Document:

QuickLinks
 -- Click here to rapidly navigate through this document

Exhibit 10.1  

 
 

FIRST AMENDMENT TO
  AMENDED AND RESTATED CREDIT AGREEMENT    
    

        THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (herein called this "Amendment") is made as of the 20th day of December, 2004 by and
among Western Gas Resources, Inc. (the "Borrower"), and Bank of America, N.A., as Agent (the "Administrative Agent"), and the Lenders under the Original Agreement referred to below. 

W I T N E S S E T H:  

        WHEREAS, the Borrower, the Administrative Agent, and Lenders have entered into that certain Amended and Restated Credit Agreement dated as of June 29, 2004
(as amended, restated, or supplemented to the date hereof, the "Original Agreement"), for the purposes and consideration therein expressed, pursuant to which Lenders made and became obligated to make
loans to the Borrower as therein provided; 

        WHEREAS,
in order to secure the Obligations, including the obligations of the Borrower under the Notes and the Original Agreement, the Borrower caused (i) MIGC, Inc.,
Delaware corporation ("MIGC"), (ii) MGTC, Inc., a Wyoming corporation ("MGTC"), (iii) Western Gas Resources—Texas, Inc., a Texas corporation,
(iv) Mountain Gas Resources, Inc., a Delaware corporation, (v) Western Gas Wyoming, L.L.C., a Wyoming limited liability company, and (vi) Lance Oil & Gas
Company, Inc., a Delaware corporation, to execute and deliver to the Administrative Agent for the benefit of Lenders, that certain Continuing Guaranty dated as of June 29, 2004 (the
"Guaranty"); 

        WHEREAS,
in order to secure the Obligations, the Borrower executed and delivered that certain Amended and Restated Pledge Agreement dated as of June 29, 2004 in favor of the
Administrative Agent for the benefit of Lenders (the "Borrower Pledge Agreement"), pursuant to which the Borrower pledged and granted a security interest to the Administrative Agent, for the benefit
of Lenders, in, among other things, pledged shares of common stock of Subsidiaries and LLC Rights; and 

        WHEREAS,
in order to secure the Obligations, MIGC executed and delivered that certain Amended and Restated Subsidiary Pledge Agreement dated as of June 29, 2004 in favor of the
Administrative Agent for the benefit of Lenders (the "Subsidiary Pledge Agreement"), pursuant to which the Borrower pledged and granted a security interest to the Administrative Agent, for the benefit
of Lenders, in, among other things, pledged shares of common stock of MGTC; and 

        WHEREAS,
the Borrower and Lenders desire to amend the Credit Agreement as specified herein; 

        NOW,
THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein and in the Original Agreement, in consideration of the loans which may hereafter
be made by Lenders to the Borrower, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows: 

ARTICLE I.

Definitions and References  

        § 1.1. Defined Terms. Unless the context otherwise requires or unless otherwise expressly defined
herein, the terms defined in the Original Agreement shall have the same meanings whenever used in this Amendment. As used herein, the term "Credit Agreement" means the Original Agreement as amended by
this Amendment.

 

ARTICLE II.

Amendment  

        § 2.1. Increase in Aggregate Commitments. The first sentence of Section 2.13(a) is
hereby amended in its entirety to read as follows: 

        "Provided
there exists no Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Borrower may from time to time, request an increase in the
Aggregate Commitments
by an amount (for all such requests) not exceeding $200,000,000; provided that each such increase shall be in an amount at least equal to $10,000,000." 

ARTICLE III.

Conditions of Effectiveness  

        § 3.1. Effective Date. This Amendment shall become effective (the "Effective Date") as of the date
first above written when, and only when, the Administrative Agent shall have received all of the following: 

        (a)   This
Amendment, duly authorized, executed and delivered by the Borrower and Credit Agreement, and in form and substance satisfactory to the Administrative Agent. 

        (b)   A
certificate of a duly authorized officer of the Borrower to the effect that all of the representations and warranties set forth in Article IV hereof are true
and correct at and as of the time of such effectiveness. 

        (c)   A
certificate of the Secretary of the Borrower dated the date of this Amendment certifying that attached thereto is a true and complete copy of resolutions adopted by
the Board of Directors of Borrower authorizing the execution, delivery and performance of this Amendment by the Borrower and certifying the names and true signatures of the officers of the Borrower
authorized to sign this Amendment and the other Loan Documents on behalf of the Borrower. 

        (d)   Such
supporting documents as the Administrative Agent may reasonably request. 

        (e)   Payment
of all fees and expenses owing to the Administrative Agent and Lenders in connection with this Amendment and payment of fees and disbursements of
Thompson & Knight L.L.P. relating to this Amendment and the Original Agreement as provided in the Original Agreement. 

ARTICLE IV.

Representations and Warranties  

        § 4.1. Representations and Warranties of the Borrower. In order to induce each Lender to enter into
this Amendment, the Borrower represents and warrants to each Lender that: 

        (a)   The
representations and warranties contained in Article V of the Original Agreement are true and correct at and as of the time of the effectiveness hereof (except
to the extent that such representations specifically refer to an earlier date, in which cases they are true and correct as of such earlier date, and except that Sections 5.05(a) and
(b) shall be deemed to refer to the annual audited consolidated financial statements of the Borrower dated as of December 31, 2003 and the quarterly unaudited consolidated financial
statements of the Borrower dated as of September 30, 2004). 

        (b)   The
Borrower is duly authorized to execute and deliver this Amendment and the Borrower is and will continue to be duly authorized to borrow monies and to perform its
obligations under the Original Agreement. The Borrower has duly taken all corporate action necessary to authorize the execution and delivery of this Amendment.

 

        (c)   The
execution and delivery by the Borrower of this Amendment, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby
do not and will not conflict with any provision of law, statute, rule or regulation or of the certificate of incorporation and bylaws of the Borrower or of any material agreement, judgment, license,
order or permit applicable to or binding upon the Borrower or result in the creation of any lien, charge or encumbrance upon any assets or properties of the Borrower. Except for those which have been
obtained, no consent, approval, authorization or order of any court or governmental authority or third party is required in connection with the execution and delivery by the Borrower of this
Amendment. 

        (d)   When
duly executed and delivered, this Amendment and the Original Agreement will be a legal and binding obligation of the Borrower enforceable against the Borrower in
accordance with its terms, except as limited by bankruptcy, insolvency or similar laws of general application relating to the enforcement of creditors' rights and by equitable principles of general
application. 

ARTICLE V.

Miscellaneous  

        § 5.1. Ratification of Agreements. The Original Agreement as hereby amended is hereby ratified and
confirmed in all respects. Any reference to the Credit Agreement in any Loan Document shall be deemed to be a reference to the Original Agreement as hereby amended. The Loan Documents, as they may be
amended or affected by this Amendment, are hereby ratified and confirmed in all respects. The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein,
operate as a waiver of any right, power or remedy of Lenders under the Original Agreement, the Notes, or any other Loan Document nor constitute a waiver of any provision of the Original Agreement, the
Notes, or any other Loan Document. 

        §
5.2. Survival of Agreements. All representations, warranties, covenants and agreements of the Borrower herein shall survive
the execution and delivery of this Amendment and the performance hereof, including without limitation the making or granting of the Loans, and shall further survive until all of the Obligations are
paid in full. All statements and agreements contained in any certificate or instrument delivered by the Borrower hereunder or under the Original Agreement to any Lender shall be deemed to constitute
representations and warranties by, and/or agreements and covenants of, the Borrower under this Amendment and under the Original Agreement. 

        §
5.3. Loan Documents. This Amendment is a Loan Document, and all provisions in the Original Agreement pertaining to Loan
Documents apply hereto. 

        §
5.4. Governing Law. This Amendment shall be governed by and construed in accordance the laws of the State of Texas and any
applicable laws of the United States of America in all respects, including construction, validity and performance. 

        §
5.5. Counterparts. This Amendment may be separately executed in counterparts and by the different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one and the same Amendment. This Amendment and the Commitment Increase Supplements may be transmitted and/or signed by
facsimile. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually-signed originals and shall be binding on all Loan
Parties, the Administrative Agent and the Lenders. 

        THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS OF THE PARTIES.

 

        IN
WITNESS WHEREOF, this Amendment is executed as of the date first above written. 

	

 	
 	

WESTERN GAS RESOURCES, INC.
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

BANK OF AMERICA, N.A., as Administrative Agent
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

BANK OF AMERICA, N.A., as Lender and L/C Issuer
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

BANK OF OKLAHOMA, N.A., a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

BNP PARIBAS, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

COMERICA BANK, a Lender
	

 	
 	

By:	
 	

 Name:

Title:

 

	

 	
 	

COMPASS BANK, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

JPMORGAN CHASE BANK, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

KEY BANK, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

THE ROYAL BANK OF SCOTLAND plc, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

UNION BANK OF CALIFORNIA, N.A., a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

U.S. BANK NATIONAL ASSOCIATION, a Lender
	

 	
 	

By:	
 	

 Name:

Title:

 

	

 	
 	

WACHOVIA BANK, NATIONAL ASSOCIATION, a Lender
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

WELLS FARGO BANK, N.A., a Lender
	

 	
 	

By:	
 	

 Name:

Title:

 

CONSENT AND AGREEMENT  

        Each of the undersigned hereby (i) consents to the provisions of this Amendment and the transactions contemplated herein, and (ii) ratifies and
confirms its Guaranty dated as of June 29, 2004 made by it in favor of the Administrative Agent for the benefit of each Lender, and agrees that its obligations and covenants thereunder are
unimpaired hereby and shall remain in full force and effect. In addition, MIGC, Inc. hereby ratifies and confirms the Amended and Restated Subsidiary Pledge Agreement dated as of
June 29, 2004 made by it in favor of the Administrative Agent for the benefit of each Lender, and agrees that its obligations and covenants thereunder are unimpaired hereby and shall remain in
full force and effect. 

	

 	
 	

MIGC, INC.
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

MGTC, INC.
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

WESTERN GAS RESOURCES—TEXAS, INC.
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

MOUNTAIN GAS RESOURCES, INC.
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

WESTERN GAS WYOMING, L.L.C.
	

 	
 	

By:	
 	

 Name:

Title:

 

	

 	
 	

LANCE OIL & GAS COMPANY, INC.
	

 	
 	

By:	
 	

 Name:

Title:

QuickLinks

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT<Page>

                                                                   Exhibit 10.49

                                 FORM OF WARRANT

THESE SECURITIES AND THE SECURITIES ISSUABLE UPON THEIR EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED UNLESS COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID
ACT, A "NO ACTION" LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION WITH
RESPECT TO SUCH TRANSFER, A TRANSFER MEETING THE REQUIREMENTS OF RULE 144 OF THE
SECURITIES AND EXCHANGE COMMISSION, OR AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER TO THE EFFECT THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

                           BIO-KEY INTERNATIONAL, INC.

                          COMMON STOCK PURCHASE WARRANT

                                             ISSUE DATE: As of November 26, 2001

          1.   ISSUANCE; CERTAIN DEFINITIONS.

               In consideration of good and valuable consideration, the receipt
of which is hereby acknowledged by BIO-KEY INTERNATIONAL, INC., a Minnesota
corporation (the "Company") KRIEGER & PRAGER LLP. or registered assigns (the
"Holder") is hereby granted the right to purchase at any time until 5:00 P.M.,
New York City time, on November 25, 2006 (the "Expiration Date") Ten Thousand
(10,000) fully paid and nonassessable shares of the Company's Common Stock, par
value $0.01 per share (the "Common Stock") at an initial exercise price per
share (the "Exercise Price") of $ 1.00, subject to further adjustment as set
forth herein.

          2.   EXERCISE OF WARRANTS.

               2.1  GENERAL. (a) This Warrant is exercisable in whole or in part
at the Exercise Price per share of Common Stock payable hereunder, (i)payable in
cash or by certified or official bank check, or (ii) by "cashless exercise", by
means of tendering this Warrant Certificate to the Company to receive a number
of shares of Common Stock equal in Market Value to the difference between the
aggregate Market Value of the shares of Common Stock issuable upon exercise of
this Warrant and the total cash exercise price thereof divided by the Market
Value. Upon surrender of this Warrant Certificate with the annexed Notice of
Exercise Form duly executed, together with payment of the Exercise Price for the
shares of Common Stock purchased, the Holder shall be entitled to receive a
certificate or certificates for the shares of Common Stock so purchased. For the
purposes of this Section 2, "Market Value" shall be an amount equal to the
average closing bid price of a share of Common Stock for the ten (10) days

<Page>

preceding the Company's receipt of the Notice of Exercise Form duly executed
multiplied by the number of shares of Common Stock to be issued upon surrender
of this Warrant Certificate.

               (b)  For purposes of Rule 144 promulgated under the Securities
Act, it is intended, understood and acknowledged that, pursuant to applicable
law as of the date hereof, the Warrant Shares issued in a cashless exercise
transaction shall be deemed to have been acquired by the Holder and the holding
period for the Warrant Shares shall be deemed to have been commenced on the date
hereof.

               2.2  LIMITATION ON EXERCISE. Notwithstanding the provisions of
this Warrant, the Funding Agreement or of the other Transaction Agreements (as
defined in the Funding Agreement), in no event (except (i) with respect to an
automatic conversion, if any, of the Preferred Stock as provided in its
Certificate of Designations, (ii) as specifically provided in this Warrant as an
exception to this provision, or (iii) while there is outstanding a tender offer
for any or all of the shares of the Company's Common Stock) shall the Holder be
entitled to exercise this Warrant, or shall the Company have the obligation to
issue shares upon such exercise of all or any portion of this Warrant, to the
extent that, after such exercise the sum of (1) the number of shares of Common
Stock beneficially owned by the Holder and its affiliates (other than shares of
Common Stock which may be deemed beneficially owned through the ownership of the
unconverted portion of the Preferred Stock or unexercised portion of the
Warrants), and (2) the number of shares of Common Stock issuable upon the
exercise of the Warrants with respect to which the determination of this proviso
is being made, would result in beneficial ownership by the Holder and its
affiliates of more than 4.99% of the outstanding shares of Common Stock (after
taking into account the shares to be issued to the Holder upon such exercise).
For purposes of the proviso to the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), except as otherwise provided
in clause (1) of such sentence. The Holder, by its acceptance of this Warrant,
further agrees that if the Holder transfers or assigns any of the Warrants to a
party who or which would not be considered such an affiliate, such assignment
shall be made subject to the transferee's or assignee's specific agreement to be
bound by the provisions of this Section 2.2 as if such transferee or assignee
were the original Holder hereof.

          3.   RESERVATION OF SHARES. From and after the date of filing of
Certificate of Amendment pursuant to Section 7(j) of the Funding Agreement, the
Company hereby agrees that at all times during the term of this Warrant there
shall be reserved for issuance upon exercise of this Warrant such number of
shares of its Common Stock as shall be required for issuance upon exercise of
this Warrant (the "Warrant Shares").

          4.   MUTILATION OR LOSS OF WARRANT. Upon receipt by the Company of
evidence satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and (in the case of loss, theft or destruction) receipt of
reasonably satisfactory indemnification, and (in the case of mutilation) upon
surrender and cancellation of this Warrant, the Company will execute and deliver
a new Warrant of like tenor and date and any such lost, stolen, destroyed or
mutilated Warrant shall thereupon become void.

<Page>

          5.   RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder in the Company, either at law or equity,
and the rights of the Holder are limited to those expressed in this Warrant and
are not enforceable against the Company except to the extent set forth herein.

          6.   PROTECTION AGAINST DILUTION.

               6.1  ADJUSTMENT MECHANISM. If an adjustment of the Exercise Price
is required pursuant to this Section 6, the Holder shall be entitled to purchase
such number of shares of Common Stock as will cause (i) the total number of
shares of Common Stock Holder is entitled to purchase pursuant to this Warrant
after such adjustment, multiplied by (ii) the adjusted Exercise Price per share,
to equal (iii) the dollar amount of the total number of shares of Common Stock
Holder is entitled to purchase before adjustment multiplied by the total
Exercise Price before adjustment.

               6.2  CAPITAL ADJUSTMENTS. In case of any stock split or reverse
stock split, stock dividend, reclassification of the Common Stock,
recapitalization, merger or consolidation, or like capital adjustment affecting
the Common Stock of the Company (each, an "Adjustment"), the Exercise Price in
effect at the time of the effective date for such Adjustment shall be
proportionally adjusted so that the Holder of this Warrant exercised after such
date shall be entitled to receive the aggregate number and kind of shares which,
if this Warrant had been exercised by such Holder immediately prior to such
date, the Holder would have owned upon such exercise and been entitled to
received upon such Adjustment (and for such purposes the Holder shall, to the
extent relevant, be deemed to have exercised this Warrant immediately prior to
the record date or the effective date, as the case may, for the Adjustment). For
example, if the Company declares a 2:1 stock dividend or stock split and the
Exercise Price immediately prior to the record date for such Adjustment was
$5.00 per share, the adjusted Exercise Price immediately after the Adjustment
would be $2.50 per share. Such adjustment may be made successively if there is
more than one Adjustment. In all other respects the provisions of this Section
shall be applied in a fair, equitable and reasonable manner so as to give
effect, as nearly as may be, to the purposes hereof. A rights offering to
stockholders shall be deemed a stock dividend to the extent of the bargain
purchase element of the rights.

               6.3  ADJUSTMENT FOR SPIN OFF. If, for any reason, prior to the
exercise of this Warrant in full, the Company spins off or otherwise divests
itself of a part of its business or operations or disposes all or of a part of
its assets in a transaction (the "Spin Off") in which the Company does not
receive compensation for such business, operations or assets, but causes
securities of another entity (the "Spin Off Securities") to be issued to
security holders of the Company, then the Company shall cause (i) to be reserved
Spin Off Securities equal to the number thereof which would have been issued to
the Holder had all of the Holder's unexercised Warrants outstanding on the
record date (the "Record Date") for determining the amount and number of Spin
Off Securities to be issued to security holders of the Company (the "Outstanding
Warrants") been exercised as of the close of business on the trading day
immediately before the

<Page>

Record Date (the "Reserved Spin Off Shares"), and (ii) to be issued to the
Holder on the exercise of all or any of the Outstanding Warrants, such amount of
the Reserved Spin Off Shares equal to (x) the Reserved Spin Off Shares
multiplied by (y) a fraction, of which (I) the numerator is the amount of the
Outstanding Warrants then being exercised, and (II) the denominator is the
amount of the Outstanding Warrants.

          7.   TRANSFER TO COMPLY WITH THE SECURITIES ACT; REGISTRATION RIGHTS.

               7.1  TRANSFER. This Warrant has not been registered under the
Securities Act of 1933, as amended, (the "Act") and has been issued to the
Holder for investment and not with a view to the distribution of either the
Warrant or the Warrant Shares. Neither this Warrant nor any of the Warrant
Shares or any other security issued or issuable upon exercise of this Warrant
may be sold, transferred, pledged or hypothecated in the absence of an effective
registration statement under the Act relating to such security or an opinion of
counsel satisfactory to the Company that registration is not required under the
Act. Each certificate for the Warrant, the Warrant Shares and any other security
issued or issuable upon exercise of this Warrant shall contain a legend on the
face thereof, in form and substance satisfactory to counsel for the Company,
setting forth the restrictions on transfer contained in this Section.

               7.2  REGISTRATION RIGHTS. (a) Reference is made to the
Registration Rights Agreement (as that term is defined in the Funding Agreement
between the Company and the Shaar Fund Ltd.). The Company acknowledges its
obligations to the Holder as third party beneficiary under the Registration
Rights Agreement with respect to the Warrant Shares, which are incorporated
herein by reference.

               (b) In addition to the registration rights referred to in the
preceding provisions of Section 7.2(a), effective after the expiration of the
effectiveness of the Registration Statement as contemplated by the Registration
Rights Agreement, the Holder shall have demand piggy-back registration rights
with respect to the Warrant Shares then held by the Holder or then subject to
issuance upon exercise of this Warrant (collectively, the "Remaining Warrant
Shares"), subject to the conditions set forth below. If, at any time after the
Registration Statement has ceased to be effective, the Company participates
(whether voluntarily or by reason of an obligation to a third party) in the
registration of any shares of the Company's stock, the Company shall give
written notice thereof to the Holder and the Holder shall have the right,
exercisable within ten (10) business days after receipt of such notice, to
demand inclusion of all or a portion of the Holder's Remaining Warrant Shares in
such registration statement. If the Holder exercises such election, the
Remaining Warrant Shares so designated shall be included in the registration
statement at no cost or expense to the Holder (other than any costs or
commissions which would be borne by the Holder under the terms of the
Registration Rights Agreement). The Holder's rights under this Section 7.2 are
subject to the following conditions: if there is a managing underwriter of the
offering of shares referred to in the registration statement and such managing
underwriter advises the Company in writing that the number of shares proposed to
be included in the

<Page>

offering will have an adverse effect on its ability to successfully conclude the
offering and, as a result, the number of shares to be included in the offering
is to be reduced, the number of Remaining Warrant Shares of the Holder which
were to be included in the registration (before such reduction) will be reduced
pro rata with the number of shares included for all other parties whose shares
are being registered.

          8.   NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage pre-paid. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission,
or, if mailed, two days after the date of deposit in the United States mails, as
follows:

               (i)      if to the Company, to:

                        BIO-KEY INTERNATIONAL, INC.
                         1285 Corporate Center Drive
                        Suite 175
                        Eagan, Minnesota 55121
                        Telephone No.: (651) 687-0414
                        Telecopier No.:

               with a copy to:

                        Choate, Hall & Stewart
                        Exchange Place
                        53 State Street
                        Boston, Massachusetts 02109
                        Attn: Charles J. Johnson, Esq.
                        Telephone No.: (617) 248-5000
                        Telecopier No.: (617) 248-4000

               (ii)     if to the Holder, to:

                        Krieger & Prager, Esqs.
                        39 Broadway
                        New York, New York 10006
                        Telephone No.: (212)363-2900
                        Telecopier No.  (212)363-2999

Any party may, by notice given in accordance with this Section to the other
parties, designate another address or person for receipt of notices hereunder.

          9.   SUPPLEMENTS AND AMENDMENTS; WHOLE AGREEMENT. This Warrant may be
amended or supplemented only by an instrument in writing signed by the parties
hereto. This Warrant contains the full understanding of the parties hereto with
respect to the subject matter

<Page>

hereof and thereof and there are no representations, warranties, agreements or
understandings other than expressly contained herein and therein.

          10.  GOVERNING LAW. This Warrant shall be deemed to be a contract made
under the laws of the State of New York and for all purposes shall be governed
by and construed in accordance with the laws of such State applicable to
contracts to be made and performed entirely within such State, except to the
extent that the Minnesota Business Corporation Act would apply to the internal
corporate governance of the Company. Each of the parties consents to the
jurisdiction of the federal courts whose districts encompass any part of the
City of New York or the state courts of the State of New York sitting in the
City of New York in connection with any dispute arising under this Warrant and
hereby waives, to the maximum extent permitted by law, any objection, including
any objection based on FORUM NON CONVENIENS, to the bringing of any such
proceeding in such jurisdictions. To the extent determined by such court, the
Company shall reimburse the Holder for any reasonable legal fees and
disbursements incurred by the Buyer in enforcement of or protection of any of
its rights under this Warrant.

          11.  COUNTERPARTS. This Warrant may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.

          12.  DESCRIPTIVE HEADINGS. Descriptive headings of the several
Sections of this Warrant are inserted for convenience only and shall not control
or affect the meaning or construction of any of the provisions hereof.

<Page>

          IN WITNESS WHEREOF, the parties hereto have executed this Warrant as
an instrument under seal.

                              BIO-KEY INTERNATIONAL, INC.

                              By:
                                 ---------------------------------
                                 Michael W. DePasquale
                                 Chief Executive Officer

Attest:

------------------------
Name:
Title:

<Page>

                          NOTICE OF EXERCISE OF WARRANT

          The undersigned hereby irrevocably elects to exercise the right,
represented by the Warrant Certificate dated as of _______________, 2001, to
purchase _____ shares of the Common Stock, par value $0.01 per share, of
BIO-KEY INTERNATIONAL, INC. and tenders herewith payment in accordance with
Section 1 of said Common Stock Purchase Warrant.

          Please deliver the stock certificate to:

Dated:

By:

9         CASH: $ ____________________

9         CASHLESS EXERCISE

AGGREGATE MARKET VALUE OF _____ SHARES                   $_______________

AGGREGATE CASH EXERCISE PRICE OF _______ SHARES          $_______________

          DIFFERENCE) MARKET VALUE                  $_______________

          NUMBER OF SHARES ISSUABLE

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00076-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00076-of-00352.parquet"}]]