UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________

FORM 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~July~~January 31, ~~2021~~2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934--

For the transition period from ________________ to __________________

Commission File Number: 0-14443

____________________

INTERNATIONAL BALER CORPORATION

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization) 13-2842053 (I.R.S. Employer Identification No.) 5400 Rio Grande Avenue, Jacksonville, Florida 32254 (Address of principal executive offices) (Zip Code)

Delaware	13-2842053
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

5400 Rio Grande Avenue, Jacksonville, Florida 32254
(Address of principal executive offices) (Zip Code)

(904) 358-3812
(Registrant’s telephone number, including area code)

Securities registered ~~under~~pursuant to Section 12(bg) of the Act: ~~None~~

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $.01 par value per share	IBAL	Pink Sheets

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

~~Yes~~YES ☒ NO ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

~~Yes~~YES ☒ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☐☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES ☐ NO ☒

As of ~~September 9~~March 14, ~~2021~~2022, there were 5,183,894 shares of common stock of the registrant outstanding.

INTERNATIONAL BALER CORPORATION

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Condensed Balance Sheets as of July 31, 2021, (unaudited) and October 31, 2020	3
Condensed Balance Sheets as of January 31, 2022, (unaudited) and October 31, 2021	3
Condensed Statements of Income for the three months and nine months ended July 31, 2021 and 2020 (unaudited)	4
Condensed Statements of Income for the three months ended January 31, 2022 and 2021 (unaudited)	4
Condensed Statements of Stockholders’ Equity for the nine months ended July 31, 2021 and 2020 (unaudited)	5
Condensed Statements of Stockholders’ Equity for the three months ended January 31, 2022 and 2021 (unaudited)	5
Condensed Statements of Cash Flows for the nine months ended July 31, 2021 and 2020 (unaudited).	6
Condensed Statements of Cash Flows for the three months ended January 31, 2022 and 2021 (unaudited)	6
Notes to Condensed Financial Statements (unaudited)	7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	14
ITEM 4. CONTROLS AND PROCEDURES	14
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS	15
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	15
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	15
ITEM 4. MINE SAFETY DISCLOSURES	15
ITEM 5. OTHER INFORMATION	15
ITEM 6. EXHIBITS	16
SIGNATURES	17

INTERNATIONAL BALER CORPORATION


INTERNATIONAL BALER CORPORATION
CONDENSED BALANCE SHEETS

	January 31, 2022			October 31, 2021
		UNAUDITED
ASSETS
Current assets:
Cash and cash equivalents	$	2,066,826		$	1,742,336
Certificate of deposit		1,013,335			1,012,960
Accounts receivable, net of allowance for doubtful accounts of $11,844 at January 31, 2022 and at October 31, 2021		736,468			870,571
Inventories		4,976,244			4,708,263
Prepaid expense and other current assets		122,182			131,333
Income taxes receivable		434,019			434,019
Total current assets		9,349,074			8,899,482
Property, plant and equipment, at cost:		4,753,873			4,719,850
Less: accumulated depreciation		3,443,032			3,386,332
Net property, plant and equipment		1,310,841			1,333,518
Other assets
Deferred income taxes		162,010			133,010
Total other assets		162,010			133,010
TOTAL ASSETS	$	10,821,925		$	10,366,010

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	433,331		$	421,293
Accrued liabilities		349,122			384,322
Accrued sales returns		490,000			490,000
Customer deposits		1,330,045			749,820
Total current liabilities		2,602,498			2,045,435
Total liabilities		2,602,498			2,045,435

Commitments and contingencies (Note 9)
Stockholders' equity:
Preferred stock, par value $.0001, 10,000,000 shares authorized, none issued		—			—
Common stock, par value $.01, 25,000,000 shares authorized;6,429,875 shares issued		64,299			64,299
Additional paid-in capital		6,419,687			6,419,687
Retained earnings		2,416,851			2,517,999
		8,900,837			9,001,985
Less:Treasury stock, 1,245,980 shares, at cost		(681,410	)		(681,410	)
Total stockholders' equity		8,219,427			8,320,575
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	10,821,925		$	10,366,010

See accompanying notes to condensed financial statements.

CONDENSED BALANCE SHEETS

		July 31, 2021			October 31, 2020
		Unaudited
ASSETS
Current assets:
Cash and cash equivalents	$	2,656,132		$	2,626,221
Certificate of deposit		1,012,960			1,011,824
Accounts receivable, net of allowance for doubtful accounts of $66,000 at July 31, 2021 and $6,000 at October 31, 2020		652,545			788,234
Inventories		4,066,772			4,254,880
Prepaid expense and other current assets		192,092			92,195
Income taxes receivable		332,815			332,815
Total current assets		8,913,316			9,106,169
Property, plant and equipment, at cost:		4,534,247			4,440,561
Less: accumulated depreciation		3,330,764			3,161,864
Net property, plant and equipment		1,203,483			1,278,697
Other assets
Deferred income taxes		221,890			77,890
Total other assets		221,890			77,890
TOTAL ASSETS	$	10,338,689		$	10,462,756
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	294,172		$	480,278
Accrued liabilities		345,127			377,898
Customer deposits		1,105,912			526,725
Total current liabilities		1,745,211			1,384,901
Long term debt		—			626,466
Total liabilities		1,745,211			2,011,367
Commitments and contingencies (Note 9)
Stockholders' equity:
Preferred stock, par value $.0001,10,000,000 shares authorized, none issued		—			—
Common stock, par value $.01, 25,000,000 shares authorized;6,429,875 shares issued		64,299			64,299
Additional paid-in capital		6,419,687			6,419,687
Retained earnings		2,790,902			2,648,813
		9,274,888			9,132,799
Less:Treasury stock, 1,245,980 shares, at cost		(681,410	)		(681,410	)
Total stockholders' equity		8,593,478			8,451,389
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	10,338,689		$	10,462,756
See accompanying notes to condensed financial statements.

INTERNATIONAL BALER CORPORATION


INTERNATIONAL BALER CORPORATION
CONDENSED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED JANUARY 31, 2022 AND 2021
UNAUDITED

		2022			2021
Net sales:
Equipment	$	1,217,081		$	1,564,221
Parts and service		822,524			785,684
Total net sales		2,039,605			2,349,905

Cost of sales		1,781,287			2,150,188
Gross profit		258,318			199,717

Operating expense:
Selling expense		110,927			135,916
Administrative expense		278,501			237,819
Total operating expense		389,428			373,735

Operating loss		(131,110	)		(174,018	)
Other income:
Interest income		962			891
Other income		—			626,466
Total other income		962			627,357
(Loss) income before income taxes		(130,148	)		453,339
Income tax benefit		(29,000	)		(36,000	)
Net (loss) income	$	(101,148	)	$	489,339

(Loss) income per share, basic and diluted	$	(0.02	)	$	0.09
Weighted average number of shares outstanding		5,183,895			5,183,895

See accompanying notes to condensed financial statements.

CONDENSED STATEMENTS OF INCOME

FOR THE THREE MONTHS AND NINE MONTHS ENDED JULY 31, 2021 AND 2020

UNAUDITED

	Three Months						Nine Months
		2021			2020			2021			2020
Net sales:
Equipment	$	1,837,914		$	1,937,971		$	5,053,158		$	4,648,093
Parts and service		885,858			727,267			2,658,529			2,042,349
Total net sales		2,723,772			2,665,238			7,711,687			6,690,442
Cost of sales		2,609,468			2,285,480			6,986,127			5,981,049
Gross profit		114,304			379,758			725,560			709,393
Operating expense:
Selling expense		209,851			217,565			491,530			470,542
Administrative expense		357,321			236,163			865,862			650,086
Total operating expense		567,172			453,728			1,357,392			1,120,628
Operating loss		(452,868	)		(73,970	)		(631,832	)		(411,235	)
Other income:
Interest income		1,664			1,876			3,455			12,870
Gain on extinguishment of debt		—			10,500			626,466			10,500
Total other income		1,664			12,376			629,921			23,370
Loss income before income taxes		(451,204	)		(61,594	)		(1,911	)		(387,865	)
Income tax benefit		(108,000	)		(14,000	)		(144,000	)		(92,000	)
Net (loss) income	$	(343,204	)	$	(47,594	)	$	142,089		$	(295,865	)
(Loss) income per share, basic and diluted	$	(0.07	)	$	(0.01	)	$	0.03		$	(0.06	)
Weighted average number of shares outstanding		5,183,895			5,183,895			5,183,895			5,183,895
See accompanying notes to condensed financial statements.

INTERNATIONAL BALER CORPORATION


INTERNATIONAL BALER CORPORATION
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE 3 MONTHS ENDED JANUARY 31, 2022 AND 2021
UNAUDITED


	Common Stock								Treasury Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings		Shares		Amount			Total
Balance - October 31, 2021	6,429,875	$	64,299	$	6,419,687	$	2,517,999		1,245,980	$	(681,410	)	$	8,320,575
Net loss			—		—		(101,148	)			—			(101,148	)
Balance - January 31, 2022	6,429,875		64,299		6,419,687		2,416,851		1,245,980		(681,410	)		8,219,427

	Common Stock								Treasury Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings		Shares		Amount			Total
Balance - October 31, 2020	6,429,875	$	64,299	$	6,419,687	$	2,648,813		1,245,980	$	(681,410	)	$	8,451,389
Net income			—		—		489,339				—			489,339
Balance - January 31, 2021	6,429,875		64,299		6,419,687		3,138,152		1,245,980		(681,410	)		8,940,728

See accompanying notes to condensed financial statements.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE THREE MONTHS AND NINE MONTHS ENDED JULY 31, 2021 AND 2020

UNAUDITED

	Common Stock								Treasury Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings		Shares		Amount			Total
Balance - October 31, 2020	6,429,875	$	64,299	$	6,419,687	$	2,648,813		1,245,980	$	(681,410	)	$	8,451,389
Net income			—		—		489,339				—			489,339
Balance - January 31, 2021	6,429,875		64,299		6,419,687		3,138,152		1,245,980		(681,410	)		8,940,728
Net loss			—		—		(4,046	)			—			(4,046	)
Balance - April 30, 2021	6,429,875	$	64,299	$	6,419,687	$	3,134,106		1,245,980	$	(681,410	)	$	8,936,682
Net loss			—		—		(343,204	)			—			(343,204	)
Balance - July 31, 2021	6,429,875	$	64,299	$	6,419,687	$	2,790,902		1,245,980	$	(681,410	)	$	8,593,478
	Common Stock								Treasury Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings		Shares		Amount			Total
Balance - October 31, 2019	6,429,875	$	64,299	$	6,419,687	$	3,057,228		1,245,980	$	(681,410	)	$	8,859,804
Net loss			—		—		(184,481	)			—			(184,481	)
Balance - January 31, 2020	6,429,875		64,299		6,419,687		2,872,747		1,245,980		(681,410	)	$	8,675,323
Net loss			—		—		(63,590	)			—			(63,590	)
Balance April 30, 2020	6,429,875	$	64,299	$	6,419,687	$	2,809,157		1,245,980	$	(681,410	)	$	8,611,733
Net loss			—		—		(47,794	)			—			(47,794	)
Balance July 31, 2020	6,429,875	$	64,299	$	6,419,687	$	2,761,363		1,245,980	$	(681,410	)	$	8,563,939
See accompanying notes to condensed financial statements.

INTERNATIONAL BALER CORPORATION


INTERNATIONAL BALER CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JANUARY 31, 2022 AND 2021
UNAUDITED

		2022			2021
Cash flow from operating activities:
Net (loss) income	$	(101,148	)	$	489,339
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Gain on extinguishment of debt		—			(626,466	)
Depreciation and amortization		56,700			55,800
Deferred income taxes		(29,000	)		—
Changes in operating assets and liabilities:
Accounts receivable		134,103			77,799
Inventories		(267,981	)		13,277
Prepaid expenses and other assets		9,151			4,164
Income taxes receivable		—			(36,000	)
Accounts payable		12,038			(24,148	)
Accrued liabilities		(35,200	)		(107,877	)
Customer deposits		580,225			330,475
Net cash provided by operating activities		358,888			176,363

Cash flows from investing activities:
Purchase of property and equipment		(34,023	)		(35,808	)
Interest earned on certificates of deposit		(375	)		(249	)
Net cash used in investing activities		(34,398	)		(36,057	)
Net increase in cash and cash equivalents		324,490			140,306

Cash and cash equivalents at beginning of period		1,742,336			2,626,221
Cash and cash equivalents at end of period	$	2,066,826		$	2,766,527

See accompanying notes to condensed financial statements.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED JULY 31, 2021 AND 2020

UNAUDITED

	2021			2020
Cash flow from operating activities:
Net income (loss)	$	142,089		$	(295,865	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Gain on extinguishment of debt		(626,466	)		—
Depreciation and amortization		168,900			161,400
Deferred income tax		(144,000	)		—
Provision for doubtful accounts		60,000			—
Gain on sale of fixed assets		—			(10,500	)
Changes in operating assets and liabilities:
Accounts receivable		75,689			(49,888	)
Inventories		188,108			(215,566	)
Prepaid expenses and other assets		(99,897	)		(55,935	)
Income taxes receivable		—			(89,532	)
Accounts payable		(186,106	)		(64,164	)
Accrued liabilities		(32,771	)		108,713
Customer deposits		579,187			(147,592	)
Net cash provided by (used in) operating activities		124,733			(658,929	)
Cash flows from investing activities:
Purchase of property and equipment		(93,686	)		(179,666	)
Proceeds received on sale of fixed assets		—			10,500
Interest earned on certificates of deposit		(1,136	)		(7,826	)
Net cash used in investing activities		(94,822	)		(176,992	)
Cash flows from financing activities:
Proceeds from PPP loan		—			626,466
Net cash provided by financing activities		—			626,466
Net increase (decrease) in cash and cash equivalents		29,911			(209,455	)
Cash and cash equivalents at beginning of period		2,626,221			2,714,764
Cash and cash equivalents at end of period	$	2,656,132		$	2,505,309
See accompanying notes to condensed financial statements.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

1. Nature of Business:

International Baler Corporation (the “Company”) is a manufacturer of baling equipment which is designed to compress a variety of materials into bales for easier handling, shipping, disposal, storage, and for recycling. Materials commonly baled include scrap metal, corrugated boxes, newsprint, aluminum cans, plastic bottles, and other solid waste. More sophisticated applications include baling of textile materials, fibers, and synthetic rubber. The Company offers a wide variety of balers, standard models as well as custom models, and conveyors to meet specific customer requirements.

The Company’s customers include recycling facilities, distribution centers, textile mills, and companies ~~which~~that generate the materials for baling and recycling. The Company sells its products worldwide with annual sales outside the United States typically ranging from 10% to 35%.

2. Basis of Presentation:

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X. Accordingly, they do not include all of the information in footnotes required by accounting principles generally accepted in the ~~United~~ United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the three-month ~~period~~ period ended ~~July~~January 31, ~~2021~~2022 are not necessarily indicative of the results that may be expected for the year ending October 31, ~~2021~~2022. The accompanying balance sheet as of October 31, ~~2020~~2021 was derived from the audited financial statements as of October 31, ~~2020~~2021.

These unaudited condensed financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended October 31, ~~2020~~2021.

The Company is closely monitoring ongoing developments in connection with the COVID-19 global pandemic, which has had an adverse impact on sales as many customers are holding off purchasing new equipment.

As of the date of this report, the COVID-19 pandemic has not materially adversely impacted our capital and financial resources. Due to the ~~economic~~ economic uncertainty that has resulted from the pandemic, and the potential impact of such to our stakeholders, we are unable to predict ~~with~~ with certainty any potential impacts to our business. Additionally, because we are unable to determine the ultimate severity or duration of of the outbreak or its long-term effects on, among other things, the global, national or local economies, the capital and credit markets, our workforce, our customers or our suppliers, at this time we are unable to predict the adverse extent that the COVID-19 crisis will have on our business, financial condition, liquidity and results of operations.

3. Summary of Significant Accounting Policies:

(a) Accounts Receivable & Allowance for Doubtful Accounts:

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company maintains an allowance for doubtful accounts for estimated losses inherent in its accounts receivable. The Company reviews its allowance for doubtful accounts monthly including the analysis of historical trends, customer ~~credit~~creditworthiness ~~worthiness~~ and the aging of receivables. Account balances are charged off against the ~~allowance~~ allowance after all means of collection have been exhausted and the potential for recovery is considered remote.

(b) Inventories:

Inventories are stated at the lower of cost and net realizable value. Cost is determined by a method that approximates the first-in, first-out method. Work in process and finished goods are valued based on underlying costs to manufacture balers which include direct materials, direct and indirect labor, and overhead. The Company reviews inventory for obsolescence on a regular basis.

The Company typically warrants its products for one (1) year from the date of sale as to materials, three (3) years for structural damage and six (6) months as to labor, and offers services for other required repairs and maintenance. Service is rendered by repairing or replacing parts at the Company’s Jacksonville, Florida facility, by on-site service provided by Company personnel who are based in Jacksonville, Florida or by local service agents who are engaged as needed. The Company maintains an accrued liability for expected warranty claims. The warranty accrual is based on historical warranty costs, the quantity and types of balers currently under warranty, and known warranty issues.

Following is a tabular reconciliation of the changes in the warranty accrual for the ~~nine~~three-month period ended ~~July~~January 31:

Warranty Accrual
Schedule of Warranty Accrual
	2021			2020
	2022			2021
Beginning balance	$	40,000		$	6040,000
Warranty service provided		(~~115~~32,~~794~~806	)		(8630,~~686~~764	)
New product warranties		~~101~~24,~~063~~342			4631,~~480~~284
Changes to pre-existing warranty accruals		148,~~731~~464			~~20,206~~(520	)
Ending balance	$	40,000		$	40,000

(d) Fair Value of Financial Instruments:

The carrying amounts of the Company’s financial instruments, including cash and cash equivalents, short term certificates of deposit, accounts receivable, accounts payable, accrued liabilities, and customer deposits, approximate their fair value due to the short-term nature of these assets and liabilities.

(e) Advertising Expenses:

Advertising costs are expensed as incurred. Advertising expense was $~~108~~31,~~235~~009 and $9631,~~885~~752 for ~~the~~quarters ~~nine months~~ ended ~~July~~January 31, ~~2021~~2022 and ~~2020~~2021, respectively, and are included in selling expense on the accompanying Condensed Statements of Income.

(f) Recent Accounting Pronouncements:

Recently Adopted Accounting Pronouncements:

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (ASUs) to the FASB Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs and any not listed below were assessed and determined to be applicable or are expected to have a minimal impact on the Company’s condensed financial statements.

Accounting Pronouncements Not Yet Adopted

In November 2019, the FASB issued ASU 2019-10, Financial Instruments-Credit Losses (Topic326), Derivative and Hedging (Topic 815), and Leases (Topic 841). The new guidance will be effective November 1, 2023. While the Company is continuing to assess the potential impacts of ASU 2019-10, it does not expect ASU 2019-10 to have a material effect on its financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases, ("ASU 2016-02"). ASU 2016-02 requires lessees to recognize assets and liabilities for most leases. All leases are required to be recorded on the balance sheet with the exception of short-term leases. This standard was adopted by the Company on November 1, 2019. Prior to adoption, the Company determined that all its lease agreements qualify as short term leases, having a lease term of twelve months or less and no purchase option, and has elected to recognize its lease payments in profit or loss on a straight-line basis over the lease term. Accordingly the Company did not record a transition adjustment.

4. Revenue from Contracts with Customers:

(a) Overview

The Company recognizes revenues from the sale of finished products upon shipment and the transfer of control to the customer. The other elements may include installation and, generally, a one-year warranty. Equipment installation revenue is valued based on estimated service person hours to complete installation and is recognized when the labor has been completed and the equipment has been accepted by the customer, which is generally within a couple days of the delivery of the equipment. Warranty revenue, if sold separately, is valued based on estimated service person hours to complete a service and generally is recognized over the contract period. Revenue from service plans is recognized over time based on the term of the service agreement.

All other product sales with customer specific acceptance provisions are recognized at a point in time upon customer acceptance and the delivery of the parts or service. Revenues related to spare part sales are recognized upon shipment or delivery based on the trade terms.

Generally, pricing is fixed with payment terms of thirty days after shipment. The majority of the Company’s contracts have a short duration and a single performance obligation to deliver a configured to order baler and related equipment to the customer. The Company has elected to expense shipping and handling costs as incurred.

In the first ~~nine~~quarter ~~months~~ ended onin ~~July~~January 31, ~~2021~~2022 deferred revenue of $~~382~~375,~~557~~014 from the fiscal year ended October 31, ~~2020~~2021 was recognized.

(b) Disaggregation of Revenue

Disaggregated revenue is by primary geographic market is as follows:

Disaggregated revenue
Schedule of Disaggregated revenue
	Nine Months Ended July 31
	Three Months Ended January 31
Equipment Revenue by Geographic Area	2021		2020
Revenue by Geographic Area	2022		2021
United States	$	72,~~453~~001,~~576~~849	$	62,~~446~~297,~~678~~546
International		~~258~~37,~~111~~756		~~243~~52,~~764~~359
Total	$	72,~~711~~039,~~687~~605	$	62,~~690~~349,~~442~~905

5. Related Party Transactions:

Avis Industrial Corporation (“Avis”) ~~controls~~owns ~~over~~ 80% of the outstanding shares of the Company. Avis owns 100% of The American Baler Company, a competitor of the Company. On January 1, 2014, Avis acquired The Harris Waste Management Group, Inc. (“Harris”), also a competitor of the Company. On July 31, 2014, Harris acquired the assets of IPS Balers, Inc. in Baxley, Georgia, another competitor of the Company. ~~These baler~~The ~~companies~~Company ~~operate~~operates ~~completely~~independently ~~independent~~and ofdoes ~~each~~not ~~other.~~transact ~~The~~business ~~company~~with ~~had~~these norelated ~~purchases~~entities. ~~from~~Avis ~~these~~owns ~~companies~~100% inof ~~the~~Peninsular Cylinder ~~first~~Co., ~~nine~~Inc ~~months of~~(“Peninsular”), ~~fiscal~~a ~~2021~~company ~~and~~that ~~2020~~manufactures cylinders. The Company ~~had~~purchased no$56,665 ~~sales~~in tothe ~~The~~first ~~American~~quarter ended ~~Baler~~January ~~Company~~31, or2022 ~~Harris~~and ~~Waste~~$120 ~~Management~~of cylinders from Peninsular in the first ~~nine~~quarter ~~months~~ of fiscal 2021 ~~and 2020~~.

6. Inventories:

Inventories consisted of the following:

Inventories
Schedule of Inventories
	July 31, 2021		October 31, 2020
	January 31, 2022		October 31, 2021
Raw materials	$	2,~~144~~777,~~051~~905	$	2,~~155~~554,~~664~~083
Work in process		1,~~598~~983,~~918~~775		1,~~725~~714,~~596~~957
Finished goods		323,803		373,620
Finished		214,564		439,223
Inventories	$	4,066,772	$	4,254,880
	$	4,976,244	$	4,708,263

7. Debt:

The Company has a $1,000,000 line of credit agreement with First Merchants Bank of Muncie, Indiana which was renewed on May 15, 2021. The line of credit allows the Company to borrow at an interest rate equal to the greater of 3% or Wall Street Journal prime rate minus 0.9525% per the line of credit agreement, adjusting daily. The line of credit is secured by all assets of the Company and expires on May 15, 2022, unless extended or otherwise modified by the parties in writing. The line of credit had no outstanding balance at ~~July~~January 31, ~~2021~~ 2022 and at October 31, ~~2020~~2021.

On April 16, 2020 the Company received a $626,466 loan made pursuant to the terms of the Paycheck Protection Program ~~(PPP)~~ authorized by the CARES Act. The loan ~~has~~had a ~~two~~ 2 two-year term and accrued ~~accrues~~ simple interest at a fixed annual rate of 1.00%. Under the terms of the CARES Act guidelines, a portion of the loan up to 100% may be forgiven by the U.S. Small Business Administration (“SBA”) if the amount spent is within the timeframe and under guidelines that have been set for forgiveness. On December 79, 2020 the Company was notified by its bank that the SBA has stated that the ~~this~~entire loan was forgiven. The Company reversed this liability during the quarter ended January 31, 2021 and the resulting gain was recognized as other income ~~in the accompanying condensed statements of income~~.

8. Income Taxes:

~~Tax~~Subsequent ~~assets~~to ~~are~~February ~~recognized~~25, in2021, the ~~balance~~income ~~sheet~~tax ifreturn itof isthe ~~more~~Company ~~likely than not that they~~ will be ~~realized~~included onin ~~future~~the ~~tax~~consolidated ~~returns.~~income ~~Factors~~tax ~~considered include~~return ~~historical results~~ of ~~operations, volatility of the economic conditions and projected earnings based on current operations~~Avis. ~~Based on~~The ~~this evidence, it~~ Company is ~~more~~in ~~likely~~the ~~than~~process ~~not~~of ~~that~~filing ~~the~~short-year ~~deferred~~income tax ~~assets~~returns ~~would~~for bethe ~~realized.~~period ~~Accordingly~~November 1, ~~there~~2020 isthrough noFebruary ~~valuation allowance as of July 31~~24, 2021 and ~~at October 31, 2020. However, if it~~ is ~~determined~~filing ~~that~~carryback claims ~~all~~for ~~or part of~~ the ~~deferred~~same ~~tax~~period ~~assets~~to ~~will~~recover ~~not~~income betaxes ~~used~~ paid in ~~the~~prior ~~future,~~periods anof ~~adjustment~~approximately to$102,000. ~~the~~The ~~deferred~~Company ~~tax~~has ~~assets~~recorded ~~would~~cumulative federal beand ~~charged~~state ~~against net~~ income intax ~~the~~refunds ~~period~~of ~~such~~approximately ~~determination~~$434,000 isat ~~made. As~~January ~~of July~~ 31, ~~2021~~2022 and October 31, ~~2020, net deferred tax assets were $77,890~~2021.

Deferred tax assets are recognized in the balance sheet if it is more likely than not that they will be realized on future tax returns. The realization ~~Company~~of ~~records~~deferred ~~interest~~tax ~~related~~assets, towith ~~unrecognized~~the exception of certain tax ~~benefits~~credits and state NOLs, will depend on the ability of Avis to generate taxable income in ~~interest~~the ~~expense~~future. Certain tax credits and ~~penalties~~state inNOLs ~~selling,~~of ~~general~~approximately $92,300 were generated by the Company prior to the Avis ownership change and ~~administrative~~may be subject to Section 382 limitations, accordingly, the Company has recorded a valuation allowance related to these deferred ~~expenses~~tax assets.

9. Commitments and Contingencies:

The Company, in the ordinary course of business, is subject to claims made, and from time to time is named as a defendant in legal proceedings relating to the sales of its products. The Company believes that the reserves reflected in its financial statements are adequate to pay losses and loss adjustment expenses which may result from such claims and proceedings; however, such estimates may be more or less than the amount ultimately paid when the claims are settled. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position, results of operations, or liquidity.

On ~~December~~March 122, ~~2017~~2021, the Company was served with a complaint related to an injury to an employee working at ~~Integrated~~a ~~Coating~~Stericycle ~~and~~facility ~~Seed~~in ~~Technology~~North ~~Inc.~~Little Rock, ~~(INCOTEC)~~Arkansas. The employee was ~~operating~~working on a baler manufactured by the Company in ~~1994~~2003. The ~~injury~~employee ~~occurred~~suffered onan ~~December~~injury 4,to ~~2015. The~~his ~~plaintiff~~left ishand ~~Star~~on ~~Insurance~~April ~~Company~~10, 2018. The ~~Company’s~~plaintiff ~~insurer~~is ~~settled~~Scott ~~this~~Tinsley, ~~claim~~the ininjured ~~March 2020~~employee. The Company’s ~~liability~~insurance onpolicy related to this ~~settlement~~complaint ofhas ~~the~~a ~~claim~~deductible ~~was~~of $20,~~645~~000 ~~which~~and the Company has ~~been~~recorded ~~paid~~an accrued liability for its estimated loss.

On ~~March~~July 2227, 2021, the Company was served with a complaint related to an injury to an employee working at aMackay ~~Stericycle~~Mitchell ~~facility~~Envelope Company in ~~North Little~~Mount ~~Rock~~Pleasant, ~~Arkansas~~Iowa. ~~The~~On August 10, 2019, the employee, Xaisavath Phanthouvong, was working on a baler manufactured by the Company in 2003. The employee suffered ana serious injury to his left hand ~~on April 10, 2018~~. The ~~plaintiff is Scott Tinsley, the injured employee. The~~ Company’s insurance policy related to this complaint has no a deductible. ofOn ~~$20~~February 21,~~000~~ ~~and~~2022 the Company ~~has~~was ~~recorded~~notified athat ~~reserve~~this ~~for~~complaint ~~this~~has ~~amount~~been dismissed, without prejudice.

On ~~July~~December 273, 2021, the Company ~~was~~filed ~~served with~~ a complaint ~~related~~in toDuval anCounty, ~~injury~~Florida against California Recyclers, Inc. (“CRI”) alleging breach of contract on the basis of CRI’s failure to anpay ~~employee~~the ~~working~~remaining at10% ~~Mackay~~on ~~Mitchell~~a ~~Envelope~~baler sold to CRI in January 2021. The Company and CRI have been in ~~Mount~~a ~~Pleasant,~~continuing ~~Iowa.~~dispute Onas ~~August~~to ~~10,~~whether ~~2019,~~the baler was capable of meeting the ~~employee,~~output ~~Xaisavath~~specifications ~~Phanthouvong,~~as ~~was~~originally ~~working~~quoted by the Company. Based on athe ~~baler~~way ~~manufactured~~CRI byhas continued to operate the baler, the Company has concluded that there is no point in ~~1996~~continuing this relationship. The ~~employee~~Company ~~suffered~~has aagreed ~~serious~~to ~~injury~~refund tothe ~~his~~amount ~~left~~paid ~~hand.~~by ~~The~~CRI ~~Company’s~~and ~~insurance~~take ~~policy~~the ~~related~~baler toback. ~~this~~The ~~complaint~~Company has recorded an amount noof ~~deductible~~$490,000 sales returns and set up a reserve for that amount in current liabilities on the Company’s ~~does~~balance ~~not~~sheet. ~~expect~~Management estimates tothat ~~incur~~there ~~any~~is ~~significant~~a ~~expenses~~potential ~~related~~additional loss of up to $100,000, but believes that the likelihood of this ~~claim~~loss is remote.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In this Quarterly Report on Form 10-Q, the terms “Company,” “we,” “us,” and “our,” refer to International Baler Corporation.

Forward -Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including statements regarding industry prospects, prospective business opportunities or future results of operations or financial position, made in this Quarterly Report on Form 10-Q are forward-looking. We use words such as anticipates, believes, expects, future, intends, and similar expressions to identify forward-looking statements. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Actual results could differ material, ~~materially~~ for a variety of reasons, including, but not limited to, changes in general economic conditions, changing competition and our ability to market and sell our commercial and industrial balers. These risks and uncertainties, as well as other risks and uncertainties, could cause our actual results to differ significantly from management’s expectations. The forward-looking statements included in this Quarterly Report on Form 10-Q reflect the beliefs of our management on the date of this Quarterly Report. We undertake no obligation to update publicly any forward-looking statements for any reason.

General

The following discussion should be read together with our unaudited condensed financial statements and the related notes thereto included in Part I, Item 1 “Financial Statements”. For further information, refer to the Company’s Annual Report on Form 10-K for the year ended October 31, ~~2020~~2021, and the Management Discussion and Analysis of Financial Condition and Results of Operations included in this Form 10-Q.

Results of Operations: Three Month Comparison

Three ~~months~~Months ~~ended~~Ended ~~July~~January 31, ~~2021~~2022 (“~~third~~first quarter of fiscal ~~2021~~2022”) compared to the three months ended ~~July~~January 31, ~~2020~~2021 (“~~third~~first quarter of fiscal ~~2020~~2021”)

In the ~~third~~first quarter ended ~~July~~January 31, ~~2021~~2022, the Company had net sales of $2,~~723~~039,~~772~~605 compared to net sales of $2,~~665~~349,~~238~~905 in the ~~third~~first quarter of fiscal ~~2020~~2021, ana ~~increase~~decrease of 213.2%. ~~Equipment~~The sales ~~included~~by ~~twenty~~product balers and conveyers at an average price of $91,896 in the third quarter of fiscal 2021 while in the same quarter of fiscal 2020, the Company sold fifteen balers and conveyers at an average price of $129,128. Parts and service sales in the current quarter were, ~~$885,858,~~as ~~compared to $727,267, an increase of 32.7%. The Baler shipments were negatively impacted by the delayed arrival of purchased components.~~follows:

Gross profit decreased to $114,304 in the third quarter of fiscal 2021, compared to $379,758 in the third quarter of fiscal 2020. The lower gross profit was the result of lower gross margin equipment sales in the third quarter of 2021 compared to higher gross profit equipment sales in the third quarter of the prior year. Gross profit margins were adversely affected by higher costs for components and steel.

	January 31, 2022		January 31, 2021
General Purpose Balers	$	983,644	$	1,500,330
Rubber Balers		103,865		—
Specialty Balers		129,572		63,891
Parts and Service Sales		822,524		785,684
Total	$	2,039,605	$	2,349,905

~~Total~~The ~~operating~~lower ~~expense,~~sales ~~consisting of selling and administrative expense, increased by 25.0% to $567,172~~ in the ~~third~~first quarter of fiscal ~~2021 compared~~2022 towere ~~$453,728 in~~ the ~~third~~result ~~quarter~~ of ~~fiscal~~general ~~2020.~~economic ~~Selling expenses included an increase in the allowance for doubtful accounts of $60,000~~conditions. ~~Administrative~~Parts ~~expenses~~and ~~included approximately $125,000 in professional~~ service ~~charges~~sales ~~related~~were tohigher ain the ~~fair~~first ~~value~~quarter ~~opinion~~ of ~~the~~ ~~Company’s~~fiscal ~~common~~2022 ~~stock~~by 4.7%.

In the first quarter ended January 31, 2022, gross profit increased to $258,318, 12.7% of net sales compared to $199,719, 8.5% of net sales in the prior-year first quarter. The higher gross profit was the result of the Company increasing prices and reducing operating costs.

The Company had a loss from operations of $133,110 in the first quarter of fiscal 2021 compared to a loss from operations of $174,018 in the first quarter of fiscal 2021.

~~The~~In ~~Company~~the ~~had~~first aquarter ~~pre-tax~~of ~~loss~~fiscal 2021, the Company recorded income of $~~451~~626,~~204~~466 infrom the ~~third~~Paycheck Protection Program (PPP) loan which was forgiven. For the first quarter of fiscal 2021, the Company had pre-tax income of $453,339 compared to a pre-tax loss of $61130,~~594~~148 in the ~~same quarter~~first quarter of fiscal ~~2020~~2022. The ~~larger~~Company ~~pre-~~had an income tax ~~loss~~benefit ~~was~~of $29,000 in the ~~result~~first quarter of ~~lower~~fiscal ~~gross~~2022 ~~profit~~compared ~~and~~to an income tax benefit of $36,000 in the ~~higher~~first ~~selling~~quarter ~~and~~of ~~administrative~~fiscal ~~expenses~~2021. ~~mentioned above~~Income from the forgiven PPP loan is not taxable.

The ~~Results~~sales oforder ~~Operations:~~backlog ~~Nine~~was ~~Month~~approximately ~~Comparison~~$3,840,000 at January 31, 2022 and $2,700,000 at January 31, 2021.

Nine months ended July 31, 2021 compared to the nine months ended July 31, 2020.

The Company had net sales of $7,711,687 in the first nine months of fiscal 2021, compared to net sales of $6,690,442 in the same period of fiscal 2020. The higher net sales in the first nine months of fiscal 2021 was the result of improved market conditions, particularly related to the COVID-19 pandemic in the first nine months of fiscal 2020. Equipment sales included sixty-eight balers and conveyors in the first nine months of fiscal 2021 versus equipment sales of fifty-two balers and conveyors in the same period of 2020. Parts and service sales were $616,180 higher in the first nine months of fiscal 2021 compared to the first nine months of fiscal 2020. This increase was due to improved market conditions.

Gross profit increased to $725,560 in the first nine months of fiscal 2021 compared to $709,393 in the first nine months of fiscal 2020. The higher gross profit was the result of the higher net sales.

Selling and administrative expenses increased from $1,120,628 in fiscal 2020 to $1,357,392 in fiscal 2021, an increase of 14.5%. The variance in these expenses from fiscal 2020 to fiscal 2021 were higher sales salaries, the increase in the allowance for doubtful accounts, higher legal and other professional service expenses in 2021, partially offset by higher sales commissions in 2020.

The Company recorded income of $626,466 from the Paycheck Protection Program (PPP) loan which was forgiven in the first quarter of fiscal 2021. In the first nine months of fiscal 2021, the Company had a pre-tax loss of $1,911. For the first nine months of fiscal 2021, the Company had an operating loss of $631,832 compared to an operating loss of $411,235 in the same period in fiscal 2020.

The sales order backlog was approximately $3,690,000 at July 31, 2021 and $1,525,000 at July 31, 2020.

Financial Condition and Liquidity:

Net working capital at ~~July~~January 31, ~~2021~~2022 was $76,~~168~~746,~~105~~576 as compared to $76,~~721~~854,~~268~~047 at October 31, ~~2020~~2021. The Company currently believes that it it will have sufficient cash flow to be able to fund operating activities for the next twelve months.

Average days sales outstanding (DSO) in the first ~~nine~~three months of fiscal ~~2021~~2022 were 31.98 days, as compared to 3225.53 days in the first ~~nine~~three months of fiscal ~~2020~~2021. DSO is calculated by dividing the total of the month-end net accounts receivable balances for the period by ~~nine~~three, and dividing that result by the average day’s sales for the period (period sales ÷ ~~273~~91.25).

During the ~~nine~~three months ended ~~July~~January 31, ~~2021~~2022 and ~~2020~~2021, the Company made additions to property, plant and equipment of $9334,~~686~~023 and $~~179~~35,~~666~~ 808 respectively.

The Company has a $1,000,000 line of credit agreement with First Merchants Bank of Muncie, Indiana which was renewed for an additional year on May 15, 2021. The line of credit allows the Company to borrow at an interest rate equal to the greater of 3% or Wall Street Journal Prime ~~prime~~ rate minus 0.9525% per line of credit agreement, adjusting daily. The line of credit is secured by all assets of the Company and expires on May 15, ~~2021~~2022, unless extended or otherwise modified in writing. The line of credit had no outstanding balance at ~~July~~January 31, 2022 ~~2021~~ and at October 31, ~~2020~~2021.

In the event that the Company’s line of credit would not be available, the Company would pursue a line of credit from other sources, and take steps to minimize expenditures, such as delaying capital expenditures and reducing overhead costs.

13The Company had cash deposits in banks of $2,705,046 and $2,512,020 above the FDIC insured limit of $250,000 per bank at January 31, 2022 and October 31, 2021, respectively.

~~The~~Off-Balance ~~Company~~Sheet ~~had cash deposits in banks of $3,409,843 and $3,275,135 above the FDIC insured limit of $250,000 per bank at July 31, 2021 and October 31, 2020, respectively.~~Arrangements:

~~Off-Balance~~As ~~Sheet~~of ~~Arrangements~~January 31, 2022, we have no material off-balance sheet arrangements with unconsolidated entities.

AsCritical ofAccounting ~~July 31, 2021, we have no material off-balance sheet arrangements with unconsolidated entities.~~Estimates:

~~Critical~~There ~~Accounting~~have ~~Estimates~~been no material changes to the critical accounting policies disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2021.

~~There~~Recent ~~have~~Accounting ~~been no material changes to the critical accounting policies disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2020.~~Pronouncements:

Recent Accounting Pronouncements

See Note 3(f) to our Financial Statements for a discussion of recent accounting pronouncements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to changes in interest rates as a result of its financing activities, including its borrowings on the revolving line of credit facility. Based on the current level of borrowings, a change in interest rates is not expected to have a material effect on operations or financial position.

ITEM 4. CONTROLS AND PROCEDURES

~~Evaluation of Disclosure~~ Controls and Procedures:

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including the Company’s Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow timely decisions regarding required disclosures.

As of ~~July~~January 31, ~~2021~~2022, the end of the period covered by this Quarterly Report on Form 10-Q, and under the supervision and with the participation of management, including the Company’s CEO and CFO, management evaluated the effectiveness of the Company’s disclosure controls and procedures. Based on this evaluation and subject to the foregoing, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting:

~~Except~~During asits ~~noted~~fiscal inyear ended October 31, 2021, the ~~preceding~~Company ~~paragraphs~~discovered material weaknesses related to pricing on inventory invoices and purchase orders. Specifically, ~~there~~the ~~has~~unit ~~been~~prices noon ~~change~~some ininventory ~~internal~~invoices ~~controls~~were ~~over~~not ~~financial~~matched ~~reporting~~to ~~that~~the ~~occurred~~unit ~~during~~prices on the related purchase orders and ~~most~~adjusted ~~recent~~to ~~quarter~~the ~~that~~invoice ~~has~~amount ~~materially~~if ~~affected,~~different. orThe iscorrection ~~reasonably~~of ~~likely~~these pricing errors was immaterial to ~~materially~~the ~~affect~~financial statements of the Company at October 31, 2021, however management considered this pricing error to be a material weakness in its controls and procedures for the ~~Company’s~~fiscal ~~internal~~year ~~control~~ended October 31, 2021. In order to remediate this material weakness, management added two additional review steps ~~over~~to ~~financial~~adjust ~~reporting~~inventory pricing to invoiced amounts if different from the purchase order amount.

Except for the foregoing, the Company’s management, including CEO and CFO, confirm that there were no changes in the Company’s internal control over financial reporting during the fiscal quarter ended January 31, 2022, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In the ordinary course of conducting our business, we have in the past and may in the future become involved in various legal actions and other claims. These legal proceedings may be subject to many uncertainties and there can be no assurance of the outcome of any individual proceedings. We do not presently anticipate any material legal proceedings that, if determined adversely to us, would have a material adverse effect on our financial position, results of operations or cash flows. See Note 9, Commitments and Contingencies, to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for information regarding certain legal proceedings in which we are involved.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULT UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

~~On May 15, 2021, the Company renewed its line of credit agreement with First Merchants Bank of Muncie, Indiana for $1,000,000~~None. The line of credit allows the Company to borrow at an interest rate equal to the Wall Street Journal prime rate minus 0.95%, adjusting daily. The line of credit is secured by all assets of the Company and expires on May 15, 2022. The line of credit had no outstanding balance at July 31, 2021 and at October 31, 2020

On April 1, 2021, the Board of Directors of the Company established a special committee of independent and disinterested directors (the “Special Committee”) to evaluate the principal terms of a proposal by Avis Industrial Corporation, an Indiana corporation (“Avis”), to acquire all of the outstanding shares of the Company’s common stock not already owned by it. Avis currently owns approximately 81.1% of the Company’s outstanding shares. The Special Committee commenced negotiations with Avis. On June 10, 2021, the Special Committee hired a financial advisor to assist it in evaluating the proposal received from Avis. With the parties having not been able to reach a definitive agreement on acceptable terms, on September 2, 2021, Avis notified the Company that it would no longer continue negotiations with respect to the proposed acquisition.

ITEM 6. EXHIBITS

The following exhibits are ~~filed~~submitted ~~as part of this Quarterly Report.~~herewith:

Exhibit No.		Description	Filed Herewith
31.1	Certification of Victor W. Biazis, Chief Executive Officer and Chief Financial Officer, pursuant to Rule 13a–14(a)/15d-14(a).*
10.1		Revolving Note and Credit Agreement Modification Agreement effective as of May 15, 2021 between International Baler Corporation and First Merchants Bank, National Association.	X
31.2	Certification of William E. Nielsen, Chief Financial, pursuant to Rule 13a-14(a)/15d-14(a).*
10.2		Credit Agreement, Security Agreement and Note dated as of January 7, 2013, as amended through May 15, 2020, between International Baler Corporation, as the Borrower and First Merchants Bank, National Association, as the lender.	X
32.1	Certification of Victor W. Biazis, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
31.1		Certification of Principal Executive Officer Required By Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, As Amended, As Adopted Pursuant To Section 302 of the Sarbanes-Oxley Act of 200
32.2	Certification of William E. Nielsen, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
31.2		Certification of Principal Financial Officer Required By Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, As Amended, As Adopted Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002	X
101.INS	XBRL Instance Document*
32.1		Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
101.SCH	XBRL Taxonomy Extension Schema*
32.2		Certification of Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase*
101.ins		Inline XBRL Instance Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase*
101.sch		Inline XBRL Taxonomy Schema*
101.LAB	XBRL Taxonomy Extension Label Linkbase*
101.cal		Inline XBRL Taxonomy Calculation Linkbase*
101.PRE	XBRL Taxonomy Extension Presentation Linkbase*
101.def		Inline XBRL Taxonomy Definition Linkbase*
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101*
101.lab		Inline XBRL Taxonomy Label Linkbase*
101.pre		Inline XBRL Taxonomy Presentation Linkbase*
104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)*

*Furnished• Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned there unto duly authorized.

Dated: ~~September~~March 914, ~~2021~~2022

INTERNATIONAL BALER CORPORATION

BY: /s/~~Victor W~~D. Roger ~~Biazis~~Griffin

~~Victor W~~D. Roger ~~Biazis~~Griffin

Chief Executive Officer

BY: /s/William E. Nielsen

William E. Nielsen

Chief Financial Officer

Filing Compare · INTERNATIONAL BALER CORP