Sequiam Biometrics (fka SQUM)

[analystslie]

On May 16, 2007, Sequiam Biometrics, Inc. or Sequiam Biometrics, one of our wholly-owned subsidiaries,, and Kwikset Corporation, a subsidiary of The Black and Decker Corporation, amended that certain Cooperative Development and Supply Agreement dated as of September 13, 2005. The amended agreement provides for: (a) current payments to us for non-recurring engineering costs and test equipment; and (b) a fixed royalty payment to us for the BioLock product over a royalty term that began June 1, 2007 and is extended to May 31, 2012. The amended agreement also grants us full reseller privileges for the BioLock product based on terms and conditions set by Kwikset. Kwikset and Sequiam also further agreed to conduct a two phase cost reduction project for the BioLock product. Kwikset agreed to pay us 50% of the Phase 1 cost savings achieved for a period of twelve months following the first delivery of the cost reduced product. Kwikset also agreed to pay us 50% of the Phase 2 incremental cost savings achieved for a period of twelve months following the first delivery of the phase 2 cost reduced product. We may also sell our proprietary technology to Kwikset for use in future versions of the BioLock product.