PRODUCT KNOW-HOW AGREEMENT
--------------------------
THIS AGREEMENT is made the 18th day of January, 0000
X X X X X X X : [illegible initials]
WEB2U Limited, a Company incorporated under the laws of United Kingdom having
its registered office at Elder House, 000-000 Xxxxx Xxxx, Xxxxxx Xxxxxx, XX0
0XX, Xxxxxxx (which expression shall unless repugnant to the context or meaning
thereof mean and include its successors and assigns) ('WEB2U') of One part and
XxxxxXxx.xxx Limited, a company registered under the Companies Act, 1956 having
its registered office at Mathurdas Mill Compound, Ground Floor, SB Marg Lower
Parel Bombay 400013 ('JADOO') of the Other part;
WHEREAS
(a) WEB2U is a wholly owned subsidiary of MSU Corporation, a corporation
registered in the State of Florida, United States having its principal place
of business at Elder House, 000-000 Xxxxx Xxxx, Xxxxxx Xxxxxx, XX0 0XX,
Xxxxxxx ('MSU') and is the owner of the Intellectual Property Rights in the
ISP Chip Set and the Product.
(b) Subject to all the applicable corporate and statutory approvals, WEB2U
agrees to grant a licence to JADOO on an exclusive basis to use the
Technical Information and Know How to manufacture the Product in the
Territory subject to clause 3.2 hereinbelow;
(c) The Parties have agreed to enter into the commitments of this Agreement and
regulate their rights in the manner appearing below.
IT IS AGREED as follows :-
1. Interpretation
1.1. "BOM" shall mean the xxxx of materials details of which are set out in
Schedule A hereto
1.2 "Intellectual Property Rights" (IPR'S) shall mean industrial and other
rights in the Product and ISP Chip Set including but not limited to
copyright, confidential information, patents and the right to apply for
patents, protected designs (whether registered or not) semi conductor
and topography rights and technical know-how.
1.3 "ISP Chip Set" shall mean the WEB2U propriety Internet Services
Processor as described in the ISP Chip Set reference manual.
1.4 "Know-how" shall mean :-
[illegible initials]
1.4.1 Pre-production drawings for the Product;
1.4.2 Layout and other documents for manufacturing assembling and
testing the product;
1.4.3 Purchasing specifications for components of the Product
1.4.4 Test specifications for manufactured items;
1.4.5 Documents relating to installation, maintenance, factory
operation, data testing and training;
1.4.6 Drawing specifications and information for the manufacture or
procurement of all production tools, gauges, inspection equipment
and accessories required for the manufacture of the Product;
1.4.7 Specifications of machine tools and accessories required for the
manufacture of the Product together with written advice on their
ordering selection and procurement;
1.4.8 Technical assistance and training in the implementation of all the
foregoing in accordance with an agreed detailed program.
1.5 "License Fee" shall mean the license fee provided for in clause 6.1.
1.6 "Manual" shall mean user guide, loose leaf volume or volumes which will
include methods and procedures to manufacture the Product and other
documentation in respect to the Product.
1.7 "Product" shall mean the WEB2U proprietary Internet Access Device
incorporating the ISP Chip Set
1.8 "Software" shall mean WEB2U proprietary Internet Access Devise software
including Browser, e-mail, printer driver and enhancements which is
licensed to JADOO under the Software License Agreement of even date
1.9 "Technical Information" shall mean technical knowledge and data
specifications of materials and the manufacturing techniques and other
information of a secret and confidential nature in existence at the date
of this Agreement which are necessary to enable JADOO to manufacture the
Product properly and efficiently in reasonable quantities of a standard
and quality required by this Agreement
1.10 "Territory" means the territories of India Sri Lanka Bangladesh and
Nepal and such other territories as may be agreed in writing by the
parties from time to time
1.11 "The Trust and Confidence Agreement" shall mean the trust and confidence
agreement to be entered into by JADOO and relevant contractors and sub
contractors JADOO pursuant to clause 7.1 and in the form set out in
Schedule C hereto
2. Commencement Date and Term
2.1. This Agreement shall be effective only upon execution by the authorised
representative of both Parties on the date first above shown
("Commencement Date").
2.2. The term of this Agreement shall be for an initial period of five years
from the Commencement Date and shall automatically renew for further
periods of one year unless three months prior notice in writing of
termination is given by either Party.
3. Grant of Licence
3.1. Subject to all applicable corporate and statutory approvals, WEB2U
hereby grants Jadoo an exclusive licence to make the Product during the
continuance of this Agreement in the Territory using for this purpose
(but not further or otherwise) the ISP Chip Set the Software the
Intellectual Property Rights and the Know How.
3.2. For so long as JADOO shall demonstrate the ability to produce a minimum
of [ ** ] units of the Product in the first two years of the Term the
License shall remain exclusive.
3.2.1 In the event of JADOO manifestly failing to demonstrate the
ability to achieve production of [ ** ] units during the first two
years of the Term or having failed to achieve production of [ ** ]
units during the first two years of the Term the License shall at
the option of WEB2U become non exclusive
3.2.2 To maintain exclusivity in subsequent years of the Term JADOO will
have to demonstrate the ability to produce [ ** ] units in each
year of the Term
3.3 Where Jadoo has failed in any period to achieve the volumes to retain
exclusivity set out in 3.2 above Jadoo shall be given a six month cure
period to remedy any shortfall
3.4 Engagement by Jadoo of manufacturing sub-contractors and agents who
will have access to Technical Information shall be subject to the prior
approval of WEB2U. Such approval shall not be unreasonably withheld
provided the provisions of Clauses 1.12 and 3.5 herein are complied
with.
3.5 Jadoo shall ensure that all manufacturing sub-contractors and agents
who will have access to Technical Information shall enter into direct
covenants of confidentiality with WEB2U in the form of the
Confidentiality and Trust Agreement set out in Schedule C hereto.
4. Improvements
4.1. It is anticipated that WEB2U will continue to develop the Product.
Improvements arising from the developments carried on by WEB2U shall
remain exclusive property of WEB2U.
4.2. The specification of the Product shall be the most current version in
commercial production from time to time but shall not include features
representing custom enhancements where such enhancements are proprietary
to any specific WEB2U customer
4.3. Anticipated improvements referred to in the development road map are as
set out in Schedule B
** The omitted information is confidential and is being filed separately with
the Securities and Exchange Commission.
5. Manufacture (General)
5.1 It is the intention of the Parties that the Product will be manufactured
to the agreed specification . JADOO shall observe the standards,
formulae, quality control procedures and instructions agreed
with/supplied by WEB2U from time to time in respect of manufacturing of
the product and shall not modify, distort the Product and/or use the
Product in any other manner.
5.2 JADOO may sub-contract the whole or any part of the manufacturing
process but always subject to Clause3 3.4 and 3.5.
5.2.1 JADOO shall submit an authentic report every four months to WEB2U
certifying the total number of units manufactured by JADOO and/or
any Sub Contractors or manufacturing agents or any other person
authorised by JADOO to manufacture the Product
5.3. WEB2U will favourably consider the use of JADOO as a manufacturer of
Product in India for its own and OEM supplies subject to agreement as to
quantity quality and costs.
5.4. Subcontractors
5.4.1. JADOO shall use all necessary efforts to ensure that any
sub-contractor or manufacturing agent with access to the Product,
the ISP Chip Set, IPR's or Technical Information will not modify,
reverse, engineer, decompile, and or disassemble the Product.
5.4.2. JADOO shall not mask, modify or suppress any copyright notices or
any other propriety right notices. Furthermore JADOO shall not
unload, decode or password protect any part of the Product or
render any part of the Product to any third party for
unauthorised use or reverse engineering.
5.5. Technical Support
5.5.1. WEB2U shall provide technical support in relation to the
Technical Information free of charge provided that JADOO shall
treat such information as trade secrets and shall not disclose
such information to any third party without prior written consent
of WEB2U or pursuant to the terms of clause 3.4 above.
5.5.2. Upon WEB2U's request, JADOO its employees, officers, directors,
Contractors, Sub-Contractors, representatives or other agents who
may have obtained the Technical Information in the course of
their employment and/or business with JADOO shall return to WEB2U
all of the Technical Information provided with all copies or
duplicate documentation on the expiry or termination of this
Agreement.
5.6. Supply and payment for the ISP Chip Set and other hardware
5.6.1. In the event of WEB2U supplying the ISP Chipset or any hardware
components to JADOO WEB2U shall restrict its charges for such
components to cost plus a handling charge to be mutually agreed
form time to time
5.6.2. JADOO shall make payment for supply of the ISP Chipset and
hardware components to WEB2U by irrevocable letter of credit in
favour of WEB2U which shall be made in the amount of each
purchase order.
6. Licence Fee
6.1 JADOO shall pay to WEB2U as a Product Know-how fee a lump sum of
[** ] at the time of transfer of the Product Know-how and such further
sums as per the Schedule D annexed hereto subject to a maximum of [**].
7. Confidentiality
7.1. JADOO undertakes to ensure that all employees, suppliers,
sub-contractors, and any other person or organisations who it is
reasonable to contemplate having access to the IPR's, Know How, Software
or Technical Information will covenant directly with WEB2U in the same
terms as the Trust and Confidence Agreement annexed hereto as Schedule C
8. Marks
8.1. It is anticipated that from time to time the Product will carry a
distinctive xxxx or logo together with an acknowledgement of WEB2U
design and ownership of rights. Such marks will be carried on the
packaging of the Product and also on the Homepage of Jadoo and
sub-contractors
8.2. JADOO shall leave in position and not cover or erase any notice or other
marks (including without limitation details of patents or trademark or
copyright relating to the Product or its ownership by WEB2U which WEB2U
may reasonably insist are placed or fixed to the Product or their
packaging supplied pursuant to this Agreement).
9. Interest
All sums due from either of the Parties to the other which are not paid
on the due date shall bear interest from day to day at the annual rate
of 1.5% (one point five percent) over the current National Westminster
Bank Plc daily base rate with a minimum of 7% (seven percent) per annum.
10. Approvals/Permissions
It is understood and agreed between the Parties herein that all the
payments including Royalty/License fee and other payments are subject to
the applicable approval permissions from concerned authorities including
the Reserve Bank of India.
11 Warranty
11.1 JADOO warrants that the Product hardware will conform to the agreed
specification and will be free from all defects in material (other than
the ISP Chipset and any materials supplied by WEB2U)
11.2 JADOO warrants that it will produce the Product to a reasonable standard
with reasonable care and skill and acknowledges that failure so to do
may damage the reputation of WEB2U in the global market place.
** The omitted information is confidential and is being filed separately with
the Securities and Exchange Commission.
12 Indemnities
12.1 WEB2U shall indemnify and hold harmless JADOO against any claims costs
and expenses that JADOO may incur in connection with any claim of
infringement of any third party IPR's caused by or arising out of the
manufacture, importation, possession, sale or use of the Product and in
respect of claims arising out of any defect in the ISP Chipset,
Know-how, and Technical information. This indemnity shall include all
costs and expenses of refuting defending or settling any claims as well
as any damage or compensation ordered to any third party by any Court.
12.2 JADOO shall except to the extent that the claim is due to any defect in
the ISP Chipset, Know-how, and Technical information fully indemnify and
hold harmless WEB2U against any claims or actions bought by third
parties against WEB2U due to manufacturing defects in the Product. This
indemnity shall include all costs and expenses of refuting defending or
settling any claims as well as any damage or compensation ordered to any
third party by any Court.
12.3 JADOO shall have no liability and shall be fully and completely
indemnified by WEB2U for any claim or suit where:
12.3.1 Infringement is primarily attributable to JADOO's incorporation
of WEB2U supplied designs into the Product;
12.3.2 Such claim or suit would have been avoided but for the
combination, operation or use of the Product with devices, parts
or software not supplied by JADOO or is subcontractors;
12.4 WEB2U shall have no liability and shall be fully and completely
indemnified by JADOO for any claim or suit where:
12.4.1 Infringement is primarily attributable to negligence and or
omission or failure of JADOO's incorporation of WEB2U supplied
designs into the Product;
12.4.2 Such claim or suit would have been avoided but for JADOO's
failure to adhere to the standards specified for production of
the Product by WEB2Uor subcontractors or any other person.
13 Termination
13.1 Notwithstanding the provisions of clause 2, either party may by notice
in writing to the other terminate this Agreement immediately upon the
happening of any one of the following events;
13.2 If either party goes into liquidation either compulsorily or voluntarily
or if a receiver or administrator is appointed in respect of the whole
or any part of its assets or makes an assignment for the benefit or
composition with its creditors generally or threatens to do these things
or any judgment or administration order is made against it become
bankrupt or be wound up or make any arrangement or composition with its
creditors.
13.3 If JADOO attempts or purports to assign or transfer this Agreement
without WEB2U's prior written consent.
13.4 If either Party's ability to carry out its obligations hereunder is
prevented or substantially interfered with for any reason whatsoever
(whether or not within the control of that Party) including without
limitation by reason of any regulation, law, decree or any act of state
or other action of a government.
13.5 If a party is in material breach of any obligation under this agreement
(the defaulting party) and the other party (notifying party) gives
written notice to the defaulting party identifying the breach and the
defaulting party does not within 30 days of the date of such notice
remedy the breach
14 Limitation of Liabilities
14.1 Force Majeure. Neither party shall be liable to the other for any delay,
loss, damage or injury caused by acts of God, governmental order or
regulation, restraining imposed by governmental action, national
strikes, commotion, riots, war, war like situations, hostilities,
governmental disposal, mobilisation, blockage, embargo, custody,
revolution, fire, earthquake, tornado, explosion, storm, flood or for
any other cause beyond its reasonable control (hereinafter referred to
as Force Majeure).
14.2 Notification of such delay, loss, damage or injury arising solely from
circumstances attributable to the Force Majeure shall be given as soon
as possible and followed in writing to the other party within seven days
of the occurrence of such an event.
14.3 Non-Performance
Should any failure of performance persist for more than twenty eight
days WEB2U may by written notice to JADOO forthwith cancel the
particular order or part thereof of effected and such cancellation shall
be without any liability on the part of WEB2U to pay for any costs or
cancellation charge arising from such cancellation.
15 Severability
If any section or subsection of this Agreement is found by competent
authority to be void, voidable, illegal or otherwise unenforceable, the
remaining provisions of this Agreement shall remain in full force and effect.
16 No agency or Partnership.
The Parties are not partners or joint venturers nor is one Party entitled to
act as the agent of the other (unless specifically authorised in writing) nor
shall either Party be liable in respect of any representation, act or
omission of the other Party whatever nature.
17 Whole Agreement.
This Agreement contains the whole agreement between the Parties and
supersedes any prior written or oral agreements between them in relation to
its subject matter and the Parties confirm that they have not entered into
this Agreement on the basis of any representations that are not expressly
incorporated into this Agreement.
18 No Modification.
This Agreement may not be modified except by an instrument in writing signed
by both of the Parties of their duly authorised representatives.
19 Survival of Term.
The warranties an indemnities and obligations of confidentiality contained in
this Agreement and the provision for payment of any accounting in respect of
continuing fees and other sums due to either party under this Agreement shall
survive the termination or expiry of this Agreement.
20 Arbitration.
Any question or difference which may arise concerning the construction
meaning or effect of this agreement or concerning the rights and liabilities
of the parties or any other matter arising out of or in connection with this
agreement shall be referred to a single arbitrator in London to be agreed
between the parties. Failing such agreement within 30 days of the request by
one party to the other that the matter be referred to arbitration in
accordance with this clause such reference shall be to the to an arbitrator
appointed by the President for the time being of the Law Society, London. The
Arbitrator shall neither be an Indian or UK national. The decision of the
arbitrator shall be binding upon the parties. Any reference under this clause
shall be deemed to be a reference to arbitration within the meaning of the
Arbitration Xxx 0000(XX)
21. Governing Law.
21.1 This Agreement shall be governed in accordance with the laws of England
and Wales.
21.2 Where either Party has any complaint of the other under this Agreement
it may at its option commence proceedings in any Court of competent
jurisdiction in the Courts of England and Wales
22. Notices.
All notices given pursuant to this agreement shall be sent by confirmed
facsimile transmission, prepaid registered mail or courier with signed
receipt to the addresses setout below or to such other addresses as a
party may from time to time notify the other in accordance with the
provision of this clause.
FOR WEB2U
Mr. Xxxxxx Xxxxx
Elder House, 000-000, Xxxxx Xxxx
Xxxxxx Xxxxxx, XX0 ILR
United Kingdom
with a copy to:
Xx. Xxxxxxx X. Xxxxxxx
Company Secretary
c/o Xxxx Xxxxx Xxxx Simey
Arlbee House, Grey Xxxxxx Xxxx
Xxxxxxx XX00 0XX
Xxxxxx Xxxxxxx
FOR JADOO
Xx. Xxxxxxx Xxxxxx
Mathurdas Mill Compound
Ground Floor,
SB Xxxx
Lower Parel
Mumbai 400013
Signed /s/ Xxxxxxx X. Xxxxxxx AUTHORISED REPRESENTATIVE OF Web2u Limited
Signed [illegible signature] AUTHORISED REPRESENTATIVE of XxxxxXxx.xxx
Limited
SCHEDULE A
Xxxx of Materials
[ ** ]
SCHEDULE B
The development road map
[ ** ]
SCHEDULE C
TRUST AND CONFIDENCE AGREEMENT
This Trust and Confidence Agreement is made the 18th day of Janaury 0000
X X X X X X N :
WEB2U Limited whose registered office is at Elder House 000-000 Xxxxx Xxxx,
Xxxxxx Xxxxxx, XX0 0XX, Xxxxxx Xxxxxxx ("WEB2U")
XxxxxXxx.xxx Limited a company organised and existing under the laws of
India, whose registered office is at Mathurdas Mill Compound Ground Floor SB
Marg Lower Parel Bombay 4000013 ('the Recipient')
RECITALS
(a) WEB2U has developed a product for accessing the Internet incorporating its
Proprietary Internet Services Processor, Chip Set, and Software ("the
Product") and is the owner of confidential information relating to the
Product and of intellectual property rights therein.
(b) To enable the Recipient to evaluate the Product with a view to taking a
license to either :
(i) component supply, or;
(ii) manufacture, and/or;
(iii) sell the same
WEB2U is willing to disclose information relating to the Product to the
Recipient under conditions of confidentiality.
OPERATIVE PROVISIONS
1. Interpretation
1.1. For the purposes of this Agreement Proprietary Information means any
and all information which is now or at any time hereafter in the
possession of WEB2U and
which relates to the Product, including without limitation data,
know-how, formula, processes, designs, photographs, drawings,
specifications, software programs and samples and any other material
bearing or incorporating any information relating to the Product.
2. Undertakings of the Recipient
2.1. In consideration of WEB2U disclosing information relating to the
Product to the Recipient, the Recipient hereby undertakes:
2.1.1. to use all Proprietary Information so disclosed exclusively for
the purpose of evaluation or any license granted in respect of
the Product, and;
2.1.2. to maintain confidential all Proprietary Information that it may
acquire in any manner;
and it will accordingly not directly or indirectly use or disclose any
of the Proprietary Information in whole or in part save for the
purposes of and in accordance with this Agreement.
3. Exceptions
3.1. The foregoing restrictions on the Recipient shall not apply to any
Proprietary Information which:
3.1.1. the Recipient can prove by documentary evidence produced to
WEB2U within 28 days of disclosure that such Proprietary
Information was already in the possession of the Recipient and
at its free disposal before the disclosure to the Recipient;
3.1.2. is hereafter disclosed to the Recipient without any obligations
of confidence by a third party who has not derived it directly
or indirectly from WEB2U;
3.1.3. is or becomes generally available to the public in printed
publications in general circulation through no act or default on
the part of the Recipient or the Recipient's agents or
employees.
4. Inclusion
4.1. Without prejudice to the generality of clause 3.1.3 information shall
not be deemed to be generally available to the public by reason only
that it is known to only a few of those people to whom it might be of
commercial interest, and a combination of two or more portions of the
Proprietary Information shall not be deemed to be generally available
to the public by reason only of each separation being so available.
5. Confidentiality measures
5.1. To secure the confidentiality attaching to the Proprietary Information
the Recipient shall:
5.1.1. keep separate all Proprietary Information and all information
generated by the Recipient based thereon from all documents and
other records of the Recipient;
5.1.2. keep all documents and other material bearing or incorporating
any of the Proprietary Information at the usual place of
business of the Recipient, namely
5.1.3. not use, reproduce, transform, or store any of the Proprietary
Information in any externally accessible computer or electronic
information retrieval system or transmit it in any form or by
any means whatsoever outside of its usual place of business;
5.1.4. allow access to the proprietary exclusively to those employees
of the Recipient who have reasonable need to see and use it for
the purposes of its evaluation by the Recipient and shall inform
each of the said employees of the confidential nature of the
Proprietary Information and of the obligations on the Recipient
in respect thereof
5.1.5. wherever reasonably practicable obtain a written statement from
each of its employees having access to the Proprietary
Information undertaking to maintain the same confidential and
shall take such steps as may be reasonably desirable to enforce
such obligations
5.1.6. make copies of the Proprietary Information only to the extent
that the same is strictly required for the purposes of any
license granted to the Recipient;
5.1.7. on request of WEB2U made at any time shall deliver up to WEB2U
all documents and other material in the possession, custody or
control of the Recipient that bear or incorporate any part of
the Proprietary Information.
6. Governing Law
6.1 Where either Party has any complaint of the other under this Agreement
it may at its option commence proceedings in any Court of competent
jurisdiction in England and Wales
SIGNED /s/ Xxxxxxx X. Xxxxxxx
..............................................
WEB2U LIMITED
SIGNED [illegible signature]
.............................................
XxxxxXxx.xxx Limited
Schedule D
(As referred to in Clause 6 hereinabove)
WEB2U becomes entitled to receive [**] from JADOO for every [**] Units
manufactured by JADOO or its authorized sub-contractors.
** The omitted information is confidential and is being filed separately with
the Securities and Exchange Commission.
