Development Agreement - Identix Inc. and International Technology Concepts Inc.
Identix Incorporated
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DEVELOPMENT AGREEMENT
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This Development Agreement (this "Agreement") is made as of January 14,
2000 by and between Identix Incorporated, a Delaware corporation, acting through
its Biometric Imaging Division ("Identix") and International Technology
Concepts, Inc., a California corporation ("IT Concepts").
WHEREAS, Identix designs, develops, manufactures and sells biometric
security and identification hardware and software products;
WHEREAS, IT Concepts designs, manufactures and distributes, among other
things, certain complete imaging components and products, and provides related
engineering services;
WHEREAS, Identix, IT Concepts and Identicator Technology, Inc., a Delaware
corporation and a wholly owned subsidiary of Identix ("Identicator Technology"),
are parties to that certain Support and Indemnification Agreement dated as of
April 26, 1999, pursuant to which IT Concepts provides biometric security IT
components and products, and related engineering services, to Identix and
Identicator Technology;
WHEREAS, Identix desires, upon the terms and conditions hereinafter set
forth, to retain IT Concepts to develop and provide certain new biometric
imaging technology and products and related services to Identix;
WHEREAS, IT Concepts desires, upon the terms and conditions hereinafter set
forth, to develop and provide such new biometric imaging technology and products
and related services to Identix;
NOW THEREFORE, in consideration of the premises and the mutual covenants and
conditions contained herein, the parties hereto agree as follows:
1. Development and Delivery.
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(a) New Scanner Technology for Four Finger Plain Image Finger Scanning. IT
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Concepts will design and develop a new Four Finger Flat Scanner mo ("FFFS
Module") for use and application with Identix's new, proprietary, fingerprint
imaging system.
(i) Specifications. The specifications and performance
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parameters ("Specifications") for the FFFS Module are attached to this
Agreement as Exhibit A-1 hereto.
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(ii) Design and Delivery Schedule. A detailed description of
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the scope of work to be completed by IT Concepts under this Section 1(a),
and the timetable for completion of such work, is set forth on Exhibit A-2
hereto. Without limiting Exhibit A-2, IT Concepts shall deliver no less
than 3 prototype units of each of the FFFS Modules no later than April1,
2000. Prior to availability or delivery of such beta units, Identix may,
upon request, conduct reviews of IT Concepts development work by means of
formal program or technical reviews at IT Concepts facilities or the
facilities of Intech, a Russian company and IT Concept's authorized
subcontractor hereunder (the "Subcontractor"). Beginning no later than
thirty (30) days following the date first above written and continuing
thereafter at least once every month until final approval by Identix of the
beta units (see below), IT Concepts shall provide Identix (1) a written
progress report ("Progress Report") of all development efforts by IT
Concepts and the Subcontractor , and (2) summaries, copies and duplicates,
as the case may be, of any and all ideas for technical solutions, designs,
drawings, schematics, technical data, prototypes, inventions, or other
intellectual property in progress under this Agreement. Optical Module beta
units will each be deemed accepted by Identix upon the issuance by Identix
to IT Concepts of a final acceptance certificate confirming that the units
meet applicable Specifications. This determination shall be made by Identix
in its sole judgement. Prior to issuance of final acceptance by Identix, if
any prototype unit does not conform to the Specifications and/or it has not
successfully passed Identix's testing criteria, as determined by Identix,
IT Concepts will have thirty (30) days from receipt of notice of deficiency
to make and submit to Identix such changes as shall be reasonably required
to correct the deficiencies set forth in the notice.
(iii) Fixed Price and Payment. The fixed price and payment
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terms for design and delivery of the FFFS Module is set forth on Exhibit A-
3 hereto.
(b) New Low Cost Roll and Plain Forensic Quality Fingerprint Image
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Capture Scanner. IT Concepts will design, develop and manufacture a new
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low cost roll and plain forensic quality fingerprint image capture scanner
(the "Scanner").
(i) Specifications. Identix shall provide Specifications
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for the Scanner at such time as Identix is prepared to initiate development
activity respecting the Scanner. Such Specifications shall be attached
hereto as Exhibit B-1.
(ii) Design, Testing, Acceptance and Delivery Schedule. A
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detailed description of the scope of work to be completed by IT Concepts
under this Section 1(b) and the timetable for completion of such work shall
be provided by IT Concepts to Identix no later than 10 days after receipt
by IT Concepts of the Scanner's Specifications from Identix. Such scope of
and schedule of work, when agreed upon in writing by Identix, shall be
attached hereto as Exhibit B-2. Prior to availability or delivery of
Scanner beta units, as per Exhibit B-2, Identix may, upon request, conduct
reviews of IT Concepts development work by means of formal program or
technical reviews at IT Concepts facilities or the facilities of the
Subcontractor. Beginning no later than thirty
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(30) days following the date Exhibit B-2 is agreed to by Identix, and
continuing thereafter at least once every month until final approval by
Identix of the Scanner beta units, IT Concepts shall provide Identix (1) a
Progress Report of all development efforts by IT Concepts and the
Subcontractor , and (2) summaries, copies and duplicates, as the case may
be, of any and all ideas for technical solutions, designs, drawings,
schematics, technical data, prototypes, inventions, or other intellectual
property in progress under this Agreement. Scanner beta units will each be
deemed accepted by Identix upon the issuance by Identix to IT Concepts of a
final acceptance certificate confirming that the units meet applicable
Specifications. This determination shall be made by Identix in its sole
judgement. Prior to issuance of final acceptance by Identix, if any beta
unit does not conform to the Specifications and/or it has not successfully
passed Identix's testing criteria, as determined by Identix, IT Concepts
will have thirty (30) days from receipt of notice of deficiency to make and
submit to Identix such changes as shall be reasonably required to correct
the deficiencies set forth in the notice.
(i) Fixed Price and Payment. The fixed price and payment terms
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for delivery of the Scanner is set forth on Exhibit B-3 hereto.
(c) Technical Representatives. In order to enhance communication,
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efficiency, goodwill and mutual cooperation under this Agreement, each of the
parties hereby designates the following individuals to act as its technical
representative and point of contact during the development activities
contemplated by this Section 1: for IT Concepts, Naum Pinkhasik; for Identix,
Dan Maase. Such representatives shall gather for a face to face meeting no later
than 30 days following the date first above written, and on a monthly basis
thereafter discuss, among other things, Progress Reports. Such meetings shall
also serve as the venue for the monthly delivery (as described above) of
summaries, copies and duplicates, as the case may be, of any and all designs,
drawings, schematics, technical data, prototypes, inventions, or other
intellectual property in progress under this Agreement. Each party may change
its technical representative at any time upon notice in writing to the other
party.
2. Ownership of Designs and Technology. All right, title and interest
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in Identix's Confidential Information, as defined in the Confidentiality
Agreement between the parties dated as of November 4, 1999 (the "Confidentiality
Agreement") shall continue to be owned solely and exclusively by Identix. All
discoveries, improvements, inventions, copyrights, and trade secrets, and any
and all tangible or intangible technology or intellectual property arising out
of or related to the FFFS Module and the Scanner (the "Products"), or otherwise
arising out of or related to the design or development activities contemplated
by this Agreement, and all intellectual property rights therein, shall be the
sole and exclusive property of Identix; neither IT Concepts nor the
Subcontractor shall obtain any rights therein. Notwithstanding the foregoing, .
individual employees of IT Concepts who are responsible for inventions leading
to patent filings and awards arising out of this Agreement shall have the right
to have their names on such filings and awards with Identix as joint inventors,
but only to the extent that such employees have executed and delivered to
Identix Proprietary Information and Inventions Agreement in the form attached
hereto as Exhibit C prior to the relevant filing. Such agreement, among others,
provides for the assignment by individual inventors to Identix of all rights,
title and interest in any and all patents related to or arising out of this
Agreement. IT Concepts shall provide, and shall cause its
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employees, the Subcontractor and its employees to provide and sign, any and all
additional documentation, technical data, drawings designs, technologies,
testimonies, affidavits, support and other assistance requested by Identix in
the furtherance of Identix' efforts to file patent applications or obtain
exclusive rights to patents arising out of or related to this Agreement.
3. Non-Disclosure. The terms and provisions of the Confidentiality
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Agreement are hereby expressly incorporated into this Agreement by reference
shall apply to the activities of the parties under this Agreement.
Notwithstanding any provision of the Confidentiality Agreement to the contrary,
IT Concepts may disclose confidential information of Identix to the
Subcontractor, provided that prior to such disclosure, IT Concepts executes with
the Subcontractor an agreement of confidentiality containing non-disclosure
ownership provisions substantially identical to those set forth in the
Confidentiality Agreement.
4. Warranties and Indemnities. Identix and IT Concepts shall share
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responsibility for conducting patent searches on technical solutions proposed by
IT Concepts under this Agreement. Patent searches will be conducted at the sole
cost of Identix. Notwithstanding the foregoing, (a) IT Concepts represents and
warrants to Identix that: (1) the Products are and will be original and will not
infringe upon or misappropriate any patent, copyright, trade secret or other
proprietary rights of others; (2) IT Concepts will not breach any non-disclosure
or restricted use obligations to any third party in the development of the
Products; (3) IT Concepts has not previously granted and will not grant any
rights in the Products to any third party which are inconsistent with the sole
and exclusive ownership rights of Identix described in this Agreement; (4) prior
to having access to any Confidential Information hereunder, and prior to
performing any activities of any nature whatsoever hereunder, each of IT
Concept's employees, and each of the Subcontractor's employees who has been or
will be involved in the development of the Products will have signed and
delivered to Identix a Proprietary Information and Inventions Agreement in the
form attached hereto as Exhibit C; (5) IT Concepts has full power to enter into
this Agreement, to carry out is obligations under this Agreement and to grant
the rights granted to Identix. IT Concepts further warrants that each Product
will conform to its applicable Specifications.
(b) IT Concepts hereby indemnifies Identix and each of its officers,
directors, employees, agents, customers, subcontractors and sublicensees (each
and "Indemnified Party") and holds harmless each Indemnified Party from and
against and all loss, costs, claims, fees, expenses (including reasonable
attorneys' fees), damages or liabilities arising out of or related to (i) any
breach of this Agreement by IT Concepts, (ii) any breach of applicable
confidentiality obligations by the Subcontractor, (iii) any challenge by any
employee of either IT Concepts or the Subcontractor to Identix's sole and
exclusive (1) ownership of all tangible and intangible technology or
intellectual property arising out of or related to this Agreement or (2) rights
to patents awarded on inventions arising out of this Agreement, or (iii) any
threat, claim, demand, suit or action alleging facts that would constitute a
breach of any of representation or warranty made by IT Concepts in this
Agreement. The warranties and indemnities set forth in this Agreement shall
survive any termination of this Agreement.
5. Manufacture of Products; Standard Terms and Conditions of Purchase.
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Following final acceptance of the prototype beta units of the FFFS Module by
Identix, IT
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Concepts shall have the right to quote Identix a bid on prices and other
relevant terms for the manufacturing of FFFS Modules. Identix will consider IT
Concepts as its primary manufacturer of Optical Modules if Identix is satisfied
with pricing for such modules, and it is otherwise satisfied, in its sole
judgement, that IT Concepts will be able to meet, among other things, Identix's
quality, volume and delivery requirements. Should Identix select IT Concepts as
its primary manufacturer, the parties shall enter into Identix's standard form
of supply agreement, and Identix shall have the right to purchase from IT
Concepts commercial production units of the FFFS Module on Identix's standard
terms and conditions of purchase. Prices for commercial units shall be agreed
upon in writing by Identix and IT Concepts in the supply agreement.
6. Term. This Agreement shall commence as of the date first above
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and shall continue in effect for an initial term of one year unless earlier
terminated in accordance with its terms. The term of this Agreement may be
extended by mutual written agreement of the parties.
7. Non-Competition. During the term of this Agreement, IT Concepts shall
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not, directly or indirectly, engage in any activity with or in relation to any
technology or product that is in any way competitive with or adverse to the
Products or the business or welfare of Identix.
8. Independent Contractor. The parties agree that at all times during
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the term of this Agreement, IT Concepts shall continue to be an independent
contractor, and is not authorized as, nor shall be deemed to be an employee,
agent or representative of Identix. All work performed for Identix by IT
Concepts under this Agreement shall be as "work for hire."
9. Termination. This Agreement may be terminated at any time by
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Identix on thirty (30) days prior written notice to IT Concepts.
10. Amendment. This Agreement shall not be amended except by a writing
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duly executed by both parties.
11. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of this State of California as applied to agreements
entered into by California residents and entirely to be performed within
California. The parties hereby consent to the exclusive jurisdiction of the
courts of the State of California.
12. Headings. The headings contained in this Agreement are intended for
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convenience and shall not be used to interpret the meaning of this Agreement or
to determine the rights of the parties.
13. Notices. All notices, requests, demands, and other communications
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made in connection with this Agreement shall be in writing and shall be deemed
to have been duly given on the date of delivery if delivered by hand delivery or
12 hours after facsimile transmission to the persons identified below or five
days after mailing if mailed by certified or registered mail postage prepaid
return receipt requested addressed as follows:
Identix: 510 N. Pastoria Avenue
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Sunnyvale, California 94086
Attention: Dan Maase, Vice President
Facsimile Number: (408) 739-0178
IT Concepts: 11501 Dublin Blvd., Building 101
Dublin, California 94568
Attention: Naum Pinkhasik, President
Facsimile Number: (925) 556 - 6901
Such addresses may be changed, from time to time by means of a notice given in
the manner provided in this Section.
14. Severability. If any provision of this Agreement is held to be
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unenforceable for any reason, it shall be adjusted rather than voided, if
possible, in order to achieve the intent of the parties to the extent possible.
In any event, all other provisions of this Agreement shall be deemed valid and
enforceable to the full extent.
15. Waiver. The waiver of any term or condition of this Agreement by any
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party shall not be construed as a waiver of a subsequent breach of failure of
the same term or condition, or a waiver of any other term or condition in this
Agreement.
16. Assignment. IT Concepts may not assign, by operation of law or
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otherwise, all or any portion of its rights or duties under this Agreement
without the prior written consent of the other party, which consent may be
withheld in the absolute discretion of the party asked to give consent.
Notwithstanding the foregoing, IT Concepts may subcontract certain of its
obligations hereunder to the Subcontractor; provided, however, that in no event
shall such subcontract relieve IT Concepts of any of its duties or obligations
hereunder. IT Concepts shall remain solely and completely responsible for the
work and activities of the Subcontractor.
17. Counterparts. This Agreement may be signed in counterparts with the
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effect as if the signatures to each party were upon a single instrument. All
counterparts shall be deemed an original of this Agreement.
18. The Subcontractor. IT Concepts represents and warrants to Identix
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that the Subcontractor is a company 70% owned by IT Concepts and that a company
duly organized and in good standing in St. Petersburg, Russia.
19. Entire Agreement. This Agreement contains all the terms and
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conditions agreed upon by the parties relating to the subject matter of this
Agreement and supersedes all prior agreements, negotiations, correspondence,
undertakings, and communications of the parties, whether oral or written,
respecting that subject matter.
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IN WITNESS WHEREOF, Identix and IT Concepts have executed this Agreement as of
the date first above written.
IDENTIX INCORPORATED
By /s/ D. Maase
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Name: Dan Maase
Title: Vice President
INTERNATIONAL TECHNOLOGY CONCEPTS,
INC.
By /s/ N. Pinkhasik
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Name: Naum Pinkhasik
Title: President
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