Verus International inc., on the 28th of December has announced that the company its wholly owned subsidiary, Big League Foods Inc., entered a letter agreement with both ACG Global Solutions and Games on Foods, Inc. For certain consideration BLF has agreed to sell, transfer and assign all of BLF’s assets to GOF.
Specifics on the Agreement
The agreement states that GOF will manufacture, package, and ship candy products under preexisting licenses of BLF. Verus, on the other hand, will operate all its sales organization in tandem with this arrangement. This agreement is designed to reduce all current and future capital costs for Verus. The agreement will also remove certain salary and obligations, as well as existing liabilities. ACG has agreed to revise the terms of its promissory note to $150,000 which will be extended to December 31, 2021.
The CEO of Verus Anshu Bhatnagar has started that “licensed products require greater scale and significant capital investment, so the agreement announcement solves a major problem for us.”
He opines that this agreement is an amazing positive development because it allows the company to participate in the growth of the business without facing significant risks and capital conditions estimated at more than $1.0 million annually that is required to develop into a profitable business. The agreement also reduces ongoing expenses by erasing significant certain annual license minimums, salaries, and inventory costs ensuring that benefits are immediate.
These changes will allow the company to follow the international model where the company primarily operates as a sales organization. The CEO assured that the company will continue to distribute and sell BLF products while freeing up additional capital for the other divisions. According to him, the agreement has put the company in a better position to move forward with strategic plans in 2021.
Updates on Operations
The company had earlier announced a reverse stock split which is proceeding as expected and is awaiting a final regulatory approval. It is expected that upon the reverse stock split completion, the company will be able to proceed with the previously discussed strategic projects.