Company: BKYI
Filing Date: 2025-04-23
Form Type: 10-K
Source: 0001437749-25-012824
Chunk: 577

Company: BIO KEY INTERNATIONAL INC
Filing Date: 2025-04-23
Form: 10-K
Item: Item 9C
Chunk 577
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.50%
         
 Supplemental cash flow information related to leases were as follows:         
         
 Cash paid for amounts included in the measurement of operating lease liabilities  $63,914  $213,783 
         
 Maturities of operating lease liabilities were as follows as of December 31, 2024:         
         
 2025  $28,195     
 2026   29,267     
 2027   22,477     
 Total future lease payments   79,939     
 Less: imputed interest   (6,303)    
 Total  $73,636     

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   NOTE M—COMMITMENTS AND CONTINGENCIES
    
   Distribution Agreement
    
   Swivel Secure had a distribution agreement with Swivel Secure Limited (“SSL”). Terms of the agreement include the following:

       1. 
       The initial term of the agreement ends on  January 31, 2027 and will be automatically extended for additional one-year terms thereafter unless either party provides written notice to the other party not later than 30 days before the end of the term that it does not wish to extend the term. 

       2. 
       SSL appoints Swivel Secure as the exclusive distributor of SSL’s products, to market, sell and distribute in the EMEA (Europe, Middle East and Africa), excluding the United Kingdom and Republic of Ireland, for a defined discount on the sale price. 

       3. 
       Swivel Secure is expected to generate a certain minimum level of orders of SSL products each year during the term of the agreement. If Swivel Secure fails to meet such minimum level of orders in any year, the exclusive distribution rights will terminate and Swivel Secure will serve as a non-exclusive distributer of SSL Products. 

   The Company and Swivel Secure Limited terminated the Distribution Agreement in the fourth quarter 2024. The Company made a business decision to that our PortalGuard and WEB-key solutions be sold versus the Swivel Secure Limited solutions to increase gross profit by close to 50%.  The termination of the agreement did not result in any penalties or inventory returns. 
    
   Litigation
    
   From time to time, the Company  may be involved in litigation relating to claims arising out of its operations in the normal course of business. As of  December 31, 2024, the Company was not a party to any pending lawsuits