**Exhibit 10.50**

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*****Text Omitted and Filed Separately**

**Confidential Treatment Requested Under**

**17 C.F.R. §§ 200.80(b)(4) and 240.24b-2.**

 

Delivery OrderDTFA01-02-23002

ContractDTFA01-02-C-00023

 

 

DELIVERY ORDER DO#2

Under Contract No.DTFA01-02-C-00023

 

The purpose of this Delivery Order is to order 100 Explosives DetectionSystems (EDS), establish a delivery schedule for the 100 units and order 300parts kits known as long lead time items and to order the TDP and manufactureramp-up, in accordance with Contract number DTFA01-02-C-00023.   Items authorized under this Delivery Orderare prescribed herein.

 

1.               Section B

 

The Contractor shall provide the following supplies and services inaccordance with the terms and conditions of this letter contract.  The following line item(s) will be orderedin accordance with the contract amounts set forth below.

 
| **CLIN** |   | **TITLE**                                                                                         |   | **QUANTITY**          |   | **UNIT PRICE**        |   | **TOTAL**             |
|----------|--------|---------------------------------------------------------------------------------------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|
| RF-01    |   | EDS Products Royalty Fee                                                                          |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| RF-01-25 |   | EDS Products Royalty Fee (CTX 2500)                                                               |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| RF-01-55 |   | EDS Products Royalty Fee (CTX 5500DS)                                                             |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| RF-01B   |   | Technical Data Package (TDP) Facilitation and  factory training                                   |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| RU-01    |   | Manufacture Ramp Up                                                                               |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| 00A1A    |   | Parts Kits for SA EDS Unit (CTX-2500) w/powered  incline conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| 0001A    |   | Pass Through SA EDS Unit (CTX-2500) w/powered  incline conveyor and baggage exit slide/conveyor   |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| 00A6A    |   | Parts Kits for SA EDS Unit (CTX-5500) w/powered  incline conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
| 0006A    |   | Pass Through SA EDS Unit (CTX-5500) w/powered  incline conveyor and baggage exit slide/conveyor   |   | **[...***...]** |   | **[...***...]** |   | **[...***...]** |
|     |   | **TOTAL ORDERED**                                                                                 |   |                  |   |                  |   | $176,300,000          |

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TBD:  To Be Determined atcontract definitization.

 

 

2.               Funding: Funding in the amount of $176,300,000 is hereby authorized under thisDelivery Order, under the provisions set forth below:

 

3.2.4-22 Limitation of Government Liability (April 1996)

 

(a)          In performing this contract, the Contractoris not authorized to make expenditures or incur obligations exceeding$176,300,000 dollars.

 

(b)         The maximum amount for which the Government shall be liableif this contract is terminated is $176,300,000 dollars.

 

(End of clause)

 

Expendituresabove that amount are not authorized, and are at InVision’s own risk.

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*******Confidential Treatment Requested**

 

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3.  Section C

 

The Contractor shall deliver the supplies and services associated withthe above CLINs in accordance with the Statement of Work in ContractDTFA01-02-C-00023.

 

 

4.  Section F

 

The CLINS are to be delivered to the following locations (TBD locationswill be supplied upon completion of FAA site surveys.

** **
| **ITEM NO.** |   | **SUPPLY/SERVICE**                                                                               |   | **QTY**               |   | **DATE OF  DELIVERY**    |   | **PLACE OF  DELIVERY** |   | **PLACE OF  ACCEPTANCE** |
|--------------|--------|--------------------------------------------------------------------------------------------------|--------|-----------------------|--------|--------------------------|--------|------------------------|--------|--------------------------|
| RF-01B       |   | TDP License                                                                                      |   | **[...***...]** |   | By **[...***...]** |   | **[...***...]**  |   | **[...***...]**    |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Pass Through SA EDS  Unit (CTX-2500) w/powered inclined conveyor and baggage exit slide/conveyor |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0001A        |   | Total  Production Units                                                                     |   | **[...***...]** |   |                     |   |                   |   |                     |
|         |   |                                                                                             |   |                  |   |                     |   |                   |   |                     |
| 0006A        |   | Pass Through SA EDS  Unit (CTX-5500) w/powered incline conveyor and baggage exit slide/conveyor  |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0006A        |   | Pass Through SA EDS  Unit (CTX-5500) w/powered incline conveyor and baggage exit slide/conveyor  |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0006A        |   | Pass Through SA EDS  Unit (CTX-5500) w/powered incline conveyor and baggage exit slide/conveyor  |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0006A        |   | Pass Through SA EDS  Unit (CTX-5500) w/powered incline conveyor and baggage exit slide/conveyor  |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0006A        |   | Pass Through SA EDS  Unit (CTX-5500) w/powered incline conveyor and baggage exit slide/conveyor  |   | **[...***...]** |   | By **[...***...]** |   |                   |   | FOB ORIGIN               |
| 0006A        |   | Total Production Units                                                                           |   | **[...***...]** |   |                     |   |                   |   |                     |

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*******Confidential TreatmentRequested**

 

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b.  Period ofDelivery

 

The period of delivery for this order is from the date of award throughJune 28, 2002.

 

 

5. Section G

 

a)  Thefollowing administration data applies to this order:

 

Contracting Officer

 

                   Federal Aviation Administration

                   Kimberley T. Branch, ASU-360

                   590 Herndon Parkway, Suite 120

                   Herndon, VA  20170-5232

                   Telephone (703) 796-7118

                   Fax (703) 707-5675

 

ContractingOfficer’s Technical Representative (COTR)

 

                   Federal Aviation Administration

                   Ed Ocker, AAR-600

                   590 Herndon Parkway, Suite 120

                   Herndon, VA  20170-5232

                   Telephone (703) 796-7104

                   Fax (703) 707-5675

 

QualityReliability Officer (QRO)

 

                   Federal Aviation Administration

                   Quality Reliability Officer (QRO)

                   Lindsey Humphrey, ASU-200

                   7151 Gateway Boulevard

                   Newark, CA  94560

                   Telephone (510) 739-2516

                   Fax (510) 739-6400

 

b.             ThisDelivery Order is funded in the amount of $176,300,000.  This amount isconsidered the contract ceiling.  Unlessmodified by the Contracting Officer in writing, the Contractor may not exceedthis 

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ceiling except at its own risk (see clause inContracting Officer’s letter dated February 19, 2002 — Limitation of GovernmentLiability (Apr 1996

 

c.             TheContractor shall submit to the FAA Contracting Officer the serial numbers/IDnumbers for each system delivered under this Delivery Order, at least one weekprior to, but no later than, delivery of the system.

 

 

6.  Section H —Special Terms and Conditions

 

The following terms apply to this Delivery Order, numberDTFA01-02-23001 only.

 

(1)          In the event the Contractor fails to meet the deliveryschedule as provided herein, such failure will be considered in accordance withthe Termination for Default clause (AMS 3.10.6-4(1996)).

 

(2)          The Contractor shall execute and perform all terms andconditions of the License Agreement contained in the Letter Contract underwhich this Delivery Order is executed. Failure to adhere to the licensing agreement may result in theGovernment terminating the contract for default pursuant to the Termination forDefault clause (AMS 3.10.6-4(1996)).

 

(3)           Payment Terms:

 

For CLIN 0001A, 0006A Production Units.

 

For units 1 through 100:

 

Up to 40% of the CLIN price at the time of order, but not to exceed theactual costs of long lead items.

 

70% of the CLIN price at satisfactory completion of Factory AcceptanceTest (minus any previously paid long-lead items).  Satisfactory completion includes a signed form FAA-256,Inspection Report of Material and/or Services.

 

30% of the CLIN price at satisfactory completion of Site AcceptanceTest, or 20% upon satisfactory completion of the Site Acceptance Test if thecontractor is responsible for training, but not later than 90 days aftersuccessful completion of the Factory Acceptance Test.  Satisfactory completion includes a signed form FAA-256,Inspection Report of Material and/or Services.

 

10% of the CLIN price when the unit is fully operational, i.e., at thecompletion of Initial Operator Training, if the contractor is responsible fortraining.

 

For CLIN 00A1A, 00A6A Production Units.

 

InVision will submit a request for payment / invoice for actual costsincurred consistent with the quantities identified in Delivery Order #1.

 

7.  DefensePriority and Allocation Requirement

The TSA is seeking approval for use of, as a minimum,a DO rated order certified for national defense use.  It is anticipated that the approval will be forthcoming veryquickly.  Once approved, the Contractorshall follow all the requirements of the Defense Priorities and AllocationsSystem regulation (15 Code of Federal Regulations Part 700).

 

END OF DELIVERY ORDER

 

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