8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 23, 2019

USIO, INC.

(Exact name of registrant as specified in its charter)

Nevada	000-30152	98-0190072
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

3611 Paesanos Parkway, Suite 300, San Antonio, TX	78231
(Address of principal executive offices)	(Zip Code)

(210) 249-4100

(Registrant’s telephone number, including area code)

Payment Data Systems, Inc.

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, par value $0.001 per share	USIO	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 7.01 Regulation FD Disclosure.

Attached is the updated investor presentation for certain investor conferences. The presentation materials are furnished hereto as Exhibit 99.1.

This report contains forward-looking statements. Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements related to its future activities or future events or conditions. The words “continue,” “will,” “bring,” “believe,” “estimate,” “expect,” “intend,” “plan,” “expand,” “should,” “likely,” and similar expressions as they relate to us or our management are intended to identify these forward-looking statements. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performances and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including risks related to the realization of the opportunities from the Singular acquisition, management of our growth, the loss of key resellers, the relationships with the Automated Clearinghouse network, bank sponsors, third-party card processing providers and merchants, the loss of key personnel, growing competition in the electronic commerce market, the security of the Company’s software, hardware and information, and compliance with complex federal, state and local laws and regulations, and other risks detailed from time to time in its filings with the SEC, including those risks discussed in the Company’s Annual Report on Form 10-K and in other documents that we file from time to time with the SEC. Any forward-looking statement speaks only as of the date as of which such statement is made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances, including unanticipated events, after the date as of which such statement was made.

Item 9.01    Financial Statements and Exhibits.

99.1* Investor Presentation as of October 23, 2019.

* The information filed as Exhibit 99.1 to this Current Report on Form 8-K is being furnished in accordance with Item 7.01 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities imposed by that Section. Such information shall not be incorporated by reference into any registration statement or other document or filing under the Securities Act of 1933, as amended, except as may be expressly set forth in a specific filing.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

USIO, INC.

Date: October 23, 2019

By:    /s/ Louis A. Hoch

Name:     Louis A. Hoch

Title: Chief Executive Officer and President

EX-99.1

Retail Broker PRESENTATION usio.com 10/23/2019 1

Forward Looking Statements These slides and any accompanying oral presentation contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. These forward-looking statements are identified by the use of words such as “believe,” “expect,” “prepare,” “anticipate,” “target,” “launch,” and “create,” or similar expressions including statements about commercial operations, technology progress, growth and future financial performance of Payment Data Systems, Inc. and its subsidiaries (the “Company”). Forward-looking statements in this presentation are subject to certain risks and uncertainties inherent in the Company’s business that could cause actual results to vary, including such risks that the Company’s security applications may be insufficient; the Company’s ability to adapt to rapid technological change; adverse effects on the Company’s relationships with Automated Clearing House, bank sponsors and credit card associations; the Company’s ability to comply with federal or state regulations; the Company’s exposure to credit risks, data breaches, fraud or software failures, and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission including its annual report on Form 10-K for the year ended December 31, 2018. One or more of these factors have affected, and in the future could affect, the Company’s businesses and financial results and could cause actual results to differ materially from plans and projections. All forward-looking statements made in this release are based on information presently available to the Company’s management. The Company disclaims any obligation to update these forward-looking statements, except as required by law. This presentation contains statistics and other data that has been obtained from or compiled from information made available by third parties service providers. The Company has not independently verified such statistics or data. The information presented in this presentation is as of October 22, 2019 unless indicated otherwise. 2

Our Timeline 3

Intro Video 4

Who is USIO? Payment Enablement Growth oriented Payment Enablement Technology Provider Leveraging… Prepaid Card Issuing Prepaid Card Issuing platform and Program Manager Leader in ACH Leading ACH provider in the segments served Merchant Acquiring Credit and Debit Card processing solutions across a variety of bill centric verticals 5 5

KEY METRICS Dollars & Transactions Processed + Revenues $3500 14 $3,300 $3,400 $3000 12 $2,978 $2,916 Over $3.4 billion dollars and $2,830 $2500 10 14.3 million transactions $2000 8 processed in 2018. $1500 6 Transactions Volume (Volume in millions) in (Volume $1000 4 (transactions in millions) in (transactions $630 $500 2 $0 Payment Data Systems | paymentdata.com 0 2013 2014 2015 2016 2017 2018 Revenue $25 30 $20 25 31% CAGR 2013-2018 $15 20 Revenue $10 * 15 ($ millions) ($ * 2016 top line revenue decreased due to a client selling a portion of $5 10 their merchant processing. $- 5 2013 2014 2015 2016 2017 2018 6

Organic Growth Strategy PAYMENT FACILITATION ACH PROCESSING Primary Growth Engine Results yield Our cash cow funds high- strong internal growth initiatives, including Payment Facilitation organic and Prepaid. growth. PREPAID CARD ISSUANCE Secondary Growth Engine 7

Our ACH Model TARGET CUSTOMER PROFILE KEY DIFFERENTIATORS • Consumer Driven • The only broad-industry focused NACHA • B2B Payments Certified sender • Bill Payments • Greater funding control – Same-day funding and late cutoff • Disbursements • Multiple Originating Depository Financial Institutions TARGET VERTICALS • Constant innovation will position us as leading player in real-time payments Specialized Healthcare Utilities Insurance B2B Billing Mortgage Non-Profit Consumer Lending Lending HOW WE MAKE MONEY TARGET VERTICAL CHARACTERISTICS ON AVERAGE NET REVENUE PER MARGIN • Recurring Transactions WE EARN TRANSACTION • Low Attrition • Need for Advanced Technology $.70 $.41 60%+ ON A RETURN OR ORIGINATION 8

Our Prepaid Model TARGET CUSTOMER PROFILE • SMBs needing expense management, refund disbursement, incentives, per diems, loyalty programs and more • Entities looking to migrate away from physical checks to virtual payment and funds disbursement mechanisms • Programs Managers that Fund the Cardholder Acquisition Costs TARGET VERTICALS HOW WE MAKE MONEY Healthcare Utilities Insurance Education Property Non-Profit Management INTERCHANGE BREAKAGE SPOILAGE MARGIN TARGET VERTICAL CHARACTERISTICS 2%-4% • Recurring Card Loads 1%-2% 40%+ 50%+ • Recurring Transactions Of cards loaded Of value on cards On card spend. with $200 or where $20 or less • Potential for Breakage, Inactivity Fees, Spoilage more. is loaded. and more • Low Risk 9

Our PayFac Model SAAS and ISV TARGET PROFILE The SHORTEST path TO THE MONEY! • 100’s to 1000’s of customers today • $10’s to $100mm+ in sales annually Integrate Batch Enroll (Implement) • Adds 10-100’s of new clients monthly 1 2 • Currently not monetizing payments properly (or at all) today 3 Activate 4 Achieve Scale = $$$ TARGET BILL-CENTRIC VERTICALS Sampling of Current Customers Healthcare Utilities Insurance Legal Education Property Non-Profit Management TARGET VERTICAL CHARACTERISTICS • High Average Ticket • Recurring Transactions • Low Attrition • Low Risk 10

Path to Revenue Illustration One Merchant Leveraged Distribution – 1,000 Merchants One Merchant processing 1,000 Merchants processing $20k/mo at 2.75% $20mm/mo at 2.75% Transaction Expenses Transaction Expenses 2.05% Issuing Bank 2.05% Issuing Bank .15% Card Brands .15% Card Brands .05% Processing Expense .05% Processing Expense $6,600 2.75% = Annual Gross Revenue to Usio $6.6mm 2.75% = Annual Gross Revenue to Usio $1,200 .50% = Annual Net Revenue 50/50 .50% = Annual Net Revenue Split w/ ISV Split w/ ISV $50 per merchant/month $50,000 per month $600 per merchant/year $600,000 per year 11

We participate in the fastest growing segment of the payments sector *According to Boston Consulting Group’s “Global Payments: The Interactive Edition” 12

APPENDIX

Investor Highlights Share Price $1.98 10/22/2019 52-week $1.38 range $3.82 Cash $ 3.3m Shares outstanding 16.85 m Debt $ 0 Market Cap $33.8m 14

Income Statement Highlights Annual Revenue 2018 $25.0 MILLION $5.6 Adjusted EBITDA Gross Profit 2018 2018 $(0.6) Annual Revenue 2017 2017 $(0.6) $14.6 $3.8 MILLION Gross Profit 2017 15

Non - GAAP 10/23/2019 16