Company: BKYI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001437749-25-017209
Chunk: 15

Company: BIO KEY INTERNATIONAL INC
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 15
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 issued to the Investor on  September 13, 2024. In consideration for the exercise of the Existing Warrants, subject to compliance with the beneficial ownership limitations included in the existing warrants, the Investor received new unregistered Series A warrants to purchase up to an aggregate of 1,545,834 shares of the Company’s Common Stock (the “Series A Warrants”) and new unregistered Series B warrants to purchase up to an aggregate of 1,545,834 shares of the Company’s Common Stock (the “Series B Warrants”, and together with the “Series A Warrants, the “New Warrants”). The New Warrants have substantially the same terms, are immediately exercisable at an exercise price of $2.15 per share, and will expire five years from the date of issuance. The Company agreed to file a resale registration statement covering the public resale of the shares of Common Stock issuable upon exercise of the New Warrants with the Securities and Exchange Commission (the “SEC”), and to use commercially reasonable efforts to have such Resale Registration Statement declared effective by the SEC within 90 calendar days following the date of the Warrant Exercise Agreement. The New Warrants each include a beneficial ownership limitation that prevents the Investor from beneficially owning more than 4.99% of the Company’s outstanding common stock at any time. The Company realized gross proceeds under the Warrant Exercise Agreement of approximately $3.8 million, prior to deducting placement agent fees and estimated offering expenses. Net proceeds are being used for working capital and general corporate purposes, including repayment of a portion of the Company’s outstanding secured note.
    
   There were 777,666 prefunded warrants exercised during the three-month period ended  March 31, 2024.

    13.  FAIR VALUES OF FINANCIAL INSTRUMENTS 

   Cash and cash equivalents, accounts receivable, due from factor, accounts payable and accrued liabilities are carried at, or approximate, fair value because of their short-term nature. The carrying value of the Company’s government loan payable approximates fair value as the interest rate related to the financial instruments approximated market.

    14.  MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE 

   During each of the three month periods ended  March 31, 2025, and 2024, two customers accounted for 47% and one customers accounted for 59% of the revenue, respectively. 
    
   Two customers accounted for 49% of current accounts