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Replies to post #95528 on Verus International Inc (VRUS)
Item 4. Purpose of Transaction
ARJ previously reported its acquisition of a significant position in the Issuer’s Common Stock (“Transaction”) in a Schedule 13D filing, dated February 8,
2019. The within report is necessitated by amendments to and exercise of certain of the documents and instruments described in such filing, as well as a new
subscription for shares of Common Stock made by ARJ. The Transaction was made pursuant to a Securities Purchase Agreement (“SPA”), dated February 8, 2019,
a Convertible Promissory Note (“Note”) of even date, a Warrant (“Warrant”) of even date and a Registration Rights Agreement (“RRA”) of even date, all by and
between the same parties. ARJ is not acting as part of a “group” as defined under Rule 13d-5(b). The SPA contains no arrangements granting ARJ any rights of
representation on or election to Issuer’s board of directors. All calculations herein specifically exclude 500,000,000 shares of Common Stock issuable upon
exercise of the Warrant which contains a prohibition on exercise based upon stock ownership which is waivable by the holder of the Warrant.
CUSIP NO. 94762T107 Page 5 of 7
On May 30, 2019, the Note was amended by letter agreement (“Letter Agreement”) to provide for a fixed exercise price of $.0025 per share, and such
Note was exercised in full by ARJ on such date resulting in the issuance of 512,333,333 shares of Common Stock. Also on May 30, 2019, the Warrant was
amended by such Letter Agreement to provide that it is exercisable as to an aggregate of 500,000,000 shares of Issuer Common Stock, not the original amount of
925,925,925 shares. The RRA was also amended on such date to provide for, among other things, an extension of time within which the Company has to file one
(1) or more registration statements. Finally, on May 30, 2019, ARJ and the Company also entered into a new Securities Purchase Agreement (“New SPA”),
pursuant to which ARJ purchased an aggregate of 41,666,666 shares of Common Stock for an aggregate consideration of $500,000.00
The foregoing descriptions of the New SPA, Letter Agreement and Amendment to the RRA are qualified in their entirety by reference to the full text of
such documents which are attached as Exhibits 99.1 through 99.3 hereto and are incorporated herein by this reference.
Neither ARJ nor Garnock does, at present, seek control of the Issuer and ARJ has acquired the Common Stock for investment purposes. In pursuing such
investment purposes, ARJ may further purchase, hold, vote, trade, dispose or otherwise deal in the Common Stock at times, and in such manner, as it deems
advisable to benefit from changes in market prices of the Common Stock, changes in the Issuer’s operations, business strategy or prospects, or from sale or merger
of the Issuer. To evaluate such alternatives, ARJ routinely monitors the Issuer’s operations, prospects, business development, management, competitive and
strategic matters, capital structure, and prevailing market conditions, as well as alternative investment opportunities, its liquidity requirements and other investment
considerations. Consistent with its investment research methods and evaluation criteria, ARJ may discuss such matters with management or directors of the Issuer,
other shareholders, industry analysts, existing or potential strategic partners or competitors, investment and financing professionals, sources of credit and other
investors. Such factors and discussions may materially affect, and result in, ARJ’s modifying its ownership of the Common Stock, exchanging information with the
Issuer pursuant to appropriate confidentiality or similar agreements, proposing changes in the Issuer’s operations, governance or capitalization, or in proposing one
or more of the other actions described in subsections (a) through (j) of Item 4 of Schedule 13D.
ARJ and Garnock each reserves the right to formulate other plans and/or make other proposals, and take such actions with respect to its investment in the
Issuer, including any or all of the actions set forth in paragraphs (a) through (j) of Item 4 of Schedule 13D, or acquire additional Common Stock or dispose of all or
part of the Common Stock beneficially owned by them, in the public market or privately negotiated transactions. ARJ and Garnock may, at any time reconsider and
change its plans or proposals relating to the foregoing.
