What changed in this filing

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Item 1. Financial Statements

2024-05-15 compared with 2023-11-13 · 145 added, 256 removed, 216 unchanged (65% of the section changed)

2 unchanged sentences

(In thousands, except share and per share data)

September 30,

March 31, 2024

December 31, 2023

(In thousands, except share and per share data)

September 30,

March 31, 2024

December 31, 2023

( UNAUDITED )

15 unchanged sentences

Accrued payroll and sales tax

Notes payable, related parties – current portion

Notes payable – current portion

3 unchanged sentences

Long term liabilities

Notes payable, related party, less current portion

Accrued interest and accrued liabilities, related party

Notes payable, less current portion

Lease liability

Lease liability, less current portion

Other long-term liabilities

8 unchanged sentences

Series C Preferred stock;

shares designated, 502,000

shares issued and 544,500 outstanding, respectively

Preferred stock value

$ 0.001 par value;

3,000,000 shares designated, 502,000 shares issued and outstanding, respectively

Preferred stock

Common stock;

4 unchanged sentences

Accumulated (deficit)

Cumulative Translation Adjustment

Accumulated other comprehensive income

Total OmniQ stockholders’ equity (deficit)

Total liabilities and equity (deficit)

accompanying unaudited notes should be read on conjunction with these unaudited condensed consolidated financial statements.

accompanying unaudited notes should be read in conjunction with these unaudited condensed consolidated financial statements.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share data)

For the three months ending

For the Nine months ended

September 30,

For the Three months ended

(In thousands, except share and per share data)

Total Revenues

Cost of goods sold

Operating expenses

10 unchanged sentences

Total Provision for Income Taxes

Net income attributable to noncontrolling interest

Net Loss attributable to OmniQ Corp

Foreign currency translation adjustment

2 unchanged sentences

Dividends attributable to non-common stockholders’ of OmniQ Corp

Net income attributable to noncontrolling interest

Net loss attributable to common stockholders’ of OmniQ Corp

Net (loss) per share - basic attributable to common stockerholders’ of OmniQ Corp

Weighted average number of common shares outstanding – basic

Net (loss) per share - basic attributable to common stockholders’ of OmniQ Corp

Weighted average number of common shares outstanding - basic and diluted

accompanying unaudited notes should be read in conjunction with these unaudited condensed consolidated financial statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

Stockholders’

(In thousands)

Income (Loss)

Preferred Stock

Comprehensive

Stockholders’

(In thousands)

6 unchanged sentences

Exercise of stock options and warrants

Conversion of shares

Cumulative Translation Adjustment

1 unchanged sentence

Balance, March 31, 2023

ESPP Stock Issuance

Noncontrolling interests - distributions and other

Exercise of stock options and warrants

Stock-based compensation – options, warrants, issuances

Cumulative Translation Adjustment

Net (loss) income

Balance, June 30, 2022

ESPP Stock Issuance

Exercise of stock options and warrants

Stock-based compensation – options, warrants, issuances

Stock and warrant issued for services

Cumulative Translation Adjustment

Net (loss) income

Balance, September 30, 2022

Balance, December 31, 2023

$ ( 113,923 )

Dividend on Class C Shares

ESPP Stock Issuance

Stock and Warrant issued for services

Stock-based compensation – options, warrants, issuances

Exercise of stock options and warrants

Conversion of shares

Acquisition of Codeblocks

Cumulative Translation Adjustment

1 unchanged sentence

Balance, March 31, 2024

Dividend on Class C Shares

ESPP Stock Issuance

Exercise of stock options and warrants

Stock-based compensation – options, warrants, issuances

Cumulative Translation Adjustment

Net (loss) income

Balance, June 30, 2023

Dividend on Class C Shares

ESPP Stock Issuance

Stock and Warrant issued for services

Stock and Warrant issued for services, shares

Stock-based compensation – options, warrants, issuances

Cumulative Translation Adjustment

Net (loss) income

Balance, September 30, 2023

$ ( 115,972 )

accompanying unaudited notes should be read in conjunction with these condensed unaudited consolidated financial statements.

CONSOLIDATED STATEMENTS OF CASH FLOW

For the nine months ended September 30,

CONSOLIDATED STATEMENTS OF CASH FLOWS

the Three Months Ended March 31,

(In thousands)

1 unchanged sentence

Adjustments to reconcile net loss to net cash provided by operating activities:

Loss on disposal of PP&E

Stock-based compensation

11 unchanged sentences

Other liabilities

Net cash provided by (used in) operating activities

Net cash used in operating activities

Cash flows from investing activities

Payment for additional ownership in subsidiary

Purchase of property and equipment

Proceeds from sale of other assets

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities

1 unchanged sentence

Proceeds from exercise of options and warrants

Dividends paid to non-controlling interest

Payments on notes/loans payable

Proceeds from the issuance of notes/loans payable

Proceeds from draw on line of credit

5 unchanged sentences

Non-cash activities:

Stock issued for services

Declared dividends payable

Right of use asset acquired in exchange for lease liability

Net assets acquired in business combination

Supplemental disclosure of cash flow information:

Cash paid for interest

Cash paid for income taxes

Cash paid for taxes

accompanying unaudited notes are an integral part of these unaudited condensed consolidated financial statements.

2 unchanged sentences

condensed consolidated financial statements include the accounts of OMNIQ Corp, and its wholly owned subsidiaries, referred to herein

as “we,” “us,” “OMNIQ,” or the “Company”.

Intercompany accounts and transactions have

as “we,” “us,” “OMNIQ,” or the “Company.” Intercompany accounts and transactions have

been eliminated.

6 unchanged sentences

Actual results could differ materially from those estimates.

Certain prior

period amounts in the condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current

period’s presentation.

These condensed consolidated financial statements and accompanying notes should be read in conjunction with

the Company’s annual consolidated financial statements and accompanying notes included in its Annual Report on Form 10-K for the

year ended December 31, 2022 (the “2022 Form 10-K”).

describe our significant accounting policies in Note 2 of the notes to consolidated financial statements in our Annual Report on Form

10-K for the year ended December 31, 2022.

During nine-month period ended September 30, 2023, there were no significant changes to those

accounting policies.

These condensed

consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial

statements and accompanying notes included in its Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form

describe our significant accounting policies in Note 2 of the notes to consolidated financial statements in the 2023 Form 10-K.

the three-month period ended March 31, 2024, there were no significant changes to those accounting policies.

Loss Per Common Share

5 unchanged sentences

The weighted-average number of common shares outstanding for computing basic

EPS for the nine-months ended September 30, 2023, and 2022 were 7,788,262 and 7,545,190 , respectively.

Diluted net loss per share of

common stock is the same as basic net loss per share of common stock because the effects of potentially dilutive securities are antidilutive.

EPS for the three-months ended March 31, 2024, and 2023 were 10,688,340 and 7,749,870 , respectively.

Diluted net loss per share of common

stock is the same as basic net loss per share of common stock because the effects of potentially dilutive securities are antidilutive.

following table sets forth the potentially dilutive securities excluded from the computation of diluted net loss per share because such

1 unchanged sentence

OF ANTI DILUTIVE SECURITIES EXCLUDES FROM COMPUTATION OF EARNING PER SHARE

September 30,

March 31, 2024

March 31, 2023

Options to purchase common stock

1 unchanged sentence

Potential shares excluded from diluted net loss per share

recognize revenue once the product has been shipped.

For some transactions we collect a deposit on the transaction.

These deposits represent

cash received under noncancelable contracts before the related product or service is transferred to the customer.

We record this as a

customer deposit, which is included in accounts payable and other accrued expenses on our consolidated balance sheet.

Such amounts are

recognized as revenue by the Company upon shipment of the product or performance of the services when the revenue recognition criteria

is met and generally within one year.

balances of customer deposits included in accounts payable and other accrued expenses as of September 30, 2023, and December 31, 2022

were approximately $ 573 thousand and $ 1 million, respectively.

The amount of revenue recognized in the nine-months ended September 30,

2023, that related to the customer deposits as of December 31, 2022 was $1.2 million.

Reclassifications

and Comparability

revenue and cost of goods sold amounts in the financial statements of the prior period have been reclassified to be presented on a net

basis rather than a gross to conform to the current period’s presentation for comparative purposes.

The total amount reclassified

from cost of goods sold to revenue, as a reduction, was $ 225 thousand.

This had no effect on total assets or net income.

2 – LIQUIDITY AND CAPITAL RESOURCES

accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern.

The following are

the principal conditions or events which potentially raise substantial doubt about the company’s ability to continue as a going

accompanying condensed consolidated financial statements have been prepared assuming that we will continue as a going concern.

The following

are the principal conditions or events which potentially raise substantial doubt about the company’s ability to continue as a going

the need for operational cash with the need to add additional products.

and cost-effective development of products

capital deficit of $ 43 million as of September 30, 2023

deficit of $ 96 million as of September 30, 2023

periods of losses from operations

Noncompliance

with certain debt covenants

facts and others have raised concerns about the Company’s ability to continue as a going concern.

The Company’s continuation

as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, which we

have successfully accomplished to date.

following conditions, plans and actions are currently being implemented to address the Company’s conditions:

warrants exist from prior offerings that could be exercised for cash depending upon the performance of our stock.

Company’s acquisition of Dangot Computers, Ltd.

has improved the balance sheet, profitability, and cash flow and is expected

to help the Company as a whole to generate positive cash flows from operations for the foreseeable future.

acquisition of Dangot has added capabilities to the Company which have already transformed into significant new orders in the Parking

Management expects the collaboration and cross sales to contribute to improved revenues and margins.

capital deficit of $ 46.4 million as of March 31, 2024

deficit of $ 116 million as of March 31, 2024

years of losses from operations

considers the conditions outlined above as the most significant factors in raising substantial doubt about the Company’s ability

to continue as a going concern within one year after the date the financial statements are issued.

Plans to Mitigate and Alleviate Conditions or Events

is evaluating operating expenses and is developing a plan to reduce expenditures without negatively impacting current operations.

Blue Star - The Company’s total accounts payable due to Blue Star as of September 30, 2023, was approximately

Blue Star is an unsecured creditor, financing a substantial amount the Company’s supply chain demand.

Management believes

that Blue Star will continue supplying the Company with preferable credit terms.

Blue Star has agreed to the annual interest rate of 5%

on invoices that are past due.

has placed a strategic focus on increasing sales with prime customers.

efforts are focused on the most profitable product lines.

Star - The Company’s total accounts payable due to Blue Star as of March 31, 2024, was approximately $ 45 million.

is an unsecured creditor, financing a substantial amount the Company’s supply chain demand.

Management believes that Blue Star

will continue supplying the Company with preferable credit terms.

Blue Star has agreed to the annual interest rate of 5 % on invoices

that are past due.

As an unsecured creditor of the Company, Blue Star has no incentive to force a liquidation.

has enjoyed a good mutual relationship for the past four years.

Management is in the process of finalizing a new line of credit with an additional financial institution.

In October 2023 management finalized an equity raise which resulted in $ 2.5 million in net cash received from investors.

The Company has enjoyed

a good mutual relationship for the past five years.

finalized a new line of credit with an additional financial institution.

October 2023 management finalized an equity raise which resulted in $ 2.5 million in net cash received from investors.

3 – CONCENTRATIONS

the nine-months ended September 30, 2023 and the year ended December 31, 2022, no customers accounted for more than 10 % and two customers

accounted for 30 %, respectively, of the Company’s consolidated revenues.

receivable at September 30, 2023 and December 31, 2022 are made up of trade receivables due from customers in the ordinary course of

No customer accounted for more than 10 % of the outstanding receivables as of September 30, 2023, or December 31, 2022.

the nine months ended September 30, 2023 and the year ended December 31, 2022 one vendor made up 29 % and 65 %, respectively, of our purchases.

4 – BUSINESS ACQUISITION

Computers Ltd

April 1, 2022, the Company closed on its acquisition of Dangot and exercised the remaining portion of its option to purchase 23.0 % of

the capital stock, thereby making Dangot a fully owned subsidiary of the Company.

The Company paid $ 3,518,000 to purchase the additional

The Company utilized its working capital and a combination of short- and long-term loans.

the three-months ended March 31, 2024, and 2023, one customer accounted for 25 % and two customers accounted

for 30 %, respectively, of the Company’s consolidated revenues.

receivable at March 31, 2024 and December 31, 2023 are made up of trade receivables due from customers in the ordinary course of business.

No customer accounted for more than 10 % of the outstanding receivables as of March 31, 2024, or December 31, 2023.

the three months ended March 31, 2024, and the year ended December 31, 2023 two vendors made up 49 %, respectively, of our purchases.

4 – BUSINESS COMBINATIONS

On January 30, 2024, OMNIQ’s wholly owned subsidiary, Dangot Computers Ltd.

(“Dangot”), entered into a Share Purchase

Agreement (the “Purchase Agreement”) with CodeBlocks Ltd.

(CodeBlocks”) and CodeBlocks’ owners, Alina Lifshits

and Erez Attia pursuant to which Dangot, acquired all of the capital stock of CodeBlocks in exchange for NIS 4,666,664 (approximately

US $ 1,275,044 ).

The consideration is payable in seven equal installments with the final payment due on January 11, 2025.

no explicit interest rate so the Company used an implicit interest rate of 8 %;

therefore the present value for the acquisition was NIS

4,356,720 , approximately $ 1,190,360 .

The purchase Agreement closed on February 1, 2024.

As of March 31, 2024, the total amount outstanding

is NIS 4.4 million, approximately $ 1 million USD, and is presented on the balance sheet in short- and long-term notes payable.

Distribution LTD

On February 15, 2024, Dangot divested its 50 % equity interest in Neway Distribution LTD for consideration of approximately NIS 1 million—which

was the carrying amount of the equity investment on Dangot’s balance sheet as of the date of the sale.

5 – INVENTORY

consisted of the following as of:

SCHEDULE OF INVENTORY

September 30, 2023

December 31, 2023

12 unchanged sentences

purchased in a reserve account.

This agreement was terminated in November 2023.

annual interest rate with respect to the daily average balance of unpaid advances outstanding under the BFA (computed on a monthly basis)

4 unchanged sentences

customary representations and warranties and default provisions for transactions of this type.

January 18, 2024, the Company’s wholly owned subsidiary, Quest Marketing, Inc.

(“Quest”) entered into a Purchase and

Sale Agreement with Prestige Capital Finance, LLC (“Prestige”), in which Quest has sold, transferred and assigned all of

its rights, title, and interest to specific accounts receivable owed to Quest.

The maximum outstanding balance of Quest to Prestige shall

be $ 7.5 million.

The discount fee starts at 1.5 % and increases based on the age of the outstanding receivables.

The balance as of March

31, 2024, was $ 0 .

7 – RELATED PARTY NOTES PAYABLE

party notes payable, consisted of the following as of:

OF NOTES PAYABLE, RELATED PARTIES

September 30,

Note payable –Marin

Note payable –Thomet

Total notes payable

Less current portion

Long-term portion

Payable -Marin

December 2017, we entered into a $ 660 thousand, 1.89 % annual interest rate note payable (the “Marin Note”) with two individuals

from whom we previously acquired their company (in 2014).

The Marin Note is payable in 60 monthly principal payments of $ 20 thousand

beginning in October 2018.

Accrued interest payable as of September 30, 2023, was $ 73 thousand.

Accrued interest is payable at maturity.

Payable – Thomet

December 2017, we entered into a $ 750 thousand, zero percent annual interest rate note payable (the “Thomet Note”) with an

individual from whom we previously acquired his company (in 2014).

The Thomet Note is payable in 60 monthly principal payments of $ 13

thousand beginning in October 2018.

8 – NOTES PAYABLE

OF NOTES PAYABLE

8 – OTHER NOTES PAYABLE

SCHEDULE OF OTHER NOTES PAYABLE

(In thousands)

September 30,

March 31, 2024

December 31, 2023

Note payable other

Acquisition payable

Less current portion

1 unchanged sentence

Payable Other

July 29, 2021, the Company entered into a long-term loan from Leumi Bank totalling NIS 7 million, which at the time was approximately

$ 2.16 million.

The note accrues interest at the Israeli Prime Rate plus 4.5 % which currently equals 8.25 % per annum and is payable in

8 instalments of principal and interest over 4 years.

The note is secured by shares of Dangot Computers, Ltd.

November 28, 2021, the Company entered into another long-term loan from Leumi Bank totalling NIS 3.5 million, which at the time was approximately

July 29, 2021, the Company entered into a long-term loan from Leumi Bank totaling NIS 7 million, which at the time was approximately

$ 2.16 million.

5 unchanged sentences

The loan accrues interest at 7.5 % per annum and is secured by the vehicles.

March 27, 2022, the Company entered into another long-term loan from Leumi Bank totalling NIS 3.5 million, which at the time was approximately

$ 1.1 million.

The note accrues interest at the Israeli Prime Rate plus 4.5 % which currently equals 8.25 % per annum and is payable in

8 instalments of principal and interest over 4 years.

The note is secured by shares of Dangot Computers, Ltd.

September 13, 2022, the Company entered into a long-term loan from Hapoalim Bank totalling NIS 3 million, which at the time was approximately

$ 0.9 million.

September 13, 2022, the Company entered into a long-term loan from Hapoalim Bank totaling NIS 3 million, approximately US $ 0.9 million.

The note accrues interest at 7.5 % per annum and is payable in 36 instalments of principal and interest over 3 years .

the year ended December 31, 2022, the Company entered into five short term loans totalling NIS 26.8 million, approximately $ 7.6 million.

The note accrues average interest at 6.3 % per annum.

September 21, 2023, the Company entered into a long-term loan from Tzameret Mimunim totaling 1.5 M NIS.

The note accrues interest at the

Israeli Prime Rate plus 3.5 % which currently equals 9.75 % per annum and is payable in 36 monthly installments.

of September 30, 2023, the Company was not in compliance with certain financial covenants related to the Bank Leumi and Bank Hapoalim

The Company’s failure to comply with these financial covenants could result in an event of default under its debt agreements.

Therefore, we reclassified the total balance as current debt on the balance sheet.

The Company is actively pursuing options to address

its noncompliance.

The lenders have not requested early repayment of the loan as of the date when these financial statements were available

to be issued.

the year ended December 31, 2023, the Company entered into a short-term loan Hapoalim Bank totaling NIS 5.5 million, approximately US

$ 1.5 million.

The note accrues interest at 7.3 % per annum.

the year ended December 31, 2023, the Company entered into a short-term loan from Bank Leumi totaling NIS 21.5 million, approximately

US $ 5.9 million.

The note accrues interest at 7.6 % per annum.

September 21, 2023, the Company entered into a long-term loan from Tzameret Mimunim totaling 1.5 M NIS, approximately US $ 393 thousand.

The note accrues interest at the Israeli Prime Rate plus 3.5 % which currently equals 9.75 % per annum and is payable in 36 monthly installments.

9 – OTHER LIABILITIES

OF OTHER LIABILITIES

SCHEDULE OF OTHER LIABILITIES

(In thousands)

September 30,

March 31, 2024

December 31, 2023

Other vendor payable

3 unchanged sentences

Total long-term other liabilities

balance of deferred revenues is included in other current and long-term liabilities on the balance sheet.

The following table summarizes

changes in deferred revenue as of March 31:

SCHEDULE OF DEFERRED REVENUE

Beginning balance

Less amounts recognized during the year

Add new deferred revenue

Ending Balance

10 – OTHER INCOME

the three months ended March 31, 2024, the Company received government relief funds in the amount of approximately NIS 1.7 million or

US $ 609 thousand.

11 – STOCKHOLDERS’ EQUITY

of September 30, 2023, there were 2,000,000 Series A preferred shares designated and no Series A preferred shares outstanding.

of March 31, 2024, there were 2,000,000 Series A preferred shares designated and no Series A preferred shares outstanding.

of directors of the Company (the “Board”) had previously set the voting rights for the Series A preferred stock at 1 share

of preferred to 250 common shares.

of September 30, 2023, there was 1 preferred share designated and no preferred shares outstanding.

of September 30, 2023, there were 3,000,000 Series C Preferred Shares (“Series C”) authorized with 502,000 issued and outstanding.

of March 31, 2024, there was 1 preferred share designated and no preferred shares outstanding.

of March 31, 2024, there were 3,000,000 Series C Preferred Shares (“Series C”) authorized with 502,000 issued and outstanding.

The Series C shares have preferential rights above common shares and the Series B Preferred Shares and is entitled to receive a quarterly

2 unchanged sentences

into common stock at the rate of 20 preferred shares to one share of common stock.

As of September 30, 2023, the accrued dividends on

the Series C Preferred Stock were $ 174 thousand.

As of March 31, 2024, the accrued dividends on the

Series C Preferred Stock was $ 189 thousand.

Series C Preferred Stock has a liquidation value and conversion price of $1.00 per share ($20.00 per 20 shares of preferred stock which

7 unchanged sentences

The Plan was approved by our stockholders at the December 2021, shareholders’ meeting.

On February 25, 2022, the Company granted

792,500 stock options.

These options were granted to employees as part of the Company’s Equity Incentive Plan.

No options were

issued in the nine months ended September 30, 2023.

the nine months ending September 30, 2023, 235,426 in stock options were exercised in exchange for 158,934 shares of OMNIQ common stock.

No warrants were exercised.

No options were issued in the three months

ended March 31, 2024 or 2023.

December 2015, our Board of Directors approved the OMNIQ.

Employee Stock Purchase Plan (the “ESPP”).

For the nine months

ending September 30, 2023, employees purchased 7,103 shares or $ 25 thousand of common stock.

August 10, 2022, our Board of Directors approved issuing 10,000 shares as part of an employment agreement.

Shares were issued January

3, 2023, and valued at $ 45 thousand.

For the three months

ending March 31, 2024, employees purchased 14,409 shares or $ 6 thousand of common stock.

12 – LITIGATION

Company was named a defendant in a case involving a former employee who claims he is owed approximately $ 60 thousand in unpaid commissions.

The Company’s intends to defend the case.

This case was filed in the Superior Court of the State of California, County of San Diego

on October 21, 2020.

company is not a party to any other pending material legal proceeding in which it is defending against any claims of material significance.

To the knowledge of management, no federal, state or local governmental agency is presently contemplating any proceeding against the

To the knowledge of management, no director, executive officer or affiliate of the Company, any owner of record or beneficially

of more than five percent of the Company’s Common Stock is a party adverse to the Company or has a material interest adverse to

the Company in any proceeding.

company is not a party to any pending legal proceeding in which it is defending against any claims of material significance.

To the knowledge

of management, no federal, state or local governmental agency is presently contemplating any proceeding against the Company.

To the knowledge

of management, no director, executive officer or affiliate of the Company, any owner of record or beneficially of more than five percent

of the Company’s Common Stock is a party adverse to the Company or has a material interest adverse to the Company in any proceeding.

13 – SUBSEQUENT EVENTS

July 6, 2023, OmniQ Corp.

(the “Company”) entered into a Share and Rights Purchase Agreement (the Agreement”) with

Afcon Holdings Ltd., (“Afcon”), a company organized under the laws of the State of Israel, and Ateka Ltd.

a company organized under the laws of the State of Israel (Afcon and Ateka, jointly and severally, shall be referred to together as the

“Sellers”) (OminQ and its newly formed wholly owned subsidiary which shall be alternatively referred to together as the “Company”

or the “Purchaser”), and Tadiran Telecom Communication Services in Israel Ltd.

(“TBSI”), a company organized

under the laws of the State of Israel, Tadiran Telecom Communication Services in Israel L.P.

(“TBSI LP”), a limited partnership

organized under the laws of the State of Israel, Tadiran Telecom Technologies (2011) Ltd.

(“TTT”), a company organized under

the laws of the State of Israel, Tadiran Telecom (TTL) L.P.

(“TTL LP”) a limited partnership organized under the laws of

the State of Israel (TBSI, TBSI LP, TTT and TTL LP shall be referred together as “TT”).

Agreement provided for termination after 60 days if not renewed.

On October 4, 2023, as a result of the non-fulfilment of certain conditions,

the Company and the Sellers mutually terminated the Agreement, as a result of the termination, the Company will not make the $ 12,500,000

cash payment and the issuance of shares of common stock having a value of $ 2,750,000 .

Additionally, the Agreement provides for a mutual

release of claims among the parties and their affiliates, in the event of an effective termination.

October 5, 2023, OmniQ Corp.

(the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”)

with ThinkEquity LLC, as representatives (the “Representatives”) of the several underwriters named therein (collectively,

the “Underwriters”), relating to the issuance and sale (the “Offering”) of 2,775,000 shares of the Company’s

common stock, par value $ 0.001 per share, at a price to the public of $ 1.00 per share (the “Underwritten Shares”) and pre-funded

warrants (the “Pre-Funded Warrants”) to purchase 225,000 shares of the Company’s common stock at a price to the public

of $ 0.999 per Pre-Funded Warrant.

Under the terms of the Underwriting Agreement, the Underwriters have agreed to purchase the Underwritten

Shares from the Company at a price of $ 1.00 per share and the Pre-Funded Warrants at a price of $ 0.999 per Pre-Funded Warrant.

also granted the Underwriters an option exercisable for 45 days from the date of the Underwriting Agreement to purchase up to an additional

450,000 shares of common stock solely for the purpose of covering over-allotments (together with the Underwritten Shares, the “Shares”).

All of the Shares and Pre-Funded Warrants in the Offering are being sold by the Company.

The Company also issued warrants to the Representative

(the “Representative’s Warrants”), exercisable to purchase 140,000 shares of common stock, at an exercise price of

$ 1.25 per share.

gross proceeds from the Offering are expected to be approximately $ 3.0 million before deducting underwriting discounts and commissions

and other offering expenses payable by the Company and assuming no exercise of the Underwriters’ option to purchase additional

The Offering closed on October 11, 2023.

We are closely monitoring developments in the war between Israel and Hamas

that began on October 7, 2023 including potential impacts to The Companies business, customers, suppliers, employees, and operations in

Israel, the Middle East and elsewhere.

At this time, impacts to The Company are uncertain and subject to change given the volatile nature

of the situation.

April 8, 2024, stockholders approved the amendment of the Company’s Certificate of Incorporation to increase the amount of authorized

common stock to 35,000,000 shares.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements