Similar to gesundheit, 'spibib' is intended to provoke a joyful reaction to counter social embarrassment. It's formed of 'spit' and 'bib', in a situation where the bib is the listener's face.
Laura: "Hi Dave."
Dave: "Do you want to go see Tree of Life tomorrow? It looks SENS((accidentally sprays saliva in Laura's face))ATIONAL" (Dave realises he just spat in Laura's face.. shiiiiiit)
Dave: Hahaha. ("Laura is lovely, and realises I didn't mean to spit in her face... phew... I love her".) Sorry!
Laura: Hahaha. It happens to the best of us. Let's totally go to the film!
Jo: "So I was talking to Mike's mom the other day, and she was getting really into memories of him as a kid and then she totally spibibbed on me!"
Rachel: "Oh no!"
Jo: "It's fine. I just said spibib, and she laughed, so it's all cool. Mike's mom is awesome".