BIO KEY INTERNATIONAL INC

The following table sets forth a summary of the compensation paid to or accrued by our chief executive officer and thetwo most highly compensated executive officers other than our chief executive officer, for the fiscal years ended* December 31, 2025and2024*:

SUMMARY COMPENSATION TABLE

Narrative Disclosure to Summary Compensation Table

Compensation for our executives is comprised ofthree main components: base salary, annual performance-based cash bonus, and long-term equity awards. We donot target a specific weighting of thesethree components or use a prescribed formula to establish pay levels. Rather, the board of directors and compensation committee considers changes in the business, external market factors and our financial position each year when determining pay levels and allocating between long-term and current compensation for the named executive officers.

Cash compensation is comprised of base salary and an annual performance-based cash bonus opportunity. The compensation committee generally seeks to set a named executive officer’s targeted total cash compensation opportunity within a range that is the average of the applicable peer company and/or general industry compensation survey data, adjusted as appropriate for individual performance and internal pay equity and labor market conditions.

In setting cash compensation levels, we favor a balance in which base salaries are generally targeted at slightly below the peer average and a bonus opportunity that is targeted at slightly above the average. In2025, we increased the base compensation of our executive officers based on their collective efforts in managing key accounts, completing a series of financing transactions over the pasttwo years, and the fact that base compensation levels hadnot been increased since2022. Effective* July 1, 2024,we restored the2023* based compensation of Mr. DePasquale, Mr. Sullivan and Ms. Welch. Effective* January 16, 2023,*we decreased the base compensation of Mr. DePasquale, Mr. Sullivan and Ms. Welch as part of the revised budget for the year.

Performance-based bonuses have historically been based upon the achievement of certain revenue milestones established by the compensation committee. The committee believes that this higher emphasis on performance-based cash bonuses places an appropriate linkage between a named executive officer’s pay, his or her individual performance, and the achievement of specific business goals by placing a higher proportion of annual cash compensation at risk, thereby aligning executive opportunity with the interests of stockholders.

30

We also include an equity component as part of our compensation package because we believe that equity-based compensation aligns the long-term interests of our named executive officers with those of stockholders. In2025 and2024, we issued restricted stock awards to each of our named executive officers.

These cash and equity compensation components of pay are supplemented by various benefit plans that provide health, life, accident, disability and severance benefits, most of which are the same as the benefits provided to all of our US based employees.

Employment Agreements

On* March26,* 2010, we entered into an employment agreement, effective as of* March25,* 2010, with Michael W. DePasquale to serve as our Chief Executive Officer until* March 24, 2011.The agreement automatically renews for subsequentone*-year terms, unless the employment relationship is terminated by either party, or modified in accordance with the terms and conditions of the agreement. Since2018, Mr. DePasquale’s annual base salary has been*$275,000,* subject to adjustment by the compensation committee. In addition to the base salary, a “Performance Bonus”* maybe awarded to Mr. DePasquale on the basis of the Company achieving certain corporate and strategic performance goals, as determined by the compensation committee in its sole discretion. The employment agreement contains standard and customary confidentiality, non-solicitation and “work made for hire” provisions as well as a covenantnot* to compete which prohibits Mr. DePasquale from doing business with any current or prospective customer of the Company or engaging in a business competitive with that of the Company during the term of his employment and for theone-year period thereafter. This agreement also contains a number of termination and change in control provisions as described under the captions “Termination Arrangements” and “Change in Control Arrangements” below.

On* April 5, 2017,we entered into an employment agreement with James Sullivan. The agreement automatically renews for subsequentone*-year terms, unless terminated by the Company upon at leasttwo months prior written notice which is treated as termination without cause. Since2021, Mr. Sullivan’s annual base salary has been*$225,000,* subject to adjustment by the compensation committee. The agreement contains standard and customary confidentiality, technical invention provisions as well as non-competition and non-solicitation covenants which prohibit Mr. Sullivan from doing business with any current or prospective customer of the Company or engaging in any business competitive with that of the Company during the term or his employment and for theone-year period thereafter. The agreement also contains a number of termination provisions as described under the caption “Termination Agreements” below.

On* May 15, 2013,we entered into an employment agreement with Cecilia Welch to serve as the Chief Financial Officer of the Company until May 2014.The agreement automatically renews for subsequentone*-year terms, unless the employment relationship is terminated by either party, or modified in accordance with the terms and conditions of the agreement. The employment agreement contains standard and customary confidentiality, technical invention provisions, as well as a covenantnot to compete, which prohibits Ms. Welch from doing business with any current or prospective customer of the Company or engaging in a business competitive with that of the Company during the term of her employment and for theone-year period thereafter. This agreement also contains a number of termination provisions as described in “Termination and Change in Control Arrangements” in this Item.

Stock Option Grants and Restricted Stock Awards

In the event of any change in the outstanding shares of our common stock by reason of a stock dividend, stock split, combination of shares, recapitalization, merger, consolidation, transfer of assets, reorganization, conversion or what the board deems to be similar circumstances, the number and kind of shares subject to outstanding options and restricted stock awards, and the exercise price of such options shall be appropriately adjusted. Restricted Furthermore, option agreements and restricted stock award agreements contain change of control provisions as described under the caption “Change in Control Provisions” below.

31

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

The following table sets forth for each named executive officer, information regarding outstanding equity awards (as adjusted to reflect our1-for-10 reverse stock split, which was effective* April 30, 2026)at December 31, 2025*.

Narrative Disclosure to Outstanding Equity Awards at Fiscal Year End Table

The following are the material terms of each agreement, contract, plan or arrangement that provide for payments toone or more of our named executive officers at, following or pursuant to their resignation, retirement or termination, or in connection with a change in control of the Company.

Termination Arrangements

We* mayterminate our employment agreement with Mr. DePasquale at any time with or without cause. In the event of termination by us without cause, we will continue to pay Mr. DePasquale his then current base salary for the greater ofnine* months from the date of such termination or the number of months remaining until the end of the term of the agreement.

We* mayterminate our employment agreement with Mr. Sullivan at any time with or without cause. In the event of termination by us without cause, we will continue to pay Mr. Sullivan his then current base salary, plus earned commissions, for the greater ofsix* months from the date of such termination or the number of months remaining until the end of the term of the agreement.

We* mayterminate our employment agreement with Ms. Welch at any time with or without cause. In the event of termination by us without cause, we will continue to pay Ms. Welch her then current base salary for the greater ofsix* months from the date of such termination or the number of months remaining until the end of the term of the Agreement.

32

Change in Control Provisions

Our2015 Equity Incentive Plan (the “Plan”) provides for the acceleration of vesting of unvested options and termination of any restriction or forfeiture provisions applicable to restricted stock awards upon a “Change in Control” of the Company. A Change in Control is defined in the Plans to include (i) a sale or transfer of substantially all of the Company’s assets; (ii) the dissolution or liquidation of the Company; (iii) a merger or consolidation to which the Company is a party and after which the prior stockholders of the Company hold less than50% of the combined voting power of the surviving corporation’s outstanding securities; (iv) the incumbent directors cease to constitute at least a majority of the Board of Directors; or (v) a change in control of the Company which would otherwise be reportable under Section13 or15(d) of the Exchange Act. In the event of a “Change In Control” the Plan provides for the immediate vesting of all options issued thereunder and termination of all forfeiture provisions applicable to restricted stock award issued thereunder. Options issued to executive officers outside of the Plans contain change in control provisions substantially similar to those contained in the Plans.

Our2023 Stock Incentive Plan (the*“2023* Plan”) provides for the Board or the Compensation Committee, as applicable, to accelerate the of vesting of unvested options and termination of any restriction or forfeiture provisions applicable to restricted stock awards upon a “Change in Control” of the Company. A Change in Control is defined in the2023 Plan to include (i) a sale or transfer of substantially all of the Company’s assets; (ii) a merger or consolidation to which the Company is a party and after which the prior stockholders of the Company hold less than50% of the combined voting power of the surviving corporation’s outstanding securities; (iii) the incumbent directors cease to constitute at least a majority of the Board of Directors; (iv) any person becomes directly or indirectly the beneficial owner of40% of the combined voting power of our outstanding securities; or (v) a change in control of the Company which would otherwise be reportable under Section13 or15(d) of the Exchange Act.

Our employment agreement with Mr. DePasquale contains a change in control provision that is triggered if Mr. DePasquale isnot offered continued employment with us or any successor, or withinfive years following such Change of Control, we or any successor terminate Mr. DePasquale’s employment without cause. If this occurs, then we will pay Mr. DePasquale his base salary and benefits earned but unpaid through the date of termination, and any prorated bonus earned during the then current bonus year, plustwo times his then current base salary.

Policies and Practices Related to the Grant of Certain Equity Awards Close in Time to the Release of Material Nonpublic Information

During2025, we didnot grant any stock options as part of our equity compensation program. If stock options are granted in the future, we intend tonot grant stock options or similar awards in anticipation of the release of material nonpublic information that is likely to result in changes to the price of our common stock, such as a significant positive or negative earnings announcement, andnot time the public release of such information based on stock option grant dates.

33

DIRECTOR COMPENSATION

The following table sets forth for each director, information regarding their compensation for the year ended* December 31, 2025*:

Narrative Disclosure to Director Compensation Table

During2025, we changed our policy to increase the board fees payable to each non-employee to*$3,500* per board meeting. The Directors still receive*$1,000* per board committee meeting attended. Fees for attendance at regular quarterly board meetings held during thefirst three quarters of each fiscal year are paid through the issuance of common stock and payments for the last meeting of the year are paid in cash or, at the option of the director, in shares of common stock. All of our directors elected to receive payment in common stock for thefirst board meeting in2025. All directors will be indemnified by us for actions associated with being a director to the fullest extent permitted under Delaware law. We reimburse each of our non-employee directors for their reasonable expenses incurred in connection with attending meetings of the board of directors and related committees.

34