Exhibit 10.12

SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE

This Settlement Agreement and Mutual General Release (“Settlement Agreement”) is
made as of September 5, 2007 (“Effective Date”) by and between Cogent, Inc.
(“Cogent”), on the one hand, and Northrop Grumman Corporation, Northrop Grumman
Information Technology Overseas, Inc., Northrop Grumman Information Technology,
Inc., Northrop Grumman Space & Mission Systems Corp., and Northrop Grumman
Commercial Systems, Inc. (collectively referred to in the singular below as
“Northrop”), on the other hand, (collectively, “Parties”).

WHEREAS, on April 20, 2005, Cogent filed an action in the California Superior
Court in and for the County of Los Angeles, Case No. BC332199, styled Cogent
Systems, Inc. v. Northrop Grumman, et al. (“Action”);

WHEREAS, as of the date of this Settlement Agreement, the operative complaint in
the Action was the Fourth Amended Complaint, which asserts claims against
Northrop for declaratory and injunctive relief, specific performance, replevin,
breach of contract, conversion and trade secret misappropriation, breach of
trust and confidence, unfair competition, intentional interference with
prospective economic advantage, and intentional interference with contract;

WHEREAS, Northrop has denied, and continues to deny, the claims asserted and
allegations made against it in the Action, and has denied, and continues to
deny, that it is liable to Cogent in any amount, or for any reason, whatsoever;
and

WHEREAS, in order to avoid the cost, expense, and vagaries of litigation, the
Parties wish to compromise, satisfy, settle, discharge, and release, in full all
rights, claims, allegations, and causes of action alleged in the Action, without
further dispute or any other action of whatever type;

 

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NOW, THEREFORE, in consideration of the mutual promises, releases and agreements
herein, the Parties hereto, for themselves and their respective subsidiaries,
successors and assigns, agree as follows:

1. Payment.

1.1 Northrop shall pay to Cogent the sum of U.S. $25,000,000 by wire transfer to
an account designated by Cogent as follows:

1.1.1 Fifteen Million Dollars ($15,000,000) on or after January 2, 2008, but no
later than January 10, 2008; and

1.1.2 Ten Million Dollars ($10,000,000) on or after January 2, 2009, but no
later than January 12, 2009.

1.2 Full and final execution and delivery of the Settlement Agreement and each
of the Related Agreements by Cogent is a condition precedent to Northrop’s
payment obligations pursuant to subparagraphs 1.1.1 and 1.1.2 above.

2. Related Agreements.

2.1 Simultaneous with the execution of this Settlement Agreement, the following
Parties shall enter into the following agreements (collectively, “Related
Agreements”):

2.1.1 A Software License Agreement between Cogent and Northrop Grumman
Corporation and its wholly owned subsidiaries and in the form attached as
Exhibit A;

2.1.2 A Products and Services Agreement between Cogent and Northrop Grumman
Corporation and its wholly owned subsidiaries and in the form attached as
Exhibit B; and

2.1.3 A Strategic Alliance Agreement between Cogent and Northrop Grumman
Corporation in the form attached as Exhibit C.

 

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2.2 Full and final execution and delivery of each of the Related Agreements is a
condition precedent to the effectiveness of this Settlement Agreement. From and
after the date of the Parties’ execution of this Settlement Agreement, the terms
of the Related Agreements and this Settlement Agreement shall be confidential,
and shall not further be disclosed by the Parties to any other persons, entities
or organizations, except:

2.2.1 to the extent such terms were known by or have been available to the
public as of the date of the Parties’ execution of this Settlement Agreement;

2.2.2 to the extent such terms become available to the public otherwise than by
breach of this Settlement Agreement;

2.2.3 to actual or prospective customers of either of the Parties;

2.2.4 to the extent required by an order of a court having jurisdiction or under
subpoena from a court of law or an appropriate government agency (in which
event, the Party receiving any such subpoena or order shall give written notice
to the other Party three (3) business days prior to responding);

2.2.5 in order for a Party to obtain legal, accounting or tax services;

2.2.6 in order to enforce this Settlement Agreement;

2.2.7 as may be required by a Party to comply with applicable law, including the
disclosure requirements of the federal securities laws and the listing
requirements of any exchange on which the securities of Cogent or Northrop may
be listed; or

2.2.8 as otherwise specified in the Related Agreements.

 

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3. Release of Northrop.

3.1 Except as to such rights or claims as may be created by this Settlement
Agreement or by any of the Related Agreements, Cogent hereby releases, remises,
and forever discharges:

3.1.1 Northrop and each of its successors, predecessors, affiliates, parents,
subsidiaries, employees, agents, representatives, officers, directors,
attorneys, sureties, or insurers;

3.1.2 the National Policing Improvement Agency (“NPIA”), the Police Information
Technology Organisation (“PITO”), UK Home Office, UK Foreign & Commonwealth
Office, UKvisas, and policing agencies and/or forces that are or have been end
users of the NAFIS and/or IDENT1 services and/or systems (collectively, “UK
Customers”); and

3.1.3 Sagem Defense Securite (“SAGEM”) and ARGTEC, Inc. (“ARGTEC”), but only
with respect to claims arising out of Northrop’s disclosure or transfer of any
Cogent proprietary information to SAGEM or ARGTEC or SAGEM or ARGTEC’s use of
any such proprietary information or information derived therefrom.

3.2 Except as set forth in Paragraph 4 below, the release of the entities named
in subparagraph 3.1 above (collectively, the “Northrop Released Parties”) shall
include any and all claims (including claims which were or could have been
brought in the Action), demands, debts, losses, obligations, warranties, costs,
expenses, rights of action and causes of action, of every kind and nature
whatsoever, whether based on contract, tort, statutory or other legal or
equitable theory of recovery, known or unknown, suspected or unsuspected,
existing, or claimed to exist, which Cogent ever held or had, now holds or has,
or may claim to hold or have, as of the Effective Date, or which are based
either in whole or in part on any materials that may be returned by Northrop to
Cogent or destroyed by Northrop pursuant to Paragraph 11 of this Settlement
Agreement (the “Northrop Released Claims”).

 

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4. Representations and Warranties by Northrop. Northrop represents and warrants
that it is not using any Cogent Source Code or Cogent Object Code (as such terms
are defined in Paragraphs 11.1 and 11.2 below) on any program, including the
IDENT1, ABIS and CIS projects as described in the Software License Agreement.
The Northrop Released Claims shall not include any claims arising out of any
breach of the representations and warranties in this Paragraph 4; provided,
however, that any such breach shall not in any way negate or affect either the
release of any of the Northrop Released Claims or the enforceability of this
Settlement Agreement.

5. Release of Cogent. Except as to such rights or claims as may be created by
this Settlement Agreement or the Related Agreements, Northrop hereby releases,
remises, and forever discharges Cogent and each of its successors, predecessors,
affiliates, parents, subsidiaries, employees, agents, representatives, officers,
directors, attorneys, sureties, or insurers (the “Cogent Released Parties”) from
any and all claims (including claims which could have been brought as
counter-claims in the Action), demands, debts, losses, obligations, warranties,
costs, expenses, rights of action and causes of action, of every kind and nature
whatsoever, whether based on contract, tort, statutory or other legal or
equitable theory of recovery, known or unknown, suspected or unsuspected,
existing, or claimed to exist, which Northrop ever held or had, now holds or
has, or may claim to hold or have, as of the Effective Date (the “Cogent
Released Claims”).

 

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6. Representations and Warranties by Cogent. Cogent represents and warrants that
it is not using any Northrop Source Code or Northrop Object Code (as such terms
are defined below) on any program. The Northrop Released Claims shall not
include any claims arising out of any breach of the representations and
warranties in this Paragraph 6; provided, however, that any such breach shall
not in any way negate or affect either the release of any of the Cogent Released
Claims or the enforceability of this Settlement Agreement. “Northrop Source
Code” shall mean all algorithms and/or source code (including algorithms
contained in any such source code), that was provided by TRW and/or Northrop to
Cogent at any time, in whatever form or medium of storage (including any
compilations of such code), including, without limitation, all fingerprint
minutia filtering routines, as well as any alterations, revisions, modifications
and/or annotations of such source code and all copies thereof. “Northrop Object
Code” shall mean any object and/or executable code within Cogent’s possession
that was provided by TRW and/or Northrop to Cogent at any time or which was
created by Cogent by compiling Northrop Source Code, in whatever form or medium
of storage (including any load images of such code), including, without
limitation, all fingerprint minutia filtering routines, as well as any
alterations, revisions, modifications and/or annotations of such source code and
all copies thereof.

7. California Civil Code Section 1542 Waiver. In furtherance of the Parties’
intention that the Settlement Agreement be in full and final accord and
satisfaction of the claims or potential claims which are the subject of the
Settlement Agreement, and except as provided in Paragraphs 4 and 6 above, each
Party hereto expressly waives the benefit of the provisions of Section 1542 of
the Civil Code of the State of California, which provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.

 

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8. Attorneys’ Fees. Each of the Parties hereto will bear its own costs and
attorneys’ fees incurred in connection with the Action and this Settlement
Agreement.

9. Dismissal. Upon execution and delivery of this Settlement Agreement and each
of the Related Agreements, counsel for Cogent and Northrop shall promptly
execute and file a Stipulation of Dismissal with Prejudice of the Action
substantially in the form of Exhibit D annexed hereto (the “Dismissal”). The
Parties each represent that, to the best of their knowledge, there are no other
pending actions arising out of or relating in any way to the Action or to the
claims and/or facts which were alleged or could have been brought in the Action.

10. Return or Disposal of Discovery Material. With respect to the disposition of
materials produced by the Parties during the course of discovery in the Action,
the Parties each agree as follows:

10.1 Within ninety (90) days after the filing of the Dismissal, each of the
Parties shall return to the Producing Party or destroy (and certify to the
Producing Party the return and/or destruction of) all Discovery Material and all
copies of such materials, including, without limitation, all Confidential
Discovery Material and Highly Confidential Discovery Materials received from the
Producing Party. “Producing Party,” “Discovery Material,” “Confidential
Discovery Material,” and “Highly Confidential Discovery Material” shall have the
meanings set forth in the Protective Order entered in the Action on February 7,
2006 (the “Protective Order”). Discovery Materials required to be returned or
destroyed pursuant to this Paragraph 10 shall be referred to herein as the
“Disposed Materials.”

10.2 The Parties’ obligations to return or destroy Discovery Materials shall
include all materials and copies provided to any expert, consultant, or other
third party.

 

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10.3 Notwithstanding any provisions of this Settlement Agreement, the Parties
agree that their respective outside counsel shall have the right to archive and
retain for a period of ten (10) years one (1) hard copy and one (1) electronic
copy of the following files regardless of whether they contain Discovery
Materials received from outside counsel for the opposing party: correspondence
files (excluding any document productions, whether in hard copy or in electronic
form, included as enclosures or attachments to correspondence from outside
counsel for the opposing Party); pleading files; written discovery requests and
written responses served in the Action (excluding any document productions,
whether in hard copy or in electronic form by an opposing Party); and
transcripts of depositions taken in the action, including exhibits
(collectively, the “Retained Discovery Materials”); provided, however, that,
except as provided in Paragraph 11.6 below and except as to deposition
transcripts and exhibits to transcripts of depositions, Cogent outside counsel
may not retain any Discovery Materials or other writings, in whatever form,
medium or embodiment, that contain any Northrop Source Code produced by Northrop
in the Action, and Northrop outside counsel may not retain any Discovery
Materials or other writings, in whatever form, medium or embodiment, that
contain any Cogent Source Code produced by Cogent in the Action.

10.4 Each Party further agrees to instruct its outside counsel to archive and
retain, notwithstanding any other provisions of this Settlement Agreement, for a
period of ten (10) years one (1) copy of all Discovery Material, including,
without limitation, all Confidential Discovery Material and Highly Confidential
Discovery Materials, produced by that Party in the Action. The Parties agree
that counsel may retain one (1) hard copy and one (1) electronic copy of such
materials notwithstanding any other provisions of this Settlement Agreement.

 

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10.5 With respect to (i) all Disposed Materials (pending their return and/or
destruction pursuant to this Paragraph 10), and (ii) all Retained Discovery
Materials, the Parties shall not use such materials for any purpose or disclose
or provide such materials to any person, except to the extent required by an
order of a court having jurisdiction or under subpoena from a court of law or an
appropriate government agency (in which event, the Party receiving any such
subpoena or order shall give written notice to the other Party three
(3) business days prior to responding).

11. Return, Disposal and/or Retrieval of Cogent Trade Secret and Other
Information. In addition to its obligation to destroy Discovery Materials set
forth in Paragraph 10, above, Northrop agrees, represents and warrants that it
shall, within ninety (90) days after the filing of the Dismissal, do the
following:

11.1 As to all algorithms and/or source code (including algorithms contained in
such source code) within Northrop’s possession that was provided by Cogent to
TRW and/or to Northrop prior to the Effective Date, in whatever form or medium
of storage (including any compilations of such code), including, without
limitation, all fingerprint encoding routines (including version 5.03 and
earlier), fingerprint matching routines (including version 6.04 and earlier),
and all fingerprint minutia filtering routines (including version 1.5 and all
earlier), as well as any revisions, modifications and/or annotations of such
source code (collectively “Cogent Source Code”) and all copies thereof:

11.1.1 Use reasonable efforts to locate and collect all Cogent Source Code;

 

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11.1.2 Where Cogent Source Code exists on tapes and in a form discrete from
Northrop or third-party source code or information, at Cogent’s option, return
or destroy (and certify the return and/or destruction of) the Cogent Source
Code; and

11.1.3 Where Cogent Source Code exists in a form other than tapes and/or in a
form that is not discrete from Northrop or third-party source code or
information, destroy (and certify the destruction of) the Cogent Source Code.

11.2 As to all Cogent object and/or executable code within Northrop’s possession
that was provided by Cogent to TRW and/or to Northrop prior to the Effective
Date or which was created by Northrop by compiling Cogent Source Code, in
whatever form or medium of storage (including any load images of such code),
including, without limitation, all fingerprint encoding routines (including
version 5.03 and earlier), fingerprint matching routines (including version 6.04
and earlier), and all fingerprint minutia filtering routines (including version
1.5 and earlier), as well as any alteration, modification and/or annotation of
such object code (collectively “Cogent Object Code”) and all copies thereof:

11.2.1 Use reasonable efforts to locate and collect all Cogent Object Code
within its possession; and

11.2.2 Return or destroy (and certify the return and/or destruction of) all
Cogent Object Code, whether or not in a form discrete from Northrop or
third-party code.

11.3 As to all data structure and data format information within Northrop’s
possession that identifies or describes all or any part of any format in which
any Cogent software extracts, encodes, stores and/or processes information,
provided by Cogent to TRW and/or to Northrop as of the Effective Date, in
whatever form or medium of storage, including, without limitation, the .hwf
format (“ Data Format Information”):

11.3.1 Use reasonable efforts to locate and collect all Data Format Information;
and

 

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11.3.2 Return or destroy (and certify the return and/or destruction of) all Data
Format Information, whether or not in a form discrete from Northrop or
third-party information.

11.3.3 For purposes of this Settlement Agreement, Data Format Information does
not include data encoded in the .mnt format, the .hwf format, or in any other
format in which Cogent software extracts, encodes stores and/or processes
information, as opposed to information which defines the format itself.

11.4 As to any of the documents identified in Exhibit E to this Settlement
Agreement (“Additional Information”) and in Northrop’s possession, use
reasonable efforts to locate and collect and to return or destroy (and certify
the return and/or destruction of) the documents.

11.5 Northrop may use vendors to locate, collect, return and/or destroy the
Cogent Source Code, Cogent Object Code, Data Format Information, and Cogent
Information as set forth above; provided that Northrop shall:

11.5.1 obtain the prior written agreement of any vendor engaged in such
activities to keep all information contained in such materials confidential; and

11.5.2 remain responsible for ensuring that reasonable efforts are undertaken to
locate and collect all such documents.

11.6 Notwithstanding any other provision of this Settlement Agreement, outside
counsel for Northrop may retain for a period of ten (10) years one (1) archive
copy of each NAFIS and IDENT1 source code release prior to source code release
20.5, which prior releases may contain Cogent Source Code, Cogent Object Code,
Data Format Information, and/or Cogent

 

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proprietary or confidential information. After ten (10) business days written
notice to Cogent, Northrop may request counsel for access to the archive copies
and may review and analyze their contents as required to fulfill customer
requirements on the IDENT1 program in effect as of the Effective Date.
Northrop’s written notice to Cogent, to the extent possible given customer
confidentiality requirements, shall generally explain the reason for Northrop’s
belief that its review and analysis of such materials is required for such
purposes. In retaining the archive copies and/or providing access to the copies
to Northrop, counsel for Northrop shall owe no duties and shall incur no
obligations to Cogent of any nature whatsoever. Cogent agrees not to assert any
claim of any kind against counsel for Northrop arising out of or related to its
retention of the archive copies and/or providing access to the copies to
Northrop; provided, however, that Cogent shall be entitled to seek injunctive
relief to prevent disclosure of Cogent Source Code, Cogent Object Code, and/or
Data Format Information to Northrop in the event Northrop fails to generally
establish that its review and analysis of such materials is necessary to fulfill
customer requirements on the IDENT1 program in effect as of the Effective Date.

11.7 As to any third party, including, but not limited to, SAGEM or ARGTEC (but
specifically excluding UK Customers, former Northrop and TRW employees,
individuals who have worked as consultants to Northrop, and vendors engaged in
effort of the type provided in Paragraph 11.5 above) to whom Northrop believes
it or TRW may have provided Cogent Source Code, Cogent Object Code, Data Format
Information and/or any rank order candidate results from any benchmark test of
Cogent software (“Cogent Test Data”) before the Effective Date, Northrop agrees
that it shall:

11.7.1 Within thirty (30) days from filing of the Dismissal, make a written
demand to any such third party that it return and/or destroy (and certify to
Northrop the return and/or destruction of) any such materials, including all
copies of any such materials, within thirty (30) days;

 

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11.7.2 Provide Cogent a copy of each written demand and all written responses to
each such demand; and

11.7.3 Return to Cogent or destroy (and certify the return and/or destruction
of) all materials returned by said third party.

11.8 As to R.J. Langley and Robert Gerbracht, Northrop agrees that it shall:

11.8.1 Within thirty (30) days from filing of the Dismissal, send letters
reminding them of any confidentiality obligations regarding Cogent’s Source
Code, Cogent Object Code, Data Format Information, and Cogent Test Data they may
have under confidentiality agreements executed between them and TRW and/or
Northrop, to the extent known by Northrop, and making a demand that they return
and/or destroy (and certify to Northrop the return and/or destruction of) any
Cogent Source Code, Cogent Object Code, Data Format Information and/or any
Cogent Test Data, including all copies of any such materials, within thirty
(30) days.

11.8.2 Return to Cogent or destroy (and certify the return and/or destruction
of) all materials returned by said third party.

11.9 Cogent acknowledges and agrees that, given, among other things, the size of
an organization such as Northrop, and despite Northrop’s exercise of reasonable
efforts, Northrop may fail to (a) identify and/or locate all materials within
the scope of subparagraphs 11.1 through 11.4 above within the ninety (90) day
period from the filing of the Dismissal, or at all; or

 

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(b) identify, and hence to send demands to, third parties within the scope of
subparagraph 11.7 above within the (30) day period from the filing of the
Dismissal, or at all. Northrop’s failure to identify and/or locate all materials
within the scope of subparagraphs 11.1 through 11.4 within the ninety (90) day
period from the filing of the Dismissal or at all, despite exercise of
reasonable efforts, shall not constitute a breach of this Settlement Agreement.
Northrop’s failure to identify, and hence to send demands to, all third parties
as specified in Paragraph 11.7 above, within the thirty (30) day period from the
filing of the Dismissal, or at all, despite the exercise of reasonable efforts,
shall not constitute a breach of this Settlement Agreement.

11.10 Should Northrop discover and/or receive additional materials subject to
subparagraphs 11.1 through 11.4 after the ninety (90) day period from the filing
of the Dismissal, Northrop shall promptly return, destroy and/or retrieve such
materials, as applicable. Should Northrop, after the time period specified in
Paragraph 11.7, identify additional third parties to whom demands for return
and/or destruction of materials should have been sent pursuant to that
paragraph, Northrop will promptly send out such demands and comply with all
other provisions of Paragraph 11.7 with respect to those third parties.

11.11 Except as to any claims arising out of any breach of the representations
and warranties in Paragraph 4 above, Cogent shall not assert against any of the
Northrop Released Parties any claim, demand, obligation, right of action or
cause of action, of any kind and nature whatsoever, whether based on contract,
tort, statutory or other legal or equitable theory of recovery, based on any
materials or the content of any materials returned to it by Northrop or
destroyed by Northrop pursuant to the requirements of subparagraphs 11.1 through
11.4 and 11.7 above.

 

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12. Rights in Technology and Information. With respect to the following
technology and information, the Parties agree as follows:

12.1 As of the filing of the Dismissal, Northrop acknowledges and agrees that
all Cogent Source Code is Cogent trade secret information and that Northrop has
no right to use or to disclose to any third party any Cogent Source Code on or
after the Effective Date.

12.2 As of the filing of the Dismissal, Northrop acknowledges and agrees that
all Cogent Object Code is Cogent trade secret information and that Northrop has
no right to use or to disclose to any third party any Cogent Object Code on or
after the Effective Date.

12.3 As of the filing of the Dismissal, Northrop acknowledges and agrees that
Northrop has no right to use or to disclose to any third party any Cogent Data
Format Information on or after the Effective Date, except as expressly may be
permitted by any of the Related Agreements and/or any future written agreements
between Cogent and Northrop and/or its related entities. Notwithstanding the
provisions of this Paragraph 12.3, Cogent agrees that, upon written request from
Northrop and at a price to be determined in accordance with the terms of the
Products and Services Agreement referenced in Paragraph 2 above, Cogent shall
convert, either to a NIST-9 format or to another public format designated by
Northrop, any fingerprint data formatted in the .hwf format and in the
possession of, and/or used by or on, the NAFIS program and/or services or the
IDENT1 program and/or services, or by the UK Customers. Cogent shall take
reasonable steps to complete any such conversion request within thirty (30) days
of Northrop’s written request, subject to Cogent’s existing work requirements
and resources, unless otherwise agreed to by the Parties in writing. After any
such conversion, Northrop may utilize the reformatted data for any purpose
whatsoever Northrop’s request for and use of such converted data shall not
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Settlement Agreement. Northrop shall have the right to encode images that may
have been previously encoded in any other format using or embodying Cogent Data
Format Information, including without limitation the .hwf format, and Northrop
shall not be liable to Cogent for the removal of Cogent Data Format Information
from any previously existing data bases or storage materials.

12.4 The UK Customers shall have the right to convert data in existence in the
.hwf format as of the time of execution of this Settlement Agreement to other
formats, and thereafter utilize the reformatted data for any purpose whatsoever.

12.5 Cogent recognizes and hereby acknowledges and agrees, that the Release 20.5
version of IDENT1 program source code provided by Northrop’s counsel to Cogent’s
counsel on August 17, 2007 does not contain, and is free of, Cogent Source Code,
Cogent Object Code, Data Format Information, and any form of Cogent proprietary
information, trade secret information, technology and/or know how.

12.6 Northrop acknowledges and agrees that Cogent owns and has all interest in
the Pattern Matching Accelerator (“PMA”) Boards. As used herein, “PMA Boards”
means the multiple-layer, Field Programmable Gate Array (“FPGA”) based printed
circuit boards produced by Cogent and designed for high-speed fingerprint
matching as of June 22, 2000.

12.7 Cogent acknowledges and agrees that Northrop owns and has all interest in
the Fingerprint Match Accelerator (“FMA”) Boards. As used herein, “FMA Boards”
means the multi-layer, FPGA-based printed circuit boards developed and produced
by TRW or which TRW paid to have developed and/or produced and designed to act
as a coarse fingerprint matcher as of June 22, 2000.

 

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12.8 Northrop shall not disclose any Cogent Test Data to any third party, other
than the UK Customers, and then only as requested by such parties and/or as
required under the NAFIS or IDENT1 contracts.

13. Confidentiality. Northrop acknowledges and agrees that it shall not disclose
to any third party any information, whether or not in written or other tangible
form, describing or identifying the content of Cogent Source Code, Cogent Object
Code, Data Format Information, or Cogent Test Data, except as expressly set
forth herein or in the Related Agreements.

14. Cooperation. The Parties agree to cooperate fully and execute any and all
additional documents and take any and all additional action as may be necessary
and appropriate to give full force and effect to the terms and intent of this
Settlement Agreement, and each of the Related Agreements.

15. Disputes and Choice of Law. The Parties stipulate and agree that this
Settlement Agreement is enforceable pursuant to California Code of Civil
Procedure § 664.6 and that the Los Angeles County Superior Court may retain
jurisdiction to enforce it; provided, however, that any dispute between the
Parties relating to any alleged breach of this Settlement Agreement shall be
resolved pursuant to the dispute resolution procedures set forth below, that
resolution of all disputes regarding the Related Agreements shall be subject to
the dispute resolution procedures specified in those agreements, and that any
breach of this Settlement Agreement shall not provide any ground for rescission
of the Settlement Agreement by either Party.

15.1 This Settlement Agreement shall be governed by, and interpreted, construed
and enforced in accordance with, the laws of the State of California, without
reference to its conflicts of laws principles without giving effect to any
choice of law rule that would cause the application of the laws of any
jurisdiction other than the internal laws of the State of California to the
rights and duties of the parties.

 

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15.2 The Parties agree to attempt to settle any claim or controversy arising out
of this Settlement Agreement through consultation and negotiation in good faith
and a spirit of mutual cooperation. Any dispute between the Parties relating to
this Settlement Agreement will first be submitted in writing to a panel
comprised of a senior executive, with a rank of Vice President or above, from
Northrop and Cogent, who will promptly confer in an effort to resolve such
dispute. The executives will be identified by written notice and may be changed
any time thereafter by written notice. Any agreed decisions of the executives
will be final and binding on the Parties.

15.3 In the event the executives are unable to resolve any dispute within thirty
(30) days after submission to them, the Parties agree to resolve the dispute by
binding arbitration. Arbitration shall be held in Los Angeles, California in
accordance with the JAMS Comprehensive Arbitration Rules and Procedures (“JAMS
Rules”); provided, that the California Code of Civil Procedure, Rules of
Evidence and discovery rules of California shall apply to the arbitration of
disputes hereunder. Arbitration shall be conducted by one arbitrator (who shall
be a retired or former judge), independent of any of the Parties, mutually
selected from a list provided by JAMS in accordance with such JAMS Rules. In the
event that Northrop and Cogent cannot agree to an arbitrator, they shall each
select an arbitrator and such arbitrators shall select a third arbitrator that
will act as the arbitrator for disputes hereunder. In circumstances requiring
expedited relief, the selection of the arbitrator shall be completed within
three (3) business days of the commencement of the arbitration. The arbitrator
shall make his or her decision in writing at the earliest convenient date. The
arbitrator shall be bound to apply the applicable substantive law set forth
herein to each dispute.

 

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The arbitrator shall decide in accordance with the express terms of the
Settlement Agreement and shall take into account usages of the trade applicable
to this Settlement Agreement. The arbitrator is not empowered to alter, amend,
modify or change any of the terms of this Settlement Agreement. The arbitrator
shall be empowered to grant any remedy or relief that is just and equitable,
including specific performance and injunctive relief; provided, however, that
the arbitrator shall not be empowered to award punitive or exemplary damages
under any circumstances, whether statutory or common law in nature, and
including but not limited to, treble damages awarded by statute. If a Party
against whom the arbitrator renders an award fails to abide by such award, the
other Party may bring an action to enforce the same in any court of competent
jurisdiction. Without limiting the foregoing, the Parties may enforce any
arbitration determination in any state or federal court in Los Angeles,
California, over the Party against whom such arbitration determination is sought
to be enforced. For the purpose of any action or proceeding instituted with
respect to any such arbitration determination, the Parties hereby irrevocably
submit to the jurisdiction of such courts, irrevocably consent to the service of
process by registered mail or personal service and hereby irrevocably waive, to
the fullest extent permitted by law, any objection which they may have or
hereafter have as to personal jurisdiction, of any state or federal court in Los
Angeles, California. The fees and expenses of the arbitrator shall be divided
equally between the Parties and paid by them accordingly.

15.4 In the event any action is brought to remedy, prevent, or obtain relief
from a breach of this Settlement Agreement, the arbitrator shall have the
discretion to decide whether or not to award the prevailing Party reasonable
attorney’s fees and expert fees and other reasonably incurred costs and expenses
in addition to any other relief to which that Party may be entitled; and shall
also have discretion as to the amount of any such fees, costs, and expenses to
be awarded; provided, however, that in the

 

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event any action is brought to remedy, prevent or obtain relief from a breach of
the payment obligations set forth in Paragraph 1.1 of this Settlement Agreement,
the prevailing Party shall recover all reasonable attorney’s fees and expert
fees and other reasonably incurred costs and expenses in addition to any other
relief to which that Party may be entitled.

16. No Admission of Liability. The Parties hereto acknowledge that this
Settlement Agreement is a compromise resolution of disputed claims for the
purpose of mitigating the costs, uncertainties, and burdens of further
litigation and that nothing contained in this Settlement Agreement, including,
but not limited to, the acknowledgements in Paragraph 12, or in or the Related
Agreements constitutes or should be construed as an acknowledgement or admission
of liability in any way on the part of the Parties hereto, each of whom
expressly denies any liability or wrongdoing in connection with any of the
claims and/or counterclaims asserted in the Action, and the Parties agree not to
issue any public statements or comments to the contrary.

17. Binding Agreement. This Settlement Agreement, and all of its terms and
provisions, shall be binding on and inure to the benefit of the Parties and each
of their present and future successors, predecessors, parents, subsidiaries,
principals, assigns, employees, agents, representatives, officers, directors,
attorneys, sureties, and insurers.

18. Power and Authority. Each Party and each signatory to this Settlement
Agreement hereby represents and warrants that it has full power, authority and
legal right to execute, deliver and perform all actions required under this
Settlement Agreement and the Related Agreements.

 

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19. No Other Actions. No other or further action is necessary for the Parties to
enter into this Settlement Agreement and all other documents contemplated hereby
and thereby; however, should any further action or documents be necessary to
implement this Settlement Agreement, the Parties agree to complete such action
or documents promptly.

20. No Assignment. The Parties each represent and warrant that there has been no
assignment or attempted assignment of any rights and/or claims that are the
subject matter of this Settlement Agreement or the Related Agreements at any
time prior to the signing of this Settlement Agreement.

21. Entire Agreement. This Settlement Agreement and the Related Agreements
constitute the entire agreement among the Parties with respect to the subject
matter hereof and supersede any prior and/or contemporaneous oral or written
agreements, negotiations and discussions with respect to the subject matter
hereof. All agreements between the Parties and/or their predecessors or
subsidiaries entered into prior to the Parties’ execution of this Settlement
Agreement are terminated, and each of the Parties’ obligations and rights
thereunder are extinguished. The agreements terminated by this Settlement
Agreement include without limitation: the June 22, 2000 Settlement Agreement and
Mutual General Release; the Confidentiality Agreement No. 78736 as executed as
of November 9, 1994 (also known by the Parties as the “1994 Confidentiality
Agreement”); the Confidentiality Agreement No. 78736 as executed as of
October 3, 2001 (also known by the Parties as the “2001 Confidentiality
Agreement”); the August 1994 Agreement in Principle (also known by the Parties
as the “Strategic Agreement”); and the February 1995 Agreement regarding the
NAFIS Contract (also known by the Parties as the “UK NAFIS Agreement”). The
Parties further acknowledge that, except as stated elsewhere in this Settlement
Agreement, no Party (nor any officer, agent, employee, representative, or
attorney of or for any Party) has made any statement or representation to any
other Party regarding any fact relied upon in entering into this Settlement
Agreement, and each Party does not rely upon any statement, representation or
promise of any Party (or of any officer,

 

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agent, employee, representative, or attorney for the other Party) in executing
this Settlement Agreement, or in making the settlement provided for herein,
except as expressly stated in this Settlement Agreement; and that no
consideration has been offered, promised, expected or held out other than as may
be expressly provided herein.

22. Modification. This Settlement Agreement may not be altered, modified or
amended, unless by agreement in writing executed by the Parties or their
authorized representatives, nor any of its provisions waived, unless in writing
by the Party granting such waiver.

23. Waiver. Any failure of any Party to enforce any provision of this Settlement
Agreement shall not (i) constitute or be construed as a waiver of such provision
or otherwise prejudice the right of that Party to enforce such provision at any
subsequent time; or (ii) preclude such Party from enforcing any other rights or
remedies that such Party may have under this Settlement Agreement.

24. Representation by Counsel. Each Party represents and warrants that it has
been represented by legal counsel with respect to the negotiation of the terms
of this Settlement Agreement, that it has been advised by legal counsel as to
its rights and obligations under this Settlement Agreement, and that it and its
counsel have participated in the review and drafting of this Settlement
Agreement.

25. Investigation. Each Party to this Settlement Agreement has made such
investigation of the facts pertaining to this settlement and this Settlement
Agreement and of all the matters pertaining thereto as it deems necessary. Each
Party has read this Settlement Agreement and understands its contents.

 

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26. Interpretation. All Parties have had the opportunity to draft, review and
edit the language of this Settlement Agreement. Accordingly, no presumption for
or against any Party arising out of drafting all or any part of this Settlement
Agreement will be applied in any action relating to, connected to, or involving
this Settlement Agreement; and the Parties hereby waive the benefit of any
statute, providing that in cases of uncertainty, language of a contract should
be interpreted most strongly against the Party who caused the uncertainty to
exist.

27. Headings. The headings of the sections of this Settlement Agreement are
included for convenience only and shall not be deemed to constitute part of this
Settlement Agreement or to affect its construction.

28. Severability. In the event that any provisions of this Settlement Agreement
shall be held to be void, voidable, or unenforceable, the remaining portions of
it shall remain in full force and effect. Should any Related Agreement, or any
portion thereof, be held to be void, voidable or unenforceable, this Settlement
Agreement shall remain in full force and effect, and a Party’s breach of any
obligation under any Related Agreement shall not constitute a breach of this
Settlement Agreement, and this Settlement Agreement shall remain in full force
and effect despite any such breach. A Party’s breach of any obligation under
this Settlement Agreement shall not constitute a breach of any of the Related
Agreements, and those Related Agreements shall remain in full force and effect
despite any such breach.

 

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29. Notices. Any and all notices, demands, or other communications required
under this Settlement Agreement (“Notices”) shall be in writing and delivered by
receipted courier to the intended recipient at the addresses set forth below, or
at such other address as any Party may designate by notice to the other. All
notices shall be deemed given when delivered to the address designated below,
addressed to the attention of the person or persons designated below:

 

Notices to Cogent

  

Notices to Northrop

Kirk D. Dillman, Esq.

Hennigan, Bennett & Dorman LLP

865 South Figueroa Street, Suite 2900

Los Angeles, California 90017

Telephone: (213) 694-1200

Facsimile: (213) 694-1234

 

Carl E. Kohlweck, Esq.

Cogent Systems

209 Fair Oaks Avenue

South Pasadena, California 91030

Telephone: (626) 799-8090

Facsimile: (626) 799-8996

  

Joseph F. Coyne, Jr., Esq.

Sheppard, Mullin, Richter & Hampton LLP

333 South Hope Street, 48th Floor

Los Angeles, California

Telephone: (213) 620-1780

Facsimile: (213) 620-1398

 

W. Burks Terry, Esq.

Corporate Vice President and General Counsel

Northrop Grumman Corp.

1840 Century Park East, 18th Floor

Los Angeles, California 90067

The above-designated names and addresses may be changed by written notice
delivered in the manner prescribed in this paragraph.

30. Counterparts. This Settlement Agreement may be executed in one or more
counterparts, each of which shall constitute an original document. Delivery of
an executed counterpart of this Settlement Agreement by facsimile transmission
shall be as effective as delivery of a manually executed counterpart of this
Settlement Agreement.

IN WITNESS WHEREOF, the Parties do execute this Settlement Agreement.

 

Dated: December 4, 2007     COGENT, INC.       By:   /s/ Ming Hsieh       Its:  
CEO

 

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Dated: December 5, 2007    

NORTHROP GRUMMAN

CORPORATION

      By:   /s/ Kathleen M. Salmas       Its:   Assistant Secretary Dated:
December 5, 2007    

NORTHROP GRUMMAN

INFORMATION TECHNOLOGY OVERSEAS, INC.

      By:   /s/ Kathleen M. Salmas       Its:   Secretary Dated: December 5,
2007    

NORTHROP GRUMMAN

INFORMATION TECHNOLOGY, INC.

      By:   /s/ Kathleen M. Salmas       Its:   Secretary Dated: December 5,
2007    

NORTHROP GRUMMAN

SPACE & MISSION SYSTEMS, CORP.

      By:   /s/ Kathleen M. Salmas       Its:   Secretary Dated: December 5,
2007    

NORTHROP GRUMMAN

COMMERCIAL SYSTEMS, INC.

      By:   /s/ Kathleen M. Salmas       Its:   Secretary

 

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