Model Joint Venture Agreement

JOINT VENTURE AGREEMENTBETWEEN

SECURIKEY, INC.OF HOUSTON, TEXAS

UNITED STATES OF AMERICA

AND

MAPLE LEAF, INC.OF VANCOUVER, BRITISH COLUMBIA

CANADA

Entered into this 1st day of May, 2012, By and Between Maple Leaf, Inc., a corporation organized and existing under the laws of British Columbia, Canada, with its principal office at 5000 Pacific Street, British Columbia, Vancouver (hereinafter called "MAPLE LEAF") and Securikey, Inc., a corporation organized and existing under the laws of the State of Texas, United States of America, with its principal office at 6111 F.M. 529, Houston, Texas, 77069 U.S.A. (hereinafter called "SECURIKEY").

MAPLE LEAF and SECURIKEY (hereinafter collectively called the "Parties") have entered into discussions and negotiations for the creation of a joint venture; and

The Parties desire to create the basis for a close and long-term relationship and, therefore, wish to establish an Equity Joint Venture in the form of a Canadian federal corporation to be known as Infosec, Inc. (hereinafter called the "Joint Venture") in which both Parties will have ownership interests and rights; and

The purpose of the Joint Venture is to own and operate a facility in Canada for the assembly and manufacture of certain security key pads as hereinafter defined.

ARTICLE I-DEFINITIONS

1.1. Definitions: The following terms will have the following meanings:

1.1.1. Agreement. This Joint Venture Agreement, together with the following Exhibits hereto and any amendments as may later be adopted pursuant to Paragraph 6.4 (entire agreement provision) hereof:

Exhibit A - Bylaws, Articles of Association, and Quality Control Provisions

Exhibit B - License Agreement

Exhibit C - List of Specialized Capital Equipment to be provided by SECURIKEY

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Exhibit D - Detailed description of capital equipment necessary for the facility for the testing of the Product to be provided by SECURIKEY

Exhibit E - Detailed description of remaining manufacturing equipment to be provided by MAPLE LEAF and initial inventory to be paid for MAPLE LEAF and provided by SECURIKEY

Exhibit F - Detailed description of components that make up Product to be provided by SECURIKEY

Exhibit G - Corporate Nondisclosure Agreement

Exhibit H - Detailed diagram of parts comprising the SHURLOCK II keypad device

1.1.2. Major Decisions. A Major Decision is any decision having or likely to have a material impact on the economic viability of the Joint Venture or affecting or likely to affect the general policy of the Joint Venture, including, without limitation, amendment of the Articles of Association; termination and dissolution of the Joint Venture; merger of the Joint Venture; equity and capital expansions; approval of or modification of the Joint Venture’s budgets or initial [five (5) year] operations and production plan; production increases or decreases; increases in wages or a change in prices; conclusion of third-party contracts; borrowings, loans and financings; establishment of new factories; purchase or sale of major machinery or capital assets; acquisition of industrial property rights; changes in management structure or policies; prosecution, defense or settlement of arbitration, litigation or conciliation; and any other decisions of similar importance.

1.1.3. Plant. The facility for the production of the Products as further described in Paragraph 1.1.3. hereof, together with related storage areas, utility areas, access routes and other structures, which are used by the Joint Venture in the activities contemplated hereunder. The Plant is located at 6500 Pacific Street, Vancouver, British Columbia and will consist of at least two separate areas: one area where the Housing, Printed Circuit Boards, Read Only Memory Chips, Retinal Scanners, and Keypads will be assembled and a second area where the finished security key pads will be shrink-wrapped with the End-User Manual and End-User License Agreement and placed into a box for shipment and delivery.

1.1.4. Products. The finished items to be assembled and manufactured by the Joint Venture will be the SHURLOCK II keypad device. The Product will exhibit a gray market tracking system comprised of a stamped metal serial number and will consists of the following parts (a detailed diagram has been set forth on Exhibit H):

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(a) Housing: A rectangular exterior measuring seven (7) inches long by five (5) inches wide, and one and one half (1.5) inches high. The housing will be made of durable plastic and colored Charcoal Gray Number Fifty-Six (56).

(b) Printed Circuit Board (PCB): a board containing the necessary electronic traces and chips.

(c) Read Only Memory chip (ROM): a chip contained on the PCB which is “flashed” during manufacturing with the retinal scan source code.

(d) Retinal Scanner: A device located above the twelve-button key pad and to the right is a small square screen that actually contains a camera into which a person would look into. This camera illuminates the eye’s retina at the same time that it takes a picture of the unique blood vessel pattern in the retina of the eye

(e) Speaker and Round Door Bell Button: A device located next to the twelve-button key pad that permits communication with a reception or security desk for responding to unannounced callers.

(f) Keypad: A twelve (12) button keypad in a three (3) by four (4) configuration, numbered from one (1) to zero (0). Reading from left to right, the bottom row has a button marked with an asterisk (*) symbol, followed by a button marked with a zero (0), and a button marked with the number (#) symbol. The keypad will be made of durable plastic and colored Forest Green Number Thirty-Four (34).

(g) End-User Manual: A booklet instructing the key pad’s end users on how to operate the key pad as well as diagrams, installation, features, and best practices sections.

(h) End-User License Agreement (EULA): A booklet containing provisions as to the terms and conditions of using the key pad. In one of the provisions, the end user agrees not to decompile, disassemble, or reverse engineer the ROM chip to learn its firmware source code.

1.1.5. Public Official. For the purpose of this Agreement, this term includes all officials, employees, agents and representatives of any branch or level of government (executive, legislative or judicial and whether national, state or local) or of any governmental department or agency (including advisors to such agencies and branches), directors, officers and employees of State-owned or controlled companies (including their consultants, advisors, agents and other representatives), political parties, party officials and candidates for office, and officials and employees of public international organizations such as the European Union or the United Nations (including their consultants, advisors, agents and other representatives).

1.1.6. Specialized Capital Equipment. Software and specialized equipment which map the traces of the solder on the PCB to define the electrical connections between the chips on the board.

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1.2. Precedence Clause

1.2.1. In the event that there is any discrepancy or ambiguity between the various documents which together constitute this Agreement, as specified in Paragraph 1.1.1., the basic document styled the Joint Venture Agreement will take precedence over all other documents. As amongst the Exhibits, the order in which they are listed in Paragraph 1.1.1., will determine the order of precedence. Thus Exhibit A, will take precedence over Exhibit B, which in turn will take precedence over Exhibit C, and so forth.

1.2.2. Amendments to any of the documents comprising this Agreement will have the same order of precedence as the document being amended.

ARTICLE II - OBJECT AND SCOPE

2.1. The object of this Agreement is the establishing of an Equity Joint Venture in the form of a Canadian federal corporation to equip, construct, manage and operate the Plant to be established in Canada for the assembly and manufacture of Products. The Joint venture intends to market all of its Products solely to SECURIKEY.

ARTICLE III - FORMATION OF JOINT VENTURE

3.1 Capitalization.

3.1.1. The initial equity capital of the Joint Venture is Forty Seven Million United States Dollars (U.S. $47,000,000), to be committed and contributed in the proportion of sixty percent (60%) for MAPLE LEAF forty percent (40%) for SECURIKEY. SECURIKEY's contribution to the equity of the Joint Venture consists of Nineteen Million United States Dollars (U.S. $19,000,000). MAPLE LEAF'S contribution to the equity of the Joint Venture consists of Twenty-Eight Million United States Dollars (U.S. $28,000,000).

3.1.2. Capitalization in Paragraph 3.1.1 will consist of Intellectual Property rights valued at Ten Million United States Dollars (U.S. $10,000,000) and specialized equipment valued at Nine Million United States Dollars (U.S. $9,000,000) to be committed by SECURIKEY. Additionally, MAPLE LEAF will retro-fit an existing plant owned by them at a cost of Twenty Five Million United States Dollars (U.S. $25,000,000) and components and initial inventory valued at Three Million United States Dollars (U.S. $3,000,000).

3.1.3. Parties agree that they are going to allow the Joint Venture to borrow capital to establish a fund for operating capital.

3.4. Powers of the Joint Venture.

3.4.1. The Parties agree that the Joint Venture will have all purposes and powers necessary to carry on the business for which it is established and all purposes and powers allied and incidental thereto, as permitted by the laws of Canada. The purposes and powers of the Joint

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Venture are set forth in the Joint Venture's Articles of Association, which are attached hereto as part of Exhibit A.

3.4.2. In the event that any provisions in this Agreement are found to be in contra to local, state, or national laws, the provision will be, amended, altered, changed or repealed as to conform with legal, business, marketing and other requirements or conditions. Provided that any such action will constitute a “Major Decision," the amendment, alteration, change or repeal will conform to the provisions as defined in Paragraph 1.1.6.

3.5. Management of the Joint Venture.

3.5.1. The management of the business and the conduct of the affairs of the Joint Venture will be vested in its Board of Directors, who will be elected by MAPLE LEAF and SECURIKEY, exercising their ownership rights in the Joint Venture in proportion to the Joint Venture's capital investments listed above.

3.5.2. The Board of Directors will be comprised of five (5) individuals. MAPLE LEAF will nominate and elect three (3) Directors and SECURIKEY will nominate and elect two (2) Directors. The five (5) Directors will hold office until their successors are elected and notified to the other party. The right to remove and replace a Director will remain exclusively with that Director's nominating party. The number of Directors may be increased or decreased by a Major Decision of the Directors.

3.5.3. The Directors will establish their own rules for proceeding, except as set forth below. Meetings will be held at least once a year and at such time and place as the Board may determine except that the first meeting will be held as soon as practicable after the entry into force of this Agreement. Meetings may also be called by any two (2) Directors giving a minimum of twenty (20) days notice to the other Directors of the time, place and subject of the meeting, it being understood, however, that each Director will be entitled to waive, in writing, such advance notice requirement as it applies to him.

3.5.4. For Board meetings in Canada, MAPLE LEAF, on behalf of the Joint Venture, will ensure that all visas have been arranged and similar Canadian requirements satisfied so as to permit non-Canadian Directors (and their substitutes appointed pursuant to this Agreement) to attend Board meetings and carry out other functions for which they are responsible in accordance with this Agreement. For Board meetings in the UnitedStates, SECURIKEY, on behalf of the Joint Venture, will be similarly responsible for all visas and arrangements. The Joint Venture will be responsible for reasonable overseas travel, transportation, living and other direct costs incurred by Directors in performance of their duties as Directors.

3.5.5. The Chairman of the Board will preside and have the right to vote at all meetings. The Chairman of the Board will be a nominee of MAPLE LEAF. SECURIKEY will nominate the Vice-Chairman of the Board, who will preside at meetings and act as Chairman of the Board if the Chairman of the Board is not present.

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3.5.6. Four (4) Directors will constitute a quorum for any Board meeting. Except with respect to Major Decisions, which will be by unanimous vote of all Board members present at the meeting, the vote of the majority of the Directors present at a meeting at which a quorum is present will be the act of the Board.

3.5.7. Any member of the Board may participate in a meeting of the Board by means of telephone conference call, telex or similar communications, and any Director may authorize another Director to act for him by proxy in all matters in which the Director giving the proxy is entitled to participate. Any Director may, by written designation, appoint a substitute to act for such Director at any meeting of the Board in all matters in which the Director appointing the substitute is entitled to participate. Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if all members of the Board consent thereto in writing, and the writing or writings are filed with the Minutes of proceedings of the Board.

3.5.8. The provisions of Paragraph 3.5.7 will apply equally to committee and section meetings.

3.5.9. Committees and Sections. The Board of Directors may, by a Major Decision, appoint officers and establish one or more committees or sections which will act under the authority of and be responsible to the Board. Committees and sections may consist of one or more Directors of the Joint Venture, officers, management personnel or other qualified persons as determined by the Board. Initially, the Joint Venture will have the following committees and sections, which will have the following functions:

A. Production and Planning Control Committee, which will be chaired by the Managing Director appointed initially by SECURIKEY as specified in Paragraph 3.5.10., and will have as members the Deputy Managing Director, the Chief Production Engineer and the Quality Control Supervisor, which officers are appointed by the Parties. The Committee will prepare and submit to the Board an initial five (5) year operations and production plan, as well as annual, biannual and other production and planning reports as requested by the Board, including information with respect to production efficiency and quality control, projected output and actual output; the Committee may also prepare recommendations for the Board to improve production efficiency, expand production or introduce new Products.

B. Personnel Section, which will be chaired by the Employee Relations Manager provided by MAPLE LEAF. The Section will have initial responsibility, subject to approval by the Board, for establishing the conditions of employment of all Canadian Joint Venturepersonnel, including for example, hiring and firing, compensation, working hours, work rules, overtime allowances, vacation and holidays, health and other benefits, all of which will be based on Canadian law and the standards generally applicable in the high technology and electronics industry in Canada as communicated to the Section and the Board by the Employee Relations Manager.

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C. Training Section, which will be chaired by the Training Manager appointed by SECURIKEY as specified in Paragraph 3.5.10. The Section will have authority for coordinating with SECURIKEY the training program as further described in Paragraph 5.4 below.

D. Engineering Maintenance and Repair Section, which will be chaired by the Maintenance Section Chief nominated initially by SECURIKEY as specified in Paragraph 3.5.10.The Section will have the primary responsibility for overseeing Plant maintenance and repair.

E. Inventory Control Section, which will be chaired by the Chief Production Engineer appointed by MAPLE LEAF as specified in Paragraph 3.5.10. The Section will have responsibility for ensuring the safe storage of and record-keeping for production materials and fished Products, and will coordinate its activities with the Production and Planning Control Committee.

F. Accounting and Budget Section, which will be chaired by the Accounts Manager nominated initially by SECURIKEY who will act in close consultation with the Deputy Accounts Manager nominated by MAPLE LEAF as specified in paragraph 3.5.10. The Section will have the primary responsibility for maintaining the Joint Venture's books and accounts and for dealing with the Joint Venture's outside accountant, as more fully described in Paragraph3.10 below.

G. Other committees and sections, whose responsibilities and authorities may be independent of or overlap with the above committees and sections, and which the Board may think appropriate to establish at any time.

3.6. Quality Control.

3.6.1. MAPLE LEAF will give full cooperation and assistance to SECURIKEY and to the Joint Venture so that all work can be accomplished in the most expeditious manner.

3.6.2. The Joint Venture will manufacture, assemble, and label the Products in strict accordance with the Know-how furnished hereunder and with this Article VI. It is the prerogative of SECURIKEY quality control experts, acting by and through the Quality Control Supervisor provided for in Paragraph 3.5.10. hereof, to decide whether production materials and Products meet the applicable quality standards. The Joint Venture's management and the Parties will assure that the procedures and standards established by the Quality Control Supervisor will be adhered to. To the extent any Products are below quality standards as established and determined by the Quality Control Supervisor, they will not be accepted for sale under the Distribution Agreement. Any Products not accepted by the Quality Control Supervisor will be destroyed.

3.6.3. In addition to inspections by the Quality Control Supervisor, during normal business hours upon ten days' notice to the Joint Venture, SECURIKEY or its duly authorized representatives "may inspect the assembly or manufacturing of the Products. Such inspections will be carried out with minimum disruption to the assembly or manufacturing processes, but may continue as long as required to ensure that the Joint Venture has achieved and is maintaining the

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established quality standards. To the extent that SECURIKEY finds any defects or irregularities in the assembly or manufacture, it will promptly advise the Joint Venture thereof, and the Joint Venture will immediately take steps to cure such defects or irregularities.

3.6.4 Officers, Managers and Section Chiefs. The following officers, managers and section chiefs will be appointed by the party indicated below, provided, however, that at a later date in the course of the Joint Venture, MAPLE LEAF will, with the consent of SECURIKEY, appoint any or all of the personnel designated herein as SECURIKEY appointees. The management personnel so appointed will be directly responsible to the Board, and will have primary operational responsibility in their designated areas:

A. To be appointed by MAPLE LEAF, after consultation with SECURIKEY:

1. Deputy Managing Director2. Vice President of Employees3. Maintenance Section Chief4. Deputy Accounts Manager

B. To be appointed by SECURIKEY, after consultation with MAPLE LEAF:

1. Senior Vice President and General Manager2. Vice President of Quality Control3. Vice President of Accounts4. Chief Production Engineer5. Training Manager

All other management personnel, whether full-time or part-time, will be provided by MAPLE LEAF unless otherwise determined by the Board. They will exercise such rights and authorities as the Board may from time to time direct.

3.6.5 MAPLE LEAF will obtain all Canadian permits and licenses necessary to accomplish all activities contemplated hereunder, including visas and travel permits for Directors, officers and expatriate Joint Venture personnel traveling to and in Canada on Joint Venture business.

3.6.6. On behalf of the Joint Venture and at its cost, MAPLE LEAF will cause to be provided adequate and appropriate living accommodations, local transportation (cars and. drivers) and internal transportation for all SECURIKEY personnel and their families while such personnel are present in Canada on Joint Venture business in accordance with this Agreement. MAPLE LEAF will also assist SECURIKEY and its personnel (and their families) in obtaining or extending visas, arranging personal travel and transportation for such persons and their belongings, clearing goods through customs, obtaining necessary work permits and making similar arrangements as required by and consistent with Canadian laws and regulations.

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3.6.7. On behalf of the Joint Venture, MAPLE LEAF will recruit and select qualified personnel to be trained as provided in Paragraph 5.4. hereof. SECURIKEY retains the right to review the personnel and object to any recruits not suitable. MAPLE LEAF will also cause to be provided all labor required to operate the Plant, which labor is initially estimated at persons. However, all such trainees and personnel will be paid by and will be under the direct hire of the Joint Venture.

3.6.8. If at any time in the judgment of the Board the operations and management of the Plant can be improved by utilizing additional expatriate management personnel, SECURIKEY will use its best efforts to make available such personnel on a full or, preferably, part-time basis.

3.6.9. Management personnel are to be paid by the Joint Venture, based on rates of compensation, fringe benefits and other terms of employment established by the Board which will be consistent with rates of compensation and benefits in the personnel’s home country. It is understood that expatriate personnel supplied by SECURIKEY, whether full-time or part-time, are to receive a portion of their compensation in Canadian Dollars, adequate to meet their local living expenditures, and the balance of their compensation, fringe benefits or other remuneration isto be paid in United States Dollars from the foreign country bank account provided for in Paragraph 3.9.1 below.

3.6.10. In the event that any personnel, selected by either SECURIKEY or MAPLE LEAF is considered not to be suitably qualified for the position to which he is assigned, the Parties will meet to consider a reassignment of such personnel.

3.6.11. Should the Parties be unable to agree to a reassignment or come to a resolution, each party will have the right to request the removal and replacement of any personnel, provided, however, that the party requesting replacement will state in writing the reasons for such a request.

3.6.12. It is recognized and agreed by the Parties that the success of the Joint Venture is dependent upon the ability of the Joint Venture to maintain the quality control standards developed by SECURIKEY.

3.6.13. The Parties therefore agree SECURIKEY will have the final right of decision in all matters relating to quality control, including, but not limited to, requiring any changes in the operation of the Plant which he deems necessary. Furthermore, the SECURIKEY will have the authority to inspect the Plant during normal business hours and shut down production of Products until such modifications, changes, or repairs are made. These modifications, changes, or repairs will be made in support of quality control standards developed by SECURIKEY and attached hereto as part of Exhibit A.

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3.7. Profits and Distributions.

3.7.1. The net earnings of the Joint Venture will be declared as Dividends (“Dividends”) on an annual basis and will be distributed to the Joint Venture owners in their respective equity proportions. Net earnings will be determined according to internationally accepted accounting principles and Canadian law.

3.7.2. Dividends to SECURIKEY will be due and payable in United States Dollars.

ARTICLE IV - CONSTRUCTION OF PLANT AND PROVISION OF EQUIPMENT AND COMPONENTS

3.8. Plant Location and Construction.

3.8.1. The Plant, which is located at 6500 Pacific Street, Vancouver, British Columbia and is currently owned by MAPLE LEAF, will be retrofitted as part of MAPLE LEAF’s capitalization.

3.8.2. MAPLE LEAF will provide the site, free and clear of hindrances, and all physical structures relating to the Plant, adequately equipped with utilities and the like, all as specified in the designs to be furnished by SECURIKEY pursuant to this Agreement. MAPLE LEAF will also make arrangements with the appropriate Canadian authorities for the initiation of service for all utilities necessary for the operation of the Plant, and will seek to obtain such utilities at costs which do not exceed the costs which would be paid by Canadian enterprises.

3.8.3. The retrofit of the Plant will be designed by SECURIKEY, after consultations with MAPLE LEAF and on-site inspections. The retrofitting of the existing Plant will be carried out under SECURIKEY's supervision utilizing Canadian labor and materials to the extent possible. MAPLE LEAF will use its best efforts to ensure that the quality of construction, labor and materials locally purchased are of the highest quality and that the construction work is satisfactory to SECURIKEY's architects and engineers overseeing the work.

3.9. Procurement and Installation of Capital Equipment.

3.9.1. The Joint Venture undertakes to obtain from SECURIKEY all Specialized Capital Equipment relating to the manufacturing of the Product. This capital equipment is described as printed circuit boards and manufacturing equipment and is further described in detail in Exhibit D. SECURIKEY will be responsible for supervising the installation of the Specialized Capital Equipment for the manufacturing processes.

3.9.2. SECURIKEY will supply all capital necessary for the facility for the testing of the Product. This capital equipment is described in detail in Exhibit E to this Agreement. SECURIKEY will be responsible for supervising the installation of the capital equipment for the assembly and testing of the Product.

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3.9.3. The Joint Venture undertakes to obtain from MAPLE LEAF all capital necessary for the remaining manufacturing equipment and initial inventory of components. MAPLE LEAF will be responsible for supervising the installation of the remaining manufacturing equipment. SECURIKEY will be responsible for providing the initial inventory once payment is made.

ARTICLE V - TRANSFER OF TECHNOLOGY AND TECHNICAL ASSISTANCE

4.0. Training of Canadian Personnel.

4.0.1. As part of the technical assistance and transfer of technology to the Joint Venture, SECURIKEY will develop a training program and in accordance therewith will provide training for Canadian operations, management, maintenance and other personnel until the Plant is fully operational. MAPLE LEAF will bear the travel, transportation, living and other direct costs (but not salary or fringe benefits) of SECURIKEY training personnel fulfilling their duties pursuant to this Agreement, while in travel to or while in Canada. Provided, however, should the training continue beyond eighteen (18) months, then MAPLE LEAF will also have to bear the salary and fringe benefits of SECURIKEY training personnel.

4.0.2. It is understood that travel, transportation, living and other direct costs of Canadian trainees incurred in connection with their training, whether in or outside Canada, as well as their salaries and any fringe benefits, will be borne by MAPLE LEAF. Furthermore, travel, transportation, living and other direct costs of United States trainees incurred in connection with their training, whether in or outside United States, as well as their salaries and any fringe benefits, will be borne by SECURIKEY.

ARTICLE VI - SALES

4.1. Purchase Commitment. SECURIKEY agrees to purchase from the Joint Venture one hundred percent (100%) of all Products produced by the Joint Venture which meet SECURIKEY's specified quality standards. The terms and conditions pertaining to these purchases are set forth in full in the Quality Control Specifications attached hereto as Exhibit A.

ARTICLE VII - MAPLE LEAF'S RESPONSIBILITIES

4.2. MAPLE LEAF undertakes to obtain, on behalf of the Joint Venture and each of the Parties, as the case may be, any permission, approval, permit or license from the competent Canadian authorities which might be required by Canadian laws or regulations in connection with the performance of the Agreement. This will include preparation and submission of project proposals, feasibility studies, and procurement of all certificates or approvals required from the department of Foreign Affairs and International Trade Canada.

ARTICLE VIII - FINANCIAL AFFAIRS AND ACCOUNTING

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4.3. Fiscal Year. The Joint Venture will have a fiscal year which coincides with the calendar year, that is, from January 1, to December 31.

4.4. Accrual Method of Accounting. The Joint Venture will adopt the accrual basis of accounting.

4.5. Books in Compliance with Ethics. The Joint Venture will keep account books and related documentation that will satisfy the requirements under the Ethical Business Practices section of this agreement.

4.6. Independent Certified Auditor. The Joint Venture will employ an outside auditor proficient in International Accounting Standards as provided in this Agreement.

4.7. Bank Accounts and Convertibility.

4.7.1. The Parties agree the Joint Venture will maintain sufficient deposits in Big Country Bank in United States Dollars or Canadian Dollars with the CBIC within Canada. The Joint Venture will, upon obtaining the necessary governmental approval, also open accounts with a bank or banks outside of Canada acceptable to the Parties, in order to provide for the Joint Venture's anticipated foreign currency requirements outside Canada, as stated below, for such period as the Board may determine.

4.7.2. SECURIKEY will have the right to receive in, U.S. dollars, its Dividends as well as the value of its share of Joint Venture assets upon any liquidation and to transfer abroad freely such Dividends and assets upon liquidation.

4.8. Books and Accounts. The official books and records of the Joint Venture are to be maintained both in Canadian Dollars and United States Dollars. In maintaining the Joint Venture's books and records, the Account Manager and Deputy Account Manager will apply International Accounting Standards. The Joint Venture will retain an internationally recognized accounting firm acceptable to both Parties, to conduct annual audits and to provide such other assistance as may be requested by the Board of Directors from time to time.

4.9. Taxes, Duties and Charges. All fees and payments due and payable to SECURIKEY under this Agreement will be net of any Canadian taxes, duties, deductions, assessments, withholdings, Canadian bank charges, or other levies of any kind. Should any such taxes, charges or levies be required, then the affected payment will be increased so as to result in a net payment to SECURIKEY equal to the amount that would have been paid if no such taxes, charges or levies had been applied.

ARTICLE IX - TERM AND LIQUIDATION

5.0. Coming into Force. This Agreement will commence and come into force and all licenses granted hereunder will take effect on the Effective Date, as defined in Paragraph 11.11,

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and will remain in force until such time as the Joint Venture may be terminated or liquidated by the Parties as hereinafter provided.

5.1. Duration of Joint Venture. The duration of the Joint Venture will be five (5) years, but may be renewed upon written agreement within the five (5) year period with sixty (60) days notice. If notice is not provided by either party of their intent to not renew this Agreement, this Agreement will be automatically renewed for an additional year. Products and subsequent versions thereof will be sequentially numbered as Exhibit A and attached hereto. Changes in price will also be reflected in the sequentially numbered Exhibit A.

5.2. Non-transferability of Ownership Interests.

Neither party to this Joint Venture may assign all or part of its equity interest and ownership rights.

5.3. Liability and Indemnification.

5.3.1. Neither SECURIKEY nor MAPLE LEAF will be individually liable for the debts or obligations of the Joint Venture, or for any claim for losses or damages caused by the Joint Venture. With the exception of a breach of confidentiality and breach of the license grants, each party’s liability to the other for all claims under, arising out of, or related to any provision of this Agreement, or at law or in equity, will be limited to the amount of Three Million United States Dollars (U.S. $3,000,000.00). As to breach of confidentiality and license grants, however, MAPLE LEAF’s liability to SECURIEKY for all claims under, arising out of, or related to any provision of this Agreement, or at law or in equity, will be unlimited.

5.3.2. Neither SECURIKEY nor MAPLE LEAF will be liable to the other, except for acts, omissions to act or decisions constituting gross negligence or bad faith, nor in such case will SECURIKEY or MAPLE LEAF be liable to each other for any indirect or consequential damages. Further, each party agrees to indemnify and hold the other party harmless from any actual damages, claims or causes of action of third Parties arising from its gross negligence or bad faith. These indemnities will apply to any acts, omissions to act or decisions taken concerning the Joint Venture whether before or after entry into force of this Agreement.

5.3.3. SECURIKEY will indemnify, defend and hold MAPLE LEAF harmless from all expenses, damages, costs, or losses resulting from any claim, suit, or proceeding arising from (i) infringement or misappropriation of any third party intellectual property right and/or (ii) SECURIKEY’s breach of any warranty, provided that MAPLE LEAF meets the conditions of indemnification of this Agreement.

5.3.4. MAPLE LEAF will indemnify, defend and hold SECURIKEY harmless expenses, damages, costs, or losses resulting from any claim from all, suit, or proceeding arising from (i) infringement or misappropriation of any third party intellectual property right; (ii) MAPLE LEAF’s breach of any warranty; (iii) MAPLE LEAF’s negligence; and/or (iv) product

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liability of the Product, provided that SECURIKEY meets the conditions of indemnification of this Agreement.

5.4. Conditions of Indemnification.

5.4.1. The indemnified party will promptly notify the indemnifying party in writing of any notice of claim or of threatened or actual suit.

5.4.2. The indemnifying party will have sole control of the defense of such suit, claim, or action and related settlement negotiations.

5.4.3. The indemnified party will cooperate with the indemnifying party in the defense and settlement of such suit, claim, or the like at the expense of the indemnifying party, and any settlement of the claim or action resulting from indemnification under this Agreement will contain no admission of indemnified party’s liability without the indemnified party’s prior written approval.

5.5. Termination and Dissolution.

5.5.1. The Board of Directors, by a Major Decision, may decide at any time to terminate and liquidate the Joint Venture because

(a) it is unable to continue profitable operations due to reasons of force majeure as provided by this agreement;

(b) the Joint Venture or Maple Leaf declares bankruptcy;

(c) a violation of the expropriation provisions of this Agreement;

(d) continued failure to produce quantities of the Product at the specified price points or at the required quality; or

(e) SECURIKEY’s failure to purchase Products as outlined in this Agreement.

5.5.2. Termination by Election of Either Party. Either of the Parties may at any time after the Joint Venture is in effect for one (1) year, elect to terminate and liquidate the Joint Venture. If only one party elects to terminate for reasons other than those specified in this Agreement, then termination will become effective only after the terminating party has given three (3) months written notice to the other party and has paid a termination fee equal to the estimated Dividends due to the non-terminating party for the time period remaining in this Agreement.

If the Parties cannot agree to the termination fee, they will appoint two (2) or more qualified experts, and the experts will present a detailed accounting for final settlement. If, however, the Parties cannot agree on the termination fee based on the recommendation of the experts, or the

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Parties are unable to agree on the appointment of such experts, then the termination fee and any dispute related thereto will be finally settled pursuant to this Agreement.

5.6. Liquidation of Assets.

5.6.1. Termination pursuant to this Agreement will result in the liquidation of Joint Venture assets and the distribution thereof to the party initiating the termination. Liquidation will be completed and a final to the terminating party will be accomplished as soon as reasonably possible. Internationally recognized principles of accounting will be utilized in accomplishing any such liquidation and distribution.

5.6.2. Plant, Specialized Capital Equipment, and other tangible assets, except finished Products and work in progress, will be sold to the highest bidder, with a first option to purchase in MAPLE LEAF, provided however that in no event will the price offered by SECURIKEY be less than the depreciated value shown on the Joint Venture's books and accounts unless otherwise agreed.

ARTICLE X - GENERAL PROVISIONS

5.7 Confidentiality.

5.7.1. Confidentiality will be governed by the Corporate Nondisclosure Agreement dated January 23, 2012 and executed by the Parties, attached hereto as Exhibit G.

5.7.2. The obligations of confidentiality set forth in this Paragraph 11.1 will survive termination or liquidation of the Joint Venture.

5.8. Force Majeure.

5.8.1. If the performance of any obligation under this Agreement on the part of either party should be prevented or delayed by an event of force majeure, such as war (whether declared or not), revolution or insurrection; strikes in facilities not under the control of either party; earthquakes, hurricanes, and natural catastrophes; acts of a government in its sovereign capacity; blockades or embargoes or acts of terror; or the imposition of tariff or non-tariff barriers or economic restrictions; provided such event is without the fault of and beyond the reasonable control of the party invoking force majeure, that party's duty to perform those obligations affected by the event of force majeure will be suspended for a period equal to the delay directly resulting from the occurrence of such event. In the event of force majeure, neither party will be responsible for any damage, increased costs or loss which the other party may sustain by reason of such a failure or delay of performance.

5.8.2. In the event that either party wishes to invoke force majeure, that party will, within seven (7) days after the occurrence of the event of force majeure has become known to that party, send written notice of such event to the other party. The party affected will take appropriate

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measures to minimize or remove the effects of force majeure and, within the shortest possible time, attempt to resume performance of the obligations affected by the event of force majeure.

5.8.3. If, due to an event of force majeure, either party should be unable to perform some or all of its obligations as specified under the terms of this Agreement for a period of three (3) consecutive months from the occurrence of the event of force majeure, then either party may invoke the termination and liquidation procedures set forth in this Agreement.

5.9. United States Export Control Laws.

5.9.1. The Parties recognize that Securikey’s ability to provide Products rests on the continuing authority from the licenses granted by the Department of Commerce under the Export Administration Regulations (EARs) and the Department of State under the International Traffic in Arms Regulations (ITARS). The Distributor acknowledges that any information obtained from Securikey pursuant to this Agreement may be subject to the export control laws and regulations of the United States and other national governments. To the extent that such information may constitute technical data, technical assistance or software, or the direct product therefrom, under restriction, as that term is construed in the U.S. Export Administration Regulations, Distributor assures it shall not export, re-export or transfer by any means or method, (a) any such restricted technical data, technical assistance or the direct product there from, or (b) any such restricted software, the direct product there from or the source code to such software, to certain countries, and to nationals of such countries, as identified in Supplement 1 to Part 738 of the U.S. Export Administration Regulations, without having obtained a prior authorization from the U.S. Department of Commerce. These Country Groups may be viewed at Internet address: http://beta-www.bis.doc.gov/index.php/regulations/export-administration-regulations-ear. This provision shall survive the expiration or earlier termination of this Agreement.

5.9.2. Anti-Boycott Compliance. The Parties agree that they shall not act in any way to further the Arab League Boycott of Israel. Distributor shall provide Securikey with any antiboycot requests made to it or any sub-distributor in a timely manner.

6.0 Ethical Business Practices.

6.0.1 The Joint Venture is committed to conducting its business with honesty and integrity and in compliance with the laws of all the countries in which the Joint Venture is active. This includes compliance with all laws, domestic and foreign, prohibiting facilitation payments or inducements to any person, including public officials.

To ensure compliance with these laws and the related requirements, the Joint Venture has outlined the following Ethical Business Practices. These Practices apply, subject to and in accordance with any applicable local law or legal requirement, to each director, officer and employee of the Joint Venture and to each agent, representative, consultant and independent contractor acting on behalf of the Joint Venture or any such subsidiary (hereinafter collectively referred to as “Joint Venture Personnel”).

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6.0.2 Joint Venture Personnel shall not permit any use of the funds or other assets of the Joint Venture for any unlawful or improper purpose.

6.0.3 Joint Venture Personnel shall not make, or authorize anyone to make on behalf of the Joint Venture any payments or gifts or offers or promises to pay money or give anything of value to or for the benefit of any person, including any Public Official, that is or may appear to be related to obtaining or retaining business with any person, directing business to any person, obtaining any other advantage in the conduct of business, or inducing or rewarding the “improper” performance by any person of any function or activity or consent to, or connive in, any of the above.

6.0.4 The performance (or failure to perform) any function or activity is “improper” if it breaches the expectations of good faith or impartiality or breaches a position of trust.

6.0.5 Joint Venture Personnel shall not make contributions of funds, facilities or services of any kind to political parties or officials or candidates for office to obtain their support for executive, legislative, administrative or other action favorable to the Joint Venture.

6.0.6 Joint Venture Personnel shall not give or offer to give on behalf of the Joint Venture any money, gift or thing of value to a third party if he or she knows or has reason to believe that it will be offered to a Public Official or any other person to obtain or retain business with any person, to direct business to any person, to obtain any other advantage in the conduct of business, or to induce or reward the improper performance by any person of any function or activity.

6.0.7 The books and records of the Joint Venture must reflect, accurately and fairly, the transactions of the Joint Venture and dispositions of its assets. No undisclosed or unrecorded funds or assets are to be established for any purpose.

6.0.8 Joint Venture Personnel who are involved in international business transactions must become familiar with the anti-corruption laws of the countries in which the Joint Venture operates and are responsible for seeking the advice of the Joint Venture’s legal counsel in any situation involving questionable payments.

6.0.10 It is a matter of the highest priority for the Joint Venture, and vital to the interests of our customers and employees, that all Joint Venture Personnel scrupulously observe these Practices.

6.1. Resolution of Disputes.

6.1.1. The Parties express the intention that all disputes in connection with this Agreement and the execution hereunder will be settled through friendly negotiations. In the event that, in the view of either party, no settlement can be reached through friendly negotiations, any dispute, controversy, or claim arising out of or relating to this Agreement or the breach,

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termination or invalidity thereof will be settled by arbitration in accordance with the International Arbitration Rules of the American Arbitration Association.

6.1.2. The arbitration will be held in Paris and will be conducted in English in accordance with the UNClTRAL Arbitration Rules in effect on the date of this Agreement, except that in the event of any conflict between those Rules and the arbitration provision of this Agreement, the provision of this Agreement will govern. The Director, Paris General Chamber of Commerce, will be the appointing authority (the "Appointing Authority") except as specified below.

6.1.3. The number of arbitrators will be three (3). Each party will appoint one (1) arbitrator. If within fifteen (15) days after receipt of the claimant's notification of the appointment of an arbitrator, the respondent has not, by telegram or telex, notified the claimant of the name of the arbitrator he appoints, the second arbitrator will be appointed in accordance with the following procedures:

a. If the respondent is MAPLE LEAF, the second arbitrator will be appointed by the Canadian National Committee of the International Chamber of Commerce.

b. If the respondent is SECURIKEY, the second arbitrator will be appointed by the American Arbitration Association.

c. If within fifteen (15) days after receipt of a request for appointment of the second arbitrator the Canadian National Committee of the International Chamber of Commerce or the American Arbitration Association, as the case may be, has not, by telegram or telex, notified the claimant of the name of the second arbitrator, the second arbitrator will be appointed by the Appointing Authority.

6.1.4. The two (2) arbitrators thus appointed will choose the third arbitrator who will act as the presiding arbitrator, but if the two arbitrators cannot agree within fifteen (15) days of their appointment, then, at the request of either party, the presiding arbitrator will be appointed by the Appointing Authority. Such presiding arbitrator will be neither of U.S. nor Canadian origin or nationality.

6.1.5. In making their award, the arbitrators will be bound by the intention of the Parties insofar as it can be ascertained from this Agreement and, where no such intention can be ascertained, by international commercial practice.

6.1.6. The award of the arbitrators will be final and binding upon the Parties. Judgment upon the award may be entered in any court having jurisdiction, or application may be made to such court for judicial acceptance of the award and an order of enforcement, as the case may be. The Parties hereby agree that if it becomes necessary for either party to enforce an arbitral award by a legal action and/or additional arbitration of any kind, the defaulting party will pay and discharge all reasonable costs and attorneys' fees, including but not limited to, any cost of

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additional litigation or of arbitration, that will be incurred by the party seeking to enforce the award. MAPLE LEAF hereby expressly waives any present or future right to assert the defense of sovereign immunity in the context of service of process, jurisdiction, attachment prior to the entry of an award or judgment or in aid of execution or execution upon any property, or enforcement of any arbitral award or judicial judgment. For the purpose of this Agreement, the Parties confirm that the Agreement constitutes a private and commercial transaction which will not for any purpose be considered as a governmental or public act.

6.2. Separability. Notwithstanding that any provision of this Agreement may prove to be illegal or unlawful, the remaining provisions of this Agreement will continue in full force and effect, but in this event the Parties will attempt in good faith to replace such provision and thereby redefine their respective rights and obligations in the context of the new situation. Should the Parties fail to agree on a redefinition of their rights and obligations, either party may invoke the termination and liquidation procedures set forth in this Agreement.

6.3. Waiver. The failure of either party hereto to insist upon a strict performance of any of the terms and provisions herein will not be deemed a waiver of any subsequent breach or default in the terms or provisions herein.

6.4. Entire Agreement. This written Agreement, together with the Exhibits attached hereto and any written amendments thereof, constitute the complete and exclusive agreement between the Parties relating to the establishment and operation of the Joint Venture, the assembly and production of Products, and the marketing of the Products, and supersedes any and all prior negotiations, representations, agreements, memoranda, correspondence and communications between the Parties with respect thereto. No change in, addition to or waiver of the terms and provisions of this Agreement or of any Exhibit will be binding upon either party unless in writing and approved by a duly authorized officer or representative of each of the Parties hereto.

6.5. Notice. Any notice required or permitted to be given hereunder will be in writing and will, unless some other mode of giving notice is accepted by the party to whom it is given, be given by telex, telegram or cable confirmed by registered air mail letter or by being delivered in person to the party at the address stated below:

MAPLE LEAF:

Attention: John Fraser 5000 Pacific Street

British Columbia, Vancouver

SECURIKEY:

Attention: John D. Ricklehouser 6111 F.M. 529 Houston, Texas 77089

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Each party named above may at any time give notice in writing to the other party named above of a change of address.

IN WITNESS WHEREOF, this Agreement has been signed in two (2) originals, each in English and all equally authentic, as of the day of 1st day of May, 2012.

SECURIKEY, INC.6111 F.M. 529Houston, Texas 77089

By: _John D. Ricklehouser Date: _ 5/01/12 ___ (John D. Ricklehouser, CEO)

MAPLE LEAF, INC.5000 Pacific Street British Columbia, Vancouver

By: _John Fraser __________ Date: _ 05/01/2012 ______(John Fraser, President)

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Exhibit A

[Bylaws, Articles of Association, and Quality Control Provisions]

This page was intentionally left blank.

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Exhibit B

[License Agreement]


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Exhibit C

[List of Specialized Capital Equipment to be provided by SECURIKEY]


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Exhibit D

[Detailed description of capital equipment necessary for the facility for the testing of the Product to be provided by SECURIKEY]


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Exhibit E

[Detailed description of remaining manufacturing equipment to be provided by MAPLE LEAF and initial inventory to be paid for MAPLE LEAF and provided by SECURIKEY]


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Exhibit F

[Detailed description of components that make up Product to be provided by SECURIKEY]


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Exhibit G

[Corporate Nondisclosure Agreement]


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Exhibit H

[Detailed diagram of parts comprising the SHURLOCK II keypad device]


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Model Joint Venture Agreement

Documents

Transcript of Model Joint Venture Agreement