BIO-key Strengthens Capital Structure with Successful Stock Conversion

“The conversions simplify and strengthen BIO-key’s capital structure while eliminating all future dividend payment requirements.” – Mike DePasquale, CEO, BIO-key

BIO-key has completed a capital restructuring effort, announcing that all outstanding shares of its Series A-1 and Series B-1 Convertible Preferred Stock, along with unpaid dividends, have been converted into common stock. The maneuver ensures that going forward, the company will no longer need to issue annual preferred stock dividend payments, saving about $638,000 in such future payments.

In a statement announcing the development, BIO-key CEO Mike DePasquale thanked the company’s erstwhile preferred stock holders and emphasized the benefits of the maneuver to all concerned, noting that the holdings and dividends were converted into common stock at a premium of about 61 percent. “The conversions simplify and strengthen BIO-key’s capital structure while eliminating all future dividend payment requirements,” he asserted.

It’s another example of BIO-key’s focus on the long term with respect to its business planning. Shortly after issuing a revenue guidance of between $8 million and $12 million for the 2018 fiscal year, the company published Q1 results indicating a year-over-year drop in revenues and a net loss; undeterred, the company’s leadership noted that quarterly fluctuations in BIO-key’s business are normal, and maintained the previously announced revenue guidance for the year.

Given that 2017 was a very successful one for BIO-key, and that interest in the kinds of biometric security solutions offered by the company continues to grow, its long-term investors are evidently bullish on BIO-key’s long-term prospects as well.

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June 4, 2018 – by Alex Perala