ITEX Corporation
a Nevada Corporation
15900 SE Eastgate Way, Suite 100
Bellevue, WA 98008
- 463-4000www.itex.com
feedback@itex.com
SIC Code: 7389
Quarterly Report
For the Period Ending: October 31, 2021
(the "Reporting Period")
As of October 31, 2021, the number of shares outstanding of our Common Stock was:
1,696,6911
As of July 31, 2021, the number of shares outstanding of our Common Stock was:
1,696,6911
Indicate by check mark whether the company is a shell company (as defined in Rule 405 of the Securities Act of 1933 and Rule 12b-2 of the Exchange Act of 1934): Yes No
Indicate by check mark whether the company's shell status has changed since the previous reporting period: Yes No
Indicate by check mark whether a Change in Control of the company has occurred over this reporting period: Yes No
1 Includes unvested restricted stock.
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Cautionary Statement Regarding Forward-Looking Statements
In addition to current and historical information, this Quarterly Report contains forward-looking statements. These statements relate to our future operations, prospects, potential products, services, developments, business strategies or our future financial performance. Forward-looking statements reflect our expectations and assumptions only as of the date of this report and are subject to risks and uncertainties. Actual events or results may differ materially. We have included a discussion of certain risks and uncertainties that could cause actual results and events to differ materially from our forward-looking statements in the section titled "Risk Factors" filed with our Annual Report, posted with the OTC Disclosure and News Service on October 15, 2021 ("Annual Report"). We undertake no obligation to update or revise publicly any forward-looking statement after the date of this report, whether as a result of new information, future events or otherwise.
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Name of the Issuer and its predecessors (if any)
ITEX Corporation (referred to as "ITEX" or the "Company") was incorporated on October 1, 1985 in the state of Nevada. ITEX's current standing in the state of Nevada is active.
The Company was incorporated as Magneto-Electric Company on October 1, 1985, and its name changed to B.I.G Enterprises Inc. the same day. The Company changed its name to ITEX Barter Systems, Inc. on May 19, 1986, and to ITEX Corporation on April 12, 1991.
Describe any trading suspension orders issued by the SEC concerning the issuer or its predecessors: None
List any stock split, stock dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or that occurred within the past 12 months:
On December 21, 2020, the Company completed a 600-for-1 reverse stock split of common stock, which was immediately followed by a forward split of common stock at a ratio of 600-for-1. Fractional shares were canceled and a cash payment of $4.50 per share, on a pre-split basis, was paid out to shareholders who held less than 600 shares prior to the reverse stock split. The Reverse/Forward split resulted in a net reduction in the number of issued and outstanding shares of ITEX's common stock by 109,061 shares, or approximately 6% of ITEX's outstanding common stock.
A cash dividend in the amount of $0.10 per share was paid on December 1, 2020 and on June 15, 2021.
The address(es) of the issuer's principal executive office and principal place of business:
Check box if principal executive office and principal place of business are the same address:
15900 SE Eastgate Way, Suite 100
Bellevue, WA 98008
Has the issuer or any of its predecessors ever been in bankruptcy, receivership, or any similar proceeding in the past five years: Yes No
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2) Security Information | |
Trading Symbol: | ITEX |
Exact title and class of securities outstanding: | Common Stock |
CUSIP: | 465647501 |
Par or stated value: | $0.01 per share |
Total shares authorized: | 9,000,000 as of October 31, 2021 |
Total shares outstanding: | 1,696,6912 as of October 31, 2021 |
Number of shares in the Public Float: | 622,411 as of October 31, 2021 |
Total number of shareholders of record: | 12 as of October 31, 2021 |
Additional classes of securities: | |
Trading Symbol: | None |
Exact title and class of securities: | Preferred Stock |
CUSIP: | None |
Par or stated value: | $0.01 per share |
Total shares authorized: | 5,000,000 as of October 31, 2021 |
Total shares outstanding: | None as of October 31, 2021 |
Transfer Agent: | |
OTR, Inc. | |
1050 SW 6th Avenue, Ste 1230 | |
Portland, OR 97204-1143 | |
Phone: (503) 225-0375 | |
Email: otr@otrtransfer.com |
Is the Transfer Company registered under the Exchange Act? Yes No
3) Issuance History
A. Changes to the Number of Outstanding Shares
Check this box to indicate there were no changes to the number of outstanding shares within the past two completed fiscal years and any subsequent periods:
The following table sets forth any events that resulted in direct changes to the total shares outstanding by the Company in the past two completed fiscal years and any subsequent interim period. Disclosure under this item includes, in chronological order, all offerings and issuances of securities, including debt convertible into equity securities, whether private or public, and all shares or any other securities or options to acquire such securities issued for services.
2 Includes unvested restricted stock.
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Number of Shares | Opening Balance: | |||||||||
outstanding as of | Common: 1,681,568 | |||||||||
July 31, 2019 | ||||||||||
Preferred: 0 | ||||||||||
Date of | Transaction | Number of | Class of | Value of | Were the | Individual/ | Reason for share | Restricted or | Exemption | |
Transaction | type | Shares | Securities | shares | shares | Entity Shares | issuance OR | Unrestricted | or | |
Issued (or | issued | issued at a | were issued | Nature of | as of this | Registration | ||||
cancelled) | ($/per | discount to | to | Services | filing? | Type? | ||||
share) at | market | Provided | ||||||||
Issuance | price at the | |||||||||
time of | ||||||||||
issuance? | ||||||||||
08-22-19 | Share | (3,300) | Common | $4.30 | No | N/A | N/A | N/A | N/A | |
buybacks/ | ||||||||||
cancellations | ||||||||||
04-06-20 | New issuance | 27,000 | Common | $3.50 | No | Steven | CEO | Restricted | Exempt | |
White | compensation | Rule 701 | ||||||||
12-21-2020 | Reverse split | (109,061) | Common | $4.50 | No | N/A | N/A | N/A | N/A | |
Share | ||||||||||
buyback | ||||||||||
02-10-21 | Share | (1,300) | Common | $4.50 | No | N/A | N/A | N/A | N/A | |
buybacks/ | ||||||||||
cancellations | ||||||||||
05-21-21 | New issuance | 150,000 | Common | $4.27 | No | Robert | CEO | Restricted | Exempt | |
Benson | compensation | Rule 701 | ||||||||
05-21-21 | New issuance | 6,714 | Common | $4.27 | No | John Wade | CFO | Restricted | Exempt | |
compensation | Rule 701 | |||||||||
07-26-21 | Share | (54,930) | Common | $4.75 | No | N/A | N/A | N/A | N/A | |
buybacks/ | ||||||||||
cancellations | ||||||||||
Shares | Ending Balance: | |||||||||
outstanding on | Common: 1,696,691 | |||||||||
October 31, 2021 | Preferred: 0 | |||||||||
In December 2013, stockholders approved the adoption of the ITEX Corporation 2014 Equity Incentive Plan (the "Plan"), pursuant to which 400,000 shares of common stock were authorized for issuance. The Plan provides for the awards of restricted stock, restricted stock units, and other awards including unrestricted stock awards, stock bonuses, or the payment of cash for bonuses or in settlement of restricted stock unit awards to the Company's employees, directors, officers or consultants.
During the years ended July 31, 2021 and 2020, we issued 156,714 and 27,000 shares respectfully, under the Plan to executive officers. The fair value of these shares as of the grant date was $669,168 and $94,500, respectively. The issuances were deemed to be exempt from registration under the Securities Act in reliance on Rule 701 promulgated thereunder.
B. Debt Securities, Including Promissory and Convertible Notes
Check this box if there are no outstanding promissory, convertible notes or debt arrangements:
4) Financial Statements
A. The following financial statements were prepared in accordance with:
- U.S. GAAP IFRS
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The financial statements for this reporting period were prepared by:
John Wade
Chief Financial Officer
The unaudited consolidated financial statements for the three months ended October 31, 2021 and 2020, are attached, starting on page 12.
5) Issuer's Business, Products and Services
- Summarize the issuer's business operations:
ITEX Corporation operates a marketplace in which products and services are exchanged by our members utilizing ITEX dollars ("ITEX dollars"). ITEX dollars are only usable by member businesses (our "members") to acquire products and services without exchanging cash. We service our member businesses through our franchise network (individually, "franchisee" and together, the "Franchise Network") in the United States and Canada. We administer the marketplace and provide record-keeping and payment transaction processing services for our members. We generate revenue by charging percentage-based transaction fees, association fees, and other fees assessed in United States dollars and Canadian dollars where applicable (collectively and as reported on our financial statements, "USD" or "Cash").
- Describe any subsidiaries, parents, or affiliated companies, if applicable, and a description of their business contact information for the business, officers, directors, managers or control persons:
ITEX has one subsidiary, BXI Exchange, Inc, a Delaware corporation. Our Chairman, Steven White, serves as sole director and executive officer.
C. Describe the issuer's principal products or services, and their markets:
Member Transactions. We provide a platform for our members to purchase from and sell their products and services to other members using ITEX dollars instead of USD. An ITEX dollar is an accounting unit used to record the value of transactions as determined by our members. ITEX dollars are not intended to constitute legal tender, securities, or commodities, are not redeemable for or convertible into USD, and have no readily determinable correlation to USD. ITEX dollars may only be used in the manner and for the purpose set forth in our Member Agreement and the Marketplace Rules.
Businesses use our services to attract new customers, increase sales and to utilize unproductive assets, surplus inventory, or excess capacity. Our services are especially useful to businesses where the variable costs of products or services are low, such as hospitality, media, and service-related businesses.
For tax purposes, the Internal Revenue Service ("IRS") considers ITEX dollar sales to be equivalent to USD sales and ITEX dollar expenses to be equivalent to USD expenses. As a third-party record keeper under the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA), ITEX is required to annually send Forms 1099-B to each of our members and to the IRS, which we do electronically. Members are responsible to collect, remit, declare, and report all applicable federal, state, provincial, local, and municipal taxes, including
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Itex Corporation published this content on 03 December 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 December 2021 21:21:20 UTC.