Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Oct. 31, 2019 | Apr. 08, 2020 | Apr. 30, 2019 | |
Document And Entity Information | |||
Entity Registrant Name | VERUS INTERNATIONAL, INC. | ||
Entity Central Index Key | 0001430523 | ||
Document Type | 10-K | ||
Document Period End Date | Oct. 31, 2019 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --10-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity Current Reporting Status | No | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business Flag | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 14,000,000 | ||
Entity Common Stock, Shares Outstanding | 2,320,876,565 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Oct. 31, 2019 | Oct. 31, 2018 |
Current Assets | ||
Cash | $ 371,898 | $ 28,554 |
Accounts receivable | 3,319,687 | 1,246,301 |
Inventory | 598,515 | 90,589 |
Prepaid expenses | 65,749 | 12,412 |
Other assets | 8,629 | 8,629 |
Total Current Assets | 4,364,478 | 1,386,485 |
Property and equipment, net | 23,257 | 15,622 |
Intangible assets, net | 837,707 | |
Total Assets | 5,225,442 | 1,402,107 |
Current Liabilities | ||
Accounts payable and accrued expenses | 3,613,641 | 642,739 |
Interest payable | 127,465 | 257,170 |
Due to former officer | 1,801 | 33,301 |
Notes payable | 1,030,000 | 530,000 |
Convertible notes payable, net | 1,378,855 | 1,497,126 |
Total Current Liabilities | 6,151,762 | 2,960,336 |
Commitments and Contingencies (Note 14) | ||
Stockholders' Deficit | ||
Common stock, $0.000001 par value; 7,500,000,000 shares authorized and 2,305,778,511 and 1,500,000,000 shares issued at October 31, 2019 and October 31, 2018, respectively | 2,306 | 1,500,000 |
Additional paid-in-capital | 27,565,919 | 22,545,691 |
Shares to be issued | 456,090 | |
Accumulated deficit | (28,494,590) | (26,104,740) |
Total Stockholders' Deficit | (926,320) | (1,558,229) |
Total Liabilities and Stockholders' Deficit | 5,225,442 | 1,402,107 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | 45 | 44,570 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | ||
Series C Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Convertible preferred stock, value | $ 160 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 31, 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 | 2,305,778,511 | 1,500,000,000 |
Series A Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.000001 | $ 0.000001 |
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 | $ 0.000001 | $ 0.000001 |
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 | $ 0.000001 | $ 0.000001 |
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 and Comprehensive Loss - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Income Statement [Abstract] | ||
Revenue | $ 13,611,101 | $ 5,802,037 |
Cost of revenue | 11,546,413 | 5,053,453 |
Gross Profit | 2,064,688 | 748,584 |
Operating Expenses: | ||
Salaries and benefits | 3,892,926 | 788,212 |
Selling and promotions expense | 125,644 | |
Legal and professional fees | 618,310 | 285,138 |
General and administrative | 1,544,689 | 585,732 |
Total Operating Expenses | 6,181,569 | 1,659,082 |
Operating loss | (4,116,881) | (910,498) |
Other Income (Expense): | ||
Interest expense | (364,005) | (320,527) |
Loss on legal settlements | (205,300) | |
Initial derivative liability expense | (225,115) | |
Amortization of debt discount | (839,876) | |
Amortization of issuance costs | (21,355) | |
Gain on extinguishment of debt | 2,700,737 | |
Gain on convertible notes payable settlement | 681,945 | |
Loss on legal settlement of accounts payable and convertible debt | (914,353) | |
Default principal increase on convertible notes payable | (938,100) | |
Total Other Income (Expense) | 1,727,031 | (2,172,980) |
Loss from continuing operations before income taxes | (2,389,850) | (3,083,478) |
Income taxes | ||
Loss from continuing operations | (2,389,850) | (3,083,478) |
Discontinued operations (Note 16) | ||
Income from discontinued operations | 259,186 | |
Net loss | (2,389,850) | (2,824,292) |
Comprehensive income (loss): | ||
Unrealized gain on currency translation adjustment | 72,924 | |
Comprehensive loss | $ (2,389,850) | $ (2,751,368) |
Loss per common share: | ||
Loss from continuing operations per common share - basic and diluted | $ 0 | $ 0 |
Income from discontinued operations per common share - basic and diluted | 0 | |
Loss per common share - basic and diluted | $ 0 | $ 0 |
Weighted average shares outstanding - basic and diluted | 1,852,481,686 | 740,632,107 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders' Deficit - 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] | Shares 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 | $ 1,244,233 | (442,298) | 801,935 | ||||||
Shares Issued for Conversion of Promissory Notes, shares | 1,244,233,615 | ||||||||
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 | |||||||
Common Stock retired from Nestbuilder | $ (4,163) | 4,163 | |||||||
Common Stock retired from Nestbuilder, shares | (4,163,315) | ||||||||
Adjustment for excess NestBuilder settlement | 116,137 | 116,137 | |||||||
Spin-off of real estate segment | (19,639) | 7,378 | (12,261) | ||||||
Shares to be issued under stock-based compensation | 299,635 | $ 299,635 | |||||||
Shares to be issued under Monaker litigation settlement | 456,090 | 456,090 | |||||||
Other comprehensive income (loss) | 72,924 | $ 72,924 | |||||||
Net loss | (2,824,292) | (2,824,292) | |||||||
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 Monaker litigation settlement | $ 152,030 | 304,060 | $ (456,090) | ||||||
Shares issued under Monaker litigation settlement, shares | 152,029,899 | ||||||||
Shares to be issued under stock-based compensation | 2,515,794 | 2,515,794 | |||||||
Shares issued under exchange agreement | $ 296 | 1,208 | 1,504 | ||||||
Shares issued under exchange agreement, shares | 295,801 | ||||||||
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 | |||||||
Relative fair value of warrants issued with convertible promissory notes | 697,611 | 697,611 | |||||||
Shares issued for sale of Common Stock | $ 42 | 499,958 | 500,000 | ||||||
Shares issued for sale of Common Stock, shares | 41,666,666 | ||||||||
Conversion of convertible promissory notes to Common Stock | $ 607 | (837,699) | (837,092) | ||||||
Conversion of convertible promissory notes to Common Stock, shares | 607,162,591 | ||||||||
Shares issued for warrant exercise | $ 2 | (2) | |||||||
Shares issued for warrant exercise, shares | 2,419,355 | ||||||||
Reduction of par value of Preferred and Common Stock | $ (44,525) | $ (431) | $ (1,652,875) | 1,697,831 | |||||
Reduction of par value of Preferred and Common Stock, shares | |||||||||
Beneficial conversion feature for conversion of convertible promissory note to Common Stock | 143,942 | 143,942 | |||||||
Net loss | (2,389,850) | (2,389,850) | |||||||
Balance at Oct. 31, 2019 | $ 45 | $ 2,306 | $ 27,565,919 | $ (28,494,590) | $ (926,320) | ||||
Balance, shares at Oct. 31, 2019 | 44,570,101 | 430,801 | 2,305,778,511 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (2,389,850) | $ (2,824,292) |
Adjustments to reconcile net loss to net cash from operating activities: | ||
Amortization of issuance costs | 21,355 | |
Depreciation and amortization | 68,136 | |
Beneficial conversion feature for conversion of convertible debt to Common Stock | 143,942 | |
Initial derivative liability expense | 225,115 | |
Amortization of debt discount | 839,876 | |
Share based compensation | 3,380,469 | 299,635 |
Gain on extinguishment of debt | (2,700,737) | |
Gain on convertible notes settlement | (681,945) | |
Loss on spin-off of real estate segment | 12,261 | |
Legal settlement settled in shares | 330,180 | |
Legal settlement to be settled in shares | 456,090 | |
Default principal increase on convertible notes payable | 938,100 | |
Gain on NestBuilder settlement | (116,137) | |
Changes in operating assets and liabilities: | ||
Increase in accounts receivable | (2,618,016) | (433,553) |
(Increase) decrease in inventory | (507,926) | 250,599 |
Increase in prepaid expenses | (53,337) | (12,412) |
Decrease in other assets | 7,992 | |
Increase in accounts payable and accrued expenses | 2,066,054 | 358,236 |
Decrease in due to officer | (31,500) | |
Net cash used in operating activities of continuing operations | (2,238,364) | (715,566) |
Net cash used in operating activities of discontinued operations | (354,733) | |
Net cash used in operating activities | (2,238,364) | (1,070,299) |
Cash flows from investing activities: | ||
Asset acquisition, net of cash acquired | (99,650) | |
Capital expenditures | (11,470) | (15,622) |
Net cash used in investing activities of continuing operations | (111,120) | (15,622) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible notes payable | 3,270,000 | 908,250 |
Payments applied to convertible promissory notes | (1,577,172) | (118,000) |
Proceeds from issuance of note payable | 500,000 | |
Proceeds from sale of common stock | 500,000 | |
Net cash provided by financing activities of continuing operations | 2,692,828 | 790,250 |
Effect of exchange rate on cash and cash equivalents | 72,924 | |
Net increase (decrease) in cash | 343,344 | (222,747) |
Cash at beginning of period | 28,554 | 251,301 |
Cash at end of period | 371,898 | 28,554 |
Supplemental disclosure: | ||
Cash paid for interest | 97,734 | 53,508 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Acquisition price of french fry business customer contracts through relief of accounts receivable invoices | 544,630 | |
Initial recognition of relative fair value of warrant agreements as convertible promissory notes discount | 697,611 | |
Settlement of Accrued Compensation Through Issuance of Series C Preferred Stock [Member] | ||
Supplemental disclosure of non-cash operating activities: | ||
Value | $ 1,504 | |
Shares | 295,801 | |
Common Stock Issued in Exchange for Note Payable and Conversion of Convertible Promissory Notes [Member] | ||
Supplemental disclosure of non-cash investing and financing activities: | ||
Value | $ 188,530 | $ 801,935 |
Shares | 607,162,591 | 1,244,233,615 |
Organization and Nature of Busi
Organization and Nature of Business | 12 Months Ended |
Oct. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | NOTE 1: ORGANIZATION AND NATURE OF BUSINESS Organization and Nature of Business Verus International, Inc., including its wholly-owned subsidiaries, are collectively referred to herein as “Verus,” “VRUS”, “Company,” “us,” or “we.” We were incorporated in the state of Delaware under the name Spectrum Gaming Ventures, Inc. on May 25, 1994. On October 10, 1995, we changed our name to Select Video, Inc. On October 24, 2007, we filed a Certificate of Ownership with the Delaware Secretary of State whereby Webdigs, Inc., our wholly-owned subsidiary, was merged with and into us and we changed our name to Webdigs, Inc. On October 9, 2012, we 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 we 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 our 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, we filed a Certificate of Ownership with the Delaware Secretary of State whereby RealBiz Media Group, Inc., our wholly-owned subsidiary, was merged with and into us and we changed our 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. 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. Until July 31, 2018, we 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) our fully licensed real estate division (formerly known as Webdigs); (ii) our television media contracts division (Home Preview Channel /Extraordinary Vacation Homes); and (iii) our 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 our programs was our proprietary video creation technology which allowed for an automated conversion of data (text and pictures of home listings) to a video with voice and music. We provided video search, storage and marketing capabilities on multiple platform dynamics for web, mobile and television. Once a home, personal or community video was created using our proprietary technology, it could be published to social media, emailed or distributed to multiple real estate websites, broadband or television for consumer viewing. We 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, we spun off our real estate division into NestBuilder. All of our 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 our 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, we, through our wholly-owned subsidiary, Verus Foods, Inc., an international supplier of consumer food products, have been focused on international consumer packaged goods, foodstuff distribution and wholesale trade. Our fine food products are sourced in the United States and exported internationally. We market consumer food products under our own brands primarily to supermarkets, hotels, and other members of the wholesale trade. Initially, we focused on frozen foods, particularly meat, poultry, seafood, vegetables, and french fries with beverages as a second vertical, and during 2018, we 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. Verus has also begun to explore new consumer packaged goods (“CPG”) non-food categories, such as cosmetic and fragrances, for future product offerings. We currently have 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. In addition to the foregoing, since our acquisition of Big League Foods, Inc. (“BLF”) during April 2019, pursuant to which we acquired a license with Major League Baseball Properties, Inc. (“MLB”) to sell MLB-branded frozen dessert products and confections, we have been selling pint size ice cream in grocery store-type packaging and are exploring novelty “grab-and-go” size ice cream in cone, bar, and sandwich versions under our frozen dessert product line. In addition, under our confections product line, we are selling gummi and chocolate candies. The MLB license covers all 30 MLB teams, and all of our current products pursuant to such license feature “home team” packaging that matches the fan base in each region. Furthermore, during August 2019, we purchased all of the assets of a french fry business in the Middle East. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Consolidation and Presentation The consolidated financial statements for the years ended October 31, 2019 and 2018 include the operations of BLF effective April 25, 2019, Verus MENA effective May 1, 2018, Verus Foods, Inc. effective January 2017, and Gulf Agro Trading, LLC through April 30, 2018 (see Note 17). The historical operations of subsidiaries RealBiz 360 Enterprise (Canada), Inc., RealBiz 360, Inc., and its wholly-owned subsidiary, Webdigs, LLC, which includes the dormant wholly owned subsidiaries of Home Equity Advisors, LLC, and Credit Garage, LLC from the recapitalization date of October 9, 2012 are reported as discontinued operations for all periods presented through July 31, 2018 (see Note 16). All significant intercompany balances and transactions have been eliminated in the consolidation. Reclassifications Certain reclassifications of prior year amounts have been made to enhance comparability with the current year’s consolidated financial statements, including, but not limited to, presenting the spin-off of the real estate segment as discontinued operations for all periods presented and presentation of certain items within the consolidated statement of cash flows. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. 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 consolidated financial statements and the reported amounts of revenues and expenses for 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, valuations of inventory, finite-lived intangible assets, derivative liabilities, stock-based compensation, and the valuation reserve for income taxes. Concentrations of Credit Risk The Company’s food products accounts receivable, net and revenues as of and for the year ended October 31, 2019 were geographically concentrated with customers located in the GCC countries. In addition, significant concentrations existed with a limited number of customers. Approximately 42% of accounts receivable, net as of October 31, 2019 was concentrated with three customers and approximately 66% of revenues for the year ended October 31, 2019 were concentrated with six customers. Although 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, such risks may be mitigated by our access to credit insurance programs. 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 we purchase could adversely affect our operating results if we are unable to offset the effect of these increased costs through price increases, and we can provide no assurance that we will be able to pass along such increased costs to our customers. Furthermore, if we cannot obtain sufficient food products or our suppliers cease to be available to us, we could experience shortages in our food products or be unable to meet our 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 October 31, 2019 or October 31, 2018. Marketable securities During January 2018, as part of the legal settlement with Monaker, NestBuilder received Monaker common shares valued at $32,270, which were classified as “available for sale” securities until being spun-off on August 1, 2018 (see Note 16). These marketable securities were determined trading securities pursuant to Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events, and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses, and such losses traditionally have been within its expectations. At October 31, 2019 and 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. Inventories consist of raw materials (film and packaging) and finished products. At October 31, 2019, raw materials and finished products inventory totaled $54,392 and $544,123, respectively. At October 31, 2018, all inventory was finished products inventory. Intangible Assets The Company amortizes its two intangible assets, a license with MLB, and certain acquired customer contracts, on a straight-line basis over the estimated useful lives of the assets. Property and Equipment All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. The estimated useful lives range from 3 to 7 years based upon asset class. When an asset is retired, sold or impaired, the resulting gain or loss is reflected in earnings. The Company incurred depreciation expense of $3,835 for the year ended October 31, 2019. The Company did not incur depreciation expense for the year ended October 31, 2018. Impairment of Long-Lived Assets In accordance with Accounting Standards Codification (“ASC”) 360-10, “Property, Plant, and Equipment”, the Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. For the years ended October 31, 2019 and 2018, the Company did not impair any long-lived assets. Fair Value of Financial Instruments The Company measures its financial instruments in accordance with 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 8). Cost of Revenues Cost of revenues represents the cost of the food products sold during the periods presented. 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 the years ended October 31, 2019 and 2018 were $562,959 and $162,190, respectively. Share-Based Compensation The Company computes share based payments in accordance with ASC 718-10 “Compensation” (“ASC 718-10”). ASC 718-10 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods and services at fair value, focusing primarily on accounting for transactions in which an entity obtains employees services in share-based payment transactions. It also addresses transactions in which an entity incurs liabilities in exchange for goods and services that are based on the fair value of an entity’s equity instruments or that may be settled by the issuance of those equity instruments. In March 2005, the U.S. Securities and Exchange Commission (the “SEC”) issued Staff Accounting Bulletin (“SAB”) No. 107, Share-Based Payment (“SAB 107”) which provides guidance regarding the interaction of ASC 718-10 and certain SEC rules and regulations. The Company has applied the provisions of SAB 107 in its adoption of ASC 718-10. The Company accounts for non-employee share-based awards in accordance with ASC Topic 505-50, Equity Based Payments to Non-Employees. The Company estimates the fair value of stock options and warrants by using the Black-Scholes option pricing model. Derivative Instruments The Company accounts for financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features in accordance with ASC topic 815, “Accounting for Derivative Instruments and Hedging Activities” as well as related interpretations of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, considering all of the rights and obligations of each instrument. The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of the Company’s common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. Increases in the trading price of the Company’s common stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Company’s common stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. 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 (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 expense over the life of the debt. Foreign Currency Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates and profit and loss accounts have been translated using average exchange rates. Foreign currency translation gains and losses are included in the Consolidated Statements of Operations and Comprehensive Loss as a component of comprehensive loss. Assets and liabilities of an entity that are denominated in currencies other than an entity’s functional currency are re-measured into the functional currency using end of period exchange rates or historical rates, where applicable to certain balances. Gains and losses related to these re-measurements are recorded within the Consolidated Statements of Operations and Comprehensive Loss as a component of other income (expense). Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740 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, 2019, 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 years ended October 31, 2019 and 2018. 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 years ended October 31, 2019 and 2018 as we incurred a net loss for those periods. At October 31, 2019, there were outstanding warrants to purchase approximately 726 million shares of the Company’s common stock, approximately 88 million shares of the Company’s common stock issuable upon the conversion of series A and series C convertible preferred stock, and approximately 16 million shares of the Company’s common stock issuable upon the conversion of convertible notes payable which may dilute future EPS. At October 31, 2018, there were outstanding warrants to purchase approximately 124 million shares of the Company’s common stock, approximately 276 million shares of the Company’s common stock to be issued, and approximately 61 million shares of the Company’s common stock issuable upon the conversion of series A and series C convertible preferred stock which may dilute future EPS. 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 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 determined the adoption of ASC 606 did not have a material impact on its consolidated financial statements. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. Refer to Note 8 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 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 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 During February 2016, the FASB established Topic 842, Leases During August 2018, the FASB issued ASU 2018-13, 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 consolidated financial statements. |
Going Concern
Going Concern | 12 Months Ended |
Oct. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 3: GOING CONCERN The accompanying 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 net losses of $2,389,850 and $2,824,292 and has used cash in operating activities of $2,238,364 and $1,070,299 for the years ended October 31, 2019 and 2018, respectively. As of October 31, 2019, the Company had a working capital deficit of $1,787,284, and an accumulated deficit of $28,494,590. 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 consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts nor to the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. In order to meet its working capital needs through the next twelve months and to fund the growth of the food business, the Company may consider plans to raise additional funds through the issuance of 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. |
Business Acquisition
Business Acquisition | 12 Months Ended |
Oct. 31, 2019 | |
Business Combinations [Abstract] | |
Business Acquisition | NOTE 4: BUSINESS ACQUISITION On October 30, 2019 (the “Closing Date”), the Company entered into a Contribution and Sale Agreement (the “Agreement”) with Nutribrands Holdings, LLC, a wholly-owned subsidiary of the Company (“Nutribrands Holdings”), South Enterprise, LLC (“South Enterprise”), the members of South Enterprise (the “SE Members”), Nutribrands, LTDA (“Nutribrands” and together with South Enterprise, the “Companies” and each individually, a “Company”) and the equity holders of Nutribrands (the “NB Equity Holders” and together with the SE Members, the “Sellers”) and Rodrigo Nogueira, solely in his capacity as the Seller’s representative. Pursuant to the terms of the Agreement, on the Closing Date, the Sellers contributed all of their limited liability interests and equity interests (collectively, the “Interests”) in South Enterprise and Nutribrands, respectively, to Nutribrands Holdings in exchange for 49% of the membership interests of Nutribrands Holdings (the “Nutribrands Holdings Membership Interests”). Pursuant to the terms of the Agreement, until the five year anniversary of the Closing Date, the Companies may request that Nutribrands Holdings make available, Working Capital (as defined in the Agreement) for Qualified Transactions (as defined in the Agreement). Of such Working Capital, $1 million may be used by the Sellers for certain transaction fees. Furthermore, the Company has agreed to provide certain Working Capital Financing (as defined in the Agreement) for Qualified Transactions, and to the extent that the Company does not provide such Working Capital Financing and fails to fund the Qualified Transactions, the Sellers shall have the right to terminate the Agreement and the Holdings LLC Agreement (as defined in the Agreement). Moreover, upon the expiration of the Measurement Period (as defined the Agreement), if the Companies fail to meet or exceed the Projections (as defined in the Agreement) with respect to the end of the Measurement Period, Nutribrands Holdings shall have the right to redeem or the Company shall have the right to acquire, and the Sellers shall have the obligation to transfer, pursuant to the Holdings LLC Agreement, the Nutribrands Holdings Membership Interests having an aggregate value (based on the value assigned to such interests on the Closing Date) equal to the amount of the shortfall of the actual revenue of the Company for the trailing 12 month period ending on the fifth anniversary of the Closing Date and the projected revenue for such trailing 12 month period included in the Projections. Furthermore, pursuant to the Agreement, beginning one year after the Closing Date, until the five-year anniversary thereof, the Sellers shall have the opportunity to receive an annual dividend of up to $4.5 million per year based upon the cumulative consolidated financial performance of the Companies; provided, however, such dividend shall not exceed an aggregate of $18 million. Subsequent to the Closing Date, as a result of the Company and Sellers inability to agree upon advancement of Nutribrands’ business operations, effective March 31, 2020, the Company and Sellers entered into a Termination and Release Agreement (“Termination Agreement”) pursuant to which, among other things, (i) all agreements between the parties (including the October 30, 2019 Amended and Restated Operating Agreement of Nutribrands International, LLC and the Agreement and all related ancillary agreements) were terminated (the “Released Transactions”) and (ii) the parties released each other from any and all obligations whatsoever arising from the Released Transactions, subject to certain exceptions. Accordingly, the Company concluded that no business combination occurred on October 30, 2019, as the Company never obtained control over Nutribrands as it did not have control over management nor could it agree with the management of Nutribrands to advance the business and operate pursuant to the terms of the Agreement. Therefore, in accordance with ASC topic 855, “Subsequent Events”, this Termination Agreement was considered a Type 1 subsequent event and therefore no financial information related to this transaction has been included in the Company’s consolidated financial statements as of and for the year ended October 31, 2019. |
Asset Acquisitions
Asset Acquisitions | 12 Months Ended |
Oct. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Asset Acquisitions | NOTE 5: ASSET ACQUISITIONS Big League Foods, Inc. 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. On the closing date, the Company paid the Seller $50,000 net of the aggregate amount of any pre-closing liabilities or obligations of BLF (other than the Assumed Company Obligations (as defined in the 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 (as defined in the stock purchase agreement) and the applicable payees thereof, the aggregate amount of the Assumed Company Obligations. During August 2019, the additional $50,000 was paid to the Seller. 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 (the “Earn Out Period”). 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) (the “Difference”). If the Difference is a positive number for the applicable fiscal quarter, the Earnout Payment for such fiscal quarter shall equal the amount of the Earnout Commission. If the Difference is equal to zero or a negative number for the applicable fiscal quarter, the Earnout Payment for such fiscal quarter shall be equal to the Operating Income. During the Earnout Period, the Seller 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 (the “Catch-Up Payment”); 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 6). French Fry Business On August 30, 2019, the Company entered into an asset purchase agreement with a certain seller (“Seller”) pursuant to which, on September 6, 2019, the Company acquired all of the assets of the Seller’s french fry business (the “Acquired Assets”) in consideration for $544,477 (2,000,000 United Arab Emirates Dirham) in cash, plus assumption of certain liabilities. The purchase price was satisfied by relieving the Seller of certain accounts receivable invoices which totaled the purchase price and were outstanding and due to the Company. The transaction was accounted for as an asset acquisition, with all of the purchase consideration allocated to the customer contracts which provide the Company the right to earn revenue under the related terms (see Note 6). |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Oct. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Net | NOTE 6: INTANGIBLE ASSETS, NET Intangible assets, net, consist of two intangible assets, a license (the “License”) with MLB and certain acquired customer contracts. MLB License The MLB License allows us 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 5) pursuant to which the Company purchased all of the outstanding capital stock of BLF. 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 14). 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. Acquired Customer Contracts The acquired customer contracts were purchased for $544,477 (2,000,000 United Arab Emirates Dirham) from a third-party frozen foods vendor on September 6, 2019, giving the Company the right to earn revenue under the terms of the acquired customer contracts. The net carrying amount of the intangible assets are as follows: Estimated October 31, Useful Lives 2019 2018 Intangible assets: MLB license 32 months $ 357,027 $ - Customer contracts 7 years 544,630 - Accumulated amortization (63,950 ) - Intangible assets, net $ 837,707 $ - Amortization expense included in cost of revenue for the year ended October 31, 2019 was $63,950. There was no amortization expense during the year ended October 31, 2018. Annual amortization expense related to the existing net carrying amount of the intangible assets for the next five years is expected to be as follows: Fiscal year 2020 $ 226,201 Fiscal year 2021 $ 212,931 Fiscal year 2022 $ 100,325 Fiscal year 2023 $ 77,804 Fiscal year 2024 $ 77,804 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Oct. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 7: Property and Equipment At October 31, 2019 and 2018, the Company’s property and equipment are as follows: Estimated October 31, Useful Lives 2019 2018 Computer equipment 3 years $ 86,974 $ 98,341 Furniture and fixtures 7 years 13,213 - Production assets 3 years 9,624 - Accumulated depreciation (86,554 ) (82,719 ) $ 23,257 $ 15,622 The Company has recorded $3,835 and $0 of depreciation expense for the years ended October 31, 2019 and 2018, respectively. There was no property and equipment impairments recorded for the years ended October 31, 2019 and 2018. |
Revenue
Revenue | 12 Months Ended |
Oct. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | NOTE 8: 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 Consolidated Statements of Operations during the year ended October 31, 2019. Information about the Company’s revenue by country is as follows: Year Ended October 31, 2019 2018 United Arab Emirates $ 9,326,205 $ 3,686,471 Kingdom of Saudi Arabia 1,891,059 710,580 Bahrain 1,202,282 827,997 Oman 1,140,116 576,989 United States 51,439 - Net revenue $ 13,611,101 $ 5,802,037 |
Debt
Debt | 12 Months Ended |
Oct. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 9: DEBT 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 expense over the life of the debt. On February 8, 2019, the Company entered into a securities purchase agreement, as amended on May 30, 2019, 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 First Warrant based upon a relative fair value methodology. The First 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 First 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 First 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 shares of the Company’s common stock. 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 Consolidated Balance Sheets. On May 30, 2019, the Company and the First Investor entered into a letter agreement pursuant to which the conversion price of the First Note was amended to a fixed conversion price of $0.0025 per share and the First Warrant was amended such that it was exercisable for 500,000,000 shares of the Company’s common stock at an exercise price of $0.0025 per share. 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, as amended, pursuant to which the Company was required to file a Registration Statement (the “Registration Statement”) covering the resale of the shares of common stock underlying the First Note and the First 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 Second Warrant based upon a relative fair value methodology. The Second 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 Second 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 Second 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 shares of the Company’s common stock. 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 Consolidated Balance Sheets. On May 30, 2019, the Company and the Second Investor entered into a letter agreement pursuant to which, among other things, the conversion price of the Second Note was amended to a fixed conversion price of $0.0025 per share and the Second Warrant was amended such that it was exercisable for 80,000,000 shares of the Company’s common stock at an exercise price of $0.0025 per share. 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, as amended, with the Second Investor pursuant to which the Company was required to file the Registration Statement covering the resale of the shares of common stock underlying the Second Note and the Second Warrant. The Company initially filed the Registration Statement with the SEC on June 7, 2019 which Registration Statement was declared effective by the SEC on August 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 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 25, 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) 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. On September 17, 2019, the Company entered into Amendment #1 to the note amending the conversion price to $0.011844 per share and recognized a beneficial conversion feature of $143,942 based upon the intrinsic value of the conversion option as a discount of the convertible note, which will be amortized to interest expense through the maturity date. On September 18, 2019, $150,000 of the outstanding principal and $2,897 of accrued interest was converted into an aggregate of 12,909,528 shares of the Company’s common stock. On September 25, 2019, the Company paid off the outstanding balance of $459,123, consisting of $450,000 of principal and $9,123 of accrued interest. On July 1, 2019, the Company entered into a securities purchase agreement with an accredited investor (the “Fourth Investor”) pursuant to which the Company issued and sold a convertible note in the principal amount of $605,000 (including a $90,000 original issuance discount). The note matures on July 1, 2020, bears interest at a rate of 4% per annum (increasing to 24% per annum upon the occurrence of an event of default) 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 prior to the 180 th On September 17, 2019, the Company entered into securities purchase agreements with accredited investors (the “Investors”) pursuant to which the Company issued and sold convertible promissory notes in the aggregate principal amount of $660,000 (including an aggregate of $110,000 in original issuance discounts). The notes mature on September 17, 2020, bear interest at a rate of 4% per annum (increasing to 24% per annum upon the occurrence of an event of default) and are convertible into shares of the Company’s common stock at a conversion price of $0.10 per share, subject to adjustment. The notes may be prepaid by the Company at any time prior to the 180 th On October 2, 2019, the Company entered into a securities purchase agreement with an accredited investor (the “Seventh Investor”) pursuant to which the Company issued and sold a convertible note in the principal amount of $345,000 (including a $45,000 original issuance discount). The note matures on April 15, 2020, bears interest at a rate of 6% per annum (increasing to 24% per annum upon the occurrence of an event of default) 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 prior to the 180 th At October 31, 2019 and October 31, 2018, there was $1,378,855 and $1,497,126 of convertible notes payable outstanding, net of discounts of $231,146 and $4,765, respectively. During the years ended October 31, 2019 and 2018, amortization of debt discount amounted to $839,876 and $17,735, respectively. During the year ended October 31, 2019, $1,638,531 of convertible notes, including accrued interest, were converted into shares of the Company’s common stock and there were payments of an aggregate of $1,577,172 toward the outstanding balances of convertible notes. At October 31, 2019, the Company was in compliance with the terms of the outstanding convertible notes. 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 on January 26, 2018 in the principal amount of $530,000, with an annual interest rate of 12%, whereby (i) the maturity date of the Monaco Note was extended 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. 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 extended to November 8, 2019. At October 31, 2019, the Company was in compliance with the terms of the Monaco Note. Subsequent to October 31, 2019, upon maturity, as the Company was not able to pay the balance due, the interest rate immediately increased to 18% per annum and the note holder agreed to only impose the default interest rate and not proceed with any other default remedies currently available. The Company expects to repay the Monaco Note in full as quickly as possible based upon its available capital. Revolving Credit Agreement On July 31, 2019, the Company entered into a secured, $500,000 revolving credit agreement (“Credit Facility”). Borrowings under the Credit Facility may be used to fund working capital needs and bear interest at a one-month LIBOR-based rate plus 300 basis-points (4.80% at October 31, 2019). The Company’s performance and payment obligations under the Credit Facility are guaranteed by substantially all of its assets. The structure of this Credit Facility is a note payable with a revolving credit line feature with a mutual termination provision instead of a stated maturity date. The outstanding balance under the Credit Facility may be prepaid at any time without premium or penalty. Additionally, the Credit Facility contains customary events of default and remedies upon an event of default, including the acceleration of repayment of outstanding amounts under the Credit Facility. At October 31, 2019, $500,000 was outstanding under the Credit Facility. The Credit Facility contains customary affirmative and negative covenants, including a borrowing base requirement upon each request for an advance from the Credit Facility. The Company was in compliance with all covenants at October 31, 2019. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Oct. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Deficit | NOTE 10: 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 with a $0.000001 par value per share of which 2,305,778,511 are outstanding at October 31, 2019 and 125,000,000 shares of preferred stock, par value $0.000001 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 October 31, 2019, (B) 1,000,000 shares have been designated as Series B Convertible Preferred Stock, of which no shares are outstanding at October 31, 2019 and (C) 1,000,000 have been designated as Series C Convertible Preferred Stock, of which 430,801 shares are outstanding at October 31, 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 October 31, 2019, the Company has not effectuated any Reverse Stock Split. Common Stock During the year ended October 31, 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. ● 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. ● 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 9). ● 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 9). ● granted 30,000,000 shares of its common stock to Christopher Cutchens, the Company’s Chief Financial Officer. The common stock will vest 25% on the six month, 1 year, 2 year, and 3 year anniversaries of the grant date. The Company recorded $143,750 of stock-based compensation expense during the year ended October 31, 2019, related to this common stock grant. ● issued 2,419,355 shares of its common stock to satisfy a former employee’s exercise of 3,000,000 warrants on a cashless basis. ● issued 12,909,258 shares of its common stock valued at $152,897 as repayment for outstanding principal and interest on a convertible promissory note as requested by the note holder according to contractual terms. During the year ended October 31, 2018, the Company: ● issued 1,244,233,615 shares of its common stock valued at $801,936 as repayment for outstanding principal and interest on convertible promissory notes as requested by the note holders according to contractual terms. ● issued 44,470,101 shares of its Series A Convertible Preferred Stock and 10,559,890 shares of its common stock valued at $330,180 as a result of the Monaker litigation settlement. ● retired 4,163,315 shares of its common stock as a result of the NestBuilder spin-off transaction. ● committed to issue 152,029,899 shares of its common stock valued at $456,090 as a result of an additional settlement with Monaker. ● issued warrants to purchase 117,055,586 shares of its common stock valued at $299,635 under the provisions of the employment agreement of the Company’s Chief Executive Officer. ● issued 1,244,233,615 shares of its common stock to the holders of convertible notes with aggregate outstanding principal and accrued interest balances of $801,935. Common Stock Warrants During February 2019, the Company entered into securities purchase agreements with the First and Second Investor, whereby the Company sold the First and Second Notes and First and Second Warrants, respectively. The Company allocated a value of $697,611 to the First and Second Warrants based upon a relative fair value methodology (see Note 9). Additionally, 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. All warrants to purchase shares of the Company’s common stock that are granted under the provisions of the Chief Executive Officer’s employment agreement are immediately vested upon being earned. At October 31, 2019, the Company was committed to issue warrants to purchase 142,500,000 shares of its common stock under the provisions of the employment agreement of its Chief Executive Officer. The fair value of these warrants was $2,515,794 and was recognized as an operating expense within the consolidated statements of operations. At October 31, 2019, there were warrants to purchase up to 725,705,000 shares of the Company’s common stock outstanding which may dilute future EPS. At October 31, 2019, there remained warrants to purchase approximately 394,000,000 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 assumptions for warrants earned during the years ended October 31, 2019 and 2018. Since Black-Scholes option valuation models incorporate ranges of assumptions for inputs, those ranges are disclosed. Expected volatilities are based on the historical volatility of the Company’s stock. The Company uses historical data to estimate award exercise and employee termination within the valuation model, whereby separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes. The expected term of granted awards is derived from the output of the option valuation model and represents the period of time that granted awards are expected to be outstanding. The risk-free rate for periods within the contractual life of the award is based on the U.S. Treasury yield curve in effect at the time of grant. The following assumptions were utilized during the years ended October 31, 2019 and 2018: 2019 2018 Expected volatility 0.20% - 486.01 % 1.45% - 6.30 % Weighted-average volatility 50.14 % 3.52 % Expected dividends 0 % 0 % Expected term (in years) 0.5 1.0 Risk-free rate 1.46% - 2.60 % 1.09% - 2.67 % The following table sets forth common share purchase warrants outstanding as of October 31, 2019: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2018 123,761,716 $ 0.007 $ - Warrants granted and issued 1,796,574,073 $ 0.001 $ - Warrants exercised (3,000,000 ) $ (0.006 ) $ - Warrants exchanged (1,191,630,789 ) $ (0.002 ) $ - Outstanding, October 31, 2019 725,705,000 $ 0.003 $ - Common stock issuable upon exercise of warrants 725,705,000 $ 0.003 $ - Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at October 31, Contractual Exercise at October 31, Exercise Prices 2019 Life (Years) Price 2019 Price $ 0.0025 580,000,000 2.35 $ 0.0025 580,000,000 $ 0.0025 $ 0.0060 142,500,000 0.79 $ 0.0060 142,500,000 $ 0.0060 $ 0.0250 1,000,000 0.17 $ 0.0250 1,000,000 $ 0.0250 $ 0.0500 1,000,000 1.17 $ 0.0500 1,000,000 $ 0.0500 $ 0.1000 1,205,000 0.35 $ 0.1000 1,205,000 $ 0.1000 725,705,000 1.99 $ 0.0034 725,705,000 $ 0.0034 The following table sets forth common share purchase warrants outstanding as of October 31, 2018: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2017 17,786,467 $ 0.016 $ - Warrants granted and issued 105,975,249 $ 0.006 $ - Warrants forfeited - $ - $ - Outstanding, October 31, 2018 123,761,716 $ 0.007 $ - Common stock issuable upon exercise of warrants 123,761,716 $ 0.007 $ - Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at October 31, Contractual Exercise at October 31, Exercise Prices 2018 Life (Years) Price 2018 Price $ 0.006 120,556,716 0.98 $ 0.006 120,556,716 $ 0.006 $ 0.025 1,000,000 1.17 $ 0.025 1,000,000 $ 0.025 $ 0.050 1,000,000 0.47 $ 0.050 1,000,000 $ 0.050 $ 0.100 1,205,000 1.35 $ 0.100 1,205,000 $ 0.100 123,761,716 0.98 $ 0.007 123,761,716 $ 0.007 Series A Convertible Preferred Stock On October 14, 2014, the Company filed a certificate of amendment to its Certificate of Designations, Number, Voting Powers, Preferences and Rights of Series A Convertible Preferred Stock with the Delaware Secretary of State pursuant to the July 31, 2014 Board of Directors approval to increase the Series A Convertible Preferred A shares from 100,000,000 shares to 120,000,000 shares. The Series A Convertible Preferred Stock was issued at $0.001 par value and bear dividends at a rate of 10% per annum payable on a quarterly basis when declared by the board of directors. Dividends accrue whether or not they have been declared by the board. At the election of the Company, Preferred Dividends may be converted into Series A Convertible Preferred Stock, with each converted share having a value equal to the market price per share, subject to adjustment for stock splits. In order to exercise such option, the Company delivers written notice to the holder. Each 20 shares of Series A Convertible Preferred Stock is convertible at the option of the holder thereof at any time into one share of Common Stock. Each holder of Series A Convertible Preferred Stock shall be entitled to one vote for each whole share of common stock that would be issuable upon conversion of such share on the record date for determining eligibility to participate in the action being taken. In the event of (a) the sale, conveyance, exchange, exclusive license, lease or other disposition of all or substantially all of the intellectual property or assets of the Company, (b) any acquisition of the Company by means of consolidation, stock exchange, stock sale, merger of other form of corporate reorganization of the Company with any other entity in which the Company’s stockholders prior to the consolidation or merger own less than a majority of the voting securities of the surviving entity, or (c) the winding up or dissolution of the Company, whether voluntary or involuntary (each such event in clause (a), (b) or (c) a “liquidation event”), the Board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the distribution of assets among, or payment thereof over to, creditors of the Company (the “net assets available for distribution”). The holders of the Series A Convertible Preferred Stock then outstanding shall be entitled to be paid out of the net assets available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series A Convertible Preferred Stock or to the Common Stock, an amount for each share of Series A Convertible Preferred Stock equal to all accrued and unpaid Preferred Dividends plus the Stated Value, as adjusted (the “Series A Liquidation Amount”). On February 8, 2019, the Company filed a Second Amended and Restated Certificate of Designations, Preferences and Rights of the Series A Convertible Preferred Stock (the “Second Amended and Restated Series ACOD”), as amended on April 9, 2019 with the Delaware Secretary of State. Pursuant to the Second Amended and Restated Series A COD, the Company designated 120,000,000 shares as Series A Convertible Preferred Stock (the “Series A Preferred Stock”). Each share of Series A Preferred Stock is convertible at any time at the option of the holder into such number of shares of the Company’s common stock determined by dividing the Series A Conversion Price divided by the Series A Stated Value. The “Series A Conversion Price” is $1.00 per share, subject to adjustment, and the “Series A Stated Value is $1.00 per share. Each share of Series A Preferred Stock shall be entitled to vote such number of shares into which the Series A Preferred Stock are convertible into. In addition, from the date the Company issued the First Note until such time that no shares of Series A Preferred Stock are outstanding, each holder of Series A Preferred Stock shall have the right to participate in any subsequent financings of the Company in an amount equal to up to 50% of such financing. In the event of (a) the sale, conveyance, exchange, exclusive license, lease or other disposition of all or substantially all of the intellectual property or assets of the Company, (b) any acquisition of the Company by means of consolidation, stock exchange, stock sale, merger of other form of corporate reorganization of the Company with any other entity in which the Company’s stockholders prior to the consolidation or merger own less than a majority of the voting securities of the surviving entity, or (c) the winding up or dissolution of the Company, whether voluntary or involuntary (each such event in clause (a), (b) or (c) a “Liquidation Event”), the board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the distribution of assets among, or payment thereof over to, creditors of the Company (the “Net Assets Available for Distribution”). The holders of the Series A Preferred Stock then outstanding shall be entitled to be paid out of the Net Assets Available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series A Preferred Stock or to the common stock, an amount for each share of Series A Preferred Stock equal to the Series A Stated Value. There were no accrued or declared preferred stock dividends on the outstanding preferred shares at October 31, 2018. On March 25, 2019, the Company entered into an inducement agreement (the “Inducement Agreement”) effective as of February 8, 2019, pursuant to which the Company issued Monaker 152,029,899 shares of its common stock as an inducement to remove certain anti-dilution provisions contained in the Series A Preferred Stock Certificate of Designation in connection with the offering to the First Investor of the First Note and the First Warrant. At October 31, 2018, the value of the 152,029,899 shares of common stock was $456,090 and was recorded as shares to be issued within our Consolidated Statement of Changes in Stockholders’ Deficit. At October 31, 2019 and 2018, there were 44,570,101 shares of Series A Convertible Preferred Stock outstanding. Series B Convertible Preferred Stock On July 31, 2014, the Company’s Board of Directors approved the creation of a new Series B Convertible Preferred Stock and on October 14, 2014 the Company filed a Certificate of Designation of Series B Convertible Preferred Stock with the Delaware Secretary of State designating 1,000,000 shares, par value of $0.001 per share, as Series B Convertible Preferred Stock (“Series B Convertible Preferred Stock”). The Series B Convertible Preferred Stock have a stated value of $5.00 per share (the “Series B Stated Value”). The Series B Convertible Preferred Stock accrue dividends at a rate of 10% per annum on the Series B Stated Value of such shares of the Series B Convertible Preferred Stock. Dividends accrue whether or not they have been declared by the board of directors. At the election of the Company, it may satisfy its obligations to pay dividends on the Series B Convertible Preferred Stock by issuing shares of common stock to the holders of Series B Convertible Preferred Stock on a uniform and prorated basis. Each share of Series B Convertible Preferred Stock is convertible at the option of the holder thereof at any time into a number of shares of common stock determined by dividing the Series B Stated Value by the conversion price then in effect. The conversion price for the Series B Convertible Preferred Stock is equal to $0.05 per share, subject to adjustment. Each holder of Series B Convertible Preferred Stock shall be entitled to the number of votes equal to 200 votes for each shares of Series B Convertible Preferred Stock held by them. Upon the occurrence of a Liquidation Event, the board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the Net Assets Available for Distribution. The holders of the Series B Convertible Preferred Stock then outstanding shall be entitled to be paid out of the Net Assets Available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series B Convertible Preferred Stock or to the common stock, an amount for each share of Series B Convertible Preferred Stock equal to all accrued and unpaid preferred dividends plus the Series B Stated Value. As of October 31, 2019 and 2018, there were no shares of Series B Convertible Preferred Stock outstanding. Series C Convertible Preferred Stock On May 5, 2015, the Company filed a Certificate of Designation of Series C Convertible Preferred Stock (the “Series C COD”) with the Delaware Secretary of State. Pursuant to the Series C COD, the Company designated 1,000,000 shares as Series C Convertible Preferred Stock (the “Series C Preferred Stock”). Each share of Series C Preferred Stock is convertible at any time at the option of the holder into such number of shares of the Company’s common stock determined by dividing the Series C Stated Value by the Series C Conversion Price. The “Series C Stated Value” means $5.00 per share, and the “Series C Conversion Price” means $0.05 per share, subject to adjustment. Each share of Series C Preferred Stock shall be entitled to vote such number of shares equal to 100 votes for each share of common stock into which the Series C Preferred Stock is then convertible into. Shares of Series C Preferred Stock shall accrue dividends at a rate of 10% per annum on the Series C Stated Value which shall be payable when and if declared by the board of directors. Upon the occurrence of a Liquidation Event, the board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the Net Assets Available for Distribution. The holders of the Series C Convertible Preferred Stock then outstanding shall be entitled to be paid out of the Net Assets Available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series C Convertible Preferred Stock or to the common stock, an amount for each share of Series C Convertible Preferred Stock equal to all accrued and unpaid preferred dividends plus the Series C Stated Value. 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. At October 31, 2019 and 2018, there were 430,801 and 160,000 shares of Series C Convertible Preferred Stock outstanding, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Oct. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 11: RELATED PARTY TRANSACTIONS During the fiscal year ending October 31, 2019, there were no related party transactions to report. At October 31, 2018, Anshu Bhatnagar, our Chief Executive Officer was due warrants to acquire 117,055,586 shares of common stock under the provisions of his employment agreement. Since there were no authorized shares of common stock available for issuance, on December 28, 2018, the Board of Directors awarded our Chief Executive Officer 294,545 shares of Series C Preferred Stock, in lieu of the warrants to acquire 117,055,586 shares of Common Stock due him, and inclusive of 501,130 shares of Common Stock related to an incentive bonus as approved by the Board of Directors. At October 31, 2018, the value of the 117,055,586 warrants to acquire shares of Common Stock was $299,635 and was recorded within our Consolidated Statement of Changes in Stockholders’ Deficit. |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 12: INCOME TAXES The Company accounts for income taxes taking into account deferred tax assets and liabilities which represent the future tax consequences of the differences between financial statement carrying amounts of assets and liabilities versus the tax basis of assets and liabilities. Under this method, deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carryforwards. Deferred liabilities are recognized for taxable temporary differences. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The impact of tax rate changes on deferred tax assets and liabilities is recognized in the year the change is enacted. Due to recurring losses, the Company’s tax provision for the years ended October 31, 2019 and 2018 was $0 and $0, respectively. The provision for income taxes consisted of the following: Year Ended October 31, 2019 2018 Deferred tax benefit (provision): Federal 729,016 659,190 State, net of federal benefit 226,255 127,093 Effect of Canada tax and exchange rates - 257,084 Nondeductible expenses - (90,961 ) Change in valuation allowance (955,271 ) (952,406 ) Income tax provision $ - $ - The following table presents the difference between the effective tax rate and the U.S. federal statutory income tax rate: Year Ended October 31, 2019 2018 U.S. federal statutory income tax rate 21.0 % 21.0 % State taxes, net of federal benefit 7.0 % 7.0 % Other 0.0 % 0.0 % Effect of valuation allowance (28.0 )% (28.0) % Effective income tax rate 0.0 % 0.0 % Deferred income taxes reflect the net tax effect of temporary difference between the carrying amounts of assets and liabilities. The significant components of the deferred income tax asset (liability) are as follows: October 31, 2019 2018 Deferred tax assets (liabilities): Net operating loss carryforwards (US) 1,312,249 2,594,497 Net operating loss carryforwards (Canada) - 1,021,065 Deferred stock warrants 1,388,579 - Other 17,075 - Depreciation (6,400 ) - Net deferred tax assets 2,711,503 3,615,562 Valuation allowance (2,711,503 ) (3,615,562 ) Income tax provision $ - $ - In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences will become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. The Company has recorded a full valuation allowance against its net deferred tax assets because it is not currently able to conclude that it is more likely than not that these assets will be realized. The amount of deferred tax assets considered to be realizable could be increased in the near term if estimates of future taxable income during the carryforward period are increased. The valuation allowance decreased by $904,059 and $361,043 during the fiscal years ended October 31, 2019 and 2018, respectively. As of October 31, 2019 the Company has a total net operating loss carryforward of approximately $4,600,000. Net operating loss carryforwards generated before January 1, 2018 will expire through 2037. Under the Internal Revenue Code Section 382, certain stock transactions which significantly change ownership, including the sale of stock to new investors, the exercise of options to purchase stock, or other transactions between shareholders could limit the amount of net operating loss carryforwards that may be utilized on an annual basis to offset taxable income in future periods. Effective December 22, 2017 a new tax bill was signed into law that reduced the federal income tax rate for corporations from 35% to 21%. The new bill reduced the blended tax rate for the Company from 39.5% to 27.5%. The change in blended tax rate reduced the 2018 net operating loss carry forward deferred tax assets by approximately $1,400,000. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Oct. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 13: Segment reporting Through July 31, 2018, the Company had two reportable segments: real estate and food products. On July 31, 2018, the real estate segment was spun-off into a separate public company, leaving the Company with only the food products segment (see Note 16). |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 14: COMMITMENTS AND CONTINGENCIES License Contingent Consideration As described in Note 5, during April 2019 the Company acquired the 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. During August 2019, $50,000 of the License contingent consideration was paid to the seller of BLF as the initial sale of an MLB-branded product was achieved during July 2019. At October 31, 2019, the Company believes it is a reasonable possibility that the remaining maximum amount of $5,000,000 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 October 31, 2019, the Company’s total expected future obligation related to these guaranteed minimum payments was $1,346,818, of which the Company expects to pay $478,485, $738,333 and $130,000 during the fiscal years ending October 31, 2020, 2021, and 2022, respectively. Amounts accrued at October 31, 2019 relating to these guaranteed minimum payments totaled $233,841 and are included in accounts payable and accrued expenses. Operating Lease Obligation The Company’s future fiscal year minimum lease payments for its corporate office operating lease are as follows: 2020 $ 90,610 2021 $ 93,329 2022 $ 15,746 Total $ 199,685 Rent expense for the Company’s corporate office for the fiscal years ending October 31, 2019 and 2018 was $87,910 and $78,681, respectively. |
Litigation
Litigation | 12 Months Ended |
Oct. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation | NOTE 15: LITIGATION RealBiz v. Monaker, Case No. 0:16-cv-61017-FAM. Monaker v. RealBiz, Case No. 1:16-cv-24978-DLG On December 22, 2017, the foregoing litigation was settled with the issuance of 44,470,101 shares of the Company’s Series A Convertible Preferred Stock and 10,559,890 shares of the Company’s common stock to Monaker and a $100,000 payment to NestBuilder by Monaker. The settlement included an anti-dilution provision requiring the Company to issue additional shares of its preferred or common stock to Monaker to maintain Monaker’s ownership percentage as of the date of the settlement. On March 25, 2019, the Company entered into an inducement agreement (the “Inducement Agreement”) effective as of February 8, 2019, pursuant to which the Company agreed to issue Monaker 152,029,899 shares of its common stock as an inducement to remove certain anti-dilution provisions contained in the Series A Preferred Stock Certificate of Designation in connection with the Company’s offering of a convertible promissory note in the original principal amount of $1,250,000 and a three-year warrant to purchase up to 925,925,925 shares of the Company’s common stock. At October 31, 2018, the value of the 152,029,899 shares of common stock was $456,090 and was recorded as shares to be issued within our Consolidated Statement of Changes in Stockholders’ Deficit. On April 22, 2019, the 152,029,899 shares of common stock were issued to Monaker to satisfy the Inducement Agreement. On January 29, 2018, additional litigation between the Company and NestBuilder was settled with the Company agreeing to pay NestBuilder $30,000 and NestBuilder agreeing to return to the Company 4,163,315 shares of the Company’s common stock. 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. On October 30, 2019, the Company paid $205,300 and received a Final Judgment Order releasing Verus Foods, Inc. and Anshu Bhatnagar from all claims. 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. On August 27, 2019 the Company filed a motion to dismiss this lawsuit. On September 30, 2019, Auctus responded by filing a First Amended Complaint. The Company then filed a second motion to dismiss on October 24, 2019. On February 25, 2020, the court issued a decision dismissing the securities laws and unjust enrichment and breach of fiduciary duty claims and retaining the breach of contract, breach of covenant of good faith, fraud and deceit, and negligent misrepresentation-and the Massachusetts Consumer Protection Act claims. The Company filed its Answer to the complaint on March 10, 2020. The case remains pending in 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 continue 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. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Oct. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | NOTE 16: DISCONTINUED OPERATIONS Through July 31, 2018, we 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) our fully licensed real estate division (formerly known as Webdigs); (ii) our TV media contracts (Home Preview Channel /Extraordinary Vacation Homes) division; and (iii) our Real Estate Virtual Tour and Media group (RealBiz 360). The assets of these divisions were used to create a new suite of real estate products and services that created stickiness through the utilization of video, social media and loyalty programs. At the core of our programs was our proprietary video creation technology which allowed for an automated conversion of data (text and pictures of home listings) to a video with voice and music. We provided video search, storage and marketing capabilities on multiple platform dynamics for web, mobile and TV. Once a home, personal or community video was created using our proprietary technology, it could be published to social media, email or distributed to multiple real estate websites, broadband or television for consumer viewing. As a result of the spin-off of our 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 consolidated statements of operations were as follows: Year Ended October 31, 2019 2018 Continuing Discontinued Continuing Total Revenue $ 13,611,101 $ 216,316 $ 5,802,037 $ 6,018,353 Cost of revenue 11,546,413 56,800 5,053,453 5,110,253 Gross Profit 2,064,688 159,516 748,584 908,099 Operating Expenses: Salaries and benefits 3,892,926 82,326 488,577 570,902 Selling and promotions expense 125,644 824 - 824 Legal and professional fees 618,310 82,999 285,138 368,137 General and administrative 1,544,689 71,714 885,367 957,081 Total Operating Expenses 6,181,569 237,863 1,659,081 1,896,944 Operating loss (4,116,881 ) (78,347 ) (910,498 ) (988,845 ) Other Income (Expense): Interest expense (364,005 ) (1,322 ) (320,527 ) (321,849 ) Loss on legal settlements (205,300 ) - - - Initial derivative liability expense (225,115 ) - - - Amortization of debt discount (839,876 ) - - - Amortization of issuance costs (21,355 ) - - - Gain on extinguishment of debt 2,700,737 - - - Gain on convertible notes payable settlement 681,945 - - - Loss on legal settlement of accounts payable - 338,855 (914,353 ) (575,497 ) Default principal increase on convertible - - (938,100 ) (938,100 ) Total Other Income (Expense) 1,727,031 337,533 (2,172,980 ) (1,835,447 ) (Loss) income before income taxes (2,389,850 ) 259,186 (3,083,478 ) (2,824,292 ) Income taxes - - - - Net (loss) income $ (2,389,850 ) $ 259,186 $ (3,083,478 ) $ (2,824,292 ) |
Business Divestiture
Business Divestiture | 12 Months Ended |
Oct. 31, 2019 | |
Subscription Agreements [Member] | |
Business Divestiture | NOTE 17: 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 MENAf: with a broader license for product distribution and full control of all intellectual property rights. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Oct. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 18: SUBSEQUENT EVENTS On November 8, 2019, the Monaco Note matured and the principal amount of $530,000 and accrued interest of $113,597 became due. As the Company was not able to pay the balance due of $643,597, the interest rate immediately increased to 18% per annum. The note holder has agreed to only impose the default interest rate and not proceed with any other default remedies currently available. The Company expects to repay the Monaco Note in full as quickly as possible based upon its available capital. On January 2, 2020, the Company entered into Amendment #1 (the “Amendment”) of a convertible note originally issued on July 1, 2019 in the principal amount of $605,000, to modify the conversion price. Subsequent to the Amendment, an aggregate of $153,266 of principal and accrued interest have been converted into 15,098,054 shares of the Company’s common stock. On January 9, 2020, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued a convertible note in the principal amount of $605,000 (including a $90,000 original issuance discount). The note matures on January 9, 2021, accrues interest at a rate of 4% per annum (increasing to 24% per annum upon the occurrence of an event of default) and is convertible into shares of the Company’s common stock at a conversion price of $0.015 per share, subject to adjustment. The note may be prepaid by the Company at any time prior to the 180 th On February 10, 2020, the Company issued a convertible note in the principal amount of $420,000 (including a $70,000 original issuance discount) to an accredited investor. The note matures on November 10, 2020, accrues interest at a rate of 4% per annum and is convertible into shares of the Company’s common stock at a conversion price of $0.0125 per share, subject to adjustment. The note may be prepaid by the Company at any time prior to the 180 th On February 14, 2020, as a result of the Company’s failure to timely file its Form 10-K, the Company was in default with respect to certain of its convertible notes. The Company obtained waiver agreements, within the stated cure periods, whereby the events of default and the rights to the event of default remedies were waived until the earlier of (i) April 30, 2020 or (ii) the date upon which the Company is no longer in default. On February 25, 2020, the court issued a decision in the lawsuit commenced by Auctus against the Company dismissing the securities laws and unjust enrichment and breach of fiduciary duty claims and retaining the breach of contract, breach of covenant of good faith, fraud and deceit, and negligent misrepresentation-and the Massachusetts Consumer Protection Act claims. The Company filed its Answer to the complaint on March 10, 2020. The case remains pending in the District of Massachusetts (see Note 15). Effective March 31, 2020, the Company and Sellers of Nutribrands entered into the Termination Agreement with Nutribrands LTDA pursuant to which, among other things, all agreements between the parties (including the October 30, 2019 Amended and Restated Operating Agreement of Nutribrands International, LLC, the Contribution and Sale Agreement and all related ancillary agreements (collectively, “Released Transactions”)) were terminated and the parties released each other from all obligations arising from the Released Transactions (See Note 4). On March 31, 2020, the Company issued a promissory note in the principal amount of $312,500 (including a $62,500 original issuance discount) to an accredited investor. The note matures on July 1, 2020, accrues interest at a rate of 4% per annum, and is secured by an interest in all of the equity of BLF. The note may be prepaid by the Company at any time prior to maturity with no prepayment penalties. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Consolidation and Presentation | Basis of Consolidation and Presentation The consolidated financial statements for the years ended October 31, 2019 and 2018 include the operations of BLF effective April 25, 2019, Verus MENA effective May 1, 2018, Verus Foods, Inc. effective January 2017, and Gulf Agro Trading, LLC through April 30, 2018 (see Note 17). The historical operations of subsidiaries RealBiz 360 Enterprise (Canada), Inc., RealBiz 360, Inc., and its wholly-owned subsidiary, Webdigs, LLC, which includes the dormant wholly owned subsidiaries of Home Equity Advisors, LLC, and Credit Garage, LLC from the recapitalization date of October 9, 2012 are reported as discontinued operations for all periods presented through July 31, 2018 (see Note 16). All significant intercompany balances and transactions have been eliminated in the consolidation. |
Reclassifications | Reclassifications Certain reclassifications of prior year amounts have been made to enhance comparability with the current year’s consolidated financial statements, including, but not limited to, presenting the spin-off of the real estate segment as discontinued operations for all periods presented and presentation of certain items within the consolidated statement of cash flows. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. 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 consolidated financial statements and the reported amounts of revenues and expenses for 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, valuations of inventory, finite-lived intangible assets, derivative liabilities, stock-based compensation, and the valuation reserve for income taxes. |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company’s food products accounts receivable, net and revenues as of and for the year ended October 31, 2019 were geographically concentrated with customers located in the GCC countries. In addition, significant concentrations existed with a limited number of customers. Approximately 42% of accounts receivable, net as of October 31, 2019 was concentrated with three customers and approximately 66% of revenues for the year ended October 31, 2019 were concentrated with six customers. Although 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, such risks may be mitigated by our access to credit insurance programs. 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 we purchase could adversely affect our operating results if we are unable to offset the effect of these increased costs through price increases, and we can provide no assurance that we will be able to pass along such increased costs to our customers. Furthermore, if we cannot obtain sufficient food products or our suppliers cease to be available to us, we could experience shortages in our food products or be unable to meet our 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 October 31, 2019 or October 31, 2018. |
Marketable Securities | Marketable securities During January 2018, as part of the legal settlement with Monaker, NestBuilder received Monaker common shares valued at $32,270, which were classified as “available for sale” securities until being spun-off on August 1, 2018 (see Note 16). These marketable securities were determined trading securities pursuant to Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities |
Accounts Receivable | Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events, and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses, and such losses traditionally have been within its expectations. At October 31, 2019 and 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. Inventories consist of raw materials (film and packaging) and finished products. At October 31, 2019, raw materials and finished products inventory totaled $54,392 and $544,123, respectively. At October 31, 2018, all inventory was finished products inventory. |
Intangible Assets | Intangible Assets The Company amortizes its two intangible assets, a license with MLB, and certain acquired customer contracts, on a straight-line basis over the estimated useful lives of the assets. |
Property and Equipment | Property and Equipment All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. The estimated useful lives range from 3 to 7 years based upon asset class. When an asset is retired, sold or impaired, the resulting gain or loss is reflected in earnings. The Company incurred depreciation expense of $3,835 for the year ended October 31, 2019. The Company did not incur depreciation expense for the year ended October 31, 2018. |
Impairment of Long-lived Assets | Impairment of Long-Lived Assets In accordance with Accounting Standards Codification (“ASC”) 360-10, “Property, Plant, and Equipment”, the Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. For the years ended October 31, 2019 and 2018, the Company did not impair any long-lived assets. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures its financial instruments in accordance with 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 8). |
Cost of Revenues | Cost of Revenues Cost of revenues represents the cost of the food products sold during the periods presented. |
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 the years ended October 31, 2019 and 2018 were $562,959 and $162,190, respectively. |
Share-based Compensation | Share-Based Compensation The Company computes share based payments in accordance with ASC 718-10 “Compensation” (“ASC 718-10”). ASC 718-10 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods and services at fair value, focusing primarily on accounting for transactions in which an entity obtains employees services in share-based payment transactions. It also addresses transactions in which an entity incurs liabilities in exchange for goods and services that are based on the fair value of an entity’s equity instruments or that may be settled by the issuance of those equity instruments. In March 2005, the U.S. Securities and Exchange Commission (the “SEC”) issued Staff Accounting Bulletin (“SAB”) No. 107, Share-Based Payment (“SAB 107”) which provides guidance regarding the interaction of ASC 718-10 and certain SEC rules and regulations. The Company has applied the provisions of SAB 107 in its adoption of ASC 718-10. The Company accounts for non-employee share-based awards in accordance with ASC Topic 505-50, Equity Based Payments to Non-Employees. The Company estimates the fair value of stock options and warrants by using the Black-Scholes option pricing model. |
Derivative Instruments | Derivative Instruments The Company accounts for financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features in accordance with ASC topic 815, “Accounting for Derivative Instruments and Hedging Activities” as well as related interpretations of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, considering all of the rights and obligations of each instrument. The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of the Company’s common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. Increases in the trading price of the Company’s common stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Company’s common stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. |
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 (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 expense over the life of the debt. |
Foreign Currency | Foreign Currency Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates and profit and loss accounts have been translated using average exchange rates. Foreign currency translation gains and losses are included in the Consolidated Statements of Operations and Comprehensive Loss as a component of comprehensive loss. Assets and liabilities of an entity that are denominated in currencies other than an entity’s functional currency are re-measured into the functional currency using end of period exchange rates or historical rates, where applicable to certain balances. Gains and losses related to these re-measurements are recorded within the Consolidated Statements of Operations and Comprehensive Loss as a component of other income (expense). |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740 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, 2019, 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 years ended October 31, 2019 and 2018. |
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 years ended October 31, 2019 and 2018 as we incurred a net loss for those periods. At October 31, 2019, there were outstanding warrants to purchase approximately 726 million shares of the Company’s common stock, approximately 88 million shares of the Company’s common stock issuable upon the conversion of series A and series C convertible preferred stock, and approximately 16 million shares of the Company’s common stock issuable upon the conversion of convertible notes payable which may dilute future EPS. At October 31, 2018, there were outstanding warrants to purchase approximately 124 million shares of the Company’s common stock, approximately 276 million shares of the Company’s common stock to be issued, and approximately 61 million shares of the Company’s common stock issuable upon the conversion of series A and series C convertible preferred stock which may dilute future EPS. |
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 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 determined the adoption of ASC 606 did not have a material impact on its consolidated financial statements. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. Refer to Note 8 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 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 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 During February 2016, the FASB established Topic 842, Leases During August 2018, the FASB issued ASU 2018-13, 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 consolidated financial statements. |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The net carrying amount of the intangible assets are as follows: Estimated October 31, Useful Lives 2019 2018 Intangible assets: MLB license 32 months $ 357,027 $ - Customer contracts 7 years 544,630 - Accumulated amortization (63,950 ) - Intangible assets, net $ 837,707 $ - |
Schedule of Future Amortization Expense of Intangible Assets | Annual amortization expense related to the existing net carrying amount of the intangible assets for the next five years is expected to be as follows: Fiscal year 2020 $ 226,201 Fiscal year 2021 $ 212,931 Fiscal year 2022 $ 100,325 Fiscal year 2023 $ 77,804 Fiscal year 2024 $ 77,804 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | At October 31, 2019 and 2018, the Company’s property and equipment are as follows: Estimated October 31, Useful Lives 2019 2018 Computer equipment 3 years $ 86,974 $ 98,341 Furniture and fixtures 7 years 13,213 - Production assets 3 years 9,624 - Accumulated depreciation (86,554 ) (82,719 ) $ 23,257 $ 15,622 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Net Revenue by Country | Information about the Company’s revenue by country is as follows: Year Ended October 31, 2019 2018 United Arab Emirates $ 9,326,205 $ 3,686,471 Kingdom of Saudi Arabia 1,891,059 710,580 Bahrain 1,202,282 827,997 Oman 1,140,116 576,989 United States 51,439 - Net revenue $ 13,611,101 $ 5,802,037 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Equity [Abstract] | |
Summary of Assumptions Used on Fair Value of Options | The following assumptions were utilized during the years ended October 31, 2019 and 2018: 2019 2018 Expected volatility 0.20% - 486.01 % 1.45% - 6.30 % Weighted-average volatility 50.14 % 3.52 % Expected dividends 0 % 0 % Expected term (in years) 0.5 1.0 Risk-free rate 1.46% - 2.60 % 1.09% - 2.67 % |
Schedule of Common Share Purchase Warrants Outstanding | The following table sets forth common share purchase warrants outstanding as of October 31, 2019: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2018 123,761,716 $ 0.007 $ - Warrants granted and issued 1,796,574,073 $ 0.001 $ - Warrants exercised (3,000,000 ) $ (0.006 ) $ - Warrants exchanged (1,191,630,789 ) $ (0.002 ) $ - Outstanding, October 31, 2019 725,705,000 $ 0.003 $ - Common stock issuable upon exercise of warrants 725,705,000 $ 0.003 $ - The following table sets forth common share purchase warrants outstanding as of October 31, 2018: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2017 17,786,467 $ 0.016 $ - Warrants granted and issued 105,975,249 $ 0.006 $ - Warrants forfeited - $ - $ - Outstanding, October 31, 2018 123,761,716 $ 0.007 $ - Common stock issuable upon exercise of warrants 123,761,716 $ 0.007 $ - |
Schedule of Share-based Compensation, Activity | Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at October 31, Contractual Exercise at October 31, Exercise Prices 2019 Life (Years) Price 2019 Price $ 0.0025 580,000,000 2.35 $ 0.0025 580,000,000 $ 0.0025 $ 0.0060 142,500,000 0.79 $ 0.0060 142,500,000 $ 0.0060 $ 0.0250 1,000,000 0.17 $ 0.0250 1,000,000 $ 0.0250 $ 0.0500 1,000,000 1.17 $ 0.0500 1,000,000 $ 0.0500 $ 0.1000 1,205,000 0.35 $ 0.1000 1,205,000 $ 0.1000 725,705,000 1.99 $ 0.0034 725,705,000 $ 0.0034 Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at October 31, Contractual Exercise at October 31, Exercise Prices 2018 Life (Years) Price 2018 Price $ 0.006 120,556,716 0.98 $ 0.006 120,556,716 $ 0.006 $ 0.025 1,000,000 1.17 $ 0.025 1,000,000 $ 0.025 $ 0.050 1,000,000 0.47 $ 0.050 1,000,000 $ 0.050 $ 0.100 1,205,000 1.35 $ 0.100 1,205,000 $ 0.100 123,761,716 0.98 $ 0.007 123,761,716 $ 0.007 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Tax | The provision for income taxes consisted of the following: Year Ended October 31, 2019 2018 Deferred tax benefit (provision): Federal 729,016 659,190 State, net of federal benefit 226,255 127,093 Effect of Canada tax and exchange rates - 257,084 Nondeductible expenses - (90,961 ) Change in valuation allowance (955,271 ) (952,406 ) Income tax provision $ - $ - |
Summary of Effective Income Tax Rate Reconciliation | The following table presents the difference between the effective tax rate and the U.S. federal statutory income tax rate: Year Ended October 31, 2019 2018 U.S. federal statutory income tax rate 21.0 % 21.0 % State taxes, net of federal benefit 7.0 % 7.0 % Other 0.0 % 0.0 % Effect of valuation allowance (28.0 )% (28.0) % Effective income tax rate 0.0 % 0.0 % |
Schedule of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effect of temporary difference between the carrying amounts of assets and liabilities. The significant components of the deferred income tax asset (liability) are as follows: October 31, 2019 2018 Deferred tax assets (liabilities): Net operating loss carryforwards (US) 1,312,249 2,594,497 Net operating loss carryforwards (Canada) - 1,021,065 Deferred stock warrants 1,388,579 - Other 17,075 - Depreciation (6,400 ) - Net deferred tax assets 2,711,503 3,615,562 Valuation allowance (2,711,503 ) (3,615,562 ) Income tax provision $ - $ - |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments for Operating Leases | The Company’s future fiscal year minimum lease payments for its corporate office operating lease are as follows: 2020 $ 90,610 2021 $ 93,329 2022 $ 15,746 Total $ 199,685 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Oct. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: Year Ended October 31, 2019 2018 Continuing Discontinued Continuing Total Revenue $ 13,611,101 $ 216,316 $ 5,802,037 $ 6,018,353 Cost of revenue 11,546,413 56,800 5,053,453 5,110,253 Gross Profit 2,064,688 159,516 748,584 908,099 Operating Expenses: Salaries and benefits 3,892,926 82,326 488,577 570,902 Selling and promotions expense 125,644 824 - 824 Legal and professional fees 618,310 82,999 285,138 368,137 General and administrative 1,544,689 71,714 885,367 957,081 Total Operating Expenses 6,181,569 237,863 1,659,081 1,896,944 Operating loss (4,116,881 ) (78,347 ) (910,498 ) (988,845 ) Other Income (Expense): Interest expense (364,005 ) (1,322 ) (320,527 ) (321,849 ) Loss on legal settlements (205,300 ) - - - Initial derivative liability expense (225,115 ) - - - Amortization of debt discount (839,876 ) - - - Amortization of issuance costs (21,355 ) - - - Gain on extinguishment of debt 2,700,737 - - - Gain on convertible notes payable settlement 681,945 - - - Loss on legal settlement of accounts payable - 338,855 (914,353 ) (575,497 ) Default principal increase on convertible - - (938,100 ) (938,100 ) Total Other Income (Expense) 1,727,031 337,533 (2,172,980 ) (1,835,447 ) (Loss) income before income taxes (2,389,850 ) 259,186 (3,083,478 ) (2,824,292 ) Income taxes - - - - Net (loss) income $ (2,389,850 ) $ 259,186 $ (3,083,478 ) $ (2,824,292 ) |
Organization and Nature of Bu_2
Organization and Nature of Business (Details Narrative) - shares | Jul. 20, 2018 | May 01, 2018 | Oct. 31, 2018 | Oct. 31, 2019 | 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] | |||||
Preferred stock, designated shares | 120,000,000 | 120,000,000 | 93,000,000 | ||
Number of shares issued in exchange transaction | 44,470,101 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |||
Oct. 31, 2019 | Oct. 31, 2018 | Nov. 02, 2019 | Jan. 31, 2018 | |
Cash equivalents | ||||
Marketable securities | ||||
Allowance for doubtful accounts | ||||
Inventory, raw materials | 54,392 | |||
Inventory, finished products | $ 544,123 | |||
Estimated useful life of property and equipment | 3 years | 7 years | ||
Depreciation expense | $ 3,835 | |||
Impairment of long-lived assets | ||||
Income tax examination, likelihood of unfavorable settlement, description | Greater than 50 percent | |||
Accounting Standards Update 2016-02 [Member] | ||||
Operating liability | $ 191,000 | |||
Warrant [Member] | ||||
Number of shares dilute future earnings per share | 726,000,000 | 124,000,000 | ||
Conversion of Series A and Series C Convertible Preferred Stock [Member] | ||||
Number of shares dilute future earnings per share | 88,000,000 | 61,000,000 | ||
Convertible Notes Payable [Member] | ||||
Number of shares dilute future earnings per share | 16,000,000 | |||
Common Stock [Member] | ||||
Number of shares dilute future earnings per share | 276,000,000 | |||
Shipping and Handling [Member] | ||||
Freight expense | $ 562,959 | $ 162,190 | ||
Monaker Group, Inc. [Member] | ||||
Available for sale securities | $ 32,270 | |||
Accounts Receivable [Member] | Three Customers [Member] | ||||
Concentration risk percentage | 42.00% | |||
Revenues [Member] | Six Customers [Member] | ||||
Concentration risk percentage | 66.00% |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net losses | $ (2,389,850) | $ (2,824,292) |
Net cash used in operations | (2,238,364) | (1,070,299) |
Working capital deficit | 1,787,284 | |
Accumulated deficit | $ (28,494,590) | $ (26,104,740) |
Business Acquisition (Details N
Business Acquisition (Details Narrative) - Nutribrand Holdings [Member] - USD ($) | Mar. 31, 2020 | Oct. 30, 2019 |
Contribution and Sale Agreement [Member] | ||
Membership interest percentage | 49.00% | |
Business acquisition, description | Pursuant to the Agreement, beginning one year after the Closing Date, until the five-year anniversary thereof, the Sellers shall have the opportunity to receive an annual dividend of up to $4.5 million per year based upon the cumulative consolidated financial performance of the Companies; provided, however, such dividend shall not exceed an aggregate of $18 million. | |
Contribution and Sale Agreement [Member] | Sellers [Member] | ||
Transaction costs | $ 1,000,000 | |
Contribution and Sale Agreement [Member] | Sellers [Member] | Maximum [Member] | ||
Annual dividend | 18,000,000 | |
Contribution and Sale Agreement [Member] | Sellers [Member] | Cumulative Consolidated Financial Performance [Member] | Maximum [Member] | ||
Annual dividend | $ 4,500,000 | |
Termination Agreement [Member] | Subsequent Event [Member] | ||
Business acquisition, description | (i) all agreements between the parties (including the October 30, 2019 Amended and Restated Operating Agreement of Nutribrands International, LLC and the Agreement and all related ancillary agreements) were terminated (the “Released Transactions”) and (ii) the parties released each other from any and all obligations whatsoever arising from the Released Transactions, subject to certain exceptions. Accordingly, the Company concluded that no business combination occurred on October 30, 2019, as the Company never obtained control over Nutribrands as it did not have control over management nor could it agree with the management of Nutribrands to advance the business and operate pursuant to the terms of the Agreement. |
Asset Acquisitions (Details Nar
Asset Acquisitions (Details Narrative) - USD ($) | Aug. 30, 2019 | Apr. 25, 2019 | Aug. 31, 2019 |
Stock Purchase Agreement [Member] | Big League Foods Inc [Member] | |||
Sale of outstanding capital stock | 1,500 | ||
Aggregate liabilities | $ 50,000 | $ 50,000 | |
Aggregate liabilities and applicable payees thereof assumed company obligations | 50,000 | ||
Stock Purchase Agreement [Member] | Big League [Member] | Maximum [Member] | |||
Earnout payments | $ 5,000,000 | ||
Asset Purchase Agreement [Member] | French Fry Business [Member] | |||
Purchase price for the acquired assets | $ 544,477 | ||
Asset Purchase Agreement [Member] | French Fry Business [Member] | United Arab Emirates, Dirhams | |||
Purchase price for the acquired assets | $ 2,000,000 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details Narrative) | Sep. 06, 2019USD ($) | Sep. 06, 2019AED (د.إ) | Oct. 31, 2019USD ($) | Oct. 31, 2018USD ($) |
Intangible assets, amortization expense | $ 63,950 | |||
Customer Contracts [Member] | Frozen Foods Vendor [Member] | ||||
Acquisition of customer contracts | $ 544,477 | |||
Customer Contracts [Member] | Frozen Foods Vendor [Member] | United Arab Emirates Dirham [Member] | ||||
Acquisition of customer contracts | د.إ | د.إ 2,000,000 | |||
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 | |||
Net of cash acquired | 350 | |||
Contingently payable amount | $ 5,050,000 |
Intangible Assets, Net - Schedu
Intangible Assets, Net - Schedule of Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Accumulated amortization | $ (63,950) | |
Intangible assets, net | $ 837,707 | |
MLB License [Member] | ||
Estimated useful lives | 32 months | |
Intangible asset, gross carrying amount | $ 357,027 | |
Customer Contracts [Member] | ||
Estimated useful lives | 7 years | |
Intangible asset, gross carrying amount | $ 544,630 |
Intangible Assets, Net - Sche_2
Intangible Assets, Net - Schedule of Future Amortization Expense of Intangible Assets (Details) | Oct. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Fiscal year 2020 | $ 226,201 |
Fiscal year 2021 | 212,931 |
Fiscal year 2022 | 100,325 |
Fiscal year 2023 | 77,804 |
Fiscal year 2024 | $ 77,804 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Depreciation expense | $ 68,136 | |
Property, Plant and Equipment [Member] | ||
Depreciation expense | 0 | 3,835 |
Impairment of property and equipment |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Property and equipment, Estimated useful lives | 3 years | 7 years |
Accumulated depreciation | $ (86,554) | $ (82,719) |
Property and equipment, net | $ 23,257 | 15,622 |
Computer Equipment [Member] | ||
Property and equipment, Estimated useful lives | 3 years | |
Property and equipment, gross | $ 86,974 | 98,341 |
Furniture and Fixtures [Member] | ||
Property and equipment, Estimated useful lives | 7 years | |
Property and equipment, gross | $ 13,213 | |
Production Assets [Member] | ||
Property and equipment, Estimated useful lives | 3 years | |
Property and equipment, gross | $ 9,624 |
Revenue - Schedule of Net Reven
Revenue - Schedule of Net Revenue by Country (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Revenue | $ 13,611,101 | $ 5,802,037 |
United Arab Emirates [Member] | ||
Revenue | 9,326,205 | 3,686,471 |
Kingdom of Saudi Arabia [Member] | ||
Revenue | 1,891,059 | 710,580 |
Bahrain [Member] | ||
Revenue | 1,202,282 | 827,997 |
Oman [Member] | ||
Revenue | 1,140,116 | 576,989 |
United States [Member] | ||
Revenue | $ 51,439 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | Oct. 02, 2019 | Sep. 18, 2019 | Sep. 17, 2019 | Sep. 17, 2019 | Jul. 01, 2019 | Jun. 04, 2019 | May 30, 2019 | Apr. 25, 2019 | Feb. 11, 2019 | Feb. 08, 2019 | Jul. 20, 2018 | Oct. 31, 2019 | Oct. 31, 2018 | Nov. 08, 2019 | Nov. 02, 2019 | Sep. 25, 2019 |
Proceeds from issuance of convertible promissory note | $ 3,270,000 | $ 908,250 | ||||||||||||||
Warrant term | 1 year 11 months 26 days | 11 months 23 days | ||||||||||||||
Debt discount | $ 231,146 | $ 4,765 | ||||||||||||||
Stock issued during period shares issues | 900 | |||||||||||||||
Gain (Loss) on extinguishment of debt | 2,700,737 | |||||||||||||||
Repayments of convertible note | 1,577,172 | 118,000 | ||||||||||||||
Convertible notes payable outstanding | 1,378,855 | 1,497,126 | ||||||||||||||
Amortization of debt discount | 839,876 | |||||||||||||||
Value of debt converted into share | 1,638,531 | |||||||||||||||
Payment for debt | 1,577,172 | |||||||||||||||
Note payable | 1,030,000 | $ 530,000 | ||||||||||||||
Revolving Credit Agreement [Member] | ||||||||||||||||
Credit facility | $ 500,000 | |||||||||||||||
Credit facility, percentage | 4.80% | |||||||||||||||
LIBOR-based rate, description | Borrowings under the Credit Facility may be used to fund working capital needs and bear interest at a one-month LIBOR-based rate plus 300 basis-points | |||||||||||||||
Credit facility, outstanding | $ 500,000 | |||||||||||||||
Donald P. Monaco Insurance Trust [Member] | ||||||||||||||||
Note interest rate | 12.00% | |||||||||||||||
Note payable | $ 530,000 | |||||||||||||||
Maturity date description | The maturity date of the Monaco Note was extended to January 26, 2020 | |||||||||||||||
Donald P. Monaco Insurance Trust [Member] | Subsequent Event [Member] | ||||||||||||||||
Note interest rate | 18.00% | |||||||||||||||
Convertible Promissory Note [Member] | ||||||||||||||||
Stock issued during period shares issues | 12,909,258 | |||||||||||||||
Repayments of convertible note | $ 152,897 | |||||||||||||||
Convertible Note [Member] | ||||||||||||||||
Debt instrument conversion of shares | 1,244,233,615 | |||||||||||||||
Value of debt converted into share | $ 801,935 | |||||||||||||||
Monaco Note [Member] | ||||||||||||||||
Debt instrument, maturity date | Nov. 8, 2019 | |||||||||||||||
Monaco Note [Member] | Subsequent Event [Member] | ||||||||||||||||
Debt instrument outstanding principal amount | $ 530,000 | |||||||||||||||
Debt instrument accrued interest | $ 113,597 | |||||||||||||||
First Investor [Member] | ||||||||||||||||
Stock issued during period shares issues | 512,333,333 | |||||||||||||||
Second Investor [Member] | ||||||||||||||||
Stock issued during period shares issues | 81,920,000 | |||||||||||||||
Securities Purchase Agreement [Member] | ||||||||||||||||
Gain (Loss) on extinguishment of debt | $ 681,945 | |||||||||||||||
Repayments of convertible note | $ 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 First 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 First Note, the Company accounted for this conversion feature as a derivative liability. | |||||||||||||||
Debt instrument, conversion price | $ 0.0025 | |||||||||||||||
Number of warrants exercisable | 500,000,000 | |||||||||||||||
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 | |||||||||||||||
Debt instrument, conversion price | $ 0.0025 | |||||||||||||||
Number of warrants exercisable | 80,000,000 | |||||||||||||||
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 Second 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 Second 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) 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. | |||||||||||||||
Third Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Note [Member] | ||||||||||||||||
Debt instrument, conversion price | $ 0.011844 | $ 0.011844 | ||||||||||||||
Debt instrument, convertible beneficial conversion feature | $ 143,942 | |||||||||||||||
Debt instrument outstanding principal amount | $ 150,000 | $ 450,000 | ||||||||||||||
Debt instrument accrued interest | $ 2,897 | 9,123 | ||||||||||||||
Debt instrument conversion of shares | 12,909,528 | |||||||||||||||
Debt instrument principal amount | $ 459,123 | |||||||||||||||
Fourth Securities Purchase Agreement [Member] | Accredited Investor [Member] | Fourth Note [Member] | ||||||||||||||||
Note interest rate | 4.00% | |||||||||||||||
Proceeds from issuance of convertible promissory note | $ 605,000 | |||||||||||||||
Debt discount | $ 90,000 | |||||||||||||||
Debt instrument, conversion price | $ 0.10 | |||||||||||||||
Debt instrument, maturity date | Jul. 1, 2020 | |||||||||||||||
Note interest rate, description | The note matures on July 1, 2020, bears interest at a rate of 4% per annum (increasing to 24% per annum upon the occurrence of an event of default) 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 prior to the 180th day after the issuance date, subject to certain prepayment penalties. | |||||||||||||||
Fifth and Sixth Securities Purchase Agreement [Member] | Accredited Investor [Member] | Fifth and Sixth Note [Member] | ||||||||||||||||
Note interest rate | 4.00% | 4.00% | ||||||||||||||
Proceeds from issuance of convertible promissory note | $ 660,000 | |||||||||||||||
Debt discount | $ 110,000 | $ 110,000 | ||||||||||||||
Debt instrument, conversion price | $ 0.10 | $ 0.10 | ||||||||||||||
Debt instrument, maturity date | Sep. 17, 2020 | |||||||||||||||
Note interest rate, description | The notes mature on September 17, 2020, bear interest at a rate of 4% per annum (increasing to 24% per annum upon the occurrence of an event of default) and are convertible into shares of the Company's common stock at a conversion price of $0.10 per share, subject to adjustment. The notes may be prepaid by the Company at any time prior to the 180th day after the issuance date, subject to certain prepayment penalties. | |||||||||||||||
Seven Securities Purchase Agreement [Member] | Accredited Investor [Member] | Seven Note [Member] | ||||||||||||||||
Note interest rate | 6.00% | |||||||||||||||
Proceeds from issuance of convertible promissory note | $ 345,000 | |||||||||||||||
Debt discount | $ 45,000 | |||||||||||||||
Debt instrument, conversion price | $ 0.10 | |||||||||||||||
Debt instrument, maturity date | Apr. 15, 2020 | |||||||||||||||
Note interest rate, description | The note matures on April 15, 2020, bears interest at a rate of 6% per annum (increasing to 24% per annum upon the occurrence of an event of default) and is convertible into shares of the Company's common stock at a conversion price of $0.10 per share, subject to adjustment. The note may be prepaid by the Company at any time prior to the 180th day after the issuance date, subject to certain prepayment penalties. |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) | Jun. 04, 2019shares | Apr. 26, 2019shares | Mar. 25, 2019shares | Feb. 28, 2019USD ($) | Feb. 08, 2019USD ($)$ / sharesshares | Jan. 11, 2019$ / sharesshares | Dec. 28, 2018shares | Jul. 20, 2018shares | Dec. 22, 2017shares | May 05, 2015$ / sharesshares | Oct. 14, 2014Integer$ / sharesshares | Oct. 31, 2019USD ($)$ / sharesshares | Oct. 31, 2018USD ($)$ / sharesshares | May 30, 2019$ / shares | Apr. 16, 2019$ / sharesshares | Oct. 09, 2012shares |
Number of shares authorized | 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 | $ / shares | $ 0.001 | $ 0.000001 | $ 0.000001 | $ 0.001 | ||||||||||||
Common stock, shares outstanding | 2,305,778,511 | |||||||||||||||
Preferred stock, par value | $ / shares | $ 0.000001 | $ 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 | |||||||||||||||
Proceeds from issuance of common stock | $ | $ 500,000 | |||||||||||||||
Repayment of outstanding principal | $ | 1,577,172 | 118,000 | ||||||||||||||
Conversion of debt converted value | $ | 1,638,531 | |||||||||||||||
Operating expenses | $ | 6,181,569 | 1,659,082 | ||||||||||||||
Stock issued during period value issues | $ | 500,000 | |||||||||||||||
Revenue | $ | $ 13,611,101 | $ 5,802,037 | ||||||||||||||
Ownership interest percentage | 80.00% | |||||||||||||||
Warrant term | 1 year 11 months 26 days | 11 months 23 days | ||||||||||||||
Maximum [Member] | ||||||||||||||||
Warrants to purchase common stock | 725,705,000 | |||||||||||||||
Convertible Promissory Note [Member] | ||||||||||||||||
Stock issued during period shares issues | 12,909,258 | |||||||||||||||
Repayment of outstanding principal | $ | $ 152,897 | |||||||||||||||
Convertible Note [Member] | ||||||||||||||||
Debt instrument conversion of shares | 1,244,233,615 | |||||||||||||||
Conversion of debt converted value | $ | $ 801,935 | |||||||||||||||
First Investor [Member] | ||||||||||||||||
Stock issued during period shares issues | 512,333,333 | |||||||||||||||
Second Investor [Member] | ||||||||||||||||
Stock issued during period shares issues | 81,920,000 | |||||||||||||||
Christopher Cutchens [Member] | ||||||||||||||||
Number of shares awarded | 30,000,000 | |||||||||||||||
Common stock vesting percentage | 25.00% | |||||||||||||||
Common stock vesting, description | The common stock will vest 25% on the six month, 1 year, 2 year, and 3 year anniversaries of the grant date. | |||||||||||||||
Stock based compensation | $ | $ 143,750 | |||||||||||||||
Former Employee [Member] | ||||||||||||||||
Number of warrant exercisable | 3,000,000 | |||||||||||||||
Number of shares awarded | 2,419,355 | |||||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||
Warrants to purchase common stock | 142,500,000 | |||||||||||||||
Securities Purchase Agreement [Member] | ||||||||||||||||
Repayment of outstanding principal | $ | $ 1,118,049 | |||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||||||||||
Warrants to purchase common stock | 925,925,925 | |||||||||||||||
Warrant term | 3 years | |||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Note [Member] | ||||||||||||||||
Conversion price per share | $ / shares | $ 0.0025 | |||||||||||||||
Warrants exercisable price per share | $ / shares | $ 0.0025 | |||||||||||||||
Letter Agreement [Member] | First Investor [Member] | ||||||||||||||||
Debt instrument conversion of shares | 512,333,333 | |||||||||||||||
Conversion price per share | $ / shares | $ 0.0025 | |||||||||||||||
Number of warrant exercisable | 500,000,000 | |||||||||||||||
Warrants exercisable price per share | $ / shares | $ 0.0025 | |||||||||||||||
Common stock shares issued upon conversion | 512,333,333 | |||||||||||||||
Letter Agreement [Member] | Second Investor [Member] | ||||||||||||||||
Debt instrument conversion of shares | 81,920,000 | |||||||||||||||
Conversion price per share | $ / shares | $ 0.0025 | |||||||||||||||
Number of warrant exercisable | 80,000,000 | |||||||||||||||
Warrants exercisable price per share | $ / shares | $ 0.0025 | |||||||||||||||
Common stock shares issued upon conversion | 81,920,000 | |||||||||||||||
Employment Agreement [Member] | ||||||||||||||||
Stock issued during period shares issues | 117,055,586 | |||||||||||||||
Stock issued during period value issues | $ | $ 299,635 | |||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Stock issued during period shares issues | 394,000,000 | |||||||||||||||
Warrants to purchase common stock | 7,500,000 | |||||||||||||||
Revenue | $ | $ 1,000,000 | |||||||||||||||
Ownership interest percentage | 20.00% | |||||||||||||||
Warrant to acquire percentage | 3.00% | |||||||||||||||
Inducement Agreement [Member] | ||||||||||||||||
Stock issued during period shares issues | 152,029,899 | |||||||||||||||
Stock issued during period value issues | $ | $ 456,090 | |||||||||||||||
Monaker Group, Inc. [Member] | ||||||||||||||||
Stock issued during period shares issues | 152,029,899 | |||||||||||||||
Monaker [Member] | ||||||||||||||||
Stock issued during period shares issues | 152,029,899 | |||||||||||||||
Stock issued during period value issues | $ | $ 456,090 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | ||||||||||||||||
Preferred stock, shares authorized | 120,000,000 | 120,000,000 | 93,000,000 | |||||||||||||
Preferred stock, par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||||||||||
Preferred stock, shares outstanding | 44,570,101 | 44,570,101 | ||||||||||||||
Stock issued during period shares issues | 44,470,101 | |||||||||||||||
Preferred stock, shares designated | 120,000,000 | |||||||||||||||
Preferred stock conversion price per share | $ / shares | $ 1 | |||||||||||||||
Preferred stock stated value per share | $ / shares | $ 1 | |||||||||||||||
Stock outstanding percentage | 50.00% | |||||||||||||||
Number of voting rights, votes per share | Integer | 20 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Board of Directors Member [Member] | ||||||||||||||||
Preferred stock, par value | $ / shares | $ 0.001 | |||||||||||||||
Preferred stock dividend rate | 10.00% | |||||||||||||||
Preferred stock, description | Each 20 shares of Series A Convertible Preferred Stock is convertible at the option of the holder thereof at any time into one share of Common Stock. Each holder of Series A Convertible Preferred Stock shall be entitled to one vote for each whole share of common stock that would be issuable upon conversion of such share on the record date for determining eligibility to participate in the action being taken. | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Board of Directors Member [Member] | Maximum [Member] | ||||||||||||||||
Preferred stock, shares authorized | 120,000,000 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Board of Directors Member [Member] | Minimum [Member] | ||||||||||||||||
Preferred stock, shares authorized | 100,000,000 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Monaker Group, Inc. [Member] | ||||||||||||||||
Stock issued during period shares issues | 44,470,101 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Monaker [Member] | ||||||||||||||||
Stock issued during period shares issues | 10,559,890 | |||||||||||||||
Stock issued during period value issues | $ | $ 330,180 | |||||||||||||||
Series A Convertible Preferred Stock [Member] | Monaker [Member] | Inducement Agreement [Member] | ||||||||||||||||
Debt instrument conversion of shares | 152,029,899 | |||||||||||||||
Series B Convertible Preferred Stock [Member] | ||||||||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | ||||||||||||||
Preferred stock, par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||||||||||
Preferred stock, shares outstanding | ||||||||||||||||
Conversion price per share | $ / shares | $ 0.05 | |||||||||||||||
Preferred stock dividend rate | 10.00% | |||||||||||||||
Preferred stock, description | The conversion price for the Series B Convertible Preferred Stock is equal to $0.05 per share, subject to adjustment. Each holder of Series B Convertible Preferred Stock shall be entitled to the number of votes equal to 200 votes for each shares of Series B Convertible Preferred Stock held by them. | |||||||||||||||
Series C Convertible Preferred Stock [Member] | ||||||||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | ||||||||||||||
Preferred stock, par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||||||||||
Preferred stock, shares outstanding | 430,801 | 160,000 | ||||||||||||||
Conversion price per share | $ / shares | $ 5 | |||||||||||||||
Common stock shares issued upon conversion | 2,500,000 | |||||||||||||||
Preferred stock dividend rate | 10.00% | |||||||||||||||
Preferred stock, description | Each share of Series C Preferred Stock shall be entitled to vote such number of shares equal to 100 votes for each share of common stock into which the Series C Preferred Stock is then convertible into. Shares of Series C Preferred Stock shall accrue dividends at a rate of 10% per annum on the Series C Stated Value which shall be payable when and if declared by the board of directors. | |||||||||||||||
Preferred stock, shares designated | 1,000,000 | |||||||||||||||
Number of shares converted | 25,000 | |||||||||||||||
Series C Convertible Preferred Stock [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Number of shares awarded | 295,801 | |||||||||||||||
Series C Convertible Preferred Stock [Member] | Board of Directors Member [Member] | ||||||||||||||||
Number of shares awarded | 501,130 | |||||||||||||||
Preferred Stock [Member] | ||||||||||||||||
Preferred stock, shares authorized | 125,000,000 | |||||||||||||||
Preferred stock, par value | $ / shares | $ 0.000001 | |||||||||||||||
Common Stock [Member] | ||||||||||||||||
Stock issued during period shares issues | 41,666,666 | |||||||||||||||
Common stock shares issued upon conversion | 1,244,233,615 | |||||||||||||||
Conversion of debt converted value | $ | $ 801,936 | |||||||||||||||
Stock issued during period value issues | $ | $ 42 | |||||||||||||||
Number of common stock shares retired | (4,163,315) | |||||||||||||||
Number of shares converted | 2,500,000 | |||||||||||||||
Common Stock [Member] | Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||||||||||
Stock issued during period shares issues | 41,666,666 | |||||||||||||||
Proceeds from issuance of common stock | $ | $ 500,000 | |||||||||||||||
Common Stock [Member] | Monaker Group, Inc. [Member] | ||||||||||||||||
Stock issued during period shares issues | 10,559,890 | |||||||||||||||
First and Second Warrants [Member] | Securities Purchase Agreement [Member] | ||||||||||||||||
Warrant allocated value | $ | $ 697,611 | |||||||||||||||
Warrant [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Operating expenses | $ | $ 2,515,794 | |||||||||||||||
Warrant [Member] | Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Stock issued during period shares issues | 117,055,586 | |||||||||||||||
Warrant [Member] | Series C Convertible Preferred Stock [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Stock issued during period shares issues | 117,556,716 |
Stockholders' Deficit - Summary
Stockholders' Deficit - Summary of Assumptions Used on Fair Value of Options (Details) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Weighted-average volatility | 50.14% | 3.52% |
Expected dividends | 0.00% | 0.00% |
Expected term (in years) | 6 months | 1 year |
Minimum [Member] | ||
Expected volatility | 0.20% | 1.45% |
Risk-free rate | 1.46% | 1.09% |
Maximum [Member] | ||
Expected volatility | 486.01% | 6.30% |
Risk-free rate | 2.60% | 2.67% |
Stockholders' Deficit - Schedul
Stockholders' Deficit - Schedule of Common Share Purchase Warrants Outstanding (Details) - $ / shares | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Warrants Outstanding Beginning Balance | 123,761,716 | |
Warrants Outstanding Ending Balance | 725,705,000 | 123,761,716 |
Common stock issuable upon exercise of warrants | 725,705,000 | 123,761,716 |
Warrant [Member] | ||
Warrants Outstanding Beginning Balance | 123,761,716 | 17,786,467 |
Warrants granted and issued | 1,796,574,073 | 105,975,249 |
Warrants exercised | (3,000,000) | |
Warrants exchanged | (1,191,630,789) | |
Warrants forfeited | ||
Warrants Outstanding Ending Balance | 725,705,000 | 123,761,716 |
Common stock issuable upon exercise of warrants | 725,705,000 | 123,761,716 |
Weighted Average Exercise Price Beginning Balance | $ 0.007 | $ 0.016 |
Weighted Average Exercise Price Warrants granted and issued | 0.001 | 0.006 |
Weighted Average Exercise Price Warrants exercised | (0.006) | |
Weighted Average Exercise Price Warrants exchanged | (0.002) | |
Weighted Average Exercise Price Warrants forfeited | ||
Weighted Average Exercise Price Ending Balance | 0.003 | 0.007 |
Common stock issuable upon exercise of warrants Weighted Average Exercise Price | 0.003 | 0.007 |
Intrinsic Value Beginning Balance | ||
Intrinsic Value Warrants granted and issued | ||
Intrinsic Value Warrants exercised | ||
Intrinsic Value Warrants exchanged | ||
Intrinsic Value Warrants forfeited | ||
Intrinsic Value Ending Balance | ||
Common stock issuable upon exercise of warrants Intrinsic Value |
Stockholders' Deficit - Sched_2
Stockholders' Deficit - Schedule of Share-based Compensation, Activity (Details) - $ / shares | Oct. 31, 2019 | Oct. 31, 2018 |
Number of Warrants Outstanding shares | 725,705,000 | 123,761,716 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 1 year 11 months 26 days | 11 months 23 days |
Warrants Outstanding Weighted Average Exercise Price | $ 0.0034 | $ 0.007 |
Number of Warrants Exercisable shares | 725,705,000 | 123,761,716 |
Warrants Exercisable Weighted Average Exercise Price | $ 0.0034 | $ 0.007 |
Range One [Member] | ||
Exercise Prices | $ 0.0025 | $ 0.006 |
Number of Warrants Outstanding shares | 580,000,000 | 120,556,716 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 2 years 4 months 6 days | 11 months 23 days |
Warrants Outstanding Weighted Average Exercise Price | $ 0.0025 | $ 0.006 |
Number of Warrants Exercisable shares | 580,000,000 | 120,556,716 |
Warrants Exercisable Weighted Average Exercise Price | $ 0.0025 | $ 0.006 |
Range Two [Member] | ||
Exercise Prices | $ 0.0060 | $ 0.025 |
Number of Warrants Outstanding shares | 142,500,000 | 1,000,000 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 9 months 14 days | 1 year 2 months 1 day |
Warrants Outstanding Weighted Average Exercise Price | $ 0.0060 | $ 0.025 |
Number of Warrants Exercisable shares | 142,500,000 | 1,000,000 |
Warrants Exercisable Weighted Average Exercise Price | $ 0.0060 | $ 0.025 |
Range Three [Member] | ||
Exercise Prices | $ 0.0250 | $ 0.050 |
Number of Warrants Outstanding shares | 1,000,000 | 1,000,000 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 2 months 1 day | 5 months 20 days |
Warrants Outstanding Weighted Average Exercise Price | $ 0.0250 | $ 0.050 |
Number of Warrants Exercisable shares | 1,000,000 | 1,000,000 |
Warrants Exercisable Weighted Average Exercise Price | $ 0.0250 | $ 0.050 |
Range Four [Member] | ||
Exercise Prices | $ 0.0500 | $ 0.100 |
Number of Warrants Outstanding shares | 1,000,000 | 1,205,000 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 1 year 2 months 1 day | 1 year 4 months 6 days |
Warrants Outstanding Weighted Average Exercise Price | $ 0.0500 | $ 0.100 |
Number of Warrants Exercisable shares | 1,000,000 | 1,205,000 |
Warrants Exercisable Weighted Average Exercise Price | $ 0.0500 | $ 0.100 |
Range Five [Member] | ||
Exercise Prices | $ 0.1000 | |
Number of Warrants Outstanding shares | 1,205,000 | |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 4 months 6 days | |
Warrants Outstanding Weighted Average Exercise Price | $ 0.1000 | |
Number of Warrants Exercisable shares | 1,205,000 | |
Warrants Exercisable Weighted Average Exercise Price | $ 0.1000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Jul. 20, 2018 | Oct. 31, 2019 | Oct. 31, 2018 |
Stock issued during period shares issues | 900 | ||
Number of common stock shares issued | $ 500,000 | ||
Employment Agreement [Member] | |||
Stock issued during period shares issues | 117,055,586 | ||
Number of common stock shares issued | $ 299,635 | ||
Chief Executive Officer [Member] | Employment Agreement [Member] | |||
Stock issued during period shares issues | 394,000,000 | ||
Number of common stock shares available for issuance | |||
Chief Executive Officer [Member] | Employment Agreement [Member] | Warrant [Member] | |||
Stock issued during period shares issues | 117,055,586 | ||
Board of Directors Member [Member] | December 28, 2018 [Member] | |||
Number of shares awarded | 501,130 | ||
Board of Directors Member [Member] | December 28, 2018 [Member] | Series C Preferred Stock [Member] | |||
Number of shares awarded | 294,545 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Income tax expense (benefit) | ||
Deferred tax assets valuation allowance decrease, amount | 904,059 | $ 361,043 |
Net operating loss carryforwards | $ 4,600,000 | |
Net operating loss expiration, description | Net operating loss carryforwards generated before January 1, 2018 will expire through 2037. | |
Income tax examination description | Effective December 22, 2017 a new tax bill was signed into law that reduced the federal income tax rate for corporations from 35% to 21%. | |
Federal income tax rate | 21.00% | 21.00% |
Blended Tax Rate [Member] | ||
Net operating loss carryforwards | $ 1,400,000 | |
Federal income tax rate | 39.50% | |
Blended Tax Rate [Member] | Reduced Rate [Member] | ||
Federal income tax rate | 27.50% | |
Federal [Member] | ||
Federal income tax rate | 21.00% |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for Income Tax (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Federal | $ 729,016 | $ 659,190 |
State, net of federal benefit | 226,255 | 127,093 |
Effect of Canada tax and exchange rates | 257,084 | |
Nondeductible expenses | (90,961) | |
Change in valuation allowance | (955,271) | (952,406) |
Income tax provision |
Income Taxes - Summary of Effec
Income Taxes - Summary of Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
U.S. federal statutory income tax rate | 21.00% | 21.00% |
State taxes, net of federal benefit | 7.00% | 7.00% |
Other | 0.00% | 0.00% |
Effect of valuation allowance | (28.00%) | (28.00%) |
Effective income tax rate | 0.00% | 0.00% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Oct. 31, 2019 | Oct. 31, 2018 |
Net operating loss carryforwards (US) | $ 1,312,249 | $ 2,594,497 |
Deferred stock warrants | 1,388,579 | |
Other | 17,075 | |
Depreciation | (6,400) | |
Net deferred tax assets | 2,711,503 | 3,615,562 |
Valuation allowance | (2,711,503) | (3,615,562) |
Income tax provision | ||
Canada [Member] | ||
Net operating loss carryforwards (Canada) | $ 1,021,065 |
Segment Reporting (Details Narr
Segment Reporting (Details Narrative) | 12 Months Ended |
Oct. 31, 2019Segments | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Aug. 31, 2019 | Oct. 31, 2019 | Oct. 31, 2018 | |
Guaranteed minimum royalty payments | $ 1,346,818 | ||
Accounts payable and accrued expenses | 233,841 | ||
Operating lease, rent expense | 87,910 | $ 78,681 | |
October 31, 2020 [Member] | |||
Guaranteed minimum royalty payments | 478,485 | ||
October 31, 2021 [Member] | |||
Guaranteed minimum royalty payments | 738,333 | ||
October 31, 2022 [Member] | |||
Guaranteed minimum royalty payments | 130,000 | ||
Big League Foods Inc [Member] | License [Member] | |||
Contingently payable amount | 5,050,000 | ||
Major League Baseball Properties, Inc [Member] | December 31, 2022 [Member] | |||
Contingently payable amount | 5,000,000 | ||
Major League Baseball Properties, Inc [Member] | License [Member] | |||
Contingently payable amount | 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. | ||
Accrued for license contingent consideration | $ 50,000 | ||
Major League Baseball Properties, Inc [Member] | License [Member] | Maximum [Member] | |||
Contingently payable amount | $ 5,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Payments for Operating Leases (Details Narrative) | Oct. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2020 | $ 90,610 |
2021 | 93,329 |
2022 | 15,746 |
Total | $ 199,685 |
Litigation (Details Narrative)
Litigation (Details Narrative) - USD ($) | Oct. 30, 2019 | Apr. 22, 2019 | Mar. 25, 2019 | Jul. 20, 2018 | May 01, 2018 | Jan. 29, 2018 | Dec. 22, 2017 | Oct. 31, 2019 | Oct. 31, 2018 |
Stock issued during period shares issues | 900 | ||||||||
Proceeds from issuance of convertible promissory note | $ 3,270,000 | $ 908,250 | |||||||
Warrant term | 1 year 11 months 26 days | 11 months 23 days | |||||||
Inducement Agreement [Member] | |||||||||
Stock issued during period shares issues | 152,029,899 | ||||||||
Common Stock [Member] | |||||||||
Stock issued during period shares issues | 41,666,666 | ||||||||
Series A Convertible Preferred Stock [Member] | |||||||||
Stock issued during period shares issues | 44,470,101 | ||||||||
Monaker Group, Inc. [Member] | |||||||||
Litigation settlement amount | $ 1,300,000 | ||||||||
Stock issued during period shares issues | 152,029,899 | ||||||||
Monaker Group, Inc. [Member] | Common Stock [Member] | |||||||||
Stock issued during period shares issues | 10,559,890 | ||||||||
Monaker Group, Inc. [Member] | Series A Convertible Preferred Stock [Member] | |||||||||
Stock issued during period shares issues | 44,470,101 | ||||||||
Monaker Group, Inc. [Member] | Series A Preferred Stock [Member] | Inducement Agreement [Member] | |||||||||
Stock issued during period shares issues | 152,029,899 | ||||||||
Proceeds from issuance of convertible promissory note | $ 456,090 | ||||||||
Debt instrument conversion of shares | 152,029,899 | ||||||||
NestBuilder [Member] | |||||||||
Payments for litigation settlement | $ 30,000 | $ 100,000 | |||||||
Number of shares returned | 4,163,315 | ||||||||
Monaker [Member] | |||||||||
Stock issued during period shares issues | 152,029,899 | ||||||||
Monaker [Member] | Series A Convertible Preferred Stock [Member] | |||||||||
Stock issued during period shares issues | 10,559,890 | ||||||||
Monaker [Member] | Series A Convertible Preferred Stock [Member] | Inducement Agreement [Member] | |||||||||
Debt instrument conversion of shares | 152,029,899 | ||||||||
Monaker [Member] | Series A Preferred Stock [Member] | Inducement Agreement [Member] | |||||||||
Agreement effective date | Feb. 8, 2019 | ||||||||
Proceeds from issuance of convertible promissory note | $ 1,250,000 | ||||||||
Debt instrument conversion of shares | 152,029,899 | ||||||||
Warrant term | 3 years | ||||||||
Warrants to purchase common stock | 925,925,925 | ||||||||
Verus Foods MENA Limited [Member] | |||||||||
Litigation settlement amount | $ 205,300 | ||||||||
Stock issued during period shares issues | 75 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Revenue | $ 6,018,353 | |
Cost of revenue | 5,110,253 | |
Gross Profit | 908,099 | |
Salaries and benefits | 570,902 | |
Selling and promotions expense | 824 | |
Legal and professional fees | 368,137 | |
General and administrative | 957,081 | |
Total Operating Expenses | 1,896,944 | |
Operating loss | (988,845) | |
Interest expense | (321,849) | |
Loss on legal settlements | ||
Initial derivative liability expense | ||
Amortization of debt discount | ||
Amortization of issuance costs | ||
Gain on extinguishment of debt | ||
Gain on convertible notes payable settlement | ||
Loss on legal settlement of accounts payable and convertible debt | (575,497) | |
Default principal increase on convertible notes payable | (938,100) | |
Total Other Income (Expense) | (1,835,447) | |
(Loss) income before income taxes | (2,824,292) | |
Income taxes | ||
Net (loss) income | (2,389,850) | (2,824,292) |
Continuing [Member] | ||
Revenue | 13,611,101 | 5,802,037 |
Cost of revenue | 11,546,413 | 5,053,453 |
Gross Profit | 2,064,688 | 748,584 |
Salaries and benefits | 3,892,926 | 488,577 |
Selling and promotions expense | 125,644 | |
Legal and professional fees | 618,310 | 285,138 |
General and administrative | 1,544,689 | 885,367 |
Total Operating Expenses | 6,181,569 | 1,659,081 |
Operating loss | (4,116,881) | (910,498) |
Interest expense | (364,005) | (320,527) |
Loss on legal settlements | (205,300) | |
Initial derivative liability expense | (225,115) | |
Amortization of debt discount | (839,876) | |
Amortization of issuance costs | (21,355) | |
Gain on extinguishment of debt | 2,700,737 | |
Gain on convertible notes payable settlement | 681,945 | |
Loss on legal settlement of accounts payable and convertible debt | (914,353) | |
Default principal increase on convertible notes payable | (938,100) | |
Total Other Income (Expense) | 1,727,031 | (2,172,980) |
(Loss) income before income taxes | (2,389,850) | (3,083,478) |
Income taxes | ||
Net (loss) income | (2,389,850) | $ (3,083,478) |
Discontinued [Member] | ||
Revenue | 216,316 | |
Cost of revenue | 56,800 | |
Gross Profit | 159,516 | |
Salaries and benefits | 82,326 | |
Selling and promotions expense | 824 | |
Legal and professional fees | 82,999 | |
General and administrative | 71,714 | |
Total Operating Expenses | 237,863 | |
Operating loss | (78,347) | |
Interest expense | (1,322) | |
Loss on legal settlements | ||
Initial derivative liability expense | ||
Amortization of debt discount | ||
Amortization of issuance costs | ||
Gain on extinguishment of debt | ||
Gain on convertible notes payable settlement | ||
Loss on legal settlement of accounts payable and convertible debt | 338,855 | |
Default principal increase on convertible notes payable | ||
Total Other Income (Expense) | 337,533 | |
(Loss) income before income taxes | 259,186 | |
Income taxes | ||
Net (loss) income | $ 259,186 |
Business Divestiture (Details N
Business Divestiture (Details Narrative) - shares | Jul. 20, 2018 | May 01, 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 ($) | Mar. 31, 2020 | Feb. 10, 2020 | Jan. 09, 2020 | Jan. 02, 2020 | Nov. 08, 2019 | Feb. 08, 2019 | Oct. 31, 2019 | Oct. 31, 2018 |
Debt, original issue discount | $ 231,146 | $ 4,765 | ||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||
Debt, original issue discount | $ 676,611 | |||||||
Monaco Note [Member] | ||||||||
debt instrument, maturity | Nov. 8, 2019 | |||||||
Subsequent Event [Member] | Monaco Note [Member] | ||||||||
Debt principal amount | $ 530,000 | |||||||
Debt instrument accrued interest | 113,597 | |||||||
Unpaid debt due on note | $ 643,597 | |||||||
Debt, increased interest rate per annum | 18.00% | |||||||
Subsequent Event [Member] | Convertible Note [Member] | ||||||||
Debt conversion, original debt, amount | $ 605,000 | |||||||
Debt, aggregation of principal and interest | $ 153,266 | |||||||
Debt instrument conversion of shares | 15,098,054 | |||||||
Subsequent Event [Member] | Convertible Note [Member] | Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||
Debt principal amount | $ 420,000 | $ 605,000 | ||||||
Debt, increased interest rate per annum | 24.00% | |||||||
Debt, original issue discount | $ 70,000 | $ 90,000 | ||||||
debt instrument, maturity | Nov. 10, 2020 | Jan. 9, 2021 | ||||||
Debt instrument, stated percentage | 4.00% | 4.00% | ||||||
Debt conversion price per share | $ 0.0125 | $ 0.015 | ||||||
Debt instrument, description | The note may be prepaid by the Company at any time prior to the 180th day after the issuance date, subject to certain prepayment penalties. | The note may be prepaid by the Company at any time prior to the 180th day after the issuance date, subject to certain prepayment penalties. | ||||||
Subsequent Event [Member] | Promissory Note [Member] | Accredited Investor [Member] | ||||||||
Debt principal amount | $ 312,500 | |||||||
Debt, original issue discount | $ 62,500 | |||||||
debt instrument, maturity | Jul. 1, 2020 | |||||||
Debt instrument, stated percentage | 4.00% |