BIO-key International raises $8.45M
Biometrics solution provider BIO-key International has raised $8.45 million through the issuance of shares of its Series A-1 Convertible Preferred Stock, at a conversion price of $0.30 per share, to an unnamed Hong Kong based security technology investor.
Under the terms of the agreement, the investor has the right to appoint one director to BIO-key’s board of directors.
Net proceeds to BIO-key after expenses were approximately $8.4 million, which BIO-key will use primarily to fund operations and expand its sales, marketing and product development efforts.
“Today’s strategic investment is a transformative event for BIO-key as it substantially strengthens our financial position to aggressively pursue sales and business development opportunities on a global basis, said Mike DePasquale, chairman and CEO of BIO-key. “We also plan to enhance our operations, management and finance teams and processes to support future growth.
“With a solid working capital base, we are now able to fund the completion of software development for strong support of Apple’s iOS ‘Touch ID’ and Samsung’s Android smartphone technology while also enhancing the capabilities of other BIO-key solutions and developing new turnkey hardware/software products.”
BIO-key reported that the investment was made in connection with its previously announced memorandum of understanding regarding a potential equity investment.
The company said it remains in talks regarding this potential investment and a license agreement for development software and source code for point-to-point identification using biometric encryption and decryption technologies controlled by affiliates of the potential investor.
The terms of the proposed license agreement would involve the placement of approximately $11 million of convertible preferred shares, which would be used to fund the technology license agreement.
BIO-key also recently begin the process of establishing a presence in Asia to support its regional business development efforts, which included creating a subsidiary in Hong Kong and opening an office in the People’s Republic of China that will be staffed by small teams.
Previously reported, BIO-key International reported record results for its second quarter ended June 30, 2015, with a record-revenue of $2.3 million and a net income of $753,000.