Software Development And Consulting Agreement

Exhibit 10.1

Software Development and Consulting Agreement
between
Arbitron Inc. and Statistical Research Inc.

THIS AGREEMENT is made this 2nd day of July, 2001 (the "Effective Date") by and between Arbitron Inc., a Delaware corporation ("Arbitron") with offices at 142 West 57th Street, New York, New York 10019 and Statistical Research, Inc. ("SRI") a New Jersey corporation with offices at 111 Prospect Street, Westfield, New Jersey 07090.

BACKGROUND

A. Arbitron and SRI have entered into an Asset Purchase Agreement dated effective as of July 2, 2001 (the "Asset Purchase Agreement") wherein Arbitron is purchasing from SRI certain assets comprising SRI's Radio All Dimensional Audience Research business (hereinafter "RADAR") as specified therein. This Agreement is being entered into as a condition to the closing under the Asset Purchase Agreement (the "Closing").

B. Arbitron desires the services described hereunder to ensure the continued and profitable operation of RADAR after the Closing, and the transition of the software used for RADAR from processing telephone interview based data to processing diary based data.

NOW THEREFORE, in consideration of and as part of the transaction set forth in the Asset Purchase Agreement and the mutual agreements contained herein, the parties agree as follows:

1. Services Provided; Payment.

A. Commencing on the Effective Date and continuing until terminated as provided by Section 10 herein, SRI shall provide to Arbitron the services and software, including any modifications and enhancements thereto (respectively referred to as the "Services" and the "Software") which are more particularly described in Schedule ?A' attached to this Agreement and which are incorporated herein.

B. Arbitron shall pay SRI for the Services and Software in accordance with Schedule ?A'.

2. Term.

This Agreement shall commence on the Effective Date and shall continue in accordance with the Term set forth in Schedule ?A', or unless otherwise terminated in accordance with the provisions set forth in Section 9 or in Schedule ?A'.

3. Proprietary Rights; Disclosures of Intellectual Property:

(a) All work performed under this Agreement, and all Services, Software, materials, products, deliverables developed or prepared for Arbitron by SRI under this Agreement, are the property of Arbitron and all title and interest therein shall vest in Arbitron and shall be deemed to be a Work Made for Hire and made in the course of performing the services rendered hereunder. To the extent that title to any such works may not, by operation of law, vest in Arbitron or such works may not be considered Works Made for Hire under applicable law, all rights, title and interest therein are hereby irrevocably assigned to Arbitron. All such materials shall belong exclusively to Arbitron, with Arbitron having the right to obtain and to hold in its own name, copyrights, registrations or such other protection as may be appropriate to the subject matter, and any extensions and renewals thereof. SRI agrees to give Arbitron and any person designated by


Arbitron, reasonable assistance required to perfect the rights defined in this Paragraph without further payment or compensation.

SRI shall promptly make a complete written disclosure to Arbitron of any invention, discovery or improvement which, to SRI's knowledge, is unique or novel, whether patentable or not, conceived of or first actually reduced to practice, solely or jointly, by Arbitron's or SRI's employees during the term of this Agreement and in the performance of services hereunder (hereinafter referred to, whether actually disclosed by SRI or not, as "Disclosed Subject"). As to any such Disclosed Subject, SRI shall specifically point out, in writing, the features or concepts which SRI believes to be new or different.

In consideration of the payment by Arbitron to SRI of the amounts specified hereunder for the performance of work, SRI hereby agrees to assign and does hereby assign to Arbitron all right, title and interest in and to any such Disclosed Subject; and SRI further agrees to execute, acknowledge and deliver all such papers prepared by Arbitron with the cooperation of SRI as may be necessary to obtain patents for such Disclosed Subject in any and all countries of the world and to vest title thereto in Arbitron, its successors and assigns, and provide, at Arbitron's expense, all assistance reasonably required to assure Arbitron the rights thereto. SRI shall have each employee performing work hereunder execute a Contract Employee Invention Agreement in the form attached hereto sufficient to comply with this Agreement.

There shall be no accountability to SRI for royalties or other payments with respect to the use of any such Disclosed Subject by Arbitron or its subsidiaries or licensees.

Unless otherwise requested by Arbitron, upon the completion of the Services to be performed under this Agreement or upon the earlier termination of this Agreement (other than upon default for non-payment by Arbitron that is not later cured either through written agreement of the parties hereto or through satisfaction by Arbitron of a judgment against it to make such payments), SRI shall immediately turn over to Arbitron all materials and deliverables acquired or developed by SRI pursuant to this Agreement.

4. Confidential Information: Any specifications, drawings, sketches, models, samples, data, computer programs (including all source code and object code) or documentation, technical information, methods of operation, Arbitron client information, SRI client information finances, or other business information or confidential information of either Arbitron or SRI (the "Confidential Information") and furnished or disclosed by one party to the other hereunder shall be deemed the property of and, when in tangible form, shall be returned to the providing party upon completion or termination of this Agreement; provided, however, that any Confidential Information created by either party in accordance with or in furtherance of the terms of this Agreement shall be deemed the property of Arbitron, and SRI shall be deemed the receiving party. Unless such information was previously known to the receiving party free of any obligation to keep it confidential, or has been or is subsequently made public by the providing party or a third party with a right to disclose such information, it shall be held in confidence by the receiving party, shall not be disclosed to any third party by the receiving party, shall be used only for the purposes hereunder, and may be used for other purposes only upon such terms and conditions as may be mutually agreed upon in writing; provided, however, that the receiving party may disclose the Confidential Information as may be required by law, rule, regulation or court order or decree, or if the receiving party reasonably determines (following advance notice to and opportunity to comment by the other party) that such disclosure is necessary in order to comply with applicable law.

Both parties acknowledge that disclosure of any Confidential Information by the receiving party will give rise to irreparable injury to the providing party, inadequately compensable in damages. Accordingly, the providing party may seek and obtain injunctive relief against the breach or threatened breach of the foregoing undertakings, in addition to any other legal remedies which may be available. Both parties acknowledge and agree that the covenants

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contained herein are necessary for the protection of legitimate business interests of the providing party and are reasonable in scope and content .

Notwithstanding anything to the contrary, in the event that SRI incorporates any of its Confidential Information into the Services and/or Software, Arbitron shall have the right to use, disclose and sublicense such Confidential Information.

5. Warranty: SRI warrants that the Software as accepted by Arbitron provided hereunder shall at all times conform to the specifications set forth in the Statement of Work attached hereto as Schedule A. The Software as accepted by Arbitron shall function properly and in conformity with such specifications for a period of one (1) year following the date of Arbitron's acceptance of the Software, and for a period of one (1) year from the date of Arbitron's acceptance of the Software SRI shall use its best efforts to correct any defects in the Software, as accepted by Arbitron, so that such Software shall function properly and in conformity with the required specifications. At the time of acceptance by Arbitron of the Software and for one (1) year thereafter, SRI will use its best efforts to keep the Software as accepted by Arbitron free of all viruses, "trojan horses," and other similar defects or deficiencies. The Services provided by SRI shall be produced in a workmanlike manner and shall be rendered by qualified personnel who will perform the tasks assigned consistent with good professional practice and the state of the art involved. In addition, SRI represents and warrants that to its knowledge it has the right to provide the Software without violating any rights of any third party, that there is currently no actual or threatened suit by any such third party based on an alleged violation of such right, and that to SRI's knowledge Arbitron shall receive free, good and clear title to all Software, Services and Disclosed Subject(s) developed and/or provided under this Agreement. SRI warrants and represents that it has not and shall not grant any rights to any third parties inconsistent with the provisions of this Agreement.

SRI hereby warrants that it has not granted to any other party exclusive rights to the Software in the specific areas described herein. SRI further warrants that no other party has exclusive rights to its Services and/or, to SRI's knowledge, Software in the specific areas described herein and that SRI is in no way compromising any rights or trust relationships between any other party and SRI, or creating a conflict of interest, or any known or likely possibility thereof, for SRI or for Arbitron. SRI further warrants that all Services and Software provided hereunder will be performed in accordance with all applicable Federal, State, or Local laws, regulations and executive orders.

EXCEPT FOR THE LIMITED WARRANTIES SET FORTH IN THIS SECTION 5, SRI MAKES NO WARRANTIES HEREUNDER, AND EXCEPT AS OTHERWISE SET FORTH IN THIS SECTION 5, SRI EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

6. Indemnification; Injunction Remedy: SRI shall indemnify and hold harmless Arbitron for any loss, injury, damage, expense or liability and all costs, fees and expenses (including reasonable attorneys' fees) that may result by reason of: (a) any breach by SRI of SRI's representations or warranties, and (b) any infringement, or claim of infringement, of any patent, trademark, copyright or other proprietary right of any third party based on the Software and/or Services provided under this Agreement to Arbitron hereunder. SRI shall defend or settle, provided that such settlement does not prejudice Arbitron's rights, at its own expense, any action for which it is responsible hereunder. Each party shall notify the other promptly of any claim of infringement for and shall provide reasonable cooperation to the other party to facilitate the defense of any such claim. Notwithstanding anything in this Agreement to the contrary, if any claim brought by Arbitron under this Section 6 is a result of any infringement, or claim of infringement, of any patent, trademark, copyright or other proprietary right of any third party based on the Software and/or Services provided under this Agreement to Arbitron hereunder was not known by SRI at the time SRI provided Arbitron notice of SRI's achieving the Acceptance

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Criterion (an "SRI Unknown Infringement"), then SRI's obligation to indemnify Arbitron under clause (b) of this first paragraph of Section 6 shall not exceed a maximum of $2,000,000. All costs, fees, judgments, settlements and expenses that may result by reason of defending or settling an SRI Unknown Infringement claim that exceed $2,000,000 shall be born 50% by SRI and 50% by Arbitron; provided that SRI's share shall in no event exceed an aggregate of $5,000,000 (including the $2,000,000).

In the event of an injunction preventing Arbitron's use of the Services and/or Software or if the Services and/or Software are likely to become the subject of a claim of violation of the rights of a third party, SRI shall, at Arbitron's election and SRI's sole expense: (a) replace or modify the infringing Services and/or Software; (b) obtain for Arbitron the right to continue to use the Services and/or software; or (c) refund amount paid for the Services and/or Software. The foregoing shall be in addition to SRI's indemnification obligation to Arbitron.

For the avoidance of doubt, SRI's representations relating to infringement and SRI's obligations to defend, indemnify and hold harmless with respect to any infringement or claim of infringement shall not apply if and to the extent that any infringement or claimed infringement relates to modifications in the Software by Arbitron, and Arbitron shall defend, indemnify and hold harmless SRI to the extent that any infringement or claims of infringement relate to modifications in the Software by Arbitron.

7. Acceptance: When SRI determines the Acceptance Criterion (as defined in Schedule A) has been achieved, SRI shall provide written notification of such fact to Arbitron. Arbitron shall have an acceptance period of thirty (30) working days, from the date of receipt of SRI's notice, in which to conduct tests to determine if the Acceptance Criterion has been achieved. On or prior to the expiration of this acceptance period, Arbitron shall provide to SRI a written notice of either, (1) Arbitron's acceptance, or (2) notice of non-achievement of Acceptance Criterion and Arbitron's rejection of same. Payment by Arbitron to SRI shall not relieve SRI of any of its obligations and responsibilities under this Agreement and/or applicable Schedule.

SRI shall supply the appropriate personnel to investigate the reported deficiencies found by Arbitron during the acceptance period. Deficiencies found to be of SRI's causing will be corrected by SRI at its own expense. Such correcting activities will commence immediately and be completed as quickly as is reasonably possible. If corrections are required, upon receipt of SRI's notice that the deficiencies have been remedied, Arbitron shall again have an acceptance period of thirty (30) working days, unless otherwise specified or agreed to in writing.

8. Insurance and Liability: SRI shall secure and maintain workers' compensation, disability benefits, unemployment insurance and the like, in accordance with the law of the state or states wher ...