Verus International Inc (VRUS)

[PennyTool]

So I just went back and read up what was filed along with the 8k, exhibit 10.1 was the security purchase agreement and 10.2 was the actual note. I had not read the security purchase agreement before which is what you seem to be quoting. You're right it does say they are to refrain from entering into another financing deal for 60 days unless it's over 2 million dollars. Below that it says if they violate that it is considered a default. The note explains what happens under a default situation. The common penalty no matter the reason for default is the interest rate increasing to 24%. Nowhere in the security purchase agreement or the actual note did it say they had to convert shares before the next note was issued. So either your speculation is correct and they already converted the note prior to giving this new one, or they defaulted on the last note regardless of whether the 10K was filed on time or not. Only time will tell. Again GLTY