319 ) (160,287 ) Income taxes - - - - - - Net income (loss) $ 152,422 $ (911,510 ) $ (759,088 ) $ 38,032 $ (198,319 ) $ (160,287 ) Nine months ended July 31, 2018 2017 Discontinued Continuing Total Discontinued Continuing Total Revenue $ 216,316 $ 3,605,889 $ 3,822,204 $ 299,982 $ 2,033,644 $ 2,333,626 Cost of revenue 56,800 3,112,002 3,168,802 120,402 1,769,302 1,889,704 Gross Profit 159,516 493,887 653,403 179,580 264,342 443,922 Operating Expenses: Salaries and benefits 82,326 382,437 464,763 141,123 834,283 975,406 Selling and promotions expense 824 - 824 5,494 965 6,459 Legal and professional fees 82,999 251,061 334,060 20,154 378,233 398,387 General and administrative 71,714 465,547 537,261 16,181 192,128 208,309 Total Operating Expenses 237,863 1,099,045 1,336,908 182,952 1,405,609 1,588,561 Operating (loss) income (78,347 ) (605,158 ) (683,506 ) (3,372 ) (1,141,267 ) (1,144,639 ) Other Income (Expense): Interest expense (1,322 ) (178,079 ) (179,401 ) (760 ) (97,603 ) (98,363 ) Other income (expense) 338,855 (259,276 ) 79,579 - (23,716 ) (23,716 ) Default principal increase on convertible notes payable - (793,327 ) (793,327 ) - - - Total Other Income (Expense) 337,533 (1,230,682 ) (893,149 ) (760 ) (121,319 ) (122,079 ) Income (loss) before income taxes 259,186 (1,835,841 ) (1,576,655 ) (4,132 ) (1,262,586 ) (1,266,718 ) Income taxes - - - - - Net income (loss) $ 259,186 $ (1,835,841 ) $ (1,576,655 ) $ (4,132 ) $ (1,262,586 ) $ (1,266,718 ) |
Nature of Business and Basis 17
Nature of Business and Basis of Presentation (Details Narrative) | 9 Months Ended |
Jul. 31, 2018Segments | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 2 |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 9 Months Ended | ||
Jul. 31, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | |
Cash equivalents | |||
Allowance for doubtful accounts | $ 45,933 | $ 119,106 | |
Number of shares dilute future earnings per share | 369,000,000 | ||
Maximum [Member] | |||
Number of outstanding warrants to purchase shares of common stock | 17,786,467 | ||
Monaker Group, Inc. [Member] | |||
Available for sale securities | $ 32,270 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Oct. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Net loss | $ 759,088 | $ 160,287 | $ 1,576,655 | $ 1,266,718 | |
Working capital deficit | 1,208,361 | 1,208,361 | |||
Net cash used in operations | (978,000) | $ (740,090) | |||
Accumulated deficit | $ 25,018,786 | $ 25,018,786 | $ 23,403,963 |
Segment Reporting (Details Narr
Segment Reporting (Details Narrative) | 9 Months Ended |
Jul. 31, 2018Segments | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | Jul. 26, 2018 | Jul. 05, 2018 | Jun. 05, 2018 | Jan. 26, 2018 | Dec. 28, 2017 | Dec. 21, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Oct. 31, 2017 |
Convertible notes payable outstanding | $ 1,349,618 | $ 1,349,618 | $ 975,250 | ||||||||
Convertible notes payable, discount | 7,500 | $ 7,500 | $ 15,000 | ||||||||
Note interest rate, description | The default provisions include 1) default interest rates ranging from 18% to 24% per annum, 2) daily fixed dollar penalties, and 3) an increase in the total amount due calculated by multiplying the aggregate of the then outstanding principal amount of the note, together with accrued and unpaid interest thereon, plus default interest and fixed dollar penalties by 200%. | ||||||||||
Debt instrument, periodic payment | $ 855,398 | ||||||||||
Debt instrument, periodic payment, principal | 793,327 | ||||||||||
Debt instrument, periodic payment, interest | 62,071 | ||||||||||
Accrued interest | 43,977 | 43,977 | |||||||||
Associated professional fees | 44,215 | $ 138,876 | $ 251,061 | $ 378,233 | |||||||
Debt converted into shares | 1,248,092,927 | ||||||||||
EMA Note 2 [Member] | |||||||||||
Note interest rate | 8.00% | ||||||||||
Convertible note principal amount | $ 100,000 | ||||||||||
Note maturity date | Dec. 21, 2018 | ||||||||||
Common stock conversion percentage | 60.00% | ||||||||||
Debt conversion price per share | $ 0.00001 | ||||||||||
Power Up Note 6 [Member] | |||||||||||
Note interest rate | 8.00% | ||||||||||
Convertible note principal amount | $ 53,000 | ||||||||||
Note maturity date | Oct. 5, 2018 | ||||||||||
Convertible note discount percentage | 39.00% | ||||||||||
Monaco Note [Member] | |||||||||||
Note interest rate | 12.00% | ||||||||||
Convertible note principal amount | $ 530,000 | ||||||||||
Note maturity date | Jan. 26, 2019 | ||||||||||
Power Up Note 7 [Member] | |||||||||||
Note interest rate | 8.00% | ||||||||||
Convertible note principal amount | $ 35,000 | ||||||||||
Note maturity date | Mar. 30, 2019 | ||||||||||
Convertible note discount percentage | 39.00% | ||||||||||
Power Up Note 8 [Member] | |||||||||||
Note interest rate | 8.00% | ||||||||||
Convertible note principal amount | $ 53,000 | ||||||||||
Note maturity date | Apr. 30, 2019 | ||||||||||
Convertible note discount percentage | 42.00% | ||||||||||
Actus Note 2 [Member] | |||||||||||
Note interest rate | 8.00% | ||||||||||
Convertible note principal amount | $ 137,250 | ||||||||||
Note maturity date | Apr. 18, 2019 | ||||||||||
Convertible note discount percentage | 40.00% | ||||||||||
Convertible Notes Payable [Member] | |||||||||||
Convertible note converted amount | 545,547 | ||||||||||
Accrued interest | 31,184 | $ 31,184 | |||||||||
Associated professional fees | $ 11,500 | ||||||||||
Debt converted into shares | 1,145,215,919 | ||||||||||
Power Up Note 3 [Member] | |||||||||||
Debt instrument, periodic payment | 57,952 | ||||||||||
Debt instrument, periodic payment, principal | 40,000 | ||||||||||
Prepayment penalties | $ 17,952 | ||||||||||
Minimum [Member] | |||||||||||
Note interest rate | 18.00% | 18.00% | |||||||||
Maximum [Member] | |||||||||||
Note interest rate | 24.00% | 24.00% |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) - USD ($) | Feb. 02, 2018 | Jul. 31, 2018 | Oct. 31, 2017 |
Number of shares authorized | 1,625,000,000 | ||
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, shares outstanding | 1,500,000,000 | 249,369,810 | |
Preferred stock, shares authorized | 125,000,000 | ||
Preferred stock, par value | $ 0.001 | ||
Debt principal amount | $ 767,209 | ||
Accrued interest | 43,977 | ||
Professional fees | $ 16,250 | ||
Conversion of debt converted into shares | 1,248,092,927 | ||
Dilutive common stock | 369,000,000 | ||
Maximum [Member] | |||
Warrants to purchase common stock | 17,786,467 | ||
NestBuilder [Member] | |||
Number of shares returned/cancelled | 4,163,315 | ||
Series A Convertible Preferred Stock [Member] | |||
Preferred stock, shares authorized | 120,000,000 | 120,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares outstanding | 44,570,101 | 100,000 | |
Series B Convertible Preferred Stock [Member] | |||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares outstanding | |||
Series C Convertible Preferred Stock [Member] | |||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares outstanding | 160,000 | 160,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | 1 Months Ended |
Jul. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Number of stock held in connection with spin off description | 1 share of NestBuilder for every 900 shares |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2018 | Jul. 31, 2017 | Oct. 31, 2017 | |
Cash | $ 217,444 | $ 217,444 | $ 280,111 | ||
Marketable securities | 27,727 | 27,727 | |||
Accounts receivable, net | 1,127,801 | 1,127,801 | 822,312 | ||
Inventory | 59,636 | 59,636 | 341,188 | ||
Prepaid expenses | 99,255 | 99,255 | 3,300 | ||
Other assets | 18,632 | 18,632 | 16,621 | ||
Total Current Assets | 1,550,494 | 1,550,494 | 1,463,532 | ||
Accounts payable and accrued expenses | 718,154 | 718,154 | 1,230,998 | ||
Interest payable | 127,782 | 127,782 | 22,560 | ||
Due to officer | 33,301 | 33,301 | 33,301 | ||
Note payable | 530,000 | 530,000 | |||
Convertible notes payable, net | 1,349,618 | 1,349,618 | 975,250 | ||
Total Current Liabilities | 2,758,855 | 2,758,855 | 2,262,109 | ||
Revenue | 1,441,461 | $ 1,154,631 | 3,822,204 | $ 2,333,626 | |
Cost of revenue | 1,164,431 | 855,481 | 3,168,802 | 1,889,704 | |
Gross Profit | 277,030 | 299,150 | 653,403 | 443,922 | |
Salaries and benefits | 78,829 | 197,141 | 464,763 | 975,406 | |
Selling and promotions expense | 26 | 1,301 | 824 | 6,459 | |
Legal and professional fees | 50,765 | 139,276 | 334,060 | 398,387 | |
General and administrative | 266,409 | 111,974 | 537,261 | 208,309 | |
Total Operating Expenses | 396,029 | 449,692 | 1,336,908 | 1,588,561 | |
Operating (loss) income | (118,999) | (150,542) | (683,506) | (1,144,639) | |
Interest expense | (99,172) | (9,745) | (179,401) | (98,363) | |
Other income (expense) | 252,409 | 79,579 | (23,716) | ||
Default principal increase on convertible notes payable | (793,327) | (793,327) | |||
Total Other Income (Expense) | (640,089) | (9,745) | (893,149) | (122,079) | |
Income (loss) before income taxes | (911,510) | (198,319) | (1,835,841) | (1,262,586) | |
Income taxes | |||||
Net income (loss) | (759,088) | (160,287) | (1,576,655) | (1,266,718) | |
Discontinued [Member] | |||||
Cash | 80,969 | 80,969 | 28,810 | ||
Marketable securities | 27,727 | 27,727 | |||
Accounts receivable, net | 146 | 146 | 9,564 | ||
Inventory | |||||
Prepaid expenses | 3,300 | 3,300 | 3,300 | ||
Other assets | 10,003 | 10,003 | |||
Total Current Assets | 122,144 | 122,144 | 41,674 | ||
Accounts payable and accrued expenses | 109,883 | 109,883 | 396,407 | ||
Interest payable | |||||
Due to officer | |||||
Note payable | |||||
Convertible notes payable, net | |||||
Total Current Liabilities | 109,883 | 109,883 | 396,407 | ||
Revenue | 70,016 | 106,055 | 216,316 | 299,982 | |
Cost of revenue | 17,200 | 28,320 | 56,800 | 120,402 | |
Gross Profit | 52,816 | 77,735 | 159,516 | 179,580 | |
Salaries and benefits | 23,482 | 35,187 | 82,326 | 141,123 | |
Selling and promotions expense | 26 | 1,301 | 824 | 5,494 | |
Legal and professional fees | 6,550 | 400 | 82,999 | 20,154 | |
General and administrative | 29,739 | 2,291 | 71,714 | 16,181 | |
Total Operating Expenses | 59,798 | 39,179 | 237,863 | 182,952 | |
Operating (loss) income | (6,982) | 38,556 | (78,347) | (3,372) | |
Interest expense | (429) | (524) | (1,322) | (760) | |
Other income (expense) | 159,832 | 338,855 | |||
Default principal increase on convertible notes payable | |||||
Total Other Income (Expense) | 159,403 | (524) | 337,533 | (760) | |
Income (loss) before income taxes | 152,422 | 38,032 | 259,186 | (4,132) | |
Income taxes | |||||
Net income (loss) | 152,422 | 38,032 | 259,186 | (4,132) | |
Continuing [Member] | |||||
Cash | 136,475 | 136,475 | 251,301 | ||
Marketable securities | |||||
Accounts receivable, net | 1,127,655 | 1,127,655 | 812,748 | ||
Inventory | 59,636 | 59,636 | 341,188 | ||
Prepaid expenses | 95,955 | 95,955 | |||
Other assets | 8,629 | 8,629 | 16,621 | ||
Total Current Assets | 1,428,350 | 1,428,350 | 1,421,858 | ||
Accounts payable and accrued expenses | 608,271 | 608,271 | 834,591 | ||
Interest payable | 127,782 | 127,782 | 22,560 | ||
Due to officer | 33,301 | 33,301 | 33,301 | ||
Note payable | 530,000 | 530,000 | |||
Convertible notes payable, net | 1,349,618 | 1,349,618 | 975,250 | ||
Total Current Liabilities | 2,648,972 | 2,648,972 | $ 1,865,702 | ||
Revenue | 1,371,445 | 1,048,576 | 3,605,889 | 2,033,644 | |
Cost of revenue | 1,147,231 | 827,161 | 3,112,002 | 1,769,302 | |
Gross Profit | 224,214 | 221,415 | 493,887 | 264,342 | |
Salaries and benefits | 55,347 | 161,954 | 382,437 | 834,283 | |
Selling and promotions expense | 965 | ||||
Legal and professional fees | 44,215 | 138,876 | 251,061 | 378,233 | |
General and administrative | 236,669 | 109,683 | 465,547 | 192,128 | |
Total Operating Expenses | 336,231 | 410,513 | 1,099,045 | 1,405,609 | |
Operating (loss) income | (112,017) | (189,098) | (605,158) | (1,141,267) | |
Interest expense | (98,743) | (9,221) | (178,079) | (97,603) | |
Other income (expense) | 92,577 | (259,276) | (23,716) | ||
Default principal increase on convertible notes payable | (793,327) | (793,327) | |||
Total Other Income (Expense) | (799,493) | (9,221) | (1,230,682) | (121,319) | |
Income (loss) before income taxes | (911,510) | (198,319) | (1,835,841) | (1,262,586) | |
Income taxes | |||||
Net income (loss) | $ (911,510) | $ (198,319) | $ (1,835,841) | $ (1,262,586) |
Business Divestiture (Details N
Business Divestiture (Details Narrative) - USD ($) | 9 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Gain on business transaction | $ (119,106) | |
Gulf Agro Trading, LLC [Member] | ||
Percentage for common stock ownership in exchange | 25.00% | |
Forgiveness payable | $ 119,106 | |
Gain on business transaction | 119,106 | |
Verus Middle East General Trading, LLC [Member] | ||
Forgiveness payable | $ 119,106 | |
Verus Foods MENA Limited [Member] | ||
Percentage for common stock ownership in exchange | 25.00% |