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. SOFTWARE LICENSE PROVISIONS 3. License Management 3.1 Catch-up licenses a) Ifyau use the Sofuvare beyond the scope of the License, the parties mutu. ally desire that the matter be resolved on a business basis, and not as a matter of possible copyright infringement. Consequently, in such event, you agree to promptly purchase the additional licenses required for such use, plus main- tenance for such additional licenses for the full teon of the then-current main- tenance subscription for such Software, or, iflonger, for the period during which such unlicensed use has been taking place. b) lfyau did not purchase such additional licenses on your own initiative, then as a compromise of any potential dispute over exactly how long you were making unlicensed use afthe Software, you wi1llikewise purchase one additional year of back maintenance (or such lower amount of back mainte- nance (not less than six months, as the parties may mutually agree). c) If you purchase additional licenses and maintenance as provided in sub- paragraphs (a) and (b), such purchase will be OUR EXCLUSIVE REMEDY for your unauthorized use of Software described in subparagraph (a)? If you do not purchase additional licenses and maintenance as provided in subpara~ graphs (a) and (b), we reserve the right, at our option, to pursue otherreme- dies for your unauthorized use to the extent permitted by applicable law. 3.2 Compliance reporting lfwe have reason to believe that you are not in compliance with a License, and we give you at least 10 business days' notice, then you will provide us with information about your installation and use of the Software reasonably sufficient to confirm your compliance. This includes running the Counting Utility software and providing us with electronic and/or hard copies of the re- sulting report(s). We will not make such a request more than once per year except for good reason. 3.3 Audits a) lfwe give you at least 10 business days' notice, we may audit the infor- mation you provide to us under Section 3.2. You agree to provide us and/or our auditors with reasonable access to your relevant documents and records for such purpose during normal business hours. If our personnel come onto your site and/or access your network in connection with such audit, we will instruct them to abide by your reasonable security procedures of which you inform us a reasonable time in advance. b) We will not disclose or use any confidential information that may be re- vealed in the audit except in connection with ensuring compliance. c) The audit will be at our expense unless the audit discloses a shortfall of more than 5%, in which case the audit will be at your expense. 7 Section 3.1: Under the above exclusive-remedy clause, BindView will be precluded from seeking damages or profits under copyright law. Please note that this is not an insignificant matter - in certain circumstances, a copyright owner is entitled to an award of the infringer's indirect profits arisingfrom the itifringement. For example, in an actual copyright case, the MGM Grand Hotel in Las Vegas was held liable for copyright infringement because it used certain musical material in its floor show without obtaining the necessary license. The court's award of the ho- tel's indirect profits to the copyright owner included 2% of the MGM Grand's hotel and gaming profits during the infringement period. See Frank Music Corp. v. Metro~Goldwyn.Mayer, Inc., 886F.2d /545 (9th Gir. /989). Under Section 3.1. BindView is voluntarily giving up its right to seek indirect profits, and other copyright remedies, in the event that you use our software in certain unlicensed ways. In return, we askfor a contractual commitment on your part that you will pay for "make-good" licenses, including back maintenance where indicated above. BINDVIEW CUSTOMER AGREEMENT 95.3172 PAGE 6