Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Apr. 30, 2019 | Jun. 11, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | VERUS INTERNATIONAL, INC. | |
Entity Central Index Key | 0001430523 | |
Document Type | 10-Q | |
Document Period End Date | Apr. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --10-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 2,290,449,898 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Apr. 30, 2019 | Oct. 31, 2018 |
Current Assets | ||
Cash | $ 493,032 | $ 28,554 |
Accounts receivable, net | 1,836,294 | 1,246,301 |
Inventory | 252,861 | 90,589 |
Prepaid expenses | 13,637 | 12,412 |
Other assets | 8,629 | 8,629 |
Total Current Assets | 2,604,453 | 1,386,485 |
Property and equipment, net | 14,725 | 15,622 |
Intangible asset - license, net | 307,377 | |
Total Assets | 2,926,555 | 1,402,107 |
Current Liabilities | ||
Accounts payable and accrued expenses | 1,668,096 | 642,739 |
Interest payable | 107,590 | 257,170 |
Due to former officer | 31,301 | 33,301 |
Notes payable | 530,000 | 530,000 |
Convertible notes payable, net | 510,000 | 1,497,126 |
Total Current Liabilities | 2,846,987 | 2,960,336 |
Commitments and Contingencies (Note 10) | ||
Stockholders' Equity (Deficit) | ||
Common stock, $0.000001 par value; 7,500,000,000 shares authorized and 1,654,529,899 and 1,500,000,000 shares issued at April 30, 2019 and October 31, 2018, respectively | 1,655 | 1,500,000 |
Additional paid-in-capital | 22,853,274 | 22,545,691 |
Shares to be issued | 1,458,244 | 456,090 |
Accumulated deficit | (24,278,606) | (26,104,740) |
Total Stockholders' Equity (Deficit) | 79,568 | (1,558,229) |
Total Liabilities and Stockholders' Equity (Deficit) | 2,926,555 | 1,402,107 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Convertible preferred stock, value | 44,570 | 44,570 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Convertible preferred stock, value | ||
Series C Convertible Preferred Stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Convertible preferred stock, value | $ 431 | $ 160 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Apr. 30, 2019 | Oct. 31, 2018 |
Common stock, par value | $ 0.000001 | $ 0.000001 |
Common stock, shares authorized | 7,500,000,000 | 7,500,000,000 |
Common stock, shares issued | 1,654,529,899 | 1,500,000,000 |
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 | 44,570,101 |
Convertible Preferred Stock, shares outstanding | 44,570,101 | 44,570,101 |
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 | 430,801 | 160,000 |
Convertible Preferred Stock, shares outstanding | 430,801 | 160,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenue | $ 2,942,435 | $ 1,165,146 | $ 5,386,255 | $ 2,234,444 |
Cost of revenue | 2,490,130 | 1,026,581 | 4,567,597 | 1,964,771 |
Gross Profit | 452,305 | 138,565 | 818,658 | 269,673 |
Operating Expenses: | ||||
Salaries and benefits | 92,414 | 179,882 | 190,638 | 327,090 |
Stock-based compensation | 290,573 | 290,573 | ||
Legal and professional fees | 76,538 | 138,831 | 188,190 | 206,846 |
General and administrative | 236,468 | 127,141 | 430,303 | 273,092 |
Total Operating Expenses | 695,993 | 445,854 | 1,099,704 | 807,028 |
Operating loss | (243,688) | (307,289) | (281,046) | (537,355) |
Other Income (Expense): | ||||
Interest expense | (46,889) | (30,451) | (148,522) | (79,337) |
Initial derivative liability expense | (225,115) | (225,115) | ||
Amortization of debt discount | (702,376) | (702,376) | ||
Loss on legal settlements | (199,489) | (351,853) | ||
Gain on convertible notes payable settlement | 681,945 | 681,945 | ||
Gain on extinguishment of debt | 2,700,737 | 2,700,737 | ||
Total Other Income (Expense) | 2,408,302 | (30,451) | 2,107,180 | (431,190) |
Income (loss) from continuing operations before income taxes | 2,164,614 | (337,740) | 1,826,134 | (968,545) |
Income taxes | ||||
Income (loss) from continuing operations | 2,164,614 | (337,740) | 1,826,134 | (968,545) |
Discontinued operations (Note 12) | ||||
(Loss) Income from discontinued operations | (17,054) | 100,701 | ||
Net income (loss) | $ 2,164,614 | $ (354,794) | $ 1,826,134 | $ (867,844) |
Income (loss) per common share: | ||||
Income (loss) from continuing operations per common share - basic | $ 0 | $ 0 | $ 0 | $ 0 |
Income (loss) from continuing operations per common share - diluted | 0 | 0 | 0 | 0 |
(Loss) income from discontinued operations per common share - basic | 0 | 0 | ||
(Loss) income from discontinued operations per common share - diluted | 0 | 0 | ||
Income (loss) per common share - basic | 0 | 0 | 0 | 0 |
Income (loss) per common share - diluted | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average shares outstanding - basic | 1,514,514,259 | 355,330,860 | 1,506,628,559 | 313,832,292 |
Weighted average shares outstanding - diluted | 2,144,219,259 | 355,330,860 | 2,136,333,559 | 313,832,292 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders' Equity Deficit (Unaudited) - USD ($) | Preferred Stock A [Member] | Preferred Stock B [Member] | Preferred Stock C [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Other Comprehensive Income (Loss) [Member] | Common Stock to be Issued [Member] | Accumulated Deficit [Member] | Total |
Balance at Oct. 31, 2017 | $ 100 | $ 160 | $ 249,370 | $ 22,409,041 | $ (53,285) | $ (23,403,963) | $ (798,577) | ||
Balance, shares at Oct. 31, 2017 | 100,000 | 160,000 | 249,369,810 | ||||||
Shares Issued for Conversion of Promissory Notes | $ 99,518 | 114,687 | 214,205 | ||||||
Shares Issued for Conversion of Promissory Notes, shares | 99,517,696 | ||||||||
Shares issued under Monaker litigation settlement | $ 44,470 | $ 10,560 | 275,150 | 330,180 | |||||
Shares issued under Monaker litigation settlement, shares | 44,470,101 | 10,559,890 | |||||||
Other comprehensive income loss | (13,564) | (13,564) | |||||||
Net income | (507,006) | (507,006) | |||||||
Balance at Jan. 31, 2018 | $ 44,570 | $ 160 | $ 359,448 | 22,798,878 | (66,849) | (23,910,969) | (774,762) | ||
Balance, shares at Jan. 31, 2018 | 44,570,101 | 160,000 | 359,447,396 | ||||||
Balance at Oct. 31, 2017 | $ 100 | $ 160 | $ 249,370 | 22,409,041 | (53,285) | (23,403,963) | (798,577) | ||
Balance, shares at Oct. 31, 2017 | 100,000 | 160,000 | 249,369,810 | ||||||
Net income | (867,844) | ||||||||
Balance at Apr. 30, 2018 | $ 44,570 | $ 160 | $ 355,285 | 22,803,041 | (5,137) | (24,272,019) | (1,074,100) | ||
Balance, shares at Apr. 30, 2018 | 44,570,101 | 160,000 | 355,284,081 | ||||||
Balance at Jan. 31, 2018 | $ 44,570 | $ 160 | $ 359,448 | 22,798,878 | (66,849) | (23,910,969) | (774,762) | ||
Balance, shares at Jan. 31, 2018 | 44,570,101 | 160,000 | 359,447,396 | ||||||
Common Stock retired from Nestbuilder | $ (4,163) | 4,163 | |||||||
Common Stock retired from Nestbuilder, shares | (4,163,315) | ||||||||
Other comprehensive income loss | 61,712 | 61,712 | |||||||
Net income | (361,050) | (354,794) | |||||||
Balance at Apr. 30, 2018 | $ 44,570 | $ 160 | $ 355,285 | 22,803,041 | $ (5,137) | (24,272,019) | (1,074,100) | ||
Balance, shares at Apr. 30, 2018 | 44,570,101 | 160,000 | 355,284,081 | ||||||
Balance at Oct. 31, 2018 | $ 44,570 | $ 160 | $ 1,500,000 | 22,545,691 | $ 456,090 | (26,104,740) | (1,558,229) | ||
Balance, shares at Oct. 31, 2018 | 44,570,101 | 160,000 | 1,500,000,000 | ||||||
Shares issued under Exchange Agreement | $ 296 | 1,208 | 1,504 | ||||||
Shares issued under Exchange Agreement, shares | 295,801 | ||||||||
Net income | (338,478) | (338,478) | |||||||
Balance at Jan. 31, 2019 | $ 44,570 | $ 456 | $ 1,500,000 | 22,546,899 | 456,090 | (26,443,218) | (1,895,204) | ||
Balance, shares at Jan. 31, 2019 | 44,570,101 | 455,801 | 1,500,000,000 | ||||||
Balance at Oct. 31, 2018 | $ 44,570 | $ 160 | $ 1,500,000 | 22,545,691 | 456,090 | (26,104,740) | (1,558,229) | ||
Balance, shares at Oct. 31, 2018 | 44,570,101 | 160,000 | 1,500,000,000 | ||||||
Net income | 1,826,134 | ||||||||
Balance at Apr. 30, 2019 | $ 44,570 | $ 431 | $ 1,655 | 22,853,274 | 1,458,244 | (242,789,606) | 79,568 | ||
Balance, shares at Apr. 30, 2019 | 44,570,101 | 430,801 | 1,654,529,899 | ||||||
Balance at Jan. 31, 2019 | $ 44,570 | $ 456 | $ 1,500,000 | 22,546,899 | 456,090 | (26,443,218) | (1,895,204) | ||
Balance, shares at Jan. 31, 2019 | 44,570,101 | 455,801 | 1,500,000,000 | ||||||
Shares issued under Monaker litigation settlement | $ 152,030 | 304,060 | (456,090) | ||||||
Shares issued under Monaker litigation settlement, shares | 152,029,899 | ||||||||
Conversion of Preferred Stock C to Common Stock | $ (25) | $ 2,500 | (2,475) | ||||||
Conversion of Preferred Stock C to Common Stock, shares | (25,000) | 2,500,000 | |||||||
Shares to be issued under stock based compensation | 138,170 | 138,170 | |||||||
Relative fair value of warrants issued with convertible promissory notes | 697,611 | 697,611 | |||||||
Shares to be issued under conversion of convertible promissory notes | (2,483,866) | 1,458,244 | (1,025,622) | ||||||
Shares to be issued under conversion of convertible promissory notes, shares | |||||||||
Reduction of par value of Common and Preferred Stock | $ (1,652,875) | 1,652,875 | |||||||
Net income | 2,164,612 | 2,164,614 | |||||||
Balance at Apr. 30, 2019 | $ 44,570 | $ 431 | $ 1,655 | $ 22,853,274 | $ 1,458,244 | $ (242,789,606) | $ 79,568 | ||
Balance, shares at Apr. 30, 2019 | 44,570,101 | 430,801 | 1,654,529,899 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Cash flows from operating activities: | ||
Net income (loss) from continuing operations | $ 1,826,134 | $ (968,545) |
Net income from discontinued operations | 100,701 | |
Adjustments to reconcile net loss to net cash from operating activities: | ||
Depreciation and amortization | 897 | |
Stock-based compensation | 138,170 | |
Initial derivative liability expense | 225,115 | |
Amortization of debt discount | 702,376 | 10,330 |
Gain on convertible notes settlement | (681,945) | |
Gain on extinguishment of debt | (2,700,737) | |
Legal settlement settled in shares | 289,483 | |
Changes in operating assets and liabilities: | ||
Increase in accounts receivable | (589,993) | (56,113) |
(Increase) decrease in inventory | (162,272) | 279,453 |
Increase in other assets | (1,226) | (109,665) |
Increase (decrease) in accounts payable and accrued expenses | 867,688 | (266,429) |
Decrease in due to officer | (2,000) | |
Net cash used in operating activities of continuing operations | (377,792) | (821,486) |
Net cash provided by operating activities of discontinued operations | 48,148 | |
Net cash used in operating activities of continuing and discontinued operations | (377,792) | (773,338) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible notes payable | 1,960,319 | 683,000 |
Payments applied to convertible promissory notes | (1,118,049) | (118,000) |
Net cash provided by financing activities of continuing operations | 842,270 | 565,000 |
Net increase in cash | 464,478 | (208,338) |
Cash at beginning of period | 28,554 | 251,301 |
Cash at end of period | 493,032 | 42,963 |
Supplemental disclosure: | ||
Cash paid for interest | 81,260 | 53,508 |
Supplemental disclosure of non-cash operating, investing and financing activity: | ||
Initial recognition of relative fair value of warrant agreements as convertible promissory notes discount | 697,611 | |
Initial recognition of derivative liability as debt discount | 752,389 | |
Settlement of Accrued Compensation Through Issuance of Series C Preferred Stock [Member] | ||
Supplemental disclosure of non-cash operating, investing and financing activity: | ||
Value | $ 1,504 | |
Shares | 295,801 | |
Settlement of Convertible Notes Payable, Accrued Interest and Professional Fees Through Issuance of Common Stock [Member] | ||
Supplemental disclosure of non-cash operating, investing and financing activity: | ||
Value | $ 214,205 | |
Shares | 99,517,696 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 6 Months Ended |
Apr. 30, 2019 | |
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 Verus International, Inc., including its wholly-owned subsidiary, are collectively referred to herein as “Verus,” “VRUS”, “Company,” “us,” or “we.” The Company was incorporated in the state of Delaware under the name Spectrum Gaming Ventures, Inc. on May 25, 1994. On October 10, 1995, the Company changed its name to Select Video, Inc. On October 24, 2007, the Company filed a Certificate of Ownership with the Delaware Secretary of State whereby Webdigs, Inc., the Company’s wholly-owned subsidiary, was merged with and into the Company and the Company changed its name to Webdigs, Inc. On October 9, 2012, the Company consummated a share exchange (the “Exchange Transaction”) with Monaker Group, Inc. (formerly known as Next 1 Interactive, Inc.), a Nevada corporation (“Monaker”) pursuant to which the Company received all of the outstanding equity in Attaché Travel International, Inc., a Florida corporation and wholly owned subsidiary of Monaker (“Attaché”) in consideration for the issuance of 93 million shares of the Company’s newly designated Series A Convertible Preferred Stock to Monaker. Attaché owned approximately 80% of a corporation named RealBiz Holdings Inc. which is the parent corporation of RealBiz 360, Inc. (“RealBiz”). As a condition to the closing of the Exchange Transaction, on October 3, 2012, the Company filed a Certificate of Ownership with the Delaware Secretary of State whereby RealBiz Media Group, Inc., the Company’s wholly-owned subsidiary, was merged with and into the Company and the Company changed its name to RealBiz Media Group, Inc. On May 1, 2018, Verus Foods MENA Limited (“Verus MENA”) entered into a Share Purchase and Sale Agreement with a purchaser (the “Purchaser”) pursuant to which Verus MENA sold 75 shares (the “Gulf Agro Shares”) of Gulf Agro Trading, LLC (“Gulf Agro”), representing 25% of the common stock of Gulf Agro to the Purchaser. In consideration for the Gulf Agro Shares, the Purchaser was assigned certain contracts executed during a specified period of time. Until July 31, 2018, the Company operated a real estate segment which generated revenue from service fees (for 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) the Company’s fully licensed real estate division (formerly known as Webdigs); (ii) the Company’s television media contracts division (Home Preview Channel /Extraordinary Vacation Homes); and (iii) the Company’s Real Estate Virtual Tour and Media group division (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 the Company’s programs was its 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. The Company provided video search, storage and marketing capabilities on multiple platform dynamics for web, mobile and television. Once a home, personal or community video was created using the Company’s proprietary technology, it could be published to social media, emailed or distributed to multiple real estate websites, broadband or television for consumer viewing. The Company entered into a Contribution and Spin-off Agreement with NestBuilder.com Corp. (“NestBuilder”) on October 27, 2017, as amended on January 28, 2018, whereby, effective as of August 1, 2018, the Company spun off its real estate division into NestBuilder. All of the Company’s stockholders as of July 2, 2018, the record date, which held their shares as of July 20, 2018, the ex-dividend date, received one share of NestBuilder common stock for each 900 shares of the Company owned. 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). Since August 1, 2018, the Company, through its wholly-owned subsidiary, Verus Foods, Inc. (“Verus Foods”), an international supplier of consumer food products, are focused on international consumer packaged goods, foodstuff distribution and wholesale trade. The Company’s fine food products are sourced in the United States and exported internationally. The Company markets consumer food products under its own brand primarily to supermarkets, hotels and other members of the wholesale trade. Initially, in 2017, the Company focused on frozen foods, particularly meat, poultry, seafood, vegetables, and french fries with beverages as a second vertical. During 2018, the Company added cold-storage facilities, and began seeking international sources for fresh fruit, produce and similar perishables, as well as other consumer packaged foodstuff, with the goal to create vertical farm-to-market operations. The Company also begun to explore new consumer packaged goods (“CPG”) non-food categories, such as cosmetic and fragrances, for future product offerings. The Company currently has a significant regional presence in the Middle East and North Africa (“MENA”) and sub-Saharan Africa (excluding The Office of Foreign Assets Control restricted nations), with deep roots in the Gulf Cooperation Council (“GCC”) countries, which includes the United Arab Emirates, Oman, Bahrain, Qatar, Kingdom of Saudi Arabia and Kuwait. The Company’s long-term goal is to source goods and generate international wholesale and retail CPG sales in North and South America, Europe, Africa, Asia and Australia. Effective October 16, 2018, the Company changed its name from RealBiz Media Group, Inc. to Verus International, Inc. and its ticker symbol to “VRUS”. On April 25, 2019 (the “Closing Date”), the Company entered into a stock purchase agreement with Big League Foods, Inc. (“BLF”) and James Wheeler, the sole stockholder of Big League Foods, Inc. (the “Seller”). Upon the closing of such acquisition, BLF became the Company’s wholly-owned subsidiary and the Company acquired a license with Major League Baseball Properties, Inc. (“MLB”) to sell MLB-branded frozen dessert products and confections. 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. The unaudited consolidated financial statements for the six months ended April 30, 2019 and 2018 include the operations of Verus MENA effective May 1, 2018, Verus Foods effective January 1, 2017, Gulf Agro Trading, LLC through April 30, 2018 (see Note 13), and Big League Foods, Inc. effective April 25, 2019. The historical operations of the Company’s real estate segment which were spun-off effective as of August 1, 2018, are reported as discontinued operations for the six months ended April 30, 2018. All significant intercompany accounts and transactions have been eliminated in the consolidation. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended October 31, 2018, contained in the Company’s Annual Report on Form 10-K filed with the SEC on March 19, 2019. The results of operations for the six months ended April 30, 2019, are not necessarily indicative of results to be expected for any other interim period or the fiscal year ending October 31, 2019. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Apr. 30, 2019 | |
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, valuation of intangible assets, stock-based compensation and the deferred tax asset valuation allowance. Reclassifications Certain reclassifications have been made to prior year’s unaudited consolidated financial statements to enhance comparability with the current year’s unaudited consolidated financial statements, including, but not limited to, presenting the spin-off of the Company’s real estate segment as discontinued operations for the six months ended April 30, 2018. 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. The loss of one or more of our top customers, or a substantial decrease in demand by any of those customers for our products, could have a material adverse effect on our business, results of operations and financial condition. 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. Increases in the prices of the food products which the Company purchases could adversely affect its operating results if the Company is unable to fully offset the effect of these increased costs through price increases, and the Company can provide no assurance that it will be able to pass along such increased costs to the Company’s customers. Furthermore, if the Company cannot obtain sufficient food products or its suppliers cease to be available, the Company could experience shortages in its food products or be unable to meet its commitments to customers. Alternative sources of food products, if available, may be more expensive. 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 April 30, 2019 and October 31, 2018. 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 April 30, 2019 and October 31, 2018, the Company determined there was no requirement for an allowance for doubtful accounts. 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. All inventory are considered finished goods. Intangible Asset The Company amortizes its only intangible asset, a license with Major League Baseball Properties, Inc., on a straight-line basis over the estimated useful life of the license. Fair Value of Financial Instruments The Company has adopted Accounting Standards Codification (“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, 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 short and 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 is derived from the sale of food and beverage products. The Company recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers and their customers. In the event any discounts, sales incentives, or similar arrangements are agreed to with a customer, such amounts are estimated at time of sale and deducted from revenue. Sales taxes and other similar taxes are excluded from revenue (see Note 6). Share-Based Compensation The Company computes share based payments in accordance with ASC 718-10, Compensation Equity Based Payments to Non-Employees 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”) 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. Foreign Currency The Company has one non-U.S. subsidiary, where the functional currency is not the U.S. dollar. The related assets and liabilities of this non-U.S. subsidiary have been translated using end of period exchange rates or historical exchange rates to the U.S. dollar. 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 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 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2018, 2017 and 2016 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, 2018 and 2017. 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 six months ended April 30, 2018 as we incurred a net loss for those periods. At April 30, 2019, there were outstanding warrants to purchase up to 623,705,000 shares of the Company’s common stock and approximately 6,000,000 shares of the Company’s common stock to be issued, which may dilute future EPS. At April 30, 2018, there were outstanding warrants to purchase up to 17,786,467 shares of the Company’s common stock and approximately 256,000,000 shares of the Company’s common stock to be issued, which may dilute future EPS. Shipping and Handling Costs Shipping and handling costs for freight expense on goods shipped are included in cost of sales. Freight expense on goods shipped for six months ended April 30, 2019 and 2018 was $178,360 and $67,421, respectively. 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 and beverage products. Recently Adopted Accounting Standards Effective November 1, 2018, the Company adopted Revenue from Contracts with Customers (Topic 606) (“ASC 606”). The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in US GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. The Company adopted ASC 606 using the modified retrospective method, which did not have an impact on its consolidated financial statements. The Company expects the impact to net income of the new standard will be immaterial on an ongoing quarterly and annual basis. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. Refer to Note 6 for additional information regarding the Company’s adoption of ASC 606. Effective November 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which provides clarification on classifying a variety of activities within the statement of cash flows. The Company determined the adoption of ASU 2016-15 did not have a material impact on its consolidated financial statements. Effective November 1, 2018, the Company adopted ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash Effective November 1, 2018, the Company adopted ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business Effective November 1, 2018, the Company adopted ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting Compensation—Stock Compensation Effective November 1, 2018, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities Recently Issued Accounting Standards Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”). The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of fiscal 2020. Early adoption of ASU 2016-02 is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842, which amends certain aspects of the new lease standard). The Company is currently evaluating the impact of adopting ASU 2016-02 and ASU 2017-13 on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, to modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in the Concept Statement, including the consideration of costs and benefits. The standard is effective for the Company as of November 1, 2020, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. 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 | 6 Months Ended |
Apr. 30, 2019 | |
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 has incurred negative cash flows from operations of $377,792 for the six months ended April 30, 2019. At April 30, 2019, the Company had a working capital deficit of $242,534, and an accumulated deficit of $24,278,606. 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 report, 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 from the date of this report and to fund the growth of the food business, the Company may consider plans to raise additional funds through the issuance of equity or debt. 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. |
Asset Acquisition
Asset Acquisition | 6 Months Ended |
Apr. 30, 2019 | |
Business Combinations [Abstract] | |
Asset Acquisition | NOTE 4: ASSET ACQUISITION On April 25, 2019, the Company entered into a stock purchase agreement with BLF and James Wheeler, the sole stockholder of BLF. Pursuant to the terms of the stock purchase agreement, on the Closing Date, the Seller sold all of BLF’s outstanding capital stock, or 1,500 shares of common stock to the Company. Subsequent to 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 stock purchase agreement)) 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 stock purchase agreement) to a customer, the Company will 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 will pay the Seller 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. During the Earnout Period the Seller will be entitled to receive a payment for each fiscal quarter based on the difference of the Operating Income (as defined in the stock purchase agreement) minus the Earnout Commission (as defined in the stock purchase agreement). 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 will 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; provided, however, no Catch-up Payment will be payable following the date on which the final Earnout Payment is made for the last fiscal quarter in the Earnout Period. Upon the closing of such acquisition, BLF became the Company’s wholly-owned subsidiary and the Company acquired a license with MLB to sell MLB-branded frozen dessert products and confections. The license covers all 30 MLB teams. The transaction was accounted for as an asset acquisition, with substantially all of the purchase consideration allocated to the license (see Note 5). |
Intangible Asset - License, Net
Intangible Asset - License, Net | 6 Months Ended |
Apr. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Asset - License, Net | NOTE 5: INTANGIBLE ASSET – LICENSE, NET Intangible asset - license, net, represents a license (the “License”) with Major League Baseball Properties, Inc. (“MLB”) to sell MLB-branded frozen dessert products and confections. The License was acquired as part of the April 25, 2019 Stock Purchase Agreement (see Note 4) to purchase all of the outstanding capital stock of Big League Foods, Inc. The transaction was accounted for as an asset acquisition, with substantially all of the purchase consideration allocated to the License. The purchase consideration to acquire the License totals $5,357,377, which consists of $50,000 cash paid subsequent to closing, $257,377 of accrued MLB License royalty fees that were assumed by the Company upon acquisition of the License (net of cash acquired of $350), and $5,050,000 cash that is contingently payable over time, through December 31, 2022, based on the future sales of MLB-branded products (see Note 10). The contingent consideration is recognized as an increase to the carrying amount of the License intangible asset when the payment becomes probable and estimable, net of any catch-up for amortization expense. The net carrying amount of the License is as follows: April 30, 2019 October 31, 2018 Intangible asset – license, gross carrying amount $ 307,377 $ - Less accumulated amortization - - Intangible asset – license, net $ 307,377 $ - The License is amortized on a straight-line basis over a useful life of 32 months, coinciding with the remaining contractual term of the License agreement, which terminates on December 31, 2021. Amortization expense is presented in cost of revenue. There was no amortization expense during the three and six months ended April 30, 2019 and April 30, 2018. Future amortization expense related to the existing net carrying amount of the License as of April 30, 2019 is expected to be as follows: Remainder of fiscal year 2019 $ 57,633 Fiscal year 2020 115,266 Fiscal year 2021 115,266 Fiscal year 2022 19,212 |
Revenue
Revenue | 6 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | NOTE 6: REVENUE The Company recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers and their customers. Sales taxes and other similar taxes are excluded from revenue. The adoption of ASC 606 resulted in no impact to the individual financial statement line items of the Company’s unaudited Condensed Consolidated Statements of Operations during the six months ended April 30, 2019. Information about the Company’s net revenue by country is as follows: For the Three Months Ended For the Six Months Ended April 30, April 30, 2019 2018 2019 2018 Kingdom of Saudi Arabia $ 463,737 $ 289,745 $ 660,385 $ 409,323 Oman 198,732 91,397 398,251 183,110 Bahrain 195,460 101,436 507,449 317,507 United Arab Emirates 2,084,506 755,741 3,820,170 1,324,504 Net Revenue $ 2,942,435 $ 1,238,319 $ 5,386,255 $ 2,234,444 |
Convertible Notes Payable
Convertible Notes Payable | 6 Months Ended |
Apr. 30, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | NOTE 7: 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. On February 8, 2019, the Company entered into a securities purchase agreement with an accredited investor (the “First Investor”), whereby the Company sold an 8% convertible promissory note in the original principal amount of $1,250,000 (the “First Note”) and a three-year warrant to purchase up to 925,925,925 shares (the “First Warrant”) of the Company’s common stock. The Company allocated a value of $573,389 to the three-year warrant based upon a relative fair value methodology. The note converts at 90% of the lowest sale price during the 30 trading days prior to conversion. Due to certain ratchet provisions contained in the convertible promissory note, the Company accounted for this conversion feature as a derivative liability. Accordingly, the Company recorded a derivative liability of $842,676 and a debt discount of $676,611 and began amortizing the debt discount over the related term of the note. On March 6, 2019, the Company received a conversion notice from the First Investor, pursuant to which the principal amount of the First Note together with interest accrued thereon was to convert into an aggregate of 512,333,333 shares of the Company’s common stock at a fixed conversion price of $0.0025 per share and the First Warrant was amended such that the First Warrant is exercisable for 500,000,000 shares of the Company’s common stock at a fixed exercise price of $0.0025 per share. As of March 6, 2019, the date the Company received the conversion notice, the Company did not have sufficient available shares of common stock to issue and therefore recorded the value of such shares at such date as Shares to be Issued within the unaudited consolidated balance sheets. On June 4, 2019, the Company issued the 512,333,333 shares of its common stock to the First Investor. In connection with the securities purchase agreement, the Company entered into a Registration Rights Agreement with the First Investor (the “First Registration Rights Agreement”), pursuant to which the Company is required to file a Registration Statement on Form S-1 (or Form S-3, if available) (the “Registration Statement”) covering the resale of the shares of common stock underlying the note and the warrant. On February 11, 2019, the Company entered into a securities purchase agreement with an accredited investor (the “Second Investor”), whereby the Company sold an 8% convertible promissory note in the original principal amount of $200,000 (the “Second Note” and together with the First Note, the “Notes”) and a three-year warrant to purchase up to 148,148,148 shares (the “Second Warrant” and together with the First Warrant, the “Warrants”) of the Company’s common stock. The Company allocated a value of $124,222 to the three-year warrant based upon a relative fair value methodology. The note converts at 90% of the lowest sale price during the 30 trading days prior to conversion. Due to certain ratchet provisions contained in the convertible promissory note, the Company accounted for this conversion feature as a derivative liability. Accordingly, the Company recorded a derivative liability of $134,828 and a debt discount of $75,778 and began amortizing the debt discount over the related term of the note. On March 6, 2019, the Company received a conversion notice from the Second Investor, pursuant to which the principal amount of the Second Note together with interest accrued thereon was to convert into an aggregate of 81,920,000 shares of the Company’s common stock at a fixed conversion price of $0.0025 per share and the Second Warrant was amended such that the Second Warrant is exercisable for 80,000,000 shares of the Company’s common stock at a fixed exercise price of $0.0025 per share. As of March 6, 2019, the date the Company received the conversion notice, the Company did not have sufficient available shares of common stock to issue and therefore recorded the value of such shares at such date as Shares to be Issued within the unaudited consolidated balance sheets. On June 4, 2019, the Company issued the 81,920,000 shares of its common stock to the Second Investor. In connection with the securities purchase agreement, the Company entered into a Registration Rights Agreement with the Second Investor (the “Second Registration Rights Agreement”), pursuant to which the Company is required to file the Registration Statement covering the resale of the shares of common stock underlying the note and the warrant. The Company filed the Registration Statement with the SEC on June 7, 2019. Upon conversions of the Notes together with interest accrued thereon, and amendments of the Warrants, the related derivative liabilities and debt discounts were eliminated and the Company recorded a net gain on extinguishment of debt of $2,700,737, which is recorded within the unaudited consolidated statements of operations. On February 8, 2019, the Company used a portion of the proceeds it received from the First Investor to pay off all convertible note holders at an aggregate amount less than the total amount due, which consisted of the principal amount of the notes, accrued interest, and penalties consisting of default principal and interest. The aggregate payment of $1,118,049 paid all convertible note holders in full and resulted in a gain on extinguishment of debt of $681,945. On April 26, 2019, the Company entered into a securities purchase agreement with an accredited investor (the “Third Investor”) pursuant to which the Company issued and sold a convertible note in the principal amount of $600,000 (including a $90,000 original issuance discount). The note matures on November 12, 2019, bears interest at a rate of 5% per annum (increasing to 24% per annum upon the occurrence of an Event of Default (as defined in the note)) and is convertible into shares of the Company’s common stock at a conversion price of $0.10 per share, subject to adjustment. The note may be prepaid by the Company at any time without penalty. At April 30, 2019 and October 31, 2018, there was $510,000 and $1,497,126 of convertible notes payable outstanding, net of discounts of $90,000 and $4,765, respectively. During the six months ended April 30, 2019 and 2018, amortization of debt discount amounted to $702,376 and $0, respectively. During the six months ended April 30, 2019, $1,485,633 of convertible notes, including accrued interest, were converted into shares of the Company’s common stock and there were payments of an aggregate of $1,118,049 toward the outstanding balances of convertible notes. |
Note Payable
Note Payable | 6 Months Ended |
Apr. 30, 2019 | |
Debt Disclosure [Abstract] | |
Note Payable | NOTE 8: NOTE PAYABLE In connection with the closing of the transactions contemplated by the securities purchase agreement entered into with the First Investor, the Company entered into amendment no. 1 dated January 26, 2019 to the promissory note (the “Monaco Note”) issued in favor of the Donald P. Monaco Insurance Trust in the amount of $530,000, with an annual interest rate of 12%, whereby (i) the maturity date of the Monaco Note was amended from January 26, 2019 to January 26, 2020 and (ii) the Company agreed to use its best efforts to prepay the unpaid principal amount of the Monaco Note together with all accrued but unpaid interest thereon on or prior to March 31, 2019; provided, however, that the failure by the Company to prepay such amount by March 31, 2019 would not result in an event of default pursuant to the terms of the Monaco Note. Subsequently, the Company entered into amendment no. 2 dated February 8, 2019 to the Monaco Note, whereby the maturity date of the Monaco Note was amended to November 8, 2019. At April 30, 2019, the Company was in compliance with the terms of the Monaco Note. |
Stockholders' Deficit
Stockholders' Deficit | 6 Months Ended |
Apr. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Deficit | NOTE 9: STOCKHOLDERS’ DEFICIT The total number of shares of all classes of stock that the Company shall have the authority to issue is 7,625,000,000 shares consisting of 7,500,000,000 shares of common stock, $0.000001 par value per shares, of which 1,654,529,899 are issued at April 30, 2019 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 April 30, 2019, (B) 1,000,000 shares have been designated as Series B Convertible Preferred Stock, none of which are outstanding at April 30, 2019 and (C) 1,000,000 have been designated as Series C Convertible Preferred Stock, of which 430,801 shares are outstanding at April 30, 2019. On January 11, 2019, stockholders holding a majority of the voting power of the Company’s issued and outstanding shares of voting stock, executed a written consent approving 1) an amendment to the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”) to (i) increase the number of authorized shares of common stock of the Company to 7,500,000,000 shares from 1,500,000,000 shares and (ii) decrease the par value of the common stock and preferred stock to $0.000001 from $0.001 per share; and 2) granting discretionary authority to the Company’s Board of Directors to amend the Certificate of Incorporation to effect one or more consolidations of the issued and outstanding shares of common stock of the Company, pursuant to which the shares of common stock would be combined and reclassified into one share of common stock at a ratio within the range from 1-for-2 up to 1-for-400 (the “Reverse Stock Split”), provided that, (X) that the Company may not effect Reverse Stock Splits that, in the aggregate, exceed 1-for-400, and (Y) any Reverse Stock Split may not be completed later than January 11, 2020. On April 16, 2019, the Company filed a Certificate of Amendment to its Certificate of Incorporation to increase its authorized common stock from 1,500,000,000 shares to 7,500,000,000 shares and to decrease the par value of its common stock and preferred stock from $0.001 per share to $0.000001 per share. As of April 30, 2019, the Company has not effected any Reverse Stock Split. Common Stock On April 22, 2019, the Company issued 152,029,899 shares of its common stock to satisfy the settlement agreement by and among the Company, Monaker, American Stock Transfer & Trust Company, LLC and NestBuilder that was executed on or about December 22, 2017. At April 30, 2019, the Company was committed to issue warrants to purchase 37,500,000 shares of its common stock under the provisions of the employment agreement of its Chief Executive Officer. At April 30, 2019, there were warrants to purchase up to 623,705,000 shares of the Company’s common stock outstanding and approximately 6,000,000 shares of the Company’s common stock to be issued which may dilute future EPS. Common Stock Warrants Under the provisions of the employment agreement with its Chief Executive Officer, the Company is committed to issue warrants to purchase shares of its common stock as follows: ● For each $1 million in revenue generated by the Company, a warrant to purchase 7,500,000 shares of the Company’s common stock will be granted, until such time as the Chief Executive Officer owns 20% of the then-outstanding shares of common stock. ● At the beginning of each calendar year, a warrant to acquire 3% of the Company’s outstanding common stock will be granted. At April 30, 2019, there remained approximately 254,000,000 shares of the Company’s common stock, to be issued if earned, under the provisions of the Chief Executive Officer’s employment agreement, which would increase such ownership percentage of the Company’s common stock to the 20% limit. The Company estimates the fair value of each award on the date of grant using a Black-Scholes option valuation model that uses the following assumptions for warrants earned during the six months ended April 30, 2019: Expected volatility 0.54% - 2.39 % Weighted-average volatility 0.63 % Expected dividends 0 % Expected term (in years) 2.0 Risk-free rate 2.39% - 2.56 % The following table sets forth common share purchase warrants outstanding at April 30, 2019: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2018 123,761,716 $ 0.007 $ 0.00 Warrants granted and issued 1,691,574,073 $ 0.002 $ 0.00 Warrants exchanged (1,191,630,789 ) $ (0.002 ) $ 0.00 Outstanding, April 30, 2019 623,705,000 $ 0.003 $ 0.00 Common stock issuable upon exercise of warrants 623,705,000 $ 0.003 $ 0.00 Series A Convertible Preferred Stock On February 8, 2019, the Company filed the Second Amended and Restated Certificate of Designations, Preferences and Rights of the Series A Convertible Preferred Stock (the “Second Amended and Restated COD”) with the Delaware Secretary of State whereby the Company removed the anti-dilution protection for holders of Series A Convertible Preferred Stock and provided holders of such preferred stock with a right of participation in future financings. Series C Convertible Preferred Stock On December 28, 2018, the Board of Directors awarded the Company’s Chief Executive Officer 295,801 shares of Series C Preferred Stock, in exchange for 117,556,716 of his warrants to acquire shares of common stock and a 501,130 share common stock bonus as approved by the Company’s Board of Directors related to the Company’s fiscal 2018 performance. On April 26, 2019, a shareholder converted 25,000 shares of Series C Preferred Stock into an aggregate of 2,500,000 shares of the Company’s common stock. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Apr. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 10: COMMITMENTS AND CONTINGENCIES Litigation On December 1, 2018, Mid-Atlantic CFO Advisory Services (“Mid-Atlantic”) commenced a lawsuit against Verus Foods, Inc. and Anshu Bhatnagar in the Fairfax Circuit Court, Case No. 2018-16824. This case stems from the Company’s use of Mid-Atlantic’s services for certain business transactions and the Company’s failure to pay for such services. On December 28, 2018, a Confirmation of Arbitration Award and Final Judgment Order was approved, awarding Mid-Atlantic an amount which included claimed services, attorney’s fees, arbitration costs and fees, and interest of 4% percent per annum from November 22, 2018. At April 30, 2019, the amount due to Mid-Atlantic under this judgment, including interest, was approximately $200,000 and is included within other income (expense) in the Company’s Unaudited Consolidated Statements of Operations for the six months ended April 30, 2019. On April 4, 2019, Auctus Fund, LLC (“Auctus”) commenced a lawsuit against the Company in the United States District Court for the District of Massachusetts. This case stems from a securities purchase agreement and convertible note issued in May 2017, a securities purchase agreement and convertible note issued in July 2018, the spin-off of the Company’s real estate division into NestBuilder including the issuance of shares of NestBuilder in the spin-off to the Company’s stockholders and an inducement agreement, release and payoff agreement executed by the parties in February 2019 whereby the Company settled the balance of outstanding amounts owed to Auctus in consideration for cash and shares of NestBuilder. Auctus has requested that the court grant it injunctive and equitable relief and specific performance with respect to the Company’s obligations; determine that the Company is liable for all damages, losses and costs and award Auctus actual losses sustained; award Auctus costs including, but not limited to, costs required to prosecute the action including attorneys’ fees; and punitive damages. The Company intends to defend this matter and although the ultimate outcome cannot be predicted with certainty, based on the current information available, the Company does not believe the ultimate liability, if any, will have a material adverse effect on its financial condition or results of operations. License Contingent Consideration As described in Note 5, during April 2019 the Company acquired a License to sell MLB-branded frozen dessert products and confections as part of its acquisition of BLF. The consideration payable to the seller of BLF includes $5,050,000 of contingent consideration, of which $50,000 is due upon the initial sale of an MLB-branded product and of which $5,000,000 is to be paid over time, through December 31, 2022, based on future sales of MLB-branded products (the “Earnout”). The Earnout is payable on a quarterly basis at $1.00 per case sold for sales that have a minimum gross margin of 20% per case. The Earnout payable each quarter is limited in aggregate to the operating income of BLF; however, any amounts constrained due to this limit may be rolled forward to future periods and paid when there is sufficient excess operating income. The Company accrues for this contingent consideration when payment becomes both probable and estimable. At April 30, 2019, no amounts were accrued for the License contingent consideration. However, the Company believes it is a reasonable possibility that the maximum amount of $5,050,000 will be paid over the term of the arrangement. Guaranteed Minimum Royalties The Company is obligated to pay royalties to certain vendors for the sale of products that contain their intellectual property. These royalty fees are based on a percentage of sales of the underlying products and are included in cost of revenue. The royalties also include certain guaranteed minimum payments. As of April 30, 2019, the Company’s total expected future obligation related to these guaranteed minimum payments was $1,715,000, of which the Company expects to pay $405,000, $530,000 and $780,000 during the fiscal years ending October 31, 2019, 2020, and 2021, respectively. Amounts accrued at April 30, 2019 relating to these guaranteed minimum payments totaled $257,727 and are included in accounts payable and accrued expenses. Guaranteed Working Capital Funding The Company is obligated to fund BLF up to $500,000 as may be required to achieve the projections set forth in the financial budget, unless mutually agreed by the Company and Seller. Such funding may be in a form of cash capital contributions, trade facilities and/or guarantees of the Company’s obligations to third parties. Such funding is required prior to a date that is six months following April 25, 2019. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Apr. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 11: Segment reporting Through July 31, 2018, the Company had two reportable segments: real estate and food products. On August 1, 2018, the real estate segment was spun-off into a separate public company, leaving the Company with only the food products segment (see Note 12). |
Discontinued Operations
Discontinued Operations | 6 Months Ended |
Apr. 30, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | NOTE 12: DISCONTINUED OPERATIONS Through July 31, 2018, the Company operated a real estate segment which generated revenue from service fees (for 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) the Company’s fully licensed real estate division (formerly known as Webdigs); (ii) the Company’s TV media contracts (Home Preview Channel /Extraordinary Vacation Homes) division; and (iii) the Company’s 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 the Company’s programs was its 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. The Company 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 Company’s real estate segment, all related assets and liabilities for periods prior to August 1, 2018 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 from discontinued operations within the consolidated statements of operations. The revenues and expenses associated with discontinued operations included in our Unaudited Consolidated Statements of Operations for the three and six months ended April 30, 2018 were as follows: Three Months Ended April 30, 2018 Discontinued Continuing Total Revenue $ 76,560 $ 1,165,146 $ 1,241,706 Cost of revenue 19,800 1,026,581 1,046,381 Gross Profit 56,760 138,565 195,325 Operating Expenses: Salaries and benefits 23,469 179,882 203,351 Selling and promotions expense 665 - 665 Legal and professional fees 29,449 138,831 168,280 General and administrative 36,463 127,141 163,604 Total Operating Expenses 90,046 445,854 535,900 Operating loss (33,286 ) (307,289 ) (340,575 ) Other Income (Expense): Interest expense (422 ) (30,451 ) (30,872 ) Gain (Loss) on legal settlement of accounts payable and convertible debt 16,653 - 16,653 Total Other Income (Expense) 16,232 (30,451 ) (14,219 ) (Loss) income before income taxes (17,054 ) (337,740 ) (354,794 ) Income taxes - - - Net (loss) income $ (17,054 ) $ (337,740 ) $ (354,794 ) Six Months Ended April 30, 2018 Discontinued Continuing Total Revenue $ 146,787 $ 2,234,444 $ 2,381,231 Cost of revenue 39,600 1,964,771 2,004,371 Gross Profit 107,187 269,673 376,860 Operating Expenses: Salaries and benefits 58,844 327,090 385,934 Selling and promotions expense 798 - 798 Legal and professional fees 76,449 206,846 283,295 General and administrative 48,525 273,092 321,617 Total Operating Expenses 184,616 807,028 991,644 Operating loss (77,429 ) (537,355 ) (614,784 ) Other Income (Expense): Interest expense (893 ) (79,337 ) (80,230 ) Gain (Loss) on legal settlement of accounts payable and convertible debt 179,023 (351,853 ) (172,830 ) Total Other Income (Expense) 178,130 (431,190 ) (253,060 ) (Loss) income before income taxes 100,701 (968,545 ) (867,844 ) Income taxes - - - Net (loss) income $ 100,701 $ (968,545 ) $ (867,844 ) |
Business Divestiture
Business Divestiture | 6 Months Ended |
Apr. 30, 2019 | |
Subscription Agreements [Member] | |
Business Divestiture | NOTE 13: BUSINESS DIVESTITURE On May 1, 2018, Verus MENA entered into a Share Purchase and Sale Agreement with the Purchaser pursuant to which Verus MENA sold 75 shares of Gulf Agro, representing 25% of the common stock of Gulf Agro, to the Purchaser. In consideration for the Gulf Agro Shares, the Purchaser was assigned certain contracts executed during a specified period of time. Upon the consummation of the transaction contemplated by the Share Purchase and Sale Agreement, the Purchaser obtained a broader license for product distribution. All liabilities of Gulf Agro remained with Gulf Agro. This transaction benefited Verus MENA by providing Verus MENA with a broader license for product distribution and full control of all intellectual property rights. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Apr. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 14: SUBSEQUENT EVENTS On May 30, 2019, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued 41,666,666 shares of its common stock for aggregate gross proceeds of $500,000. On May 30, 2019, the Company entered into a letter agreement with the First Investor, pursuant to which the principal amount of the First Note together with interest accrued thereon was converted into an aggregate of 512,333,333 shares of the Company’s common stock at a fixed conversion price of $0.0025 per share and the First Warrant was amended such that the First Warrant is exercisable for 500,000,000 shares of the Company’s common stock at a fixed exercise price of $0.0025 per share. The Company issued the 512,333,333 shares of its common stock on June 4, 2019. See Note 7. On May 30, 2019, the Company entered into a letter agreement with the Second Investor, pursuant to which the principal amount of the Second Note together with interest accrued thereon was converted into an aggregate of 81,920,000 shares of the Company’s common stock at a fixed conversion price of $0.0025 per share and the Second Warrant was amended such that the Second Warrant is exercisable for 80,000,000 shares of the Company’s common stock at a fixed exercise price of $0.0025 per share. The Company issued the 81,920,000 shares of its common stock on June 4, 2019. See Note 7. On June 1, 2019, the Board of Directors of Verus International, Inc. (the “Company”) appointed Christopher Cutchens as Chief Financial Officer of the Company, effective immediately. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Apr. 30, 2019 | |
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, valuation of intangible assets, stock-based compensation and the deferred tax asset valuation allowance. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior year’s unaudited consolidated financial statements to enhance comparability with the current year’s unaudited consolidated financial statements, including, but not limited to, presenting the spin-off of the Company’s real estate segment as discontinued operations for the six months ended April 30, 2018. |
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. The loss of one or more of our top customers, or a substantial decrease in demand by any of those customers for our products, could have a material adverse effect on our business, results of operations and financial condition. 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. Increases in the prices of the food products which the Company purchases could adversely affect its operating results if the Company is unable to fully offset the effect of these increased costs through price increases, and the Company can provide no assurance that it will be able to pass along such increased costs to the Company’s customers. Furthermore, if the Company cannot obtain sufficient food products or its suppliers cease to be available, the Company could experience shortages in its food products or be unable to meet its commitments to customers. Alternative sources of food products, if available, may be more expensive. 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 April 30, 2019 and October 31, 2018. |
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 April 30, 2019 and October 31, 2018, the Company determined there was no requirement for an allowance for doubtful accounts. |
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. All inventory are considered finished goods. |
Intangible Asset | Intangible Asset The Company amortizes its only intangible asset, a license with Major League Baseball Properties, Inc., on a straight-line basis over the estimated useful life of the license. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company has adopted Accounting Standards Codification (“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, 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 short and 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 Revenue is derived from the sale of food and beverage products. The Company recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers and their customers. In the event any discounts, sales incentives, or similar arrangements are agreed to with a customer, such amounts are estimated at time of sale and deducted from revenue. Sales taxes and other similar taxes are excluded from revenue (see Note 6). |
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 |
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”) 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. |
Foreign Currency | Foreign Currency The Company has one non-U.S. subsidiary, where the functional currency is not the U.S. dollar. The related assets and liabilities of this non-U.S. subsidiary have been translated using end of period exchange rates or historical exchange rates to the U.S. dollar. |
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 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 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2018, 2017 and 2016 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, 2018 and 2017. |
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 six months ended April 30, 2018 as we incurred a net loss for those periods. At April 30, 2019, there were outstanding warrants to purchase up to 623,705,000 shares of the Company’s common stock and approximately 6,000,000 shares of the Company’s common stock to be issued, which may dilute future EPS. At April 30, 2018, there were outstanding warrants to purchase up to 17,786,467 shares of the Company’s common stock and approximately 256,000,000 shares of the Company’s common stock to be issued, which may dilute future EPS. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs for freight expense on goods shipped are included in cost of sales. Freight expense on goods shipped for six months ended April 30, 2019 and 2018 was $178,360 and $67,421, respectively. |
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 and beverage products. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards Effective November 1, 2018, the Company adopted Revenue from Contracts with Customers (Topic 606) (“ASC 606”). The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in US GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. The Company adopted ASC 606 using the modified retrospective method, which did not have an impact on its consolidated financial statements. The Company expects the impact to net income of the new standard will be immaterial on an ongoing quarterly and annual basis. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. Refer to Note 6 for additional information regarding the Company’s adoption of ASC 606. Effective November 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which provides clarification on classifying a variety of activities within the statement of cash flows. The Company determined the adoption of ASU 2016-15 did not have a material impact on its consolidated financial statements. Effective November 1, 2018, the Company adopted ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash Effective November 1, 2018, the Company adopted ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business Effective November 1, 2018, the Company adopted ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting Compensation—Stock Compensation Effective November 1, 2018, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”). The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of fiscal 2020. Early adoption of ASU 2016-02 is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842, which amends certain aspects of the new lease standard). The Company is currently evaluating the impact of adopting ASU 2016-02 and ASU 2017-13 on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, to modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in the Concept Statement, including the consideration of costs and benefits. The standard is effective for the Company as of November 1, 2020, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. 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. |
Intangible Asset - License, N_2
Intangible Asset - License, Net (Tables) | 6 Months Ended |
Apr. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The net carrying amount of the License is as follows: April 30, 2019 October 31, 2018 Intangible asset – license, gross carrying amount $ 307,377 $ - Less accumulated amortization - - Intangible asset – license, net $ 307,377 $ - |
Schedule of Future Amortization Expense of Intangible Assets | Future amortization expense related to the existing net carrying amount of the License as of April 30, 2019 is expected to be as follows: Remainder of fiscal year 2019 $ 57,633 Fiscal year 2020 115,266 Fiscal year 2021 115,266 Fiscal year 2022 19,212 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Net Revenue by Country | Information about the Company’s net revenue by country is as follows: For the Three Months Ended For the Six Months Ended April 30, April 30, 2019 2018 2019 2018 Kingdom of Saudi Arabia $ 463,737 $ 289,745 $ 660,385 $ 409,323 Oman 198,732 91,397 398,251 183,110 Bahrain 195,460 101,436 507,449 317,507 United Arab Emirates 2,084,506 755,741 3,820,170 1,324,504 Net Revenue $ 2,942,435 $ 1,238,319 $ 5,386,255 $ 2,234,444 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 6 Months Ended |
Apr. 30, 2019 | |
Equity [Abstract] | |
Summary of Assumptions used on Fair Value of Options | The Company estimates the fair value of each award on the date of grant using a Black-Scholes option valuation model that uses the following assumptions for warrants earned during the six months ended April 30, 2019: Expected volatility 0.54% - 2.39 % Weighted-average volatility 0.63 % Expected dividends 0 % Expected term (in years) 2.0 Risk-free rate 2.39% - 2.56 % |
Schedule of Common Share Purchase Warrants Outstanding | The following table sets forth common share purchase warrants outstanding at April 30, 2019: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2018 123,761,716 $ 0.007 $ 0.00 Warrants granted and issued 1,691,574,073 $ 0.002 $ 0.00 Warrants exchanged (1,191,630,789 ) $ (0.002 ) $ 0.00 Outstanding, April 30, 2019 623,705,000 $ 0.003 $ 0.00 Common stock issuable upon exercise of warrants 623,705,000 $ 0.003 $ 0.00 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 6 Months Ended |
Apr. 30, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The revenues and expenses associated with discontinued operations included in our Unaudited Consolidated Statements of Operations for the three and six months ended April 30, 2018 were as follows: Three Months Ended April 30, 2018 Discontinued Continuing Total Revenue $ 76,560 $ 1,165,146 $ 1,241,706 Cost of revenue 19,800 1,026,581 1,046,381 Gross Profit 56,760 138,565 195,325 Operating Expenses: Salaries and benefits 23,469 179,882 203,351 Selling and promotions expense 665 - 665 Legal and professional fees 29,449 138,831 168,280 General and administrative 36,463 127,141 163,604 Total Operating Expenses 90,046 445,854 535,900 Operating loss (33,286 ) (307,289 ) (340,575 ) Other Income (Expense): Interest expense (422 ) (30,451 ) (30,872 ) Gain (Loss) on legal settlement of accounts payable and convertible debt 16,653 - 16,653 Total Other Income (Expense) 16,232 (30,451 ) (14,219 ) (Loss) income before income taxes (17,054 ) (337,740 ) (354,794 ) Income taxes - - - Net (loss) income $ (17,054 ) $ (337,740 ) $ (354,794 ) Six Months Ended April 30, 2018 Discontinued Continuing Total Revenue $ 146,787 $ 2,234,444 $ 2,381,231 Cost of revenue 39,600 1,964,771 2,004,371 Gross Profit 107,187 269,673 376,860 Operating Expenses: Salaries and benefits 58,844 327,090 385,934 Selling and promotions expense 798 - 798 Legal and professional fees 76,449 206,846 283,295 General and administrative 48,525 273,092 321,617 Total Operating Expenses 184,616 807,028 991,644 Operating loss (77,429 ) (537,355 ) (614,784 ) Other Income (Expense): Interest expense (893 ) (79,337 ) (80,230 ) Gain (Loss) on legal settlement of accounts payable and convertible debt 179,023 (351,853 ) (172,830 ) Total Other Income (Expense) 178,130 (431,190 ) (253,060 ) (Loss) income before income taxes 100,701 (968,545 ) (867,844 ) Income taxes - - - Net (loss) income $ 100,701 $ (968,545 ) $ (867,844 ) |
Nature of Business and Basis _2
Nature of Business and Basis of Presentation (Details Narrative) - shares | Jul. 20, 2018 | May 02, 2018 | Oct. 09, 2012 |
Owned percentage | 80.00% | ||
Number of shares issued in exchange transaction | 900 | ||
Stockholders shares description | The ex-dividend date, received one share of NestBuilder common stock for each 900 shares of our Company owned. | ||
Verus Foods MENA Limited [Member] | |||
Number of shares issued in exchange transaction | 75 | ||
Percentage for common stock ownership in exchange | 25.00% | ||
Series A Convertible Preferred Stock [Member] | |||
Designated shares | 93,000,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Oct. 31, 2018 | |
Accounting Policies [Abstract] | |||
Cash equivalents | |||
Allowance for doubtful accounts | |||
Number of outstanding warrants to purchase shares of common stock | 623,705,000 | 17,786,467 | |
Number of shares dilute future earnings per share | 6,000,000 | 256,000,000 | |
Freight expense | $ 178,360 | $ 67,421 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Oct. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Net cash used in operations | $ 377,792 | $ 773,338 | |
Working capital deficit | 242,534 | ||
Accumulated deficit | $ 24,278,606 | $ 26,104,740 |
Asset Acquisition (Details Narr
Asset Acquisition (Details Narrative) - Stock Purchase Agreement [Member] | Apr. 25, 2019USD ($)shares |
Big League Foods Inc [Member] | |
Sale of outstanding capital stock | shares | 1,500 |
Aggregate liabilities | $ 50,000 |
Aggregate liabilities and applicable payees thereof assumed company obligations | 50,000 |
Big League [Member] | Maximum [Member] | |
Earnout payments | $ 5,000,000 |
Intangible Asset - License, N_3
Intangible Asset - License, Net (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | |
Intangible assets, amortization expense | ||||
Major League Baseball Properties, Inc [Member] | License [Member] | ||||
Purchase consideration to acquire license | 5,357,377 | |||
Payments to acquire license | 50,000 | |||
Accrued royalty fees | 257,377 | 257,377 | ||
Net of cash acquired | 350 | |||
Contingently payable amount | $ 5,050,000 | $ 5,050,000 | ||
Amortized useful life | 32 months | |||
Intangible assets, amortization description | The License is amortized on a straight-line basis over a useful life of 32 months, coinciding with the remaining contractual term of the License agreement, which is through December 31, 2021. |
Intangible Asset - License, N_4
Intangible Asset - License, Net - Schedule of Intangible Assets (Details) - USD ($) | Apr. 30, 2019 | Oct. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Intangible asset - license, gross carrying amount | $ 307,377 | |
Less accumulated amortization | ||
Intangible asset - license, net | $ 307,377 |
Intangible Asset - License, N_5
Intangible Asset - License, Net - Schedule of Future Amortization Expense of Intangible Assets (Details) | Apr. 30, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of fiscal year 2019 | $ 57,633 |
Fiscal year 2020 | 115,266 |
Fiscal year 2021 | 115,266 |
Fiscal year 2022 | $ 19,212 |
Revenue - Schedule of Net Reven
Revenue - Schedule of Net Revenue by Country (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | |
Net revenue | $ 2,942,435 | $ 1,238,319 | $ 5,386,255 | $ 2,234,444 |
Kingdom of Saudi Arabia [Member] | ||||
Net revenue | 463,737 | 289,745 | 660,385 | 409,323 |
Oman [Member] | ||||
Net revenue | 198,732 | 91,397 | 398,251 | 183,110 |
Bahrain [Member] | ||||
Net revenue | 195,460 | 101,436 | 507,449 | 317,507 |
United Arab Emirates [Member] | ||||
Net revenue | $ 2,084,506 | $ 755,741 | $ 3,820,170 | $ 1,324,504 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | Apr. 26, 2019 | Mar. 06, 2019 | Feb. 11, 2019 | Feb. 08, 2019 | Jul. 20, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | Oct. 31, 2018 |
Proceeds from issuance of convertible promissory note | $ 1,960,319 | $ 683,000 | ||||||||
Warrants to purchase common stock | 623,705,000 | 17,786,467 | 623,705,000 | 17,786,467 | ||||||
Stock issued during period shares issues | 900 | |||||||||
Gain (Loss) on extinguishment of debt | $ 2,700,737 | $ 2,700,737 | ||||||||
Debt instrument, maturity date | Nov. 8, 2019 | |||||||||
Convertible notes payable outstanding | 510,000 | 510,000 | $ 1,497,126 | |||||||
Convertible notes payable, discount | $ 90,000 | 90,000 | $ 4,765 | |||||||
Amortization of debt discount | 702,376 | $ 10,330 | ||||||||
Value of debt converted into share | $ 1,485,633 | |||||||||
First Investor [Member] | June 4, 2019 [Member] | ||||||||||
Stock issued during period shares issues | 512,333,333 | |||||||||
Second Investor [Member] | June 4, 2019 [Member] | ||||||||||
Stock issued during period shares issues | 81,920,000 | |||||||||
Securities Purchase Agreement [Member] | ||||||||||
Gain (Loss) on extinguishment of debt | $ 681,945 | |||||||||
Proceeds from repayments of debt | $ 1,118,049 | |||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||||
Warrant term | 3 years | |||||||||
Warrants to purchase common stock | 925,925,925 | |||||||||
Allocated fair value of warrant | $ 573,389 | |||||||||
Derivative liability | 842,676 | |||||||||
Debt discount | $ 676,611 | |||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Note [Member] | ||||||||||
Note interest rate | 8.00% | |||||||||
Proceeds from issuance of convertible promissory note | $ 1,250,000 | |||||||||
Debt description | The note convertible debentures converts at 90% of the lowest sale trading price during the 30 trading days prior to conversion. Due to certain ratchet provisions contained in the convertible promissory note, the Company accounted for this conversion feature as a derivative liability. | |||||||||
Number of shares issued upon conversion | 512,333,333 | |||||||||
Number of warrants exercisable | 500,000,000 | |||||||||
Debt instrument, conversion price | $ 0.0025 | |||||||||
Exercise price of warrants | $ 0.0025 | |||||||||
Second Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||||
Warrant term | 3 years | |||||||||
Warrants to purchase common stock | 148,148,148 | |||||||||
Allocated fair value of warrant | $ 124,222 | |||||||||
Derivative liability | 134,828 | |||||||||
Debt discount | $ 75,778 | |||||||||
Number of shares issued upon conversion | 81,920,000 | |||||||||
Number of warrants exercisable | 80,000,000 | |||||||||
Debt instrument, conversion price | $ 0.0025 | |||||||||
Exercise price of warrants | $ 0.0025 | |||||||||
Second Securities Purchase Agreement [Member] | Accredited Investor [Member] | Second Note [Member] | ||||||||||
Note interest rate | 8.00% | |||||||||
Proceeds from issuance of convertible promissory note | $ 200,000 | |||||||||
Debt description | The note converts at 90% of the lowest sale price during the 30 trading days prior to conversion. Due to certain ratchet provisions contained in the convertible promissory note, the Company accounted for this conversion feature as a derivative liability. | |||||||||
Third Securities Purchase Agreement [Member] | Accredited Investor [Member] | Third Note [Member] | ||||||||||
Note interest rate | 5.00% | |||||||||
Proceeds from issuance of convertible promissory note | $ 600,000 | |||||||||
Debt discount | $ 90,000 | |||||||||
Debt instrument, conversion price | $ 0.10 | |||||||||
Debt instrument, maturity date | Nov. 12, 2019 | |||||||||
Note interest rate, description | The Note matures on November 12, 2019, bears interest at a rate of 5% per annum (increasing to 24% per annum upon the occurrence of an Event of Default (as defined in the Note)) and is convertible into shares of the Company's common stock at a conversion price of $0.10 per share, subject to adjustment. The Note may be prepaid by the Company at any time without penalty. |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) | Feb. 08, 2019 | Apr. 30, 2019 | Oct. 31, 2018 |
Note payable | $ 530,000 | $ 530,000 | |
Maturity date | Nov. 8, 2019 | ||
Donald P. Monaco Insurance Trust [Member] | |||
Note payable | $ 530,000 | ||
Annual interest rate | 12.00% | ||
Maturity date description | January 26, 2019 to January 26, 2020 |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) - $ / shares | Apr. 26, 2019 | Jan. 11, 2019 | Dec. 28, 2018 | Jul. 20, 2018 | Apr. 30, 2019 | Jan. 31, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | Oct. 31, 2018 | Oct. 09, 2012 |
Number of shares authorized | 7,625,000,000 | 7,625,000,000 | ||||||||
Common stock, shares authorized | 1,500,000,000 | 7,500,000,000 | 7,500,000,000 | 7,500,000,000 | ||||||
Common stock, par value | $ 0.001 | $ 0.000001 | $ 0.000001 | $ 0.000001 | ||||||
Common stock, shares outstanding | 1,654,529,899 | 1,654,529,899 | ||||||||
Preferred stock, par value | $ 0.000001 | |||||||||
Reverse stock split description | pursuant to which the shares of common stock would be combined and reclassified into one share of common stock at a ratio within the range from 1-for-2 up to 1-for-400 (the "Reverse Stock Split"), provided that, (X) that the Company may not effect Reverse Stock Splits that, in the aggregate, exceed 1-for-400, and (Y) any Reverse Stock Split may not be completed later than January 11, 2020. | |||||||||
Stock issued during period shares issues | 900 | |||||||||
Warrants to purchase common stock | 623,705,000 | 623,705,000 | 17,786,467 | |||||||
Number of shares dilute future earnings per share | 6,000,000 | 256,000,000 | ||||||||
Ownership interest percentage | 80.00% | |||||||||
Preferred Stock [Member] | ||||||||||
Preferred stock, shares authorized | 125,000,000 | 125,000,000 | ||||||||
Preferred stock, par value | $ 0.000001 | $ 0.000001 | ||||||||
Common Stock [Member] | ||||||||||
Number of shares dilute future earnings per share | 6,000,000 | |||||||||
Number of shares converted | 2,500,000 | |||||||||
Common stock shares issued upon conversion | 99,517,696 | |||||||||
Monaker Group, Inc. [Member] | ||||||||||
Stock issued during period shares issues | 152,029,899 | |||||||||
Chief Executive Officer [Member] | ||||||||||
Warrants to purchase common stock | 37,500,000 | 37,500,000 | ||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||||||
Stock issued during period shares issues | 254,000,000 | |||||||||
Warrants to purchase common stock | 7,500,000 | 7,500,000 | ||||||||
Ownership interest percentage | 20.00% | 20.00% | ||||||||
Warrant to acquire percentage | 3.00% | 3.00% | ||||||||
Series A Convertible Preferred Stock [Member] | ||||||||||
Preferred stock, shares authorized | 120,000,000 | 120,000,000 | 120,000,000 | |||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares outstanding | 44,570,101 | 44,570,101 | 44,570,101 | |||||||
Series B Convertible Preferred Stock [Member] | ||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | |||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares outstanding | ||||||||||
Series C Convertible Preferred Stock [Member] | ||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | |||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares outstanding | 430,801 | 430,801 | 160,000 | |||||||
Number of shares converted | 25,000 | |||||||||
Common stock shares issued upon conversion | 2,500,000 | |||||||||
Series C Convertible Preferred Stock [Member] | Chief Executive Officer [Member] | ||||||||||
Number of shares awarded | 295,801 | |||||||||
Series C Convertible Preferred Stock [Member] | Chief Executive Officer [Member] | Warrant [Member] | ||||||||||
Stock issued during period shares issues | 117,556,716 | |||||||||
Series C Convertible Preferred Stock [Member] | Board of Directors Member [Member] | ||||||||||
Number of shares awarded | 501,130 |
Stockholders' Deficit - Summary
Stockholders' Deficit - Summary of Assumptions used on Fair Value of Options (Details) | 6 Months Ended |
Apr. 30, 2019 | |
Weighted-average volatility | 0.63% |
Expected dividends | 0.00% |
Expected term (in years) | 2 years |
Minimum [Member] | |
Expected volatility | 0.54% |
Risk-free rate | 2.39% |
Maximum [Member] | |
Expected volatility | 2.39% |
Risk-free rate | 2.56% |
Stockholders' Deficit - Schedul
Stockholders' Deficit - Schedule of Common Share Purchase Warrants Outstanding (Details) - Warrant [Member] | 6 Months Ended |
Apr. 30, 2019$ / sharesshares | |
Warrants Outstanding Beginning Balance | shares | 123,761,716 |
Warrants Granted and Issued | shares | 1,691,574,073 |
Warrants Exchanged | shares | (1,191,630,789) |
Warrants Outstanding Ending Balance | shares | 623,705,000 |
Common Stock Issuable Upon Exercise of Warrants Shares | shares | 623,705,000 |
Weighted Average Exercise Price Beginning Balance | $ 0.007 |
Weighted Average Exercise Price Warrants Granted and Issued | 0.002 |
Weighted Average Exercise Price Warrants Exchanged | (0.002) |
Weighted Average Exercise Price Ending Balance | 0.003 |
Common Stock Issuable Upon Exercise of Warrants Price | 0.003 |
Intrinsic Value Beginning Balance | 0 |
Intrinsic Value Warrants Granted and Issued | 0 |
Intrinsic Value Warrants Exchanged | 0 |
Intrinsic Value Ending Balance | 0 |
Common Stock Issuable Upon Exercise of Warrants Intrinsic Value | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | |
Commitments percentage | 4.00% | |||
Amount awarded under litigation | $ 200,000 | |||
Loss on legal settlement | 199,489 | $ 351,853 | ||
Guaranteed minimum royalty payments | 1,715,000 | 1,715,000 | ||
Accounts payable and accrued expenses | 257,727 | 257,727 | ||
October 31, 2019 [Member] | ||||
Guaranteed minimum royalty payments | 405,000 | 405,000 | ||
October 31, 2020 [Member] | ||||
Guaranteed minimum royalty payments | 530,000 | 530,000 | ||
October 31, 2021 [Member] | ||||
Guaranteed minimum royalty payments | 780,000 | 780,000 | ||
Major League Baseball Properties, Inc [Member] | License [Member] | ||||
Contingently payable amount | 5,050,000 | 5,050,000 | ||
Due amount upon initial sale | $ 50,000 | |||
Earnout payable, description | The Earnout is payable on a quarterly basis at $1.00 per case sold for sales that have a minimum gross margin of 20% per case. | |||
Major League Baseball Properties, Inc [Member] | License [Member] | Maximum [Member] | ||||
Contingently payable amount | 5,050,000 | $ 5,050,000 | ||
Major League Baseball Properties, Inc [Member] | License [Member] | December 31, 2022 [Member] | ||||
Contingently payable amount | $ 5,000,000 | 5,000,000 | ||
Big League Foods, Inc. [Member] | ||||
Payment on guaranteed working capital funding | $ 500,000 |
Segment Reporting (Details Narr
Segment Reporting (Details Narrative) | Jul. 31, 2018Segments |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Apr. 30, 2019 | Jan. 31, 2019 | Apr. 30, 2018 | Jan. 31, 2018 | Apr. 30, 2019 | Apr. 30, 2018 | |
Revenue | $ 1,241,706 | $ 2,381,231 | ||||
Cost of revenue | 1,046,381 | 2,004,371 | ||||
Gross Profit | 195,325 | 376,860 | ||||
Salaries and benefits | 203,351 | 385,934 | ||||
Selling and promotions expense | 665 | 798 | ||||
Legal and professional fees | 168,280 | 283,295 | ||||
General and administrative | 163,604 | 321,617 | ||||
Total Operating Expenses | 535,900 | 991,644 | ||||
Operating loss | (340,575) | (614,784) | ||||
Interest expense | (30,872) | (80,230) | ||||
Gain (Loss) on legal settlement of accounts payable and convertible debt | 16,653 | (172,830) | ||||
Total Other Income (Expense) | (14,219) | (253,060) | ||||
(Loss) income before income taxes | (354,794) | (867,844) | ||||
Income taxes | ||||||
Net (loss) income | $ 2,164,614 | $ (338,478) | (354,794) | $ (507,006) | $ 1,826,134 | (867,844) |
Discontinued [Member] | ||||||
Revenue | 76,560 | 146,787 | ||||
Cost of revenue | 19,800 | 39,600 | ||||
Gross Profit | 56,760 | 107,187 | ||||
Salaries and benefits | 23,469 | 58,844 | ||||
Selling and promotions expense | 665 | 798 | ||||
Legal and professional fees | 29,449 | 76,449 | ||||
General and administrative | 36,463 | 48,525 | ||||
Total Operating Expenses | 90,046 | 184,616 | ||||
Operating loss | (33,286) | (77,429) | ||||
Interest expense | (422) | (893) | ||||
Gain (Loss) on legal settlement of accounts payable and convertible debt | 16,653 | 179,023 | ||||
Total Other Income (Expense) | 16,232 | 178,130 | ||||
(Loss) income before income taxes | (17,054) | 100,701 | ||||
Income taxes | ||||||
Net (loss) income | (17,054) | 100,701 | ||||
Continuing [Member] | ||||||
Revenue | 1,165,146 | 2,234,444 | ||||
Cost of revenue | 1,026,581 | 1,964,771 | ||||
Gross Profit | 138,565 | 269,673 | ||||
Salaries and benefits | 179,882 | 327,090 | ||||
Selling and promotions expense | ||||||
Legal and professional fees | 138,831 | 206,846 | ||||
General and administrative | 127,141 | 273,092 | ||||
Total Operating Expenses | 445,854 | 807,028 | ||||
Operating loss | (307,289) | (537,355) | ||||
Interest expense | (30,451) | (79,337) | ||||
Gain (Loss) on legal settlement of accounts payable and convertible debt | (351,853) | |||||
Total Other Income (Expense) | (30,451) | (431,190) | ||||
(Loss) income before income taxes | (337,740) | (968,545) | ||||
Income taxes | ||||||
Net (loss) income | $ (337,740) | $ (968,545) |
Business Divestiture (Details N
Business Divestiture (Details Narrative) - shares | Jul. 20, 2018 | May 02, 2018 |
Number of shares issued in exchange transaction | 900 | |
Verus Foods MENA Limited [Member] | ||
Number of shares issued in exchange transaction | 75 | |
Percentage for common stock ownership in exchange | 25.00% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Jun. 04, 2019 | May 30, 2019 | Jul. 20, 2018 | Jan. 31, 2018 |
Stock issued during period shares issues | 900 | |||
Common Stock [Member] | ||||
Common stock shares issued upon conversion | 99,517,696 | |||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Common Stock [Member] | Accredited Investor [Member] | ||||
Stock issued during period shares issues | 41,666,666 | |||
Proceeds from issuance of common stock | $ 500,000 | |||
Subsequent Event [Member] | Letter Agreement [Member] | First Investor [Member] | ||||
Common stock shares issued upon conversion | 512,333,333 | |||
Number of shares issued for note conversion | 512,333,333 | |||
Conversion price per share | $ 0.0025 | |||
Number of warrant exercisable | 500,000,000 | |||
Warrants exercisable price per share | $ 0.0025 | |||
Subsequent Event [Member] | Letter Agreement [Member] | Second Investor [Member] | ||||
Common stock shares issued upon conversion | 81,920,000 | |||
Number of shares issued for note conversion | 81,920,000 | |||
Conversion price per share | $ 0.0025 | |||
Number of warrant exercisable | 80,000,000 | |||
Warrants exercisable price per share | $ 0.0025 |