Simputer Device Manufacturing License (SDML2) - Version 1.1

MANUFACTURING AND DISTRIBUTION LICENSE FOR SIMPUTERS
Version 1.1        7 May, 2001
Copyright © The Simputer Trust

This Manufacturing and Distribution License for Simputers is executed on this the ___ day of ___________, 2001 by and between:

The Simputer Trust, a registered non-profit trust having its office at 9A & B Garden Homes 27, Aga Abbas Ali Road, Bangalore - 560042 and represented herein by its managing trustee Mr. Vinay L. Deshpande (hereinafter the Simputer Trust), of the ONE PART; and _________________, a company incorporated under the laws of ______________ and having its registered office at ____________________, represented herein by its Managing Director, _____________ (hereinafter Licensee), of the OTHER PART.

Recitals

A.        Whereas Licensee has developed a prototype of a device which satisfies the Core Simputer Specifications as defined in the Simputer General Public License and has approached the Simputer Trust for a license to manufacture and distribute devices under the Simputer trademark.

B.         Whereas the Simputer Trust has examined the Device developed by Licensee and, being convinced that the said Device meets the Core Simputer Specifications has agreed to grant Licensee the license to manufacture and distribute the Device and to use the Simputer trademark in respect of the manufacturing and distribution of the Device under and subject to the terms contained herein.

NOW THE PARTIES AGREE AS FOLLOWS:

1.         Definitions.

The following terms when used with initial letters capitalized shall, in this Agreement, have the respective meanings as set out hereunder:

Core Simputer^TM Specifications or CSS when used in this SGPL refers to the minimal core features that any Device must necessarily display in order that such device may be called or referred to as a Simputer^TM. The Simputer^TM Trust shall from time to time, publish the CSS on its website with clear version numbering.

Device means the device constructed or fabricated by Licensee using the Specifications or any modifications or derivations thereof a working prototype of which has been submitted to the Simputer^TM Trust, which Licensee has affirmed meets and satisfies the CSS and in respect of which Licensee seeks a license from the Simputer^TM Trust.

Device Specifications means the specifications, including any modifications of the Specifications, based upon which the Device was created.

Functional Tests when used in this SGPL shall refer to the set of non-invasive tests which if applied to any Device will indicate whether or not such Device satisfies the CSS.

SGPL means the Simputer General Public License as published on the Simputer^TMwebsite.

Simputerised Device means any device which utilizes any part, but not the whole of the Specifications or modifications thereof or which meets or achieves only a portion of the Core Simputer Specifications but not all the Core Simputer^TM Specifications.

Specifications means any such specifications pertaining to the hardware design, the printed circuit board layout or other works necessary for the creation of a Device as released by the Simputer^TM Trust and published on its website, from time to time.

Trademark means the Simputer^TM trademark solely and exclusively owned by the Simputer^TM Trust.

2.         The Device.

Licensee has developed the Device using the Specifications or the Device Specifications. Licensee covenants that the Device does not infringe any patent or other third party intellectual property rights. To the extent that the Device incorporates any proprietary intellectual property, Licensee has obtained appropriate and adequate third party licenses in respect of the use of those intellectual properties in the manufacture and distribution of the Device. Licensee hereby agrees to indemnify the Simputer^TM Trust and all other parties claiming under or through the Simputer^TM Trust in respect of any third party intellectual property infringement actions howsoever called in relation to the manufacture by the Licensee of the Device.

3.         Grant of License.

3.1        This Agreement pertains to the license to manufacture Devices based on the Specifications or modifications of the Specifications, which meet the CSS. In order to manufacture devices based on the Specifications but which do not meet the CSS, Licensee will be required to approach the Simputer^TM Trust for a fresh license in respect thereof.

3.2        The Simputer^TM Trust hereby grants Licensee the license to manufacture and distribute Simputers subject and in accordance with the terms of the SGPL. The Simputer^TM Trust, being the sole and absolute owner of the Trademark does hereby grant Licensee the worldwide, non-exclusive, non-transferable right to use the Trademark in relation to the Device, without limitation in point in time, and strictly in accordance with and subject to the terms and conditions herein mentioned. The rights granted under this Agreement are personal to Licensee and cannot be assigned, transferred or otherwise dealt with except in accordance with the conditions herein contained. The license has been granted to Licensee in respect of the Device created, fabricated or manufactured in accordance with the Specifications or the Device Specifications. Nothing contained herein shall operate to grant the Licensee any rights in respect of the manufacture or distribution of any device which has been created based upon any specifications other than the Device Specifications.

4.         Consideration.

4.1        In consideration for the grant of the license under Clause 3, Licensee has paid the Simputer^TM Trust the one-time, lumpsum license fee of US$ ___________/-, receipt whereof the Simputer^TM Trust hereby acknowledges. The Simputer^TM Trust covenants and affirms that the license fee represents to total consideration for the grant of the license under the terms of this Agreement and that Licensee shall not be required to pay any additional consideration or license fee in respect of the manufacture and/or distribution of the Device any subsequent version of the Device. However, the fact that Licensee shall not be required to pay any further license fee shall not absolve Licensee of the obligation to approach the Simputer^TM Trust for a license in respect of each version of the Simputer^TM proposed to be manufactured and/or distributed by Licensee.

4.2        In the event License approaches the Simputer^TM Trust, under the provisions of Clause 3.1 hereof for a license to manufacture Simputerised Devices, Licensee shall not, having already paid the license fee under clause 4.1, be required to pay any additional license fee in respect of any such license that may be granted by the Simputer^TM Trust.

5.         Licensee Rights.

Licensee shall have the right to:

5.1        Manufacture, fabricate, market, distribute, sell, transfer, hire, or otherwise dispose of in any manner, the Devices either within the territory of India or anywhere else in the world.

5.2        Appoint sales and marketing agents and/or distributors for the Devices anywhere in the world, provided that no such appointment will hamper or restrict the right of any other licensee to appoint agents and/or distributors in the same geographical region.

5.3        Advertise the sale and marketing of the Device in any media provided that all such advertisements make reference to the Trademark in relation to the Device as well as the name of Licensee as the manufacturer of the Device.

5.4        Price the Device freely.

5.5        Develop and distribute any proprietary or open source software along with the Device.

5.6        Develop and distribute any external hardware or other peripheral device designed to be used in conjunction with the Device.

5.7        Exclusively manufacture, distribute and market any Device based on Device Specifications (but not on the Specifications) for a period of 12 months from the date of the first commercial sale of such Device.

6.         Licensee Obligations.

Licensee shall be obliged to:

6.1        Publish or cause to be published a copy of the Device Specifications and deliver a copy of such modified Specifications to the Simputer^TM Trust on the expiry of twelve months from the date on which the first commercial sale of such Device is completed.

6.2        Adhere to the terms of the SGPL in the manufacture, distribution, marketing and development of the Device or all modifications thereto.

6.3        Adhere to the guidelines published by the Simputer^TM Trust from time to time in respect of the display of the Trademark and the Simputer^TM logo on the Device as well as in all promotional material, documentation, brochures, notices, etc. relating thereto.

6.4        Ensure that the manufacture or distribution of the Device does not infringe or violate any existing intellectual property rights of any third party. To the extent that the Device incorporates any third party intellectual property, the Device Specifications should name the licensor of such intellectual property and list the specifications thereof in sufficient detail as would be necessary for any subsequent licensee of the Specifications to be able to obtain a license for such intellectual property from the licensor.

6.5        Hold the Simputer^TM intellectual property in trust including that vesting in the Specifications, the Device Specifications and the Trademark and diligently inform the Simputer^TM Trust about all infringements or threatened infringements thereof as may be discovered by Licensee.

6.6        Ensure that all Devices sold or distributed are distributed along with the SGPL and all recipients thereof are made aware of the terms of the SGPL and its implications in the context of such distribution.

6.7        Refrain from sub-licensing the manufacture or distribution of the Devices. Nothing contained herein shall limit the right of Licensee to appoint sales and marketing agents and distributors in respect of the distribution of the Devices provided that Licensee retains control over the actual manufacture of the Devices and that all such agents and distributors agree to be bound by the terms and conditions of the SGPL.

6.8        Refrain from registering any intellectual property vesting in or connected with the Device, including but not limited to the Specifications and the Device Specifications.

7.         Ownership of Specifications.

Licensee agrees that the Specifications and the modified Specifications constitute the valuable intellectual property of the Simputer Trust and shall under all circumstances remain the property of the Simputer Trust. Licensee further agrees that on the 12 month anniversary of the date on which the first sale of a Device based on the Device Specifications was completed, the Device Specifications shall be handed over to the Simputer Trust and Licensee shall perform all actions necessary to effect the transfer of title and ownership over the Device Specifications to the Simputer Trust. From such date the term Specification, when used in this Manufacturing and Distribution License or in the SGPL shall be deemed to include the Device Specifications.

8.         Termination.

8.1        This license shall not be limited in point in time.

8.2        Notwithstanding anything contained herein, the Simputer Trust shall be entitled to terminate this license at any time with immediate effect in the event Licensee is found, at any point in time, to be in breach of any of the terms and conditions set out in this Manufacturing and Distribution License or the SGPL.  In such event the Simputer Trust shall also be entitled to terminate, with immediate effect, the license of the Trademark under the terms of this Agreement.

8.3        From the date of such termination, Licensee shall not be entitled to legally denote any Device manufactured or distributed by it, as being a Simputer or any modifications or colourable imitations thereof or to represent, whether expressly or through reasonable implication, that such Devices are derived from, or similar to, Simputers or Simputerised Devices. Furthermore, from the date of termination, Licensee shall not be entitled to develop or manufacture any Devices based on the Specifications or the Device Specifications whether or not such Device Specifications have been published and transferred to the Simputer Trust or not.

8.4        Licensee hereby authorize the Simputer Trust, in the event of such termination of this Manufacturing and Distribution License, to publish, disclose or otherwise generally make known the fact that such license has been terminated and that any Device manufactured by Licensee commencing from the date of such termination, are not Simputers as defined and certified by the Simputer Trust.

9.         Disclaimer.

9.1        THE SPECIFICATIONS HAVE BEEN PROVIDED "AS IS". THE Simputer TRUST DOES NOT PROVIDE ANY WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE IN RESPECT OF THE SPECIFICATIONS OR ANY DEVICES THAT MAY BE MANUFACTURED BASED ON THE SPECIFICATIONS. THE ENTIRE RISK AS TO THE QUALITY AND PERFORMANCE OF DEVICES MANUFACTURED UNDER THE TERMS OF THE SPECIFICATIONS SHALL VEST WITH LICENSEE. SHOULD THE SPECIFICATION PROVE DEFECTIVE, LICENSEE SHALL ASSUME THE COST OF ALL NECESSARY REPAIR OR CORRECTION OF THE DEVICE.

9.2        IN NO EVENT UNLESS REQUIRED BY APPLICABLE LAW OR AGREED TO IN WRITING WILL THE Simputer TRUST OR ANY OTHER PERSON OR LEGAL ENTITY WHICH HAS CONTRIBUTED TO THE SPECIFICATIONS, BE LIABLE TO LICENSEE FOR DAMAGES, INCLUDING ANY GENERAL, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY TO USE THE SPECIFICATIONS IN ORDER TO DEVELOP OR MANUFACTURE DEVICES, EVEN IF THE Simputer TRUST OR OTHER PERSON HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

10.       Miscellaneous.

10.1      If the full scope of the applicability of this Manufacturing and Distribution License is restricted in certain countries either by patents or by the operation of any other law, the Simputer Trust may, at its discretion, add an explicit geographical limitations excluding those countries, so that scope and extent of this Manufacturing and Distribution License extends only to those countries not thus excluded. In such case, this Manufacturing and Distribution License incorporates the limitation as if written in the body of this Manufacturing and Distribution License Agreement.

10.2      This Manufacturing and Distribution License shall be executed in two counterparts, each of which shall be deemed as original but all of this together shall constitute one and the same instrument.

10.3      Any amendment to this Manufacturing and Distribution License shall be in writing and signed by both parties.

10.4      This Manufacturing and Distribution License shall be construed, and the legal relations between the parties hereto shall be determined, in accordance with the laws of India.

10.5      Licensee shall not be entitled to assign its obligations under this Manufacturing and Distribution License to any third party without the written consent of the Simputer Trust. In the event of a re-structuring, re-organisation or other change in the management or shareholding of Licensee the Simputer Trust shall at its own discretion, be entitled to require Licensee to obtain a fresh license or in the alternative to revoke this Manufacturing and Distribution License.

10.6      All Section headings herein are for convenience of reference only and are not part of this Manufacturing and Distribution License, and no construction or inference shall be derived therefrom.  Wherever required by the context, any gender shall include the other gender, the singular shall include the plural, and the plural shall include the singular.  Each defined term herein may be used either in its singular or plural form whether or not so defined.

10.7      No failure by either party hereto at any time to give notice of any breach by the other party of, or to require compliance with, any condition or provision of this Manufacturing and Distribution License shall be deemed a waiver of the same or any other provisions or conditions at the same or any prior or subsequent occasion.

IN WITNESS WHEREOF, the parties here to have executed this Manufacturing and Distribution License as on the date and year first hereinabove written;