Exhibit 10.1


    
      

    


    EXHIBIT
      10.1

    


     

    


     

    


    


     CO-OPERATIVE
      DEVELOPMENT & SUPPLY AGREEMENT

     

    This
      Co-operative Development & Supply Agreement ("Agreement") is hereby entered
      into between:

    


    Sequiam
      Biometrics, Inc.

    300
      Sunport Lane 

    Orlando,
      Florida 32809 

    ("Sequiam
      Biometrics")

     

    and

     

    Kwikset
      Corporation 

    19701
      DaVinci

    Lake
      Forrest, CA 92610

    (“Kwikset")

    


    (each
      a
“Party” and collectively the “Parties”)

    


    The
      effective date of this Agreement shall be
      SEPTEMBER 13,
      2005
      (the "Effective Date").

    


    In
      consideration of the mutual covenants and promises contained herein, and for
      other good and valuable consideration, the Parties agree as
      follows:


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    BACKGROUND

    Purpose:
      

    


    The
      purpose of this document is to set forth the agreements and deliverables of
      a
      business relationship between Kwikset and Sequiam Biometrics in respect to
      the
      development, marketing and sales of biometric enabled security door hardware
      and
      systems.

    


    Scope:

    


    This
      agreement relates to two distinct and separate programs for the development,
      marketing and sales of biometric enabled security door hardware and systems.
      

    


    BIOLOCK
      -
      The Biolock program will be a biometric enabled residential deadbolt built
      on
      the foundation of Kwikset’s current Powerbolt keypad access
      product.

    


    BIOSYSTEM
      - The Biosystem program will be a biometric enabled system which will provide
      for central enrollment and monitoring with distributed access control suitable
      for applications including but not restricted to multifamily dwellings,
      commercial buildings, and assisted living environments.

    


    


    ARTICLE
      I
      - BIOLOCK PROJECT

    


    
      	
              1.1

            	
              Development 

            


    

    


    Kwikset
      and Sequiam Biometrics * develop a biometric
      enabled residential deadbolt,
      which
      incorporates such changes in design made pursuant to the terms of this Agreement
      as will ensure, to the extent practicable, that the developed deadbolt is
      commercially acceptable to Kwikset. The biometric
      enabled residential deadbolt to
      be
      developed ("BIOLOCK") is described in the preliminary specification
      (“SPECIFICATION”) attached hereto as Appendix "A" and made a part hereof. The
      respective responsibilities of the Parties with regard to the development of
      the
      BIOLOCK shall be as follows:

    


    
      	 	
              (a)

            	
              The
                development platform for BIOLOCK shall be the current Kwikset
                *.

            


    

    


    
      	 	
              (b)

            	
              Kwikset
                shall be responsible for * of the grade 1 deadbolt and
                latch.

            


    

    


    ___________________

    *
      The
      information omitted is confidential and has been filed separately with the
      Securities and Exchange Commission pursuant to Rule 406 of the Securities Act
      of
      1933, as amended. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    


    
      	 	
              (c)

            	
              Kwikset
                shall be responsible for * of the deadbolt surround which will be
                the
                mechanical support for the biometric
                sensor.

            


    

    


    
      	 	
              (d)

            	
              Kwikset
                shall be responsible for * subject to revision
                control.

            


    

    


    
      	 	
              (e)

            	
              Kwikset
                and Sequiam Biometrics * cabling, packaging of the new mother board,
                and
                functional design of the user
                display/interface.

            


    

    


    
      	 	
              (f)

            	
              Sequiam
                Biometrics shall be responsible for development of the *
                board.

            


    

    


    
      	 	
              (g)

            	
              Sequiam
                Biometrics shall be responsible for all * for the current * mother
                board.

            


    

    


    The
      tradenames for BIOLOCK marketed by Sequiam Biometrics will be owned by Sequiam
      Biometrics. The tradenames for BIOLOCK marketed by Kwikset will be owned by
      Kwikset. 

    


    1.3        
       Testing
      - The
      Parties’ respective responsibilities with regard to the testing of the BIOLOCK
      shall be as follows: 

    


    
      	 	
              (a)

            	
              Kwikset
                will be responsible for the mechanical test plan and execution.
                

            


    

    


    
      	 	
              (b)

            	
              Sequiam
                Biometrics will be responsible for the electronic test plan and
                execution.

            


    

    


    
      	 	
              (c)

            	
              Kwikset
                and
                Sequiam Biometrics shall be jointly responsible for the integration
                test
                plan and execution.

            


    

    


    1.4         
       Tooling/Capital
      -
      Kwikset’s responsibilities with regard to tooling and capital shall be as
      follows:

    


    
      	 	
              (a)

            	
              To
                provide the capital *.

            


    

    


    
      	 	
              (b)

            	
              To
                support the * test equipment.

            


    

    


    1.5         
       Production
      -
The
      Parties’ respective responsibilities with regard to the production of the
      BIOLOCK shall be as follows:

    


    
      	 	
              (a)

            	
              Sequiam
                Biometrics shall be responsible for * and connecters from domestic
                sources
                for initial production.

            


    

    


    
      	 	
              (b)

            	
              Kwikset
                shall source the above components listed in Section 1.5(a) above
                from the
                lowest cost provider if the BIOLOCK enters high volume production,
                i.e.,
                entry into mass market retail (e.g.,
                *).

            


    

     

    
      ___________________

    

    *
      The
      information omitted is confidential and has been filed separately with the
      Securities and Exchange Commission pursuant to Rule 406 of the Securities Act
      of
      1933, as amended. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    


    
      	 	
              (c)

            	
              Kwikset
                shall perform final assembly, test and pack at an appropriate facility
                as
                determined by Kwikset.

            


    

    


    1.6         
       Sales
      -
The
      Parties’ respective responsibilities with regard to sales of the BIOLOCK shall
      be as follows:

    


    
      	 	
              (a)

            	
              Initial
                sales (first six (6) months after completion of the first production
                available BIOLOCK) will be by Sequiam Biometrics, under its brand
                to
                satisfy current orders.

            


    

    


    
      	 	
              (b)

            	
              Sequiam
                Biometrics agrees to * jointly participate in market research with
                respect
                to customer satisfaction.

            


    

    


    
      	 	
              (c)

            	
              Sequiam
                Biometrics agrees to establish and maintain a toll free number for
                customer service for the BIOLOCK sold under the Sequiam Biometrics
                brand.

            


    

    


    
      	 	
              (d)

            	
              Sequiam
                Biometrics agrees to advise Kwikset of any sales to * prior to shipment
                of
                BIOLOCKS.

            


    

    


    
      	 	
              (e)

            	
              During
                the foregoing six (6) month period referenced in Section 1.6(a) above,
                Kwikset will evaluate field product performance to determine if product
                modifications are appropriate.

            


    

    


    
      	 	
              (f)

            	
              Kwikset
                intends to offer the BIOLOCK to its customers for listing in retail
                or new
                construction if performance is deemed by Kwikset to be
                satisfactory.

            


    

    


    
      	 	
              (g)

            	
              If
                listings are obtained Kwikset may sell BIOLOCK under any or all of
                its
                brand names.

            


    

    


    1.7         
       Financial

    


    
      	 	
              (a)

            	
              Kwikset
                agrees to sell, and Sequiam Biometrics agrees to purchase, the initial
                six
                (6) months of production of BIOLOCK for Kwikset’s total cost therefore,
                calculated in accordance with generally accepted accounting principles
                (“GAAP”) for cost of goods sold and general and administrative costs, *.
                

            


    

    


    
      	 	
              (b)

            	
              If
                Kwikset introduces BIOLOCK under its brands or chooses to not introduce
                BIOLOCK under its brands but is willing, in either case, to supply
                Sequiam
                Biometrics further BIOLOCKS, the price will be escalated to current
                fleet
                average margins. 

            


    

    


    ___________________

    *
      The
      information omitted is confidential and has been filed separately with the
      Securities and Exchange Commission pursuant to Rule 406 of the Securities Act
      of
      1933, as amended. 

     


    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    


    
      	 	
              (c)

            	
              If
                Kwikset introduces BIOLOCK under its brands the Parties agree that
                Kwikset
                shall pay Sequiam Biometrics * of the operating income earned by
                Kwikset,
                calculated in accordance with GAAP, from the sale of Kwikset branded
                BIOLOCKS for * from the date of the first such
                sales.

            


    

    


    ARTICLE
      II - BIOSYSTEM PROJECT

    


    2.1           Market
      Research
      -
      Kwikset shall undertake market research to determine the opportunity for and
      priority of attractive market segments for BIOSYSTEM. The market research shall
      be conducted in a manner as reasonably determined by Kwikset and shall focus
      on
      facilitators and inhibitors to the adoption of BIOSYSTEM. Market research output
      shall describe the viability of the BIOSYSTEM concept and functionality which
      will lead to a final system specification.

    


    2.2         
       Development
      - The
      respective responsibilities of the Parties with regard to the development of
      the
      BIOSYSTEM shall be as follows: 

    


    
      	 	
              (a)

            	
              Kwikset
                shall develop all * including, but not limited to, residence doors,
                access
                gates and parking garage access.

            


    

    


    
      	 	
              (b)

            	
              Kwikset
                shall provide * interface for the biometric
                sensors.

            


    

    


    
      	 	
              (c)

            	
              Sequiam
                Biometrics shall provide *.

            


    

    


    
      	 	
              (d)

            	
              Sequiam
                Biometrics shall provide the design interface *
                technology.

            


    

    


    
      	 	
              (e)

            	
              Sequiam
                Biometrics shall provide * design.

            


    

    


    
      	 	
              (f)

            	
              The
                Parties shall jointly develop the software to facilitate features
                and
                functions identified by market
                research.

            


    

    


    
      	 	
              (g)

            	
              Sequiam
                Biometrics agrees to support the development by providing all agreed
                upon
                * through the beta test phase.

            


    

    


    2.3           Testing
      - The
      Parties shall have joint
      responsibility for development of tests to certify the BIOSYSTEM as acceptable
      to all approval bodies, including, but not limited to, UL, BHMA and the
      FCC. 

    


    2.4         
       Tooling/Capital
      -
      Kwikset shall
      be
      responsible for * associated with BIOSYSTEM.

    


    2.5           Production
      -
      Kwikset shall
      be
      responsible for production of BIOSYSTEM whether from current operations or
      sourced. 

    


    
      ___________________

    

    *
      The
      information omitted is confidential and has been filed separately with the
      Securities and Exchange Commission pursuant to Rule 406 of the Securities Act
      of
      1933, as amended. 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    


    2.6           Sales
      and Marketing
      -
Kwikset
      shall
      be
      responsible for all sales and marketing of BIOSYSTEM. 

    


    2.7         
       Royalty
      -
      In
      consideration of Sequiam Biometrics’s contributions to the development and
      implementation of BIOSYSTEM, Kwikset agrees to pay Sequiam Biometrics * by
      the
      Parties after the completion of applicable market research, specification
      generation, and agreement of accountability for deliverables from each of the
      Parties. 

    


    ARTICLE
      III -- INVENTIONS

    


    3.1        
         Ownership
      of Improvements.
      Any
      improvements arising from development work on BIOLOCK and BIOSYSTEM shall be
      owned as set forth in this Article III. 

    


    3.2          
      Definition
      -
“Invention,” as used herein, means any invention, whether product, process or
      equipment, technical information, data, computer program, improvement, design,
      copyrightable work, or know-how, whether or not patentable, which relates to
      biometric
      enabled residential deadbolts or biometric enabled systems which
      (a)
      are conceived or first reduced to practice by Sequiam Biometrics and/or Kwikset
      during the term or in anticipation of this Agreement, or (b) results from work
      done pursuant to this Agreement. 

    


    3.3           Kwikset
      Improvements
      -
      Inventions solely
      conceived by Kwikset or relating to the industrial design and/or the mechanical
      features shall be solely owned by Kwikset (“Kwikset Improvements”). Kwikset
      shall grant Sequiam Biometrics a non-exclusive, royalty-free license in any
      patented Kwikset Improvements related to BIOLOCK and/or BIOSYSTEM.

    


    3.4           Sequiam
      Biometrics Improvements
      -
      Inventions solely conceived by Sequiam Biometrics and not relating to industrial
      design shall be solely owned by Sequiam Biometrics (“Sequiam Biometrics
      Improvements”). Sequiam Biometrics shall grant Kwikset a
      non-exclusive, royalty-free
      license
      in any patented Sequiam Biometrics Improvements related to BIOLOCK
      and/or BIOSYSTEM.

    


    3.5          
       Joint
      Improvements
      -
      Inventions that are jointly conceived by Sequiam Biometrics and Kwikset and
      not
      relating to industrial design shall be solely owned by Kwikset (“Joint
      Improvements”). Kwikset shall grant Sequiam Biometrics a non-exclusive,
      royalty-free license to any patented Joint Improvements related to BIOLOCK
      and/or BIOSYSTEM. 

     

    
      ___________________

    

    *
      The
      information omitted is confidential and has been filed separately with the
      Securities and Exchange Commission pursuant to Rule 406 of the Securities Act
      of
      1933, as amended. 

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    


    3.6         
       Assignment
      and Filing
      -
      Sequiam Biometrics shall, upon request by Kwikset, assign all right, title
      and
      interest in the Joint Improvements and all proprietary rights therefore to
      Kwikset. Sequiam Biometrics's owners, employees and consultants will sign all
      applications for patents, copyrights, and other proprietary rights in the U.S.
      and foreign countries. All attorney's fees and government costs relating to
      said
      patents, copyrights or other proprietary rights shall be paid by Kwikset.
      Kwikset shall have the sole discretion to decide whether to file or prosecute
      any patent application, or to otherwise obtain, maintain, or enforce proprietary
      rights for the Joint Improvements.

    


    ARTICLE
      IV -- EXCLUSIVITY

    


    4.1         
       Kwikset
      -
      Kwikset agrees to form no business relationship during the term of this
      Agreement with any biometric technology provider other than Sequiam Biometrics,
      contingent upon satisfactory annual technology and business performance reviews
      by Kwikset of Sequiam Biometrics. Annual technology reviews will require Sequiam
      Biometrics to demonstrate its technology performance is comparable or superior
      to their competition in delivering performance specified in the engineering
      specification at the most competitive cost.

    


    4.2           Sequiam
      Biometrics agrees to enter into no business relationships with any person or
      entity which competes with Kwikset or its parents, subsidiaries or affiliates
      in
      the fields of use described in this Agreement for a period of five (5) years
      from the Effective Date of this Agreement if agreed upon timelines,
      product/system performance and cost targets are achieved. 

    


    ARTICLE
      V
      - CONFIDENTIALITY

    


    5.1         
       Definition
      -
      INFORMATION, as used herein, means any business or technical information,
      including without limitation any drawing, disclosure, design, data, report,
      calculation, computer programs, model, component part, patent application,
      or
      the like of the disclosing party which the receiving party develops, learns,
      or
      gains access to during the course of and as a result of work performed pursuant
      to the terms of this Agreement, excluding any information or object: (a) which
      is publicly known as of the Effective Date, (b) which becomes publicly available
      subsequent to the Effective Date through no fault of the receiving party, (c)
      which is known or possessed by the receiving party before receipt from the
      disclosing party or developed by Sequiam Biometrics for Kwikset pursuant to
      this
      Agreement, (d) which is disclosed at any time to the receiving party by a third
      party not under binder of confidentiality to the disclosing party,
      or (e)
      becomes subject to legal process or applicable law that requires disclosure
      of
      any INFORMATION, in which case the party subject to such legal process shall
      notify the other party of such required disclosure as promptly as possible
      (and
      prior to disclosure, if permissible) and shall take all actions as may be
      reasonably necessary to keep the INFORMATION confidential, including all actions
      that such party takes to preserve the confidentiality of its own
      INFORMATION.
      INFORMATION shall also include the
      existence and/or subject matter of this Agreement and relationship between
      the
      Parties.

    


    5.2         
       Confidentiality
      - Each
      Party will maintain in confidence all INFORMATION disclosed to it by the other
      Party and will not use or disclose the INFORMATION to a third party (a) except
      in connection with the performance of its obligations hereunder or when
      necessary to contract for services needed to perform this Agreement, (b) except
      pursuant to a license granted under this Agreement, or (c) unless authorized
      in
      writing by the disclosing party. The obligations of non-disclosure and non-use
      under this Agreement shall not apply to any information unless, if tangible,
      such INFORMATION is labeled or tagged "CONFIDENTIAL" at the time of disclosure,
      or if intangible, is noted as Confidential at the time of disclosure and reduced
      to a writing labeled "CONFIDENTIAL" and sent to the receiving party within
      fifteen (15) days of its disclosure to the receiving party by the disclosing
      party.


    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    


    5.3         
       Confidentiality
      Term
      - All
      obligations of the Parties pursuant to Section 5.2 above shall survive any
      early
      termination of this Agreement and shall expire five (5) years from the effective
      date of such termination.

    


    ARTICLE
      VI --TERM AND TERMINATION

    


    6.1         
       Term
      - This
      Agreement shall commence on the Effective Date and continue for a period of
      five
      (5) years.
      Such
period
      may be extended as necessary by approval of both Parties.

    


    6.2        
        Termination
      -
      This
      Agreement may be terminated by either Party so long as they provide written
      notice of termination to the other Party. Said termination will become effective
      in thirty (30) days. This Agreement may alternatively be terminated as permitted
      hereunder.

    


    6.3           Termination
      for Insolvency
      - This
      Agreement may be terminated by a Party without penalty immediately upon giving
      notice, if proceedings under any bankruptcy, insolvency or similar legislation
      are instituted by or against the non-terminating Party, or the non-terminating
      Party makes an assignment for the benefit of creditors, or a receiver is
      appointed for all or a substantial part of the non-terminating Party’s
      assets.

    


    6.4         
       Effect
      of Termination.
      Neither
      the expiration nor termination of this Agreement shall relieve either Party
      of
      its obligation to make any and all payments that have come due under this
      Agreement prior to the date of termination, nor shall it relieve either Party
      of
      obligations incurred prior to termination, which by their nature or term survive
      termination. 

    


    ARTICLE
      VII

    MISCELLANEOUS

    


    7.1         
       Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Maryland, without regard to its conflicts of law principles.


    


    7.2         
       Assignability.
      Neither
      Party may assign its rights or obligations hereunder without the prior written
      consent of the other Party hereto, except that Kwikset may assign this Agreement
      to an affiliate without the prior written consent of Sequiam Biometrics.


    


    7.3           Entire
      Agreement; Modification.
      This
      Agreement together with any Exhibits attached hereto and incorporated by
      reference herein sets forth the entire agreement between the Parties relating
      to
      the subject matter hereunder and any representation, promise, agreement or
      condition therewith not incorporated herein shall not be binding upon either
      Party. No change, modification, extension or renewal of this Agreement shall
      be
      binding unless made in writing and signed by authorized representatives of
      both
      Parties.


    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    


    7.4.        
       Public
      Announcement.
      The
      Parties shall not disclose, advertise or publish the terms and conditions of
      this Agreement without the prior written consent of the other Party. Each Party
      shall consult with the other Party before issuing any press releases or other
      public statements regarding the existence or nature of this Agreement, or
      regarding the Parties’ execution, performance or benefit hereunder.

    


    7.5         
       Nature
      of Relationship.
      For the
      purposes of this Agreement, the Parties are deemed to be independent
      contractors. It is expressly agreed that this Agreement and the relationship
      between the Parties hereby established do not constitute a partnership, joint
      venture, agency or contract of employment. No Party shall have the authority
      to
      make any statements, representations or commitments of any kind, or to take
      any
      action, which shall be binding on the other, except as authorized in writing
      by
      the party to be bound. No Party shall bind nor attempt to bind the other to
      any
      contract or to the performance of any obligation, nor represent to third parties
      that it has any right to enter into any obligation on the other’s
      behalf.

    


    7.6.        
       Partial
      Invalidity.
      If and
      to the extent that any court of competent jurisdiction or arbitrator holds
      any
      provision (or part thereof) of this Agreement to be invalid, illegal, or
      unenforceable, that provision shall, if possible, be construed as though more
      narrowly drawn, if a narrower construction would avoid such invalidity,
      illegality, or unenforceability or, if that is not possible, such provision
      (or
      part thereof) shall be severed, and the remaining provisions of this Agreement
      shall remain in effect.

    


    7.7         
       Waiver.
      Failure
      of either Party to enforce any provision of this Agreement shall not be deemed
      a
      waiver of future enforcement of that or of any other provision.

    


    7.8        
        Counterparts.
      This
      Agreement and any related amendments or other documents or instruments between
      or among the Parties may be executed in multiple counterparts, each of which
      shall be deemed an original, and all of which together shall constitute one
      and
      the same instrument.

     

    7.9      
           Notice.
      Any
      notice required or permitted hereunder must be in writing and be either (i)
      personally delivered; (ii) delivered by courier, overnight delivery, facsimile
      or similar means providing for proof of service; or (iii) sent by mail, postage
      prepaid (which shall be registered or certified mail, return receipt requested);
      properly addressed to the Party entitled to receive such notice or communication
      at the address for such Party set forth below or at such other address as the
      intended recipient shall have previously designated by written notice to the
      sender. Notice shall be effective on the date that it is delivered or, if mailed
      as provided above, three (3) days after the date of mailing.


    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    


    WITH
      INTENT TO BE BOUND, the Parties have executed this Agreement on the dates
      indicated below.

    


    
      	
              Kwikset

            	
              Sequiam
                Biometrics:

            
	
              KWIKSET
                CORPORATION

              A
                BLACK & DECKER HHI COMPANY

            	
              SEQUIAM
                BIOMETRICS, INC.

              A
                SEQUIAM COMPANY

            
	
              By: 

              

            	
              By:

              

            
	
              Title:
                VP
                R&D, ENGR. BDHHI

            	
              Title:
                CHIEF
                EXECUTIVE OFFICER

            
	 	 
	
              Dated: SEPTEMBER
                13, 2005

            	
              Dated: SEPTEMBER
                12, 2005

            
	 	 
	
              Address:
                19701 Da Vinci

            	
              Address: 300
                Sunport Lane

            
	                  Lake
              Forest, CA 92610	                 
              Orlando, FL 32809


    

     

     

    10