VOXX International Announces Joint Venture Between EyeLock And GalvanEyes Partners To form BioCenturion, LLC

Companies reach agreement to engage in a joint venture and form new entity – BioCenturion, LLC

ORLANDO, Fla., March 7, 2024 /PRNewswire/ -- VOXX International Corporation (NASDAQ:VOXX), a leading manufacturer and distributor of automotive and consumer technologies for the global markets, today announced that its majority owned subsidiary, EyeLock LLC, has entered into a joint venture agreement (the "Agreement") with GalvanEyes Partners LLC to form BioCenturion, LLC. The combination of both companies will create a stronger and more streamlined organization bringing together technology, R&D, sales, marketing, and business development under one roof, while opening new avenues for growth.

Under the Agreement, both companies will be contributing selected assets and liabilities to the joint venture. GalvanEyes will serve as the managing member and will be responsible for all working capital needs over the next two years, after which, the companies will evaluate the best path forward for the business. The new entity will be run by Allen Ibaugh, who served both as President of EyeLock and CEO of GalvanEyes and will combine and manage the talent from both organizations.  BioCenturion has been structured as a 50/50 joint venture, whereby GalvanEyes will manage all day-to-day business operations and EyeLock will have veto rights as it relates to various fundamental company matters, including, but not limited to, amendments to the operating agreement, the admission of new members, future financing arrangements, potential acquisitions, or the potential sale of the business. In the event of a capital event as defined therein and based on the respective capital contributions to date and expected, the first $45.0 million from a capital event would get preferential distribution rights with ~77% going to EyeLock and ~23% to GalvanEyes, and the remaining portion split evenly between the companies. EyeLock will retain the liability of the approximate $70 million Note due to VOXX, which is not part of this transaction.

In conjunction with this transaction, Beat Kahli has stepped down as President of VOXX but will continue to serve as co-Vice Chairman of the Company's Board of Directors. Further and as previously announced, effective March 1, 2024, Loriann Shelton assumed the role of Chief Financial Officer of VOXX, replacing Michael Stoehr, who served in this position for over 40 years. Mr. Stoehr will remain with the company as Senior Vice President and Treasurer and has stepped down from the Board as a Director. Additionally, Mr. Kahli will serve as Chairman of the Board and Chief Executive Officer of BioCenturion, enabling him to spend more time unlocking value in this new entity, while continuing to support VOXX and its shareholders at the Board level.

Commenting on the joint venture and executive changes, Pat Lavelle, Chief Executive Officer of VOXX International stated, "With respect to the joint venture, I believe this is a win-win situation for the Company. VOXX no longer will be responsible for the operating costs needed to support EyeLock, while retaining much of the upside of EyeLock's potential. Our Biometrics segment has recorded losses since its inception and while we have several large opportunities in development and on the horizon, the business is expected to generate losses near-term. By structuring the JV as we did, we can reallocate capital and generate further savings for VOXX. With respect to Beat's transition, this too is a positive for shareholders. His goal as President was to secure strategic partnerships for VOXX and he will continue to do so.  Beat will focus on driving this partnership forward and supporting VOXX as he has in the past, while building BioCenturion into a competitive force in the biometrics industry."

Beat Kahli added, "What initially drove me to investing in VOXX was biometrics, and I have continued to invest over the years as I saw tremendous opportunities for value creation amongst VOXX's various businesses.  I also believed that Pat and the VOXX team could unlock the value inside EyeLock.  After a year of working closely at VOXX, I feel the Company and its shareholders, myself included, would be best served if I focused my attention on building a strong Biometrics business with cutting-edge technology that generates returns, while continuing to work on strategic partnerships for VOXX. I saw value in EyeLock years ago which is what prompted the formation of GalvanEyes. Now, we have a chance to combine the companies' respective strengths and turn our vision into reality, which will increase value for BioCenturion and for VOXX shareholders."