Company: BKYI
Filing Date: 2025-04-23
Form Type: 10-K
Source: 0001437749-25-012824
Chunk: 82

Company: BIO KEY INTERNATIONAL INC
Filing Date: 2025-04-23
Form: 10-K
Item: Item 1A
Chunk 82
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 2022
    
   On  December 22, 2022, the Company entered into and closed a securities purchase agreement (the “Purchase Agreement”) which issued a $2,200,000 principal amount senior secured promissory note (the “Note”). At closing, a total of $2,002,000 was funded, with the proceeds to be used for general working capital.
    
   The principal amount of the Note was due six months following the date of issuance, subject to one six-month extension by the Company. Interest under the Note accrues at a rate of 10% per annum, payable monthly through month six and at the rate of 12% per annum in months seven through twelve, payable monthly. The Note is secured by a lien on substantially all of the Company’s assets and properties can be prepaid in whole or in part without penalty at any time.
    
   In connection with the issuance of the Note, the Company issued to the investor 38,889 shares of Common Stock (the “Commitment Shares”) valued at $18.00 per share and a warrant (the “Warrant”) to purchase 11,112 shares of common stock (the “Warrant Shares”) at an exercise price of $54.00 per share, exercisable commencing on the date of issuance with a term of five years. The warrant was valued at $94,316 (see Note N). 
    
   On  October 31, 2023 the Company repaid $1,400,000 of principal due under the Note, and on  December 21, 2023 the Company repaid the remaining principal balance of $800,000 due under the Note.
    
   As of  December 31, 2023, the Note was paid in full.

   NOTE L—LEASES
    
   The Company’s leases office space in New Jersey, Minnesota, New Hampshire, Madrid and Hong Kong with lease termination dates in 2025 and 2027. The property leased in China is paid monthly as used, without a formal agreement. The following tables present the components of lease expense and supplemental balance sheet information related to the operating leases were:

       Year ended    Year ended  
   December 31,    December 31,  
   2024    2023  
 Lease cost         
 Operating lease cost  $45,787  $166,161 
 Total lease cost  $45