Contract analysis

ARTICLE VII — DERIVED DATA; INTELLECTUAL PROPERTY OWNERSHIP AND COMMERCIALIZATION RIGHTS QUORUM'S PROPOSED DRAFTING — FOR INSERTION INTO MASTER DATA LICENSE AGREEMENT DRAFT — PRIVILEGED & CONFIDENTIAL — ATTORNEY WORK PRODUCT Prepared by: Wendy Schultz, Associate, intellectual Property, and Omar Siddiqui, Associate, intellectual Property, Calderwood & Harkness LLP Date: January 2023 C&H Matter No.: 1025-00008 Client:

ARTICLE VII DERIVED DATA; INTELLECTUAL PROPERTY OWNERSHIP AND COMMERCIALIZATION RIGHTS

Section 7.1 — Definitions For purposes of this Article VII and the Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Article VII shall have the meanings ascribed to them elsewhere in this Agreement.

Section 7.1(a) — "Derived Data" "Derived Data" means any and all data, datasets, databases, compilations, indices, metrics, risk scores, predictive scores, propensity models, statistical models, algorithms (including trained machine-learning model weights and parameters), analytical outputs, enriched datasets, blended datasets, reports, visualizations, and any other information or work product, in any format or mediu

Section 7.1(b) — "Licensed Data" "Licensed Data" shall have the meaning set forth in Section [1.1(aa)] / [2.1] of this Agreement and shall include all data delivered by Licensor to Licensee under this Agreement, including without limitation data from the following Licensor data products: (i) MCI Consumer Credit File™ — consisting of approximately three hundred ten million (310,000,000) individual consumer credit reco

Section 7.1(c) — "Licensee IP" "Licensee IP" means all intellectual property rights owned by or licensed to Licensee (other than rights licensed to Licensee under this Agreement) as of or after the Effective Date, including without limitation: (i) all patents and patent applications, including United States Patent and Trademark Office application Serial No. 97/482,116 for QuorumScore™, and all continuations, continua

Section 7.1(d) — "Licensor IP" "Licensor IP" means all intellectual property rights owned by Licensor in and to the Licensed Data as delivered to Licensee in its original, unmodified form, including without limitation: (i) Licensor's proprietary database rights (to the extent recognized under applicable law) in the Licensed Data as compiled and organized by Licensor; (ii) copyrights, if any, in compilations and arran

Section 7.1(e) — "Model Outputs" "Model Outputs" means the predictions, scores, classifications, rankings, recommendations, risk assessments, probability estimates, or other outputs generated by Licensee's machine-learning models, statistical models, deep learning models, neural networks, or other algorithms in real-time or batch processing using new input data (whether or not such new input data includes Licensed Da

Section 7.1(f) — "Commercialization" "Commercialization" means the sale, sublicensing, distribution, provision as a service (whether as software-as-a-service, data-as-a-service, analytics-as-a-service, or otherwise), or other transfer or making available of Derived Data or Model Outputs to any third party (including affiliates and subsidiaries within Licensee's corporate group and unrelated third parties), for such t

Section 7.2 — Ownership of Derived Data

Section 7.2(a) — Vesting of Ownership in Licensee As between Licensor and Licensee, Licensee shall be the sole and exclusive owner of all right, title, and interest in and to all Derived Data, including without limitation all intellectual property rights therein and thereto, including all copyrights, trade secrets, database rights, patent rights, and all other proprietary rights of any kind or nature, whether now kno

Section 7.2(b) — Ownership of Model Outputs All Model Outputs shall be deemed Derived Data for all purposes of this Agreement and shall be owned exclusively by Licensee, regardless of whether such Model Outputs are generated using Licensed Data, Licensee's proprietary data, third-party data, or any combination thereof as inputs at the time of inference or generation. The ownership of Model Outputs by Licensee shall n

Section 7.2(c) — No License-Back Licensee does not grant, and shall not be deemed to grant, any license, right, or interest of any kind — whether express, implied, by estoppel, by exhaustion, or otherwise — to Licensor in or to any Derived Data, Model Outputs, Licensee IP, or any other intellectual property of Licensee. This prohibition applies regardless of the degree to which any Derived Data or Model Outputs incor

Section 7.2(d) — No Revenue Sharing Licensee shall not owe Licensor any royalties, revenue share, profit share, fees, or other compensation of any kind or nature, whether fixed or variable, in connection with Licensee's creation, development, use, internal deployment, or Commercialization of Derived Data or Model Outputs, whether within Licensee's corporate group or to third parties, and regardless of the volume, sca

Section 7.2(e) — Reservation of Licensor IP Notwithstanding anything to the contrary in this Section 7.2, Licensor retains all right, title, and interest in and to the Licensed Data in its original, unmodified form as delivered to Licensee under this Agreement, including all Licensor IP therein. Nothing in this Article VII shall be construed to transfer ownership of the Licensed Data (in its raw, unmodified form as d

Section 7.3 — Licensee's Commercialization Rights

Section 7.3(a) — Unrestricted Commercialization Subject only to the restrictions on redistribution of raw Licensed Data set forth in Section 7.4(a) and the regulatory compliance obligations set forth in Section 7.4(b) and Section 7.4(c), Licensee shall have the unrestricted right to use, reproduce, modify, adapt, create derivative works from, display, perform, distribute, sublicense, sell, offer for sale, import, exp

Section 7.3(b) — No "Sufficient Transformation" Requirement Licensee's right to Commercialize Derived Data and Model Outputs under Section 7.3(a) shall not be conditioned on, or subject to, any determination by Licensor (or by any third party designated, retained, or approved by Licensor) that the Derived Data or Model Outputs have been "sufficiently transformed," "adequately anonymized," "materially altered," or oth

Section 7.3(c) — Specific Carve-Out for QuorumScore™ Without limiting the generality of Sections 7.2 and 7.3(a)–(b), the parties specifically acknowledge and agree as follows: (i) The QuorumScore™ predictive underwriting model (United States Patent and Trademark Office application pending, Serial No. 97/482,116), including all algorithms, trained model weights, parameters, and methodologies embodied therein, constitu

Section 7.4 — Licensee's Obligations Regarding Licensed Data

Section 7.4(a) — Restrictions on Redistribution of Raw Licensed Data Licensee shall not sell, sublicense, distribute, publish, transmit, or otherwise make available to any third party the Licensed Data in its raw, unmodified form as received from Licensor. For the purposes of this Section 7.4(a), "raw, unmodified form" means the Licensed Data as delivered by Licensor to Licensee without any material transformation, a

Section 7.4(b) — Compliance with Applicable Law Licensee's use, processing, storage, and Commercialization of Derived Data and Model Outputs shall comply with all applicable federal, state, and local laws, regulations, rules, and orders, including without limitation: (i) the Fair Credit Reporting Act, as amended ("FCRA"), 15 U.S.C. § 1681 et seq.; (ii) the Gramm-Leach-Bliley Act ("GLBA"), 15 U.S.C. § 6801 et seq., an

Section 7.4(c) — FCRA Compliance for Derived Data To the extent any Derived Data or Model Output constitutes a "consumer report" within the meaning of Section 603(d) of the FCRA (15 U.S.C. § 1681a(d)), or is used or expected to be used as a factor in establishing a consumer's eligibility for credit, insurance, employment, or any other purpose described in Section 604 of the FCRA (15 U.S.C. § 1681b), Licensee shall us

Section 7.5 — Intellectual Property Representations and Warranties

Section 7.5(a) — Licensor Representations and Warranties Licensor represents and warrants to Licensee as of the Effective Date and as of each date on which Licensed Data is delivered to Licensee that: (i) Licensor owns or has the right to license the Licensed Data to Licensee as contemplated by this Agreement, and has full power and authority to grant the rights and licenses set forth herein, including without limita

Section 7.5(b) — Licensee Representations and Warranties Licensee represents and warrants to Licensor as of the Effective Date that: (i) Licensee has the technical capability, analytical expertise, and organizational infrastructure to create Derived Data and Model Outputs in compliance with this Agreement and all applicable laws and regulations; (ii) Licensee has implemented and maintains data-governance policies, in

Section 7.6 — Survival and Post-Termination Rights

Section 7.6(a) — Survival of Derived Data Rights Licensee's ownership of all Derived Data and Model Outputs created during the Term of this Agreement, and all of Licensee's rights to use, modify, adapt, reproduce, distribute, sublicense, Commercialize, and otherwise exploit such Derived Data and Model Outputs, shall survive the expiration or termination of this Agreement in perpetuity, regardless of the reason for su

Section 7.6(b) — No Reversion No right, title, or interest in any Derived Data or Model Outputs shall revert to Licensor upon the expiration or termination of this Agreement, regardless of the reason for such expiration or termination. Licensor hereby irrevocably waives any claim, right, or argument that any portion of the Derived Data or Model Outputs should revert to Licensor, be returned to Licensor, be destroyed

Section 7.7 — Indemnification for intellectual Property Claims

Section 7.7(a) — Licensor Indemnification Licensor shall indemnify, defend, and hold harmless Licensee and its officers, directors, employees, agents, affiliates, successors, and assigns (collectively, the "Licensee Indemnified Parties") from and against any and all claims, demands, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litiga

Section 7.7(b) — Licensee Indemnification Licensee shall indemnify, defend, and hold harmless Licensor and its officers, directors, employees, agents, affiliates, successors, and assigns (collectively, the "Licensor Indemnified Parties") from and against any and all claims, demands, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litiga

Section 7.8 — Dispute Resolution for Article VII Matters Any dispute, controversy, or claim arising under or in connection with this Article VII, including disputes regarding the ownership, characterization, or classification of any data or information as Derived Data, Licensed Data, or Model Outputs, shall be resolved in accordance with the dispute resolution provisions of Article [__] (Dispute Resolution; Governing

Section 7.9 — Entire Article; No Implied Licenses This Article VII sets forth the entire agreement of the parties with respect to the ownership, licensing, use, and Commercialization of Derived Data and Model Outputs and the allocation of intellectual property rights between the parties with respect thereto. This Article VII supersedes any prior or contemporaneous understandings, representations, negotiations, corres