[*CONFIDENTIAL TREATMENT REQUESTED]
TMS VSC LICENSE AGREEMENT
BETWEEN
VSC TECHNOLOGIES, LLC,
A DELAWARE LIMITED LIABILITY COMPANY
AND
TMS, INC.,
AN OKLAHOMA CORPORATION
October 10, 2002
TMS VSC LICENSE AGREEMENT
THIS TMS VSC LICENSE AGREEMENT (the "Agreement"), made and
entered into as of the 10th day of October, 2002 by and between
VSC Technologies, LLC, a Delaware limited liability company
("LLC") and TMS, Inc., an Oklahoma corporation ("TMS").
WHEREAS, contemporaneously herewith, Measurement
Incorporated, a North Carolina corporation ("MI"), along with TMS
and LLC have entered into that certain Master Agreement (the
"Master Agreement"), pursuant to which, among other things, the
parties agreed that TMS and the LLC shall enter into this
Agreement; and
WHEREAS, in addition to entering into the Master Agreement,
MI, TMS and LLC have contemporaneously entered into that certain
Operating Agreement;
NOW, THEREFORE, in consideration of the premises, the
parties agree as follows:
1. Definitions.
1.1. Code shall mean computer programming code and any
other machine processable material necessary to complete the
computer programming code.
1.2. Confidential Information shall have the meaning
given in Section 3.01 of the Master Agreement.
1.3. Copy shall mean a material object in which a work
is fixed by any method now known or later developed, and from
which the work can be communicated, either directly or with the
aid of a machine or device. The term "copy" includes the
material object in which a work is first fixed, including a
diskette, or a file which may be downloaded via any electronic
or telecommunications means.
1.4. Documentation (in lower case) shall mean textual
and/or graphic material, perceivable directly by humans and/or
with the aid of a device or machine, relating to a computer
program; (when capitalized) the term shall mean documentation
relating to the Licensed Software.
1.5. Education Market shall mean customers (including,
but not limited to, educational testing companies, private
and governmental departments of education and colleges,
universities and similar institutions) which conduct testing,
surveys or otherwise collect and/or archive information in
or for educational systems or institutions.
1.6. Executable Code shall mean the machine readable
form of the Code.
1.7. Field means the market for delivering products and/or
services for the purpose of scoring and measuring the results of
constructed response and selected response answers against
predefined criteria and for archiving and exploiting stored
images, but shall exclude the Education Market.
1.8. Intellectual Property Rights shall mean any and all
rights to exclude existing from time to time in a specified
jurisdiction under patent law, copyright law, moral rights law,
trade secret law, trademark law, unfair competition law, or
other similar rights.
1
1.9. Item shall mean a constructed response answer to
be read or archived using the Licensed Software.
1.10. Licensable Activity shall mean any activity
encompassed by one or more Intellectual Property Rights, e.g.,
an activity which, absent a license, would give rise to
liability for infringement (or inducement of infringement
or contributory infringement) of the Intellectual Property
Right(s).
1.11. License shall have the meaning given in
Section 2.1.
1.12. Licensed Marks shall mean those trademarks
listed in Annex A hereto, and all other trademarks now or
hereafter owned by LLC, relating to the Field.
1.13. Licensed Software shall mean the software
listed in Annex A hereto, all Improvements (as such term is
defined in the Operating Agreement) and Modifications (as
defined in Section 3.5 thereto) thereto and all other Program
Technology (as such term is defined in the Operating Agreement),
relating to the Field.
1.14. Net Sales shall mean TMS's invoice price of
Licensed Software, f.o.b. factory, sold or leased by TMS, less
only: (a) sales taxes, shipping and/or insurance if these are
separately itemized on the invoice; and (b) credits,
product returns, refunds, rebates, chargebacks, retroactive
price adjustments and any other reasonable allowances granted
following the original invoice. A Copy of Licensed Software
shall be deemed to be sold or leased upon acceptance of the
Licensed Software by the customer. In no event, however,
shall Net Sales exceed the amount actually paid to TMS.
1.15. Operating Agreement shall mean the certain
operating agreement by and among the LLC, MI and TMS of even date
herewith.
1.16. Person shall mean a natural person, a
corporation (for profit or not-for-profit), an association, a
partnership (general or limited), a joint venture, a trust, a
government or political department, subdivision, or agency, or
any other entity.
1.17. Prescribed Term shall mean terms, conditions and
warranties implied by law and to some contracts for the supply of
goods and services which the law expressly provides:
(a) may not be excluded, restricted or modified;
or
(b) may be excluded, restricted or modified only to a
limited extent.
1.18. Processor System shall mean a central processing unit
("CPU") and one or more co-processors (e.g., math or graphics co-
processors) associated with the CPU.
1.19. Royalty shall have the meaning given in Section 3.1.
1.20. Sheet shall mean two sides or two pages of a single
sheet of paper whether processed in whole or in part by the
Licensed Software.
1.21. Term shall have the meaning given in Section 4.
2
1.22. Territory shall be the world.
1.23. Trademark Use means use of a Licensed ▇▇▇▇ in
accordance with and subject to Section 2.4.
1.24. Transactional Agreements shall have the meaning given
in Section 1.07 of the Master Agreement.
1.25. Use or Using of the Licensed Software shall mean the
performance of the following steps only:
(a) copying some or all of a Copy of the Licensed
Software into memory accessible by one or more
Processor Systems, solely for the purpose of making the
Copy accessible to that Processor System for execution
of the Licensed Software (specifically not including
making other Copies of the Licensed Software in disk
storage or other permanent storage); and
(b) causing the User's Processor System to
execute the computer programs which have been copied
into its memory.
1.26. User shall mean each Person who Uses the
Licensed Software to perform VSC Services, in the Field.
1.27. User License shall mean a license granted by
TMS to a User to Use the Licensed Software in accordance with
Section 1.24 (a) and (b).
1.28. User License Agreement shall have the meaning
given in Section 2.2.
1.29. VSC Services shall mean the processing of
Sheets, which may include archiving the resulting images of those
Sheets, and reading Items utilizing the Licensed Software.
2. Grant of License.
2.1. License Rights Granted. Subject to the terms and
conditions of this Agreement, LLC hereby grants to TMS and TMS
hereby accepts a non-exclusive license in the Territory (the
"License") during the Term, under any and all Intellectual
Property Rights owned or otherwise assertable by LLC, to engage
in the following Licensable Activities:
(a) Distribution of Copies of the Licensed
Software to customers within the Field for the
sole purpose of performing VSC Services by
Users thereof;
(b) Trademark Use of the Licensed Marks; and
(c) Distribution of Documents for use by Users.
2.2. Sublicensing. TMS shall have the right to grant
User Licenses in the Territory, but shall have no other right to
grant other sublicenses of the rights conferred by this
Agreement. Prior to granting any User License, TMS and MI, on
behalf of the LLC, shall agree upon a standard User License
agreement (excluding financial terms), which form shall be
attached hereto as Annex B ("User License Agreement").