Verus International Inc (VRUS)

[GermanCol]

I want to share my theory of why I think we are going to be free from notes and convertible notes very soon and company is going to announce it. I also think this note payment is going to bring a huge share price increase. In the table below is the information for all notes and convertible notes ordered by maturity date that I have put together looking at our filings and crossing information.



What is highlighted in pink is what is my estimation according to last filings and OS changes. The numbers not highlighted in pink are exact numbers coming from previous filings. In the last line you will see the average share prices for VRUS for the different Qs, that are always higher than the estimated conversion prices, so the numbers make sense.

As some of you should remember, around Jan 31st 2020 the company got delinquent in reporting and the notes at that time defaulted, so they had to start to renegotiate the corresponding terms and payments with noteholders. In the table is the information of how they have been paying them.

Then, on August 19th Anshu’s tweet he said that the recent volume was not from White Lion. The only way he could now that was if no shares had been sold to White Lion until that date. Also, to reinforce this theory, the last change in OS from August 10 to August 24 was 607,268,379 (3,782,151,277 – 3,174,882,898) that is just a little bit more than the number of shares registered for White Lion sale on last S-1 (598,515,704). Also I think the company was waiting to make sure previous noteholders had converted and sold or almost sold all shares before selling to White Lion, so the share price would not have a double effect of selling, so that conversion price would be higher with benefits for the company.

So according to my theory, what occurred is that they paid all the notes according to the table presented above (they probably used all or part of last 3 notes to pay in cash part of previous notes still outstanding) and then on Monday 24th of August or around that date they sold to White Lion and final sale price will be around $0.00114 (0.0012 * 95%. 0.0012 was the lowest price on August 24th and for the whole week). With that money from WL they will pay all or part of the last notes for $165K, $153K and 63K plus Monaker note (according to dates agreed by VRUS and Monaker).

Reinforcing this theory is the timing and proximity of last two PRs. Timing was excellent because if WL dumped part of the shares sold to them in order to pay less for the shares, thanks to the news on Monday the price didn’t go down by much and then started to climb. And then when price was coming back the following day, the second press release made it jump again as it did Yesterday. So if this is the case, payment by White Lion will be not less than 0.00114 per share. Also take into account that the deals with NHL Meijer, TJ Maxx, Marshalls and Big 5 were from before, sure not at the same time, but news were strategically timed.

Also reforcing this theory is that the last 3 notes can start converting by the noteholder by 26 Oct 2020, 8 Nov 2020 and 10 Jan 2021 respectively, so before those days is important to pay them because they have a huger discount than WL.

Very important to note in the table above in the line Total that in the Q3/Q4 2020 for the first time the notes amount is decreasing and by a huge amount (1,626,000). Before that, it was always increasing or stable (600,000, 605,000, 405,000o, 0 and 709,500 from Q2 2019 to Q2 2020).

Much people forget what happened to businesses around the world with Covid and I see VRUS not only surviving, but doing great improvements.

And finally something to think, dilution for the last year of around 65% is nothing compared to price reduction by more than 10 times from highs that has come just as a temporary situation due to supply vs. demand of shares (due to Garnock sale and note conversions mainly) that will change dramatically very soon. So just with the same business, price should be around 6 times the price now if it were just for dilution (10 / 1.6 = 6.26), but also we now have a much bigger business. We are tremendously undervalued.