BIO-key Sells Secured Note for $2.1 Million

BIO-key has raised just over $2 million through the sale of a Senior Secured Convertible Note to Lind Global Macro Fund. The note was worth $2,415,400, which led to $2.1 million in funding at the closing of the sale.

The biometric specialist will set aside some of the money to repay outstanding debt. The rest will go toward the company’s general working capital.

“BIO-key completed this funding to ensure that we have sufficient financial resources to fund our business and execute on our growth strategy,” said BIO-key CEO Michael DePasquale. “We believe this financing structure, including its above-market conversion price and 12-month repayment schedule, provides an attractive source of capital for our company as we start our recently announced contracts in Africa and deal with the current coronavirus pandemic.”

Lind has the option to convert the note into BIO-key shares at a fixed price of $1.16 per share, while the note itself is secured with a priority lien on BIO-key’s assets. BIO-key will pay off the principal with five monthly installments of $268,333, with the first installment due seven months after the date of funding. The company can pay the note in full at any time, although Lind will have the option to convert 25 percent of the outstanding principal into BIO-key shares.

BIO-key recently opened an African subsidiary in Nigeria, and has already signed $30 million and $45 million contracts with a telecommunications company and the Nigerian Ministry of Labour, respectively.

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May 7, 2020 – by Eric Weiss