Good morning, everyone. Thank you for standing by, and welcome to BIO-key International second quarter 2026 conference call. During management's prepared remarks, all participants will be in listen-only mode. Afterwards, listeners will be invited to participate in a question and answer session. As a reminder, this conference is being recorded today, Friday, August 14th, 2026. I will now turn the call over to Bill Jones of Investor Relations. Please go ahead. Thank you, Chloe. Hosting today are BIO-key's Chairman and CEO, Mike DePasquale, and its CFO, Ceci Welch. As a reminder, today's call and webcast, as well as answers to investor questions, include forward-looking statements. These are subject to risks and uncertainties that may cause actual results to differ materially from current expectations. Words such as "anticipate," "believe," "expect," "plan," or "project," and similar words, identify and express forward-looking statements. These statements are made based on beliefs, assumptions and information currently available to management pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act. For a more complete description of these risks and uncertainties that affect future performance, please see risk factors in the company's annual report on Form 10-K and the current Form 10-Q filed with the SEC. Listeners are cautioned not to place undue reliance on forward-looking statements made as of today, and the company makes no obligation to revise or disclose revisions to forward-looking statements to reflect circumstances or events occurring after this call. Now I'll turn the call over to Mike to begin. Mike? Thanks, Bill, and thank you all for joining us this morning. After my remarks, Ceci will review the financials, and then we will take investor questions. Let me start with the headline. Our second quarter bottom line improved 51% on 13% revenue growth. For the first half of the year, our net loss improved almost 60% on 23% growth in revenues. To be clear, these results didn't meet our proposed expectations, not because of any softness in demand, but due to a delayed shipment for a hardware order that we had anticipated in Q2. The order was delayed, and we expect to ship it in the second half of the year. Considering that shift, combined with the opportunities already in our pipeline, we expect continued growth and are targeting profitability for the second half of 2026. Let me spend some time talking about what's driving our outlook. It's really about the broader momentum we're building, particularly across Europe, the Middle East, and Africa, or EMEA, which is really starting to bear fruit. We're closing deals, adding productive channel partners, and developing new project discussions at an accelerated pace, all of which fundamentally underlie our business momentum. Our revenue gains are also supported by strong secular backdrops. According to Future Market Insights, the global market for authentication solutions is projected to grow rapidly over the next 10 years, from roughly $26 billion this year to over $114 billion by 2036. This represents a 16% compounded annual growth rate as organizations of all kinds and all sizes take action to defend against increasingly sophisticated cyber threats. In the area of passwordless authentication, where BIO-key delivers industry-leading solutions, a recent FIDO Alliance report found that 68% of organizations are actively deploying or piloting Passkeys for employee sign-in. In addition to our biometric and Passkey:YOU passwordless solutions, our flexible authentication platform, PortalGuard, supports 16 different authentication factors and doesn't depend on any single device. This provides us with a unique ability to support complex authentication environments because when it comes to enterprise and government authentication needs, one size simply doesn't fit all. To put that in context, let me walk through several recent wins and partnerships, most of which were announced just in the past few weeks. In the Middle East, we partnered with Maktabi Tech to bring PortalGuard, including passwordless authentication and Identity-Bound Biometrics, to educational institutions in Saudi Arabia, supporting their Vision 2030 digital transformation agenda, as well as to Jordan and the UAE. Separately, the Central Bank of Jordan is working with us on a national initiative to modernize authentication across the country's financial sector using our PortalGuard and WEB-key technologies to move away from passwords and tokens entirely. We believe growing examples of national scale mandates, including sovereign ID, represent the future of authentication in the region, a future where we intend to play a substantial role. Turning to Europe, a national security agency in Portugal selected BIO-key and our in-country partner, Visualforma, to deploy PortalGuard and WEB-key with our FBI-certified EcoID III fingerprint scanners. This follows our earlier nationwide public sector rollout and a digital identity contract we secured with Visualforma for deployment in a major Portuguese tourist city. It's an example of how one successful public sector deployment can help foster additional opportunities as trust and reference relationships continue to build over time. In the U.S., Alabama's AOD Federal Credit Union, which serves more than 37,000 members, deployed our phishing-resistant biometric-based authentication solution through our partner, BlueAlly, citing our platform's flexibility versus alternatives that they evaluated, as well as reduced help desk burden from eliminating frequent password resets. As phishing and MFA fatigue attacks escalate against financial institutions, our Identity-Bound Biometrics is gaining traction as smart and powerful protection with a compelling cost of ownership. I'll also note we continue to see attractive second-half opportunities building in our EMEA pipeline, as our momentum in the region is broad-based, spanning government, defense, financial services, and now education. We believe this reflects rising urgency among these customers, driven both by increasing cybersecurity incidents and growing geopolitical tensions, and supported by generally more favorable regulatory frameworks that let us move from first conversation to signed contracts much more quickly. In the second quarter, we completed a 1-for-10 reverse stock split to support our continued Nasdaq listing. In July, we regained compliance with the Nasdaq listing rules and resumed trading on the NASDAQ Capital Market, which provides a visible and respected platform for our common stock. Earlier this week, we enhanced our financial liquidity and balance sheet through a warrant transaction that raised gross proceeds of $2.5 million. This new capital will continue to support our operations, more importantly, our growth initiatives and perceived financial strength with prospective customers, while also bolstering our compliance with current and proposed listing requirements. Most importantly, we are focused on executing against the significant opportunities in front of us. Our go-to-market model continues to scale efficiently through partners. Roughly half of our new U.S. business and virtually all of our international business is developed through our channel network. On the domestic public sector side, we are building out our working relationship with our new partner, DLT Solutions, a division of TD SYNNEX. This relationship provides a streamlined procurement path into DLT's very large base of public sector customers, most of whom must work with pre-approved vendors to meet Zero Trust and MFA mandates. On the product side, our major PortalGuard 7.0 platform upgrade is now being demonstrated to prospects and has already begun to roll out more broadly across our existing customer base. I will now touch on an area of exciting potential, which is the role biometric authentication can play in securing the AI ecosystem, as we believe that human oversight of agentic operations really is a killer app opportunity for biometrics. Several recent high-profile AI control failures have helped to highlight the need and the potential for biometrics to play a critical role in providing non-repudiable authentication and approval for material AI agent actions. This is not just our internal view. In January, the first government's framework built specifically for Agentic AI was released at the World Economic Forum's annual meeting with a central pillar that humans must remain meaningfully accountable for decisions and actions taken by autonomous systems. We see biometrics as the ideal method for enabling such human control. Separately, the Cloud Security Alliance have described a governance vacuum around non-human identities as service accounts, bots, and AI agents now outnumber human users inside many enterprises by more than 100 to one. Most organizations have no reliable way to tie an agent's actions back to an accountable person. Chief Information Security Officers rank identity assurance for an AI world as a top security priority in 2026 and 2027. We think that is exactly the gap that biometric Identity-Bound Biometrics authentication is built to close, anchoring high-stakes approvals to a real person rather than a device or a credential that can be shared, stolen, or cloned. We are actively working to develop strategies around our existing solutions such as Passkey:YOU and working to identify and develop strategic partners to build out AI governance connection points around this opportunity. Before I turn the call over to Ceci, I want to reiterate our excitement about the business progress so far this year and the strength of our outlook for the second half and moving forward. It's a genuinely exciting time for BIO-key, as the work we put into this business over many years is increasingly being recognized and, more importantly, validated by a growing base of private and public sector customers around the world. With that, I'll turn the call over to Ceci for her financial review. Thank you, Mike. We released our results after yesterday's close via press release and also filed our Form 10-Q. Let me walk you through some of the important highlights. Total revenue for Q2 2026 increased 13% to $1.92 million, compared to $1.7 million in Q2 2025. That growth was driven by a 53% increase in license fee revenue to $1.2 million from $800,000, reflected several new customer license agreements signed during the quarter. Hardware revenue decreased 19% to $460,000 from $569,000, principally due to the timing of customer deployments, including the absence of a large order Mike mentioned that shifted from Q2 into our second half, compared with a large deployment for a long-term customer in prior year period. Service, maintenance, and other revenue decreased 28% to $231,000 from $322,000 due to lower non-recurring service revenues tied to product customization and the timing of recurring revenue service agreements renewals. The first half of the year, total revenue grew 23%, also driven primarily by the license fee growth. Gross profit for the quarter increased 36% to $1.7 million from $1.2 million in Q2 2025, and gross margin improved to 87%, up from 73% a year ago. That improvement reflects growth as well as larger concentration of high-margin license fee revenue and increased benefit from sales of hardware inventory that had previously been fully reserved. Much of the reserved inventory relates to units originally purchased for projects that were delayed indefinitely during the pandemic. We have been selling that inventory into other markets, and since it's been fully reserved, those sales carry 100% gross profit contribution. Total operating expenses decreased 5% to $2.2 million, principally reflecting lower selling, general, and administrative expense from our ongoing cost containment efforts, partially offset by higher expenses related to the reverse stock split and audit and tax-related costs. In all, our Q2 2026 net loss improved to $577,000, or $0.56 per share, compared to a net loss of $1.17 million or $2.01 per share in Q2 2025, a 51% improvement. For the first half, our net loss improved 59% to $782,000 or $0.75 per share compared to $1.9 million or $3.61 per share in the first half of 2025. Weighted average common shares outstanding and per share results reflect an impact of the April 30th one-for-10 reverse stock split, as well as warrant exercises and other financing activities through June 30th. Turning to the balance sheet, stockholders' equity was $4.3 million as of June 30, and we had $3.8 million of current assets at the quarter end, including $1.4 million of cash and $1.7 million of accounts receivable and $376,000 of inventory. Following the quarter end, we reduced the outstanding balance due for our outstanding note by $350,000 or 51% to $325,000 in exchange for the issuance of 81,100 BIO-key shares or approximately $4.32 per share. As Mike mentioned, we raised gross proceeds of $2.5 million earlier this week through a warrant inducement transaction involving the share sale of 681,334 shares of common stock upon the exercise price of $4.06 per share, and the new issuance of warrants to purchase 1.2 million shares of common stock at an exercise price also $4.06 per share. Given the effect of the financing proceeds, the company's current cash position is now over $4.5 million, which provides ample working capital support for our operations and growth. As Mike outlined, we expect continued growth, and we are targeting profitability for the second half of the year. Operator, we can now proceed with questions and answers. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question today comes from Jack Vander Aarde with Maxim Group. Please go ahead. Okay. Good morning. Great update, Mike. Thanks for taking my questions. So Mike, maybe I'll start with a question on your business outlook for the back half of the year. You're expecting revenue growth and profitability, which is great to hear. Can you just maybe touch on that, I guess, specifically that large hardware order that got pushed into the second half? Do you have any line of sight there, visibility, how that's going to be allocated as it ships? And is it going to be or is it going to be allocated across both the third and the fourth quarter? It's hard for me to say right now. We'd like to see it all ship in the third quarter, but we'll see as things evolve. More importantly, Jack, that's not the only large order or let's say project or contract that we're working for the second half. What I didn't mention in my prepared remarks is what we're really enthused and excited about is the size of our orders, and the size of our contracts are going up significantly. As we work in the regulated industries, especially in government, defense, and in banking, the opportunities in general themselves are bigger, right? The user counts and user population are larger, and so therefore, so are the value of those contracts. The reason that we're enthused and excited about continued growth in the second half and obviously getting to profitability is we need just a couple of those large ones to fall and we should easily get there. So it's that order and many others that we're working in the second half as well in our pipeline. Okay, great. No, I appreciate all that. Of course, it's really growth across the board here. If I look at your license revenue as well, that did look like it picked up a bit here in the second quarter. Just sort of kind of housekeeping question. Normally, you have that a slower third quarter sometimes in the licensing front because of EMEA. Now, things have changed a little bit in your business model, but do we expect growth across, I guess, all the segments as well then in the back half, including license revenue? Yeah. Well, first of all, license revenue is growing, and that's really what we're after, right? I mean, that's what drives our gross margin and maintaining a high gross margin because most of our customers who buy our biometric, Identity-Bound Biometrics solutions, buy both hardware and software. But for sure, the third quarter given, again, EMEA, like right now, virtually everyone is off in August, so things don't pick up until first or so, first, second week of September. But I still feel like we have enough in the pipeline to have growth in the third quarter and absolutely, certainly significant growth in the fourth quarter as we close out the year. So, yeah, I think we're going to continue to see growth across the board. And license is what we're after, right? That's the business here. Recurring revenue, signing customers up, getting more contracts in play, and building a recovering revenue base. That and maintaining our expense levels. We had a little bit of a blip in the second quarter with one-time expenses. That was a one-time event. Our expenses have been very stable, if not declining. We need to hold in that realm, and we need to build that license revenue with gross margins in the 85% range. Most of what we sell drops to the bottom line. Yep. No, definitely. This is actually might be a historical record quarter on the gross margin front. I am looking back at my model here, but no, that was great to see. Plus you got this cash that came in with these warrant inducements. I think you are over $4 million of cash now kind of pro forma-wise. As you look forward and you are going to be profitable, I mean, what are the specific use cases for cash? Or is this just good working capital on hand to have and no further dilution expected? Well, there is no further dilution expected, that is for sure. At this point, we have adequate cash resources to not only operate our business, but to continue to invest in the areas, as I mentioned, around Agentic AI and securing that whole ecosystem right now is really a wonderful opportunity for biometrics. No one does it better than us. I mean, it is pretty clear, and we have been validating this, as I mentioned in my prepared remarks, with many prospect customers and in particular partners, that we have a very unique offering for roaming users and use cases where phones and tokens just don't work. Because, again, users cannot have, for example, a phone in their hand if they are in a service bay, or they don't want them with a phone in a call center where you can take photographs of customer records and that kind of thing. We have got the perfect solution, and our Passkey:YOU offering, which is now ramping, is going to be a really big benefit for us. We are just really optimistic about being able to take advantage of that. But yeah, we are not anticipating any additional dilution at this point. We have got adequate cash on hand to continue to operate our business, and we would like to keep working capital at the highest level we can. It gives us credibility with our prospects and our customers. That was the impetus behind doing this last raise that we did. Okay, great to hear. Just because you mentioned it, maybe one more question is asking you, just do you have a rough sense what percentage or just roughly how much of that is a business driver for your results, I guess in the back half to get profitable or your revenues recently? Just what does that make up in terms of BIO-key's overall revenue mix? Well, we're just scaling up. It's hard for me to give you a percentage, but it's the kind of solution. Maybe put it in context. It's a solution that can be sold anywhere to anyone, even if they're running today a competitive offering. Let's just take a classic Okta, ForgeRock, Duo, SailPoint customer that has those use cases that I just mentioned. They have employees in the call center. They have service employees that cannot utilize a phone or a token. They can take advantage of our solution because it can just bolt on to their existing, what we call IDP. It can just bolt on and can be utilized today without changing out their infrastructure. That's pretty powerful. We don't really know what the potential is over the next probably 12 months, but it's significant. As we continue to. Right now we're in a number of different evaluations and pilots with some large customers. As we get more data and information on that, I think we'll be able to predict. At this point, we know it's large. We'll see how large. By the way, if we can attach this directly to those partners for them to make available to their customers that are in those fringe use cases, it can be even bigger. It could be really significant. But we have work to do. Excellent. Well, great to hear, Mike. I appreciate all the time, and I'll hop back in the queue. Thanks. Thank you. Again, if you have a question, please press star then one. The next question comes from Dan Khamis, private investor. Please go ahead. Good morning. Morning. Hi. The Bank of Jordan, the release said that the central bank was developing an initiative. Does that mean that they're studying what they want to do, or have they been? Are you contracted and actually receiving revenues, like in the second quarter or expect in the third quarter? Yes. We are, and we are expecting it to be much more significant going forward. In the second half, and then obviously into the first part of 2027. As we described in that press release, it is a significant initiative that could impact their entire user population. If you think about our South African bank customer, where we are generating well over $1 million in ARR, it certainly has that potential and capability. But we will crescendo to that over the next probably two to three quarters. I see. Will you be selling hardware? Both hardware and software, but obviously our focus is on the software, right? The user counts. That is always driving. Well, again, our blended gross margins are really, really good, 75% +. But obviously, software is a higher gross margin. I see. What has to happen for you to actually ramp up and make some of these bigger sales? Is there some pilot that happens? We're really in the deployment planning stage right now. It's how we go from point A to point B. There's a lot of work when you're doing a deployment this large, right? There's not only, there's logistics, there's everything, right? Provisioning, logistics, all that kind of stuff. We're in the planning stages with them right now. I see. My question is this like a pilot where they'll then decide whether they want to continue to ramp? No, no. We're well beyond that. Yeah, we've been selected. I think the press release was clear on that, as was the quote from the senior cyber resource who's been working with us. I see. Was that a competitive bid? Believe it or not, it was a competitive situation, and we were selected sole source. Okay. All right, let's switch to the Portugal release. How do we estimate the value of the rollout of BIO-key's IAM and biometric authentication technologies to the Portugal's public sector ecosystem? And what is your margin considering you're partnering with Visualforma? The margins are the same. Typically, a partner, it could be Visualforma or it could be DLT, could be any one of our partners, domestic or international. Typically, they get a 25%, anywhere from 20%-30% on the high-end discount off the software. But again, the gross margin to us, because it's software, is the same. So it's 85% of a lower number, but it's 85%. So typically, again, Dan, that's the classic partner discount that these partners get. So generally, they get a discount on the software, and then they're providing services to the customer, right? That's where they really make most of their money, right? Obviously they get a margin on selling the product, but their real business is providing the services and all of the support to the end customers. In EMEA, 100%. It doesn't matter how large the enterprise is or how small they are, they're generally buying through an MSP, MSSP, or reseller, or a distributor. So that's the way that model works, and it really is a force multiplier. We bought the Swivel Secure Europe business. When we bought it almost five years ago now, we bought that to get the distribution channel and the resources that we have there now in EMEA to sell through our products, right? We were always planning on a transition from selling the Swivel product to BIO-key product, right? The Swivel product had a 50% gross margin. Our BIO-key products have margins that are significantly higher than that. What's astounding to me, especially over the last year, given that we jettisoned the SSE product and decided not to renew that contract, it's amazing how these partners have very rapidly picked up on the BIO-key solutions and the biometric component in the BIO-key solutions that they're now selling through to all these customers. It really is amazing, and that's why we have such a significant pipeline there. Okay. The first part of that question was, how do we value the rollout to the public sector for modeling? You're talking about a country, you're talking about a public sector component in, I call it state and local, right? We did sell a large municipality a solution that now can be replicated into 50 or 100 types of scenarios like that. Then you have what we announced last week or the week before was a federal government agency that secured our product for a very high profile defense-related initiative. So that was federal. We sold about four to six months ago, a municipal type scenario, and now connect the dots, you got references. What is that potential? It's certainly in the millions of ARR over the next quarters. But again, that business will be developed in combination with that partner and other partners as well that are selling in that space. I see. Now, I think Portugal's got about 1 million people in their public sector. So are you basically looking to get that whole niche over the next couple of years or something like that? Is that what we're looking at? Well, again, if you're thinking about state and local, that's one thing. Think about all the government-related initiatives in security, in military, in intelligence, right? These are all the things that are ramping up, not just in Portugal. They're ramping up in every country in the region, in the fuller EMEA region, not just in Europe, in the Middle East. Look at the way the countries in the Middle East are ramping from a defense initiative perspective, from an intelligence perspective. This is why I think our business there has just astounding potential because we're now collaborative. As a country, we are collaborating more with those Middle Eastern countries than we ever have before. They're buying a lot from us on the defense side, right? Not just weapons, but we're collaborating from an intelligence perspective. We're collaborating from a financial perspective. I just think the potential is incredible. Got it. Well, Saudi Arabia. One other thing, Dan. We have references. Yeah. Like real references. Right. When we find an opportunity or an opportunity comes to the doorstep through a partner, it is easy for us to refer them to someone who is already using the solution to solve a similar problem. To me, that is huge. That is 60% of what you need to continue to build and scale a business. Yeah, I understand. On Saudi Arabia, I found it interesting that they were interested in your technology for education, not necessarily for finance and defense. Is there an opportunity there? Well, there is. Again, it all comes down to the partners, right? We signed on a partner that has a very strong base in education. We have the references in other applications where it is being used. Here to what I just described is a proof point that we can continue to find ourselves expanding into other sectors of the economy, and education is just one of them. We have a very large project in healthcare in a Middle Eastern country that we are deploying right now. A lot going on. Okay. You said Jordan wasn't with sole source. Is that true of some of these other ones, too? Is there any competition? I'm just kind of wondering, who are you competing against on these. Yeah. Things you're winning? Many of these projects come in through partners, but also come in through large technology partner companies as well. For example, we have been working very closely with SailPoint in the Middle East, who has multi-million dollar contracts to provide security solutions, mostly for governance and not necessarily authentication. They need an authentication partner, someone who has the flexibility and someone who provides the biometrics like we do, which is very unique. That's why our business is growing. It's the relationships with the partners and the big technology companies that are driving these large contracts on these international opportunities. That's where our group, in particular in EMEA, has done an incredible job. They've been doing this for 15 years. That partner network that we built there is very valuable because it takes a lot of time to build that network. It takes even more time to get real deals going with them. It takes just really good relationship management to continue to grow and scale the business. Got it. Let's move to the U.S. The U.S. financial system seems to me like it's been quite resistant to moving towards Identity-Bound Biometrics. Is the Alabama Federal Credit Union any kind of even minor harbinger of change for that in the U.S.? I think it is, Dan. I think that the whole First of all, the cyber attack acceleration, especially since we've been engaged with the international altercations and geopolitical stuff that we're going through, is kind of escalating. That's number one. Number two, I think the Agentic AI situation has everyone on edge. You're right. Biometrics in general. There was this perception that biometrics infringed on privacy, and the U.S. was all about protecting your privacy. Not caring necessarily about your security. I shouldn't say not caring, but caring less about the security and more about your privacy. That line is moving, for sure, because good security protects your privacy. It doesn't impinge or impinge on your privacy. That perception of biometrics potentially impinging on privacy is really starting to move. I think consumers are starting to recognize that as well. They're also recognizing the convenience of a biometric. They're also seeing that the traditional SMS multi-factor type authentication, that the hard token that we've been using for years to validate accounts are going away. I mean, Microsoft announced it fundamentally that they're killing SMS authentication in Entra over the next couple of quarters, and they're going to Passkeys. Passkeys connote a direct, convenient biometric option, which I think is going to accelerate the use of biometrics in general across the enterprise, and across consumer apps in the coming quarters. It's going to happen pretty quick. I see. Is there an opportunity with Microsoft there to partner in any way? I'd like to say yes, but on the other hand, if you look at Google and Microsoft, Google Authenticator and Microsoft with Entra, they've kind of gone it alone, I should say. They're trying to entrap all of their customers into utilizing everything that they make available. Most of the high-end, more experienced CISOs are rebelling against that because they don't want all their eggs in one basket. There, in my opinion, is the opportunity. It's not necessarily partnering with them. It's offering an alternative which is better, faster, and cheaper than they can provide. Okay. Because they may lure you in and offer you a new component for free, then next year when you get your renewal contract, you notice that you just got a 20% hit. Now you're already using the solution and it's very difficult to switch out. I think we play to that and we play very well there. Plus, we offer the 16 factors of authentication, including the biometrics, if that's in your bailiwick and you want to use it. That's our differentiator. I understand. Let's talk about AI a little bit. In this non-repudiable authenticational approval for these AI agents, what stops an AI agent from, say, intercepting a fingerprint and using it to authenticate later or identify later? Well, that's a simple one, Dan. What stops that is the ecosystem and the technology infrastructure that you have around your biometric. Because your biometric is public information. When you walk into your office or you go into a store and you put your hand on the door, you leave your fingerprint there. If somebody really wanted your fingerprint, they could lift it. Again, this is all theoretical, right? Your face is surveilled. You walk through Times Square, now it could be 500 times. I used to say 200, but it could be 500 times your face is surveilled and if someone wanted your face, they could take a picture of your face. What makes biometrics systems secure and protect from a gentic scenarios is the ecosystem around the biometric. So what is that? That's liveness detect, right? To ensure that it's real and your face is real, or your finger is real, or your palm is real, or your iris is real. That's number one. It's all the encryption around the biometric. Remember, we're never matching a fingerprint or a face or a palm. We're matching a digital representation of that. What are we doing? We are algorizing and we are encrypting. We're encrypting the templates that we. Then we're encrypting the transportation, the way we move the template from one place to another, whether it's on device or it's into a central system to match and back down for approval to, let's say a mobile device, a phone or a tablet or a computer. It's that secure ecosystem that protects against that potential agentic formation. That's where we have 30 years experience in doing that. Why in very high profile, high secure venues and environments, WEB-key, our product, our full and complete encrypted ecosystem for biometrics, has been selected by some of the most sophisticated, if not the most sophisticated security organizations in the world. Long-winded answer, but. No, I got it. That was good. A couple of questions on the warrants, and then I'll be off here. What were the net proceeds on the warrants? $2.5 million. Is that net or gross? There is a commission for the bankers was 5%, so I guess that is what, $2.350 million, somewhere in that range. $2.3 million- $2.4 million. Okay. Does that mean, I think there were $600,000 of them. You had $1.1 million. Does that mean that somebody now owns a third of the company? If they exercise the other $1.2 million warrants, what happens then? Yeah. The way that works, and you can look at the filings. It is all detailed out there in the 8-K and so forth, is that the warrant holder will never own more than 10%, 9.9% of the company. There is a blocker in place. So they bought all the warrants, and they only take ownership of 9.9% at a time of the warrants. The rest are held in abeyance. The company gets the money upfront because they exercised all of the $618,000 warrants that they had. So, the answer is no, they will never own a third of the company. I see. Do we know how many of the warrants have been exercised so far? Well, they've all been exercised. How many of them have been taken out of abeyance? I would say nearly half, give or take. Oh, I see. Okay. Quite a few. Quite a large number. Yeah. $275,000, $300,000. In that range, 300,000, give or take, have already been taken out of abeyance, so about half in the last four days. That by itself, I guess could explain some of the price drop in the stock. There's no question. There's no question. That is one. It's also the general market. It's an interesting point you bring up. I've been watching a series of companies. They're not necessarily peers to us in the context of what they offer, but they're size-wise small public Nasdaq companies. There seems to be a mantra in the market this past couple of weeks, and it's sell on the news. I've seen really good earnings announcements, I've seen good contract announcements, and I've seen these stocks trade down 15%-20%. I don't think you can look at the stock price and say, "Well, it happened because of this," or, "It happened because of that." I think it's just a series of things, and it's a fact that the low end of the market has been experiencing this kind of volatility right now. It is what it is. Look. Yes. We clearly were disappointed in our anticipated revenue for the second quarter. Again, that hardware order would've put us well over the top and obviously would've been a profitability. That's one thing. Our business is still growing. For sure, that's a factor. The second thing, though, on the other side is, our balance sheet is very strong right now. Our equity position is very strong right now. Having a few more shares outstanding strengthens our compliance requirements and so forth. That's very positive. You look at the pipeline and the things that I described over the last 45 minutes, all very positive. I think there are more positives than negatives out there right now, and we'll catch up. We'll catch back up, I'm sure. Because we're so. Yeah. Undervalued by any metric that all ships rise with the tide, and at some point, we will get our due fair value. Well, your cash is, I think just based on your cash, that's $2.50 a share, I think, if I'm computing this right, assuming you have about 1.8 million shares outstanding. One question on the cash. I think you had $1.4 million at the end of the last quarter, the second quarter, and you got $2.3 million, but suddenly you have $4.5 million now. That's not the $800,000 in hardware. You pulled in some of the receivables or something in this quarter, or something like that happen? How'd you get that extra cash? I'm a little confused. I think, Ceci. Well, I don't know. I didn't understand your question. Yes. We have collected receivables from the June close through July. Okay. And added more. Okay, that's good. All right, last question. In your 2025 Form 10-K, I saw the line, "We expect that the growth in revenue will alleviate our going concern within the next 12 months." I'm not sure. Has that line remained in the recent Q? Ceci handle that. No, that did not remain, but that normally the end of the year is where it matters the most, and that's where we're headed. I see. So you guys, is that still something that you feel is valid? Yes, absolutely. What has to happen? What do the auditors or what do the SEC regulations say about allowing you to say something like that? Because I do not think I have ever seen that in any of your Form 10-Ks. Well, the auditors approved us saying that. I think, Dan, it is pretty straightforward, right? It is you are on the right path, meaning that you are crossing the line between using cash and being cash neutral. You have enough cash on the balance sheet to operate the business for a couple of years, even with the burn that you have. That gives you comfort to say, "Listen, this is not a going concern scenario because if there is a blip or a downturn, the company has enough cash to continue to operate." I mean, it is not that complex. Okay. That is it. Okay. Hey, I appreciate all the time you guys gave me. Thank you. You are welcome. Showing no further questions, this concludes today's Q&A session. I will ask Mike DePasquale to provide closing remarks. Thank you again for joining today's call. We genuinely appreciate your continued interest in BIO-key, and I look forward to updating investors on our progress on our next call. We will be participating in the H.C. Wainwright Conference in mid-September. As always, we'll continue to update investors via press release on significant developments in the interim. If you have any additional questions, please reach out to our IR team, whose contact information is provided in today's press release. Thank you, everyone, and have a terrific weekend. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.