Exhibit 10.3

 

EXECUTION VERSION

 

Exhibit C

 

MANUFACTURING AGREEMENT WITH NATIONAL

 

ARCHIVE PUBLISHING COMPANY

 

This MANUFACTURING AGREEMENT is made as of October 28, 2005 (this “Agreement”)
between PROQUEST INFORMATION AND LEARNING COMPANY, a corporation organized under
the laws of the State of Delaware (“Seller”) and NATIONAL ARCHIVE PUBLISHING
COMPANY, a corporation organized under the laws of the State of Michigan
(“Buyer”).

 

WHEREAS, Seller and Buyer have entered into an Asset Purchase Agreement dated
October 28, 2005 (the “Purchase Agreement”) for the sale of the Periodicals
Microform Business, the Production Assets, the XanEdu Business and the Facility
(each as defined in the Purchase Agreement);

 

WHEREAS, Buyer wishes to provide to Seller, and Seller wishes to receive from
Buyer, on a preferred provider basis certain Services (as defined below)
relating to the manufacture, shipping and delivery of the ProQuest Retained
Microform Products (as defined in the Purchase Agreement) and digital versions
thereof, together with certain other Services to the extent provided in this
Agreement; and

 

WHEREAS, Sections 2.02(iii) and 2.03(v) of the Purchase Agreement provide that,
at the Closing, each of Seller and Buyer, respectively, shall deliver or cause
to be delivered to the other party a duly executed counterpart to this
Agreement;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

1. DEFINITIONS

 

1.1 Capitalized terms used herein and not otherwise defined herein shall have
the meanings ascribed to them in the Purchase Agreement.

 

1.2 “Buyer’s Cost” means Buyer’s reasonable costs for providing Services
hereunder, consisting of Cost Per Unit and Overhead, but excluding all executive
compensation, marketing expenses, interest on loans of Buyer, rent/mortgage on
the Facility, capital expenditures not agreed to by Seller pursuant to
Section 2.6 hereof, and all other costs not expressly included as components of
Buyer’s Cost on Schedule D hereto or agreed to by Seller pursuant to Section 2.6
hereof.

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1.3 “Change of Control” has the meaning set forth in Section 15.2 of this
Agreement.

 

1.4 “Conversion” means (i) Digitization, when related to the reformation of a
digital file (e.g. PDF, MSWord) into a master image and/or (ii) the creation of
a secondary output file (e.g. ASCII, XML, HTML, SGML) from a digital file or
image.

 

1.5 “Cost Per Unit” means the costs for direct manufacturing labor, indirect
manufacturing labor, raw material, supplies and other costs set forth on
Schedule D hereto.

 

1.6 “CRC” has the meaning set forth in Section 2.5 of this Agreement.

 

1.7 “Executives” means, in the case of Seller, Suzanne BeDell and Rod Gauvin, as
applicable based on the subject matter of the dispute, and in the case of Buyer,
Daniel Arbour, Joe Mills, Tim Mitchell and Jeff Moyer.

 

1.8 “Extended Term” has the meaning set forth in Section 7.2 of this Agreement.

 

1.9 “Force Majeure” has the meaning set forth in Section 5.1 of this Agreement.

 

1.10 “Guaranteed Minimum Amount” has the meaning set forth in Section 2.2(a) of
this Agreement.

 

1.11 “Initial Term” has the meaning set forth in Section 7.1 of this Agreement.

 

1.12 “Market Cost” has the meaning set forth in Section 2.3 of this Agreement.

 

1.13 “Material Breach” has the meaning set forth in Section 11.1(b) of this
Agreement.

 

1.14 “Notice of Non-Compliance” has the meaning set forth in Section 2.8(b) of
this Agreement.

 

1.15 “Overhead” means the costs of Buyer for utilities, including heat,
electricity, water, sewer, and gas, allocated pro rata to Seller on the basis of
the square footage estimates set forth in Schedule D attached hereto.

 

1.16 “Relationship Manager” has the meaning set forth in Section 2.8(a) of this
Agreement.

 

1.17 “Seller’s Requirements” means Seller’s then-current requirements for the
Services for all of Seller’s existing businesses as of the date hereof,
excluding requirements of (i) Seller’s outsourcing to its Chadwyck-Healy
division in the United Kingdom and (ii) any businesses acquired by Seller after
the date hereof, provided that Seller does not divert to any such business any
requirements that would ordinarily be provided by Buyer under this Agreement.
For the avoidance of doubt, Seller’s Requirements shall (i) include any
requirements resulting from the Conversion portion (consisting of the types of
Services contemplated to be provided by Buyer under this Agreement) of any
contract entered into by Seller with a third party that provides for both
(A) Conversion and (B) distribution of Periodicals, Newspapers or Research
Collections, regardless of whether the Conversion portion of such contract is
performed by Buyer, and (ii) exclude any requirements of Seller after the date
hereof arising as a result of any contract with any third party identified on
Schedule A hereto.

 

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1.18 “Service” means any service, function or responsibility set forth in the
Statements of Work.

 

1.19 “Service Fees” means the fees that are payable by Seller in exchange for
the Services provided by Buyer in accordance with this Agreement.

 

1.20 “Service Level” has the meaning set forth in Section 2.4 of this Agreement.

 

1.21 “Shortfall” has the meaning set forth in Section 2.2(b) of this Agreement.

 

1.22 “Statements of Work” means the statements of work relating to the Services
attached as Schedule B hereto, as amended or supplemented from time to time by
the mutual agreement of the parties, including, as of the date hereof:

 

1.01 Microform Production (Masters)

 

1.02 Vault Management for All Products

 

1.03 Paper Scan of Periodicals and Dissertations

 

1.04 PDF Dissertation Conversion and Pagination

 

1.05 Paper Scan and Conversion of PDF Newspapers

 

1.06 Serial and Collection Film Scanning (APS, HNP, EEBO, etc)

 

1.07 Book Film Scanning (Dissertations & BOD)

 

1.08 Product Distribution and Fulfillment

 

1.23 “Term” means the Initial Term, and if extended in accordance with
Section 7.2, the Extended Term.

 

1.24 “Works” has the meaning set forth in Section 6.2 of this Agreement.

 

2. PROVISION OF SERVICES

 

2.1 Provision of Services. Buyer shall provide, or cause to be provided, on a
preferred provider basis to Seller the Services set forth in the Statements of
Work, at the applicable Service Levels set forth therein, and Seller shall pay
the Service Fees to Buyer for the Services provided, on a preferred provider
basis in accordance with the terms and subject to the conditions of this
Agreement.

 

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2.2 Seller’s Requirements; Guaranteed Minimum Amount; Notice.

 

(a) Seller shall purchase from Buyer an annual amount of Services, as measured
by Service Fees due and payable from Seller to Buyer, that shall equal or exceed
the greater of (i) eighty percent (80%) of Seller’s Requirements, or
(ii) $6,000,000 for the calendar year ending December 31, 2006, $5,500,000 for
the calendar year ending December 31, 2007 and $5,000,000 for each calendar year
thereafter through the remainder of the Term (each such dollar amount, the
“Guaranteed Minimum Amount” for the applicable calendar year), provided that
Buyer complies with the terms and conditions of this Agreement. The parties
agree that there shall be no Guaranteed Minimum Amount for the calendar year
ending December 31, 2005. Subject to the provisions of this Section 2.2(a),
Seller may, in its sole discretion, elect at any time to obtain services
(including the Services) from a third party not affiliated with Buyer.

 

(b) If the aggregate amount of Services purchased by Seller from Buyer, as
measured by Service Fees paid from Seller to Buyer, in any completed calendar
year fails to meet or exceed the Guaranteed Minimum Amount for such completed
calendar year (each such failure, a “Shortfall”), then Seller shall pay to Buyer
on or before February 14 of the immediately following calendar year an amount
equal to the amount of such Shortfall. For the avoidance of doubt, the amount of
any Shortfall shall be the difference between (A) the Guaranteed Minimum Amount
and (B) the aggregate amount of Services Fees paid by Seller from Buyer, in each
case for the applicable completed calendar year.

 

(c) Concurrently with the execution of this Agreement, Seller shall provide to
Buyer as Schedule C attached hereto Seller’s estimated monthly requirements for
the Services for the three (3) month period immediately following, but not
including, the month in which this Agreement is executed. Seller shall hereafter
give notice to Buyer on a rolling monthly basis, no later than the first
Business Day of each month, of Seller’s estimated monthly requirements for the
Services for the three (3) month period immediately following, but not
including, the month in which such notice is given; provided, however, that,
notwithstanding any such notice of Seller’s estimated requirements in accordance
with this Section 2.2, Seller shall not be required under any circumstances to
purchase an amount of Services greater than the amount required by
Section 2.2(a) hereof.

 

2.3 Buyer’s Duty to Provide. Buyer shall take all necessary actions to provide,
or to cause to be provided, to Seller 100% of Seller’s estimated monthly
requirements for the Services pursuant to Section 2.2(c) hereof, including any
requirements of Seller for Services in excess of the Guaranteed Minimum Amount
in any calendar year, in accordance with the terms and conditions of this
Agreement. In the event that Buyer requests from Seller an increase in Buyer’s
Cost for any Service(s) required by Seller that would exceed by ten percent
(10%) or more the Market Cost for such Service(s), Seller shall have the right
to decline such Service(s) from Buyer (to the extent that the amount of such
Service(s) would exceed the Guaranteed Minimum Amount for the applicable
calendar year) and instead to obtain the affected amount of Service(s) from a
third party unaffiliated with Buyer, in which case the full affected amount of
such Service(s) so obtained shall be excluded for all purposes of this Agreement
from Seller’s Requirements. For purposes of this Section 2.3, “Market Cost”
means the mathematical average of the bids of at least two (2) third parties
regularly engaged in the business of providing the affected Service(s) at
comparable quality to provide the affected Service(s) at the same Service
Level(s) to Seller.

 

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2.4 Service Level. Buyer shall provide each Service to Seller at a service level
(the “Service Level”) that is (i) the Service Level for such Service set forth
in Schedule B or the applicable Statement of Work, or, in the absence thereof,
(ii) the manner and quality in which such Service, or a substantially similar
service, has heretofore been provided to the Retained Business while Seller
owned and operated the Production Assets.

 

2.5 Prohibition on Modifications by Buyer. Subject to Section 2.6 hereof, under
no circumstances shall Buyer at any time modify the Services or the Composing
Reducing Camera (the “CRC”) or Cold Seal without the prior written approval of
Seller, which Seller shall not unreasonably withhold. In the event that Buyer
ceases to use the CRC or Cold Seal or any e-Beam Camera for more than one
(1) year or Buyer ceases at any time to be a going concern, Buyer shall notify
Seller of the same, and Seller shall have the right to purchase the CRC and/or
Cold Seal and/or one (1) e-Beam Camera from Buyer for book value.

 

2.6 Change in Services. In the event that Seller at any time during the Term
desires a material change in any Service (other than pursuant to Section 7
hereof) or any service not listed as a Service, subject to the last sentence of
Section 2.2(a) hereof, Seller shall provide reasonable advance written notice
thereof to Buyer and shall consult with Buyer with respect to obtaining such
changed Service from Buyer and amending or supplementing the Statements of Work
to reflect such changed or new Service, as the case may be, on mutually
agreeable terms and conditions. Buyer agrees to use commercially reasonable
efforts to accommodate any such request from Seller for a material change in any
Service. The provisions of this Section 2.6 shall be subject to Section 2.3
hereof.

 

2.7 Intellectual Property. The parties agree that matters relating to
Intellectual Property under this Agreement shall be governed by the Software
License Agreement and any other applicable agreement(s) contemplated by the
Purchase Agreement.

 

2.8 Governance.

 

(a) Promptly after the date of this Agreement, each party shall designate, and
shall notify the other party of such designation, a representative for
communicating with the other party regarding the obligations and duties of the
parties under each Statement of Work pursuant to this Agreement (each such
representative, a “Relationship Manager”). The Relationship Managers of Buyer
and Seller shall act as the principal points of contact between the parties for
all matters relating to the day-to-day provision of Services provided under this
Agreement and shall meet as often as is reasonably necessary in connection
therewith. The parties agree that, as a first step, the Relationship Managers
shall negotiate all disputes and other matters of joint concern in good faith,
with the intention of resolving issues between them in a mutually satisfactory
manner. If, but only if, the Relationship Managers are unable to resolve an
issue promptly, either party may submit the issue to dispute resolution pursuant
to Section 10 hereof, in addition to any other rights of such party under this
Agreement. Either party may change its Relationship Manager by notice to the
other party pursuant to Section 12 hereof.

 

(b) In the event that Seller is dissatisfied with the level or quality of any
Service provided under this Agreement or otherwise believes that Buyer is not in
full compliance with its obligations under this Agreement, Seller may provide
prompt written notice thereof (a “Notice of Non-Compliance”)

 

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to Buyer, setting forth in reasonable detail the basis for Seller’s belief as
well as Seller’s view of the actions that should be taken by Buyer to remedy the
alleged non-compliance. The Relationship Managers of the parties shall negotiate
in good faith to address the alleged deficiency or non-compliance in a
commercially reasonable manner. If the dispute cannot be resolved by the
Relationship Managers in a mutually satisfactory manner within thirty (30) days
after receipt of such Notice of Non-Compliance, the dispute shall be submitted
to dispute resolution in accordance with Section 10 of this Agreement.

 

3. PRICING; BILLING AND PAYMENT; AUDITS AND ACCESS TO INFORMATION

 

3.1 Pricing. Subject to Section 3.2 and Section 3.3 hereof, Buyer shall provide
the Services to Seller at Buyer’s Cost plus an eight percent (8%) mark-up. The
components of Buyer’s Cost for the Services are set forth on Schedule D attached
hereto. The parties agree to meet on at least a quarterly basis, beginning in
the first quarter of 2006, to review and adjust, to the extent necessary and by
mutual agreement, the calculation of Service Fees, the components of Buyer’s
Cost set forth in Schedule D (including any increases therein, or reductions
thereof other than as permitted pursuant to Section 3.3), and Service Levels.
Buyer will provide Seller with any billing data or other information (including
a breakdown between Cost Per Unit and Overhead) that Seller reasonably requires
to determine whether adjustments to Buyer’s Cost for any Service(s) are
required.

 

3.2 Cost Increase. In the event that Buyer requests a material increase in
Buyer’s Cost for any Service(s) over the average Buyer’s Cost for such Service
during the preceding four (4) calendar quarters that is materially greater than
the increase in the Consumer Price Index – All Urban Consumers, for the Detroit
– Ann Arbor – Flint area, published by the U.S. Department of Labor, Bureau of
Labor Statistics, over the same period, Seller shall have the right to decline
such Service(s) from Buyer and instead to obtain the affected Service(s) from a
third party unaffiliated with Buyer. In any such case, (i) the Guaranteed
Minimum Amount for the applicable calendar year(s) shall be reduced pro rata by
the quotient of (A) the dollar amount paid by Seller to any third party for the
affected Services during such year, divided by (B) the aggregate amount of
Service Fees paid by Seller to Buyer during such year, and (ii) the full amount
of any such Service(s) so obtained shall be excluded for all purposes of this
Agreement from Seller’s Requirements.

 

3.3 Cost Reduction.

 

(a) In the event that Buyer is able to reduce Buyer’s Cost for any Service while
continuing to perform its obligations in accordance with the terms of this
Agreement, Seller agrees, subject to the provisions of this Section 3.3(a), to
pay to Buyer, in addition to Buyer’s Cost plus a markup of eight percent (8%) as
set forth in Section 3.1 hereof, an additional amount equal to sixty-five
percent (65%) of the amount of such reduction for the duration of such
reduction. Buyer agrees to provide reasonable advance written notice of any such
cost reduction. All such reductions and additional amounts shall be reflected in
reasonable detail and designated as such in the monthly invoice provided by
Buyer to Seller in accordance with Section 3.4.

 

(b) If, in any calendar year, Seller purchases an amount of Services from Buyer
that, in the aggregate, equals or exceeds the Guaranteed Minimum Amount for such
calendar year, Buyer agrees, subject to Section 2.3 above, to provide any
Service(s) in excess of the Guaranteed

 

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Minimum Amount for such calendar year at the lesser of (i) Buyer’s Cost for such
Service(s) plus a markup of eight percent (8%), or (ii) an aggregate price for
such Service(s) (including Buyer’s markup) equal to the most favorable price
charged by Buyer for such Service(s), or substantially similar service(s), to
any third party.

 

3.4 Billing and Payment. The parties agree that Service Fees shall be calculated
in accordance with Section 3.1 and billed by Buyer to Seller monthly, promptly
after the last day of each month, for Services actually provided during such
month and shall be payable (i) from the date hereof through December 31, 2005,
upon receipt; (ii) from January 1, 2006 through March 31, 2006, on the fifteenth
(15th) day following the last day of each such month, (ii) from April 1, 2006
through June 30, 2006, on the thirtieth (30th) day following the last day of
each such month, and (iii) during the remainder of the Term, on the forty-fifth
(45th) day following the last day of each month. Buyer will provide as part of
its monthly invoice a statement setting forth in reasonable detail the aggregate
Service Fees and a breakdown by Service of the basis for such Service Fees.

 

3.5 Seller’s Right to Withhold. Seller shall have the right upon reasonable
advance written notice to Buyer to withhold any amounts invoiced by Buyer for
which Seller determines in good faith that Seller is not liable to Buyer.

 

3.6 Seller’s Access to Buyer. Seller shall have the right upon reasonable
advance written notice to meet on no less than a quarterly basis with Daniel
Arbour or another member of the board of directors of Buyer to discuss the
management, business strategy and operations of the Acquired Businesses,
including, but not limited to, any material matters relating to financial
statements provided by Buyer to Seller pursuant to any of the Transaction
Agreements. Buyer agrees to provide Seller with complete and correct copies of
all documents and information provided by Buyer to National City Bank at the
same time that Buyer provides any such documents and information to National
City Bank. Each of Buyer and Seller agrees to disclose to the other at such
quarterly meetings on an ongoing basis any material changes, trends or
developments in the business operations of such party as they relate to the
Acquired Businesses, subject to any applicable third party confidentiality
obligations or requirements of law. Any and all such disclosures made by a party
to the other party pursuant to this Section 3.6 shall be held strictly
confidential by the other party.

 

3.7 Audits and Access to Information.

 

(a) Seller or its designee shall have the right, upon reasonable advance notice
and at its expense, to review the books and records of Buyer solely with respect
to Buyer’s obligations under this Agreement and to confer with Buyer’s employees
responsible for providing or supervising Services in order to review the
accuracy of the invoices provided to Seller hereunder (during regular business
hours and without unreasonably disrupting Buyer’s normal business operations).
In the event that Seller disputes any such invoice, Seller shall deliver a
written statement describing the dispute to Buyer within thirty (30) days
following receipt of the disputed invoice. The statement shall provide a
reasonably detailed description of the disputed items. Upon delivery of the
written statement, Seller and Buyer shall cooperate and negotiate in good faith
and use commercially reasonable efforts to resolve such disputed charges. If
they are unable to resolve such disputed charges within thirty (30) days of
delivery of the written statement, either party may elect to submit the matter
to the dispute resolution process set forth in Section 10 of this Agreement.

 

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(b) Buyer shall have the right to receive, and Seller shall provide upon written
request of Buyer, an appropriate schedule showing a breakdown of the aggregate
dollar volume of Seller’s Requirements for the applicable calendar year and
appropriate supporting documentation, solely in order to verify whether Seller
has purchased 80% of Seller’s Requirements for such calendar year from Buyer as
required in Section 2.2(a). Thereafter, upon reasonable advance notice and at
Buyer’s expense, Buyer shall have the right to designate a third party not
affiliated with Buyer to review (during regular business hours and without
unreasonably disrupting Seller’s normal business operations) the books and
records of Seller and to confer with Seller’s employees responsible for
receiving or supervising Services, in each case solely in order to verify
whether Seller has purchased 80% of Seller’s Requirements for such calendar year
from Buyer as required in Section 2.2(a). Buyer shall not be entitled to review
Seller’s books and records or to confer with Seller’s personnel other than
through Buyer’s designated non-affiliated third party as contemplated in this
Section 3.7(b). Subject to Seller fulfilling in good faith its obligations under
this Section 3.7(b), Buyer shall be entitled to exercise its rights under this
Section 3.7(b) only once, and not later than May 1 of the immediately following
calendar year, with respect to any calendar year. In the event that Buyer
disputes whether Seller has purchased 80% of Seller’s Requirements for the
applicable calendar year, Buyer shall deliver a written statement describing the
dispute to Seller within thirty (30) days following the end of such one hundred
twenty (120) day period. The statement shall provide a reasonably detailed
description of the disputed items. Upon delivery of the written statement, Buyer
and Seller shall cooperate and negotiate in good faith and use commercially
reasonable efforts to resolve the dispute. If they are unable to resolve the
dispute within thirty (30) days of delivery of the written statement, either
party may elect to submit the matter to the dispute resolution process set forth
in Section 10 of this Agreement.

 

4. WARRANTY, LIABILITY AND INDEMNITY

 

4.1 Warranty. Buyer warrants that any Services or products resulting from
Services provided to Seller pursuant to this Agreement will (a) conform to the
specifications, drawings, samples, descriptions or Service Levels furnished to
or by Seller, including, but not limited to, any specifications, drawings,
samples, descriptions or Service Levels set forth in the Statements of Work;
(b) be of good quality and workmanship; (c) be free of defects in design (unless
Seller provided the design), materials and workmanship; (d) be merchantable; and
(e) be fit for the particular purposes intended by Seller.

 

4.2 LIMITATION ON LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE
OTHER PARTY FOR ANY CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES SUFFERED BY THE
OTHER PARTY ARISING OUT OF THIS AGREEMENT, WHETHER RESULTING FROM NEGLIGENCE OF
THE OTHER PARTY OR OTHERWISE, EXCEPT WHERE RESULTING FROM GROSS NEGLIGENCE,
FRAUD, OR WILLFUL OR INTENTIONAL BREACH.

 

4.3 Indemnity.

 

(a) Buyer agrees to indemnify, defend and hold Seller harmless against all
claims, liabilities, losses, expenses, fees and other damages (including
reasonable attorney fees and expenses and the cost of enforcing this indemnity)
allegedly or actually arising out of or resulting from any breach by Buyer of
this Agreement or any act, omission, or negligence of Buyer or its employees,
agents or subcontractors in connection with performing or failing to perform any
aspect of this Agreement.

 

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(b) Seller agrees to indemnify, defend and hold Buyer harmless against all
claims brought by third parties, to the extent that (i) Seller has provided
content of such third parties to Buyer under this Agreement, and (ii) such third
party’s claim allegedly or actually arises out of or results from Buyer’s
performance of its obligations under this Agreement with respect to such
content.

 

4.4 Insurance. During the Term, Buyer will carry and maintain at least the
following insurance: (i) commercial general liability insurance with a limit of
at least $1,000,000 per occurrence, (ii) business auto insurance with a combined
single limit of at least $1,000,000 per occurrence for bodily injury and
property damage, (iii) workers’ compensation insurance as prescribed by
applicable law; (iv) employee injury insurance with a limit of at least $500,000
per occurrence; (v) software errors and omissions liability insurance with a
limit of at least $2,000,000 per occurrence, (vi) employment practices liability
insurance with a limit of at least $2,000,000, and (vii) crime coverage with a
limit of at least $500,000, each subject to usual and customary exclusions,
limitations and conditions of such policies. Each such policy will include
provisions generally considered standard for the type of insurance involved,
including the loss payable and waiver of subrogation clauses and deductible
amounts. In addition, Buyer agrees to maintain property casualty insurance
including, but not limited to, appropriate fire, sprinkler leakage, and other
damage coverage with respect to items held in any storage vault of Buyer, with
limits of at least $10,000,000 per occurrence, and to name Seller as an
additional insured party on any such policy.

 

5. FORCE MAJEURE

 

5.1 If either party hereto is rendered unable wholly or in part by Force Majeure
(as defined herein) to perform its obligations hereunder (other than the
obligation to pay money), such party shall give prompt notice to the other party
with reasonable particulars thereof and the probable extent of the inability to
perform such obligation, whereupon the obligation of such party shall be
suspended so far as it is affected by such Force Majeure during but no longer
than the continuance thereof. The affected party shall use all possible
diligence to remove such Force Majeure. For the purpose of this Agreement, the
term “Force Majeure” shall mean any act of God, strike or lockout or other labor
dispute (other than at any of the Acquired Businesses), act of a public enemy,
war declared or undeclared, terrorist act, blockade, revolution, riot,
insurrection, civil commotion, lightening, fire, storm, flood, earthquake,
explosion, governmental restraint, embargo, inability to obtain or delay in
obtaining governmental approvals, permits, licenses or allocations (excluding
any such governmental approvals, permits, licenses or allocations that a party
was required to obtain under any Transaction Agreement), and any other cause of
the kind enumerated above which is not reasonably within the control of the
party claiming Force Majeure.

 

6. PROPRIETARY INFORMATION AND RIGHTS

 

6.1 Each party acknowledges that the other possesses, and will continue to
possess, information that has been created, discovered or developed by it and/or
in which property rights have been assigned or otherwise conveyed to it, which
information has commercial value and is not

 

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in the public domain. Except as otherwise expressly set forth in the Purchase
Agreement, the proprietary information of each party will be and remain the sole
property of such party and its assigns. Each party shall use the same degree of
care that it normally uses to protect its own proprietary information to prevent
the disclosure to third parties of information that has been identified as
proprietary by written notice to such party from the other party. Neither party
shall make any use of the information of the other which has been identified as
proprietary except as contemplated or required by the terms of this Agreement.
Notwithstanding the foregoing, this Article shall not apply to any information
that a party can demonstrate: (a) was, at the time of disclosure to it, in the
public domain through no fault of such party; (b) was received after disclosure
to it from a third party who had a lawful right to disclose such information to
it; or (c) was independently developed by the receiving party. For the avoidance
of doubt, the specifications for the Services set forth in the Statements of
Work and in any schedules thereto shall be considered proprietary information of
Seller for purposes of this Section 6.1 and shall not be used by Buyer other
than to perform Buyer’s obligations under this Agreement.

 

6.2 All copyrights, trade secrets, or other intellectual property rights in or
to any and all work product, including, but not limited to, microform masters
produced by Buyer for Seller pursuant to this Agreement and Digitized versions
of periodicals in microform and newspapers in microform produced by Buyer for
Seller pursuant to this Agreement (collectively, “Works”) shall belong
exclusively to Seller. Any and all Works shall be considered a work made for
hire for Seller within the meaning of Title 17 of the United States Code. Buyer
automatically assigns, and shall cause its personnel automatically to assign, at
the time of creation of the Works, without any requirement of further
consideration, any right, title, or interest it or they may have in such Works,
including any copyrights or other intellectual property rights pertaining
thereto. Upon request of Seller, Buyer shall take such further actions, and
shall cause its personnel to take such further actions, including execution and
delivery of instruments of conveyance, as may be appropriate to give full and
proper effect to such assignment.

 

7. TERM AND TERMINATION

 

7.1 Term. The initial term of this Agreement (the “Initial Term”) shall commence
on the Closing Date and shall expire on December 31, 2010, unless earlier
terminated or extended in accordance with the terms of this Agreement.

 

7.2 Extended Term. Upon not less than ninety (90) days written notice to Buyer
prior to expiration of the Initial Term, Seller shall have a one-time right to
extend the Initial Term by up to twelve (12) months (such extended term, the
“Extended Term”). Such extension notice shall indicate the period, which may not
be more than twelve (12) months, by which Seller desires to extend the Initial
Term.

 

7.3 Termination.

 

(a) Buyer may terminate this Agreement upon one hundred twenty (120) days’
written notice upon material breach by Seller of this Agreement, other than
failure by Seller to pay any amount due and payable under this Agreement, unless
Seller shall have cured such breach within the one hundred twenty (120) day
notice period. In the event that Seller fails to pay any invoice submitted to
Seller in accordance with Section 3.4 hereof within sixty (60) days after the

 

10

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receipt of such invoice, the parties agree that the issue shall be submitted to
dispute resolution pursuant to Section 10 hereof, and that Buyer shall not have
any right to terminate this Agreement other than as may be permitted pursuant to
Section 10 hereof.

 

(b) Notwithstanding any other provision of this Agreement, Seller may terminate
this Agreement (i) upon thirty (30) days’ written notice, either in whole or in
part with respect to any Service, upon any material breach by Buyer of this
Agreement, unless Buyer shall have cured such breach within the thirty (30) day
notice period, and/or (ii) immediately, or at any time thereafter in Seller’s
sole discretion, upon written notice after receiving from Buyer notice of a
Change of Control as set forth in Section 15.2 hereof.

 

(c) Any one or more of the Services may be terminated upon mutual agreement of
Buyer and Seller.

 

(d) Either party may terminate this Agreement immediately in the event that the
other party has been adjudicated bankrupt, has failed to vacate an involuntary
bankruptcy or reorganization petition within sixty (60) days of the date of such
filing, files such a petition on a voluntary basis, fails to vacate the
appointment of a receiver or trustee for such party or for a substantial portion
of its assets, makes an assignment for the benefit of creditors, or ceases to do
business as a going concern.

 

(e) All accrued and unpaid Service Fees shall be due and payable upon
termination of this Agreement with respect to such Service. Notwithstanding
anything in this Agreement to the contrary, in the event of any termination of
this Agreement by Seller for material breach of Buyer pursuant to
Section 7.3(b), the provisions of Section 2.2(b) of this Agreement shall not
apply, and Seller shall not be obligated to make any payment to Buyer pursuant
thereto, with respect to the calendar year in which such termination occurs.

 

(f) This is a master agreement and shall be construed as a separate and
independent agreement for each and every Service provided under this Agreement.
Any termination of this Agreement with respect to any Service shall not
terminate this Agreement with respect to any other Service then being provided
pursuant to this Agreement. Following any termination of this Agreement, each
party shall cooperate in good faith with the other to transfer and/or retain all
records, prepare and file tax returns and take all other actions necessary to
provide Seller and Buyer and their respective successors and assigns with
sufficient information in the form requested by Seller or Buyer, or their
respective successors and assigns, as the case may be, to make alternative
service arrangements substantially consistent with those contemplated by this
Agreement.

 

8. NO IMPLIED ASSIGNMENTS OR LICENSES

 

Nothing in this Agreement is to be construed as an assignment or grant of any
right, title or interest in any trademark, copyright, design or trade dress,
patent right or other intellectual or industrial property right.

 

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9. NO AGENCY OR PARTNERSHIP

 

9.1 No Agency. In performing its obligations under this Agreement, Buyer shall
operate as, and have the status of, an independent contractor and shall not
operate or have the status of agent, employee or representative of Seller.

 

9.2 No Partnership. This Agreement does not constitute a partnership and nothing
herein is intended to render, nor shall anything herein be construed to render,
the parties hereto as partners of each other. Nothing contained herein shall
render either party an agent of the other party, and no party shall have the
power, authority, or right to act on behalf of or bind another party or
negotiate or conclude contracts on behalf of or in the name of another party
impose any liability or obligation to third parties upon another party. No party
shall incur or accept any liability or enter into any commitments or contracts
on behalf of another party.

 

10. RESOLUTION OF DISPUTES

 

If a dispute arises between the parties relating to this Agreement that the
parties have not been able to resolve pursuant to Section 2.8, the following
procedure shall be implemented before any party pursues other available
remedies, except that a party may seek injunctive relief from a court where
appropriate in order to maintain the status quo while this procedure is being
followed:

 

(a) The parties shall hold a meeting (either in person or telephonically)
promptly after receipt by either party of notification of the dispute, attended
by certain Executives of the parties, to attempt in good faith to negotiate a
resolution of the dispute; provided, however, that no such meeting shall be
deemed to vitiate or reduce the obligations and liabilities of the parties
hereunder or be deemed a waiver by a party hereto of any remedies to which such
party would otherwise be entitled hereunder.

 

(b) If, within thirty (30) days after such meeting, the parties have not
succeeded in negotiating a resolution of the dispute, they agree to submit the
dispute to mediation in accordance with the then-current Model Procedure for
Mediation of Business Disputes of the Center for Public Resources and to bear
equally the costs of the mediation.

 

(c) The parties shall jointly appoint a mutually acceptable mediator, seeking
assistance in such regard from the Center for Public Resources if they have been
unable to agree upon such appointment with twenty (20) days from the conclusion
of the negotiation period.

 

(d) The parties agree to participate in good faith in the mediation and
negotiations related thereto for a period of thirty (30) days. If the parties
are not successful in resolving the dispute through the mediation, then the
parties agree to submit the matter to binding arbitration in accordance with the
Center for Public Resources Rules For Non-Administered Arbitration, by a sole
arbitrator.

 

(e) Mediation or arbitration shall take place in the City of Ann Arbor,
Michigan. Equitable remedies shall be available in any arbitration. This clause
is subject to the Federal Arbitration Act, 9 U.S.C.A. Section 1 et seq., or
comparable legislation in non-U.S. jurisdictions, and judgment upon the award
rendered by the arbitrator, if any, may be entered by any court having
jurisdiction thereof.

 

12

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(f) In the event of any claim that this Section 10 is invalid or is not
enforceable by the arbitrators, the arbitrators shall determine whether this
Section 10 is valid and enforceable. The parties agree that this determination,
which is often reserved for the courts, is hereby submitted to the arbitrators.

 

11. REMEDIES

 

11.1 Breach or Default and Cure. Notwithstanding any other provision of this
Agreement, and in addition to any other remedy herein provided or otherwise
available to Seller, in the event that Buyer breaches or fails to perform any of
its obligations under this Agreement,

 

(a) where, in the reasonable judgment of Seller, Buyer’s breach is not a
Material Breach (as defined below) of Buyer’s obligations, Seller’s remedies
shall include, without limitation, upon reasonable advance written notice to
Buyer:

 

(i) Seller may establish or extend, as applicable, a period within which Buyer
may cure such breach;

 

(ii) Seller may require Buyer to refund the price paid by Seller for the
affected Service(s) or, at the option of Seller, to redeliver (or deliver) the
Service(s) to Seller;

 

(iii) Seller may exercise any rights or remedies set forth in any applicable
Statement of Work; and

 

(b) where, in the reasonable judgment of Seller, Buyer’s breach is a material
breach of Buyer’s obligations under Section 2 of this Agreement (a “Material
Breach”), Seller’s remedies shall include, without limitation, in the sole
discretion of Seller:

 

(i) Seller shall be entitled to, and Buyer shall grant upon the written request
of Seller, physical access to the Vault, upon reasonable notice and at
reasonable times of day, so that Seller may (A) take possession of and
permanently remove from the Vault all assets owned by Seller, including all
newspaper, dissertation, collection and other Microform Products other than
Periodicals Microform Products, and (B) make duplicates in a commercially
reasonable manner of all Periodicals Microform masters stored in the Vault as of
the date hereof; and/or

 

(ii) Seller and Buyer agree that, upon the written notice of Seller, the
provisions of Section 2.2(a) (other than the last sentence of Section 2.2(a))
and Section 2.2(b) shall immediately cease to apply and shall be null and void
for all purposes of this Agreement.

 

11.2 Specific Performance. The parties hereto agree that irreparable damage
would occur if any provision of this Agreement were not performed in accordance
with the terms hereof and that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement or to enforce specifically the
performance of the terms and provisions hereof in the United States District
Court for the Eastern District of Michigan or the state courts of Michigan
located in Washtenaw County, in addition to any other remedy to which they are
entitled at law or in equity.

 

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11.3 Statements of Work. The remedies set forth in this Section 11 shall be in
addition to the remedies, if any, set forth in the Statements of Work attached
hereto, provided, however, that Seller shall avail itself of any remedy provided
in a Statement of Work prior to availing itself of any other remedy set forth in
this Section 11. Except as provided in the foregoing sentence, and unless
expressly provided to the contrary in the applicable Statement of Work, the
terms of this Agreement shall take precedence in the event of any conflict
between the terms of this Agreement and of any Statement of Work.

 

12. NOTICES

 

Any notice required to be given hereunder shall be delivered in accordance with
Section 9.02 of the Purchase Agreement.

 

13. ENTIRE AGREEMENT; AMENDMENT, WAIVER

 

This Agreement, the Schedules attached hereto, and the other Transaction
Agreements constitute the entire understanding between the parties with respect
to the subject matter hereof, and supersede all other understandings and
negotiations with respect thereto. This Agreement may be amended only in a
writing signed by both parties hereto. Any provision of this Agreement may be
waived only in a writing, which writing may be signed only by the party granting
such waiver. No course of dealing between the parties shall be effective to
amend or waive any provision of this Agreement. Waiver by a party of a condition
or default by another party shall be limited to the particular instance and
shall not imply or be deemed to imply that such party will waive such condition
or default by any other party in any future instance.

 

14. SEVERABILITY

 

In the event that any provision contained in this Agreement shall for any reason
be held to be invalid, illegal or unenforceable in any jurisdiction, such
provision shall be ineffective as to such jurisdiction to the extent of such
invalidity, illegality or unenforceability without invalidating or affecting the
remaining provisions hereof or affecting the validity, legality or
enforceability of such provision in any other jurisdiction.

 

15. ASSIGNMENT; CHANGE OF CONTROL

 

15.1 Assignment. Neither this Agreement nor any of the rights and obligations of
the parties hereunder may be assigned by Buyer without the prior written consent
of the Seller, which shall not be unreasonably withheld or delayed, subject to
Seller’s rights under Section 15.2 hereof, provided, however, that Seller
consents herewith to the assignment by Buyer of its rights and duties hereunder
to National City Bank of Indiana and ACP-I, L.P. as collateral for Buyer’s
Financing. Seller shall have the right to assign this Agreement and any of the
rights and obligations of Seller hereunder without the consent of Buyer. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Any attempted assignment
or transfer in violation of this Section 15.1 shall be void.

 

14

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15.2 Change of Control of Buyer. In the event of any proposed Change of Control
of Buyer during the Term, Buyer shall provide prompt written notice thereof to
Seller (which written notice shall include a copy or other description in
reasonable detail of the terms and conditions of such proposed Change of
Control), and Seller shall have (i) the right to terminate this Agreement
immediately and/or (ii) a right of first refusal to acquire Buyer on the terms
and conditions proposed, including, without limitation, in the event of any sale
of assets that includes the Production Assets and/or the Facility, a right of
first refusal to acquire all, but not less than all, of the assets included in
such sale of assets, on the applicable terms and conditions proposed. Seller
agrees to notify Buyer within ten (10) days after receiving Buyer’s written
notice as to whether Seller will exercise such right of first refusal. For
purposes of this Section 15.2, “Change of Control” means, with respect to Buyer,
(i) the sale or other disposition of the Production Assets, the Facility, and/or
other assets required for Buyer to perform its material obligations under this
Agreement, whether pursuant to a single transaction or a series of transactions,
(ii) the acquisition by any person of beneficial ownership of securities of
Buyer representing fifty percent (50%) or more of the then issued equity
securities of Buyer, or (iii) the merger or consolidation of Buyer with or into
any other entity or a merger of any other entity with and into Buyer, as a
result of which the security holders of Buyer prior to any such merger or
consolidation would cease to be the beneficial owners, directly or indirectly,
of securities of Buyer or the surviving entity representing more than fifty
percent (50%) of the then issued and outstanding equity securities of Buyer or
the surviving entity.

 

16. GOVERNING LAW

 

This Agreement shall be governed by and construed in accordance with the laws of
the State of Michigan, without regard to principles of conflicts of law.

 

17. JURISDICTION

 

EACH PARTY IRREVOCABLY AGREES THAT ANY LEGAL ACTION, SUIT OR PROCEEDING AGAINST
ANY OF THEM WITH RESPECT TO ITS OBLIGATIONS OR LIABILITY UNDER OR ARISING OUT OF
OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT OR DISPUTES RELATING HERETO (WHETHER FOR BREACH OF CONTRACT, TORTIOUS
CONDUCT OR OTHERWISE) MAY BE BROUGHT ONLY IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF MICHIGAN OR, IF SUCH COURT DOES NOT HAVE
JURISDICTION, THE STATE COURTS OF MICHIGAN LOCATED WITHIN WASHTENAW COUNTY, SO
LONG AS ONE OF SUCH COURTS SHALL HAVE SUBJECT MATTER JURISDICTION OVER SUCH
LEGAL ACTION, SUIT OR PROCEEDING (AND THE PARTIES HERETO SHALL NOT TAKE THE
POSITION THAT ANY SUCH COURT DOES NOT HAVE SUBJECT MATTER JURISDICTION), AND
THAT ANY CAUSE OF ACTION ARISING OUT OF THIS AGREEMENT SHALL BE DEEMED TO HAVE
ARISEN FROM A TRANSACTION OF BUSINESS IN THE STATE OF MICHIGAN, AND EACH OF THE
PARTIES HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION OF SUCH COURTS (AND OF
THE APPROPRIATE APPELLATE COURTS THEREFROM) IN ANY SUCH LEGAL ACTION, SUIT OR
PROCEEDING, AND EACH PARTY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF THE

 

15

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VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT ANY SUCH
SUIT, ACTION OR PROCEEDING WHICH IS BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.

 

18. SERVICE OF PROCESS

 

Each of the parties hereto irrevocably consents to the service of any and all
legal process, summonses, notices and other documents which may be served in any
action, suit or proceeding referred to in Section 17 above, which service may be
made by mailing a copy of such process by certified or registered mail, postage
prepaid, to the party to be served at its address as provided in Section 12
hereof, with such service to be effective upon receipt.

 

19. WAIVER OF JURY TRIAL

 

EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR DISPUTES RELATING HERETO. EACH PARTY
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTY HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 19.

 

20. NO THIRD PARTY BENEFICIARIES

 

This Agreement is for the sole benefit of the parties hereto, and nothing herein
expressed or implied shall give or be construed to give to any person, other
than the parties hereto, any legal or equitable rights hereunder.

 

21. COUNTERPARTS AND FACSIMILE SIGNATURES

 

This Agreement may be executed (including by facsimile) in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date first above
written.

 

PROQUEST INFORMATION AND

LEARNING COMPANY

By:   /S/    SCOTT HIRTH           Name:   Scott Hirth Title:   Vice President,
Finance/CFO NATIONAL ARCHIVE PUBLISHING COMPANY By:   /S/    DANIEL C.
ARBOUR           Name:   Daniel C. Arbour Title:   President

 

17

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SCHEDULE A

 

Third Party Contracts Excluded from Seller’s Requirements

 

1. The Opportunity currently under negotiation with the Library of Congress

 

18

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SCHEDULE B

 

Statements of Work

 

Section 2.4 in the Manufacturing Agreement provides that “Buyer shall provide
each Service to Seller at a service level (the “Service Level”) that is (i) the
Service Level for such Service set forth in the applicable Statement of Work,
or, in the absence thereof, (ii) the manner and quality in which such Service,
or a substantially similar service, has heretofore been provided to the Retained
Business while Seller owned and operated the Production Assets.”

 

Each Statement of Work provides an outline of the Services to be provided by
Buyer to Seller. These are the services as they are being provided today and as
they will be provided Day 1. Referenced herein are SOW Schedules A-E (see below)
that, when completed, will detail Service Levels and baseline expectations of
Buyer to Seller.

 

The information necessary to populate each SOW Schedule is available in various
forms, formats and places, and in the “custody” of both Buyer and Seller. Upon
the execution of this Agreement, the Governance Council shall assign appropriate
associates under the guidance of the Relationship Managers to compile
information and create the respective SOW Schedules on or before January 27,
2006. Each SOW Schedule shall be initially reviewed by the Governance Council,
and, when approved, shall be reviewed on a quarterly basis by the Relationship
Managers with any substantive changes escalated to the Governance Council as
appropriate for approval.

 

REMEDIES: When a failure by Buyer triggers a discussion of remedies, the
Relationship Managers will consider the level of severity and the effect on
Seller’s revenue, Seller’s Customer(s), or a combination thereof, and,
referencing Section 11 of the Manufacturing Agreement, determine a remedy. This
provision shall be deemed included in each Statement of Work.

 

SOW Schedule A will detail the Quality and manufacturing specifications for each
product handled by Buyer for Seller. This will include specifications that are
provided to Customers via Marketing and the Seller’s Website.

 

SOW Schedule B will detail the delivery time and throughput requirements for
each product handled by Buyer for Seller.

 

SOW Schedule C will detail the square footage allocations owned and operated by
Buyer for Seller. Specifically, these allocations will be used to determine
charge back of overhead (utilities) cost and define specific vault utilization

 

SOW Schedule D will be the annual and rolling 3-month adjusted unit forecast for
each product handled by Buyer for Seller.

 

SOW Schedule E will detail the raw material specifications for product the
packaging material specifications and the freight carrier assumptions to be used
throughout the fulfillment of services by Buyer for Seller.

 

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Statement of Work

 

1.01 Microform Production (Masters)

 

Specifications: All master negatives created for Seller under this Agreement
shall be prepared using best practices and standards of highest quality
generally used in the industry, including silver gelatin film, and shall, at
minimum, be in compliance with applicable ANSI/AIIM Standards, including but not
limited to:

 

ANSI/AIIM MS 111 – Recommended Practice for Microfilming Newspapers

 

ANSI pH 1.41 – Specifications for Photographic Film for Archival Records, Silver
Gelatin Type, on Polyester Base. Residual Thiosulfate content of the processed
film shall be measured using the Methylene Blue Method as described in ANSI/ASC
pH 4.8

 

ANSI/ASC pH 4.8 – Residual Thiosulfate and Other Chemical in Film, Plates, and
Papers – Determination and Measurement

 

Master Density will fall in a range .90 – 1.10 unless deviation is approved by
Seller in response to bad source material. Buyer will report all refilm activity
related to first pass masters out of range.

 

More detailed specifications and service levels are provided in SOW Schedule A.

 

Periodical Check-in (Transitional; Systems also being Transitioned by IS )

 

1) Seller checks in periodical/item. Errors in check in and item data for
periodical filming/mastering will be corrected by end of the following shift.

 

2) Transitional issue for IS: Item master maintenance will be supported by
Seller.

 

3) Transitional issue for IS: support of work order flow from technical area.

 

Purchase/Vendor Film

 

1) For Newspapers: Seller provides camera negative master to Buyer who produces
working master for vault services. Seller owns vendor relationship.

 

2) For Collections:

 

Purchased Film: Seller owns acquiring film and Buyer will provide vault services
and fulfillment.

 

Purchased Master: Seller owns acquiring master and Buyer creates working master.

 

Seller will maintain all relationships with outside filmers doing original
filming for collection products.

 

Newspaper Mastering Process

 

1) Buyer is responsible for the following:

 

  a. Check in (reviewed during transition)

 

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  b. Claiming (reviewed during transition)

 

  c. Masters

 

  d. Creates Delivery Units in Item Master

 

  e. Push unit to sales orders in JDEdwards

 

  f. Sends some masters or Direct Intermediate Print Masters to Ann Arbor for
fulfillment further defined in SOW Schedule B

 

  g. Maintains film vault.

 

2) Wooster system creates box label data.

 

3) List of major newspapers their standard specifications will be included in
SOW Schedule A and will follow same escalation for re-filming as scans for
periodicals

 

Collections Mastering Process

 

1) Buyer may be requested by Research Collections to film content for select
product lines as defined in the forecast by Research Collections.

 

2) Buyer will provide film processing for outside filmers and inside filming.

 

3) RC Mastering:

 

A) Vault dupe mastering—Use current custom report as work order for Buyer to
create working master.

 

B) CRC mastering—Use current custom report as work order for Buyer to create
working master. Seller to provide fiche titling information.

 

6) Official collections database will not be available to Buyer.

 

7) Seller retains the book camera.

 

8) NIDs and NSA will follow research collections manufacturing expectations with
Buyer. Other mastering done for Chadwyck-Healey by Micromedia UK. Relationship
is owned by Seller

 

Dissertations Mastering Process

 

1) Seller creates work order batch and physically hands-off to Buyer (includes
work order and hard-copy dissertations) or just work order for electronic with
PDF’s placed on server.

 

2) Buyer scans, QCs, paginates, adds UMI page, etc., as instructed by notes in
WO. Buyer creates master in e-Beam (if dissertation passed through scan or PDF
conversion process – see # 5 for exception). If QC passes item, Buyer delivers
information to manager location. If fails anywhere in scan process, Buyer will
notify Seller regardless of the cause.

 

3) Seller resolves failure issues that are fault of Seller input, splits work
order if required, returns materials to Buyer for reprocessing (split work
orders are treated like new work orders)

 

4) Buyer will process and file film masters in the vault after order processing.

 

5) Buyer will provide mastering services for dissertations that do not meet
requirements for dissertation scanning process (using manual filming process)

 

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Statement of Work

 

1.02 Vault Management for All Products

 

Specifications:

 

Buyer is providing Hard Copy and Microform Vault Services.

 

Master Negatives shall be stored in a vault which conforms to the requirements
of ANSI pH 1.43.

 

Vinegar Syndrome inspections will be conducted on a monthly basis with results
reported and corrective actions taken at Seller discretion.

 

Secured storage with limited access (including designated Seller and Buyer
staff) will be provided.

 

Seller staff, or representative may perform random sampling inspection of
materials contained in the vault against criteria more specifically set forth in
Schedule A . Results will be reported to Buyer and Seller. Buyer will replace,
free of charge, any masters Buyer created that are rejected as a result of this
inspection. Buyer will also replace any affected Customer Copies free of charge.

 

Film will be filed and re-filed in Buyer’s vault in the same file sequence from
which it was pulled, using the same storage and filing methodologies employed by
Seller prior to contract date. Current filing methodologies are provided in SOW
Schedule A and current space allocation and forecasts are provided in SOW
Schedule C and D, respectively.

 

Any defects found on Seller film, either prior to printing, post printing, or in
the course of normal vault management activities will be reported to Seller.
Replacement masters, either working or archive will be completed at Buyer’s
expense if damaged in the process. Defects found pre-process will be resolved at
Seller’s discretion.

 

Vault Services

 

1) The hard-copy vault will hold a minimum of current year plus two.

 

2) There will be a blanket service fee for hard-copy vault activities (Included
in rent). Vault pulls are unlimited.

 

3) Hard-copy in hard-copy vault is available to Seller for use in QA processes
or to request scanning services for new electronic.

 

4) Buyer manages the vault and Seller will identify associates who require
access to the vaults.

 

5) Seller will maintain subscriptions for, and own, periodicals required for
electronic-only products.

 

6) Transitional: Maintenance and ownership of film only titles subscriptions are
currently owned by Seller.

 

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Statement of Work

 

1.03 Paper Scan of Periodicals and Dissertations

 

Specifications:

 

Periodical pages will be scanned according to the requirements in SOW Schedule
A. Finished scans will be delivered directly to Seller. Requests to rescan due
to image errors, poor contrast, missing source will be communicated by Seller on
a regular source exceptions report. Rescans will be completed at no charge to
Seller.

 

Periodical paper scan output requirements are determined on a priority category
basis for electronic products as defined in SOW Schedule B.

 

Dissertations pages will be scanned according to the requirements in SOW
Schedule A. Buyer will provide QC, final pagination, and page insertion for each
dissertations unit. Dissertations will be either recycled or returned based on
school instructions. A list provided by Seller will drive this activity.

 

Files will be delivered to Seller in TIFF format for wrapping and deposit in
PQDD vault, sent to Electron Beam Recorder (e-Beam) for master creation and
stored in EMC device. Seller will have visibility into the process status
through the ScanAll and Electronic Image Repository (EIR) tools provided to
Buyer. Film master inspection will ensure densities in range as stated in SOW
Schedule A and that pagination and page insertion were performed correctly.
Rescans activity will be tracked and reported to Seller. Rescans will be
completed at no charge to Seller except for a vault repair on images or masters
created prior to the contract date.

 

Periodicals Check-in and Prep Processes

 

1) Transitional. See Statement of Work 1.02. All current acquisition/claiming is
done by Seller for all periodical products.

 

2) Hard-copy will always go to Scan first when only 1 hard-copy is being shared.

 

3) Seller will provide to Buyer publisher restrictions for manual blocking and
buyer will do manual blocking prior to scanning.

 

Periodicals to scan:

 

1) The Coversheet created by Seller is defacto work-order. There is a blanket
PO. The coversheet specifies the product and includes turnaround time (SOW
Schedule B) reported from PQDZ, scan requirements as measured today (SOW
Schedule A), and is considered a release against blanket PO .

 

2) Buyer requires access to PQDZ for inputting information to enable cycle time
measures.

 

3) Seller maintains vendor relationships.

 

If a rescan is required:

 

1) Seller will initiate a rescan request.

 

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2) Seller will provide Buyer with a spreadsheet with rescanned information
(discrepancy report). Options: 1: Meets Requirement/Specs 2: Will Rescan 3: No
Fix (can’t get better)

 

3) Requests to be rescanned—if original scanning does not meet set requirements,
rework would not be charged back to Seller and Buyer assumes the cost. Buyer may
challenge rescans; Seller vendor management will agree/disagree and escalate as
necessary to resolve disagreements.

 

Dissertation Services

 

1) Buyer will receive mail and deliver to Seller for unpacking (paper). All
electronic submissions continue to go to Seller for processing and will be
handed off to Buyer with a work order for conversion and filming.

 

2) Seller (Acquisitions) will check into Exodus.

 

3) Seller creates work order batch and physically hands-off to Buyer (includes
work order and hard-copy dissertations).

 

4) Buyer scans, QCs, paginates, adds UMI page, etc., as instructed by notes in
WO. Buyer creates master in e-Beam. If QC passes item, Buyer delivers
information to manager location. If fails anywhere in scan process, Buyer will
notify Seller regardless of the cause.

 

5) Seller resolves failure issues that are fault of Seller input, splits work
order if required, returns materials to Buyer for reprocessing (split work
orders are treated like new work orders)

 

6) Buyer will process and file film masters in the vault after order processing.

 

7) Seller is responsible for claiming and author relations.

 

8) Buyer stages dissertations to storage area after scan/mastering completed.

 

24

--------------------------------------------------------------------------------

Statement of Work

 

1.04 PDF Dissertation Conversion and Pagination

 

Specifications:

 

PDF Dissertations submissions checked in by Seller must be checked by Buyer to
ensure all fonts are available in the file or in the conversion font library. If
not, Seller will approve purchase of the required fonts up to $500 quarterly, or
will notify the school/author that the file needs resubmitting or will be
rejected. The approved PDF will be converted according to the requirements in
SOW Schedule A.

 

Buyer will provide QC, final pagination and page insertion for each
dissertations unit. Original PDF files will be delivered to Seller along with
converted TIFFs being stored in EMC device. Seller will have visibility into the
process status through the ScanAll and Electron Image Repository (EIR) tools
provided to Buyer. Film master inspection will ensure densities in range as
stated in SOW Schedule A and that pagination and page insertion were performed
correctly. Specifications for Quality Control and the inspection process are
provided in SOW Schedule A.

 

Conversion activity will be tracked and reported to Seller.

 

Conversion rework will be done at no charge to Seller except for vault repairs
on images/masters created prior to the contract date. Conversion rework will be
mandated by the guidelines provided in SOW Schedule A.

 

1) All electronic submissions continue to go to Seller for processing and will
be handed off to Buyer with a work order for conversion and filming.

 

2) If Seller delivers a native PDF to Buyer then Buyer will send back in the
same format.

 

3) Seller (Acquisitions) will check into Exodus.

 

4) Seller creates work order for electronic with PDF’s placed on server.

 

5) Buyer scans, QCs, paginates, adds UMI page, etc., as instructed by notes in
WO. Buyer creates master in e-Beam. If QC passes item, Buyer delivers
information to manager location. If fails anywhere in scan process, Buyer will
notify Seller regardless of the cause.

 

6) Seller resolves failure issues that are fault of Seller input, splits work
order if required, returns materials to New Co for reprocessing (split work
orders are treated like new work orders)

 

7) Buyer will process and file film masters in the vault after order processing.

 

8) Seller is responsible for claiming and author relations.

 

25

--------------------------------------------------------------------------------

Statement of Work

 

1.05 Paper Scan and Conversion of PDF Newspapers

 

Called out separately from other paper scan and PDF conversion because criteria
has not been set. It is expected that ouputs volume requirements will be equal
to those of Newspaper Film Mastering (SOW 1.01) and will likely have similar
production specs to those of Periodical scanning. No hardware to support this
process has been acquired to date, although it has been investigated both for
capability and throughput. PDF conversion will likely have to support film and
XML creation for load to Seller digital vaults such as Historical Newspapers
(“HNP”).

 

To Be Delivered: This will be managed through the process outlined in
Section 2.6 of the Manufacturing Agreement (Change in Services).

 

Criteria and reports on hardware

Expenditures necessary

Time frames to acquire

Ownership

FTEs required to manage

Capacities

 

26

--------------------------------------------------------------------------------

Statement of Work

 

1.06 Serial and Collection Film Scanning (APS, HNP, EEBO, etc)

 

Specifications:

 

Film Scan Image Quality and Start-up Guidelines

 

All scanning is to be from 35mm film, or fiche, with output according to the
requirements in SOW Schedule A.

 

Pages filmed two-up are required to be split, each page must be a file by itself

 

Images must be put in print order, as best can be determined. Specs will be
determined on a project by project basis and defined on SOW Schedule A.

 

These specs will be used to evaluate Buyer’s output quality. Requests to rescan
due to image errors, poor contrast, missing source will be communicated from
Seller on a regular source exceptions report. Rescans will be done at no charge
to Seller. If significant deliveries within a given project are out of spec thus
impacting conversion vendor and product schedules, the appropriate Relationship
Managers will determine remedy.

 

Historical Newspaper Image Quality (Buyer and Seller will have sample sets for
use in comparison)

 

Standards as determined by Product Manager and included in SOW Schedule A for
Evaluating HNP – subjective 1-10 scale (this is a current standard and will be
defined in SOW Schedule A):

 

Chicago Tribune 1850’s – 1860’s = 1

Atlanta Constitution = 2

Chicago Tribune early 1900’s = 3

LA Times mid 1900’s = 4

Philadelphia Inquirer = 5

NY Times 20th Century = 10

 

A sample scale is provided for APS, EEBO and other collections in SOW Schedule
A.

 

Quality of Microfilm is the main driver. In all cases, tests should be conducted
from existing film with Seller Product and Vendor Management responsible for
determining whether to proceed or pursue mitigation strategies.

 

27

--------------------------------------------------------------------------------

Start up Process to be followed at the start of every scanning project
(typically product specific) for identification of images that will result in
undesirable OCR quality:

 

1) Scan a representative sample from beginning, middle, and end of each film
run, more samples may be required dependent upon the size of the project as
required in SOW Schedule A.

 

2) Evaluate and grade against predefined scale

 

3) Deliver samples and grade to Seller for evaluation by Product and Vendor
Management

 

4) Images will go to Seller conversion vendor to test their ability to zone, OCR
and clean up

 

5) Vendor will deliver results and conversion pricing to Seller

 

6) Seller will notify Buyer on results and may at this time request rescans or
other actions

 

7) If approved by Seller, Buyer will begin the process and develop a delivery
schedule

 

During the Scan/Scan QC process if an operator finds that 20% of the pages in a
batch* consists of images of which at least 50% of the page contains unreadable
text due to fading, bleed through, background noise, missing/cut off text, the
following procedures will begin: These are current standards and may be amended
by Seller.

 

* “Batch” will be defined by product in SOW Schedule A

 

1. Buyer Scan/Scan QC will identify the batch by spot-checking within the range,
until acceptable images are found.

 

2. Scan coordinator will notify Seller QA and Vendor Management and supply
samples of the images.

 

3. Seller Product Management will be engaged for internal sample review and
formal notification of film condition and image quality.

 

4. Seller will send samples to vendor for OCR evaluation and notify Buyer of
results to determine if and how conversion on the images should progress.

 

Rejects for skew, density, focus, missing and partial pages will be reworked by
Buyer at no charge to Seller. Buyer will provide samples of any questionable
images prior to large scale conversion. Although the cost to replace is a Buyer
liability, significant delay in recognition could impact Seller product delivery
schedules and vendor commitments for which there will be a penalty.

 

Film Scan Timelines

 

Film Scan Schedules for Seller product will be set on an annual basis; will be
adjusted quarterly as additional opportunities or shifts in market demands
dictate (See SOW Schedule D).

 

28

--------------------------------------------------------------------------------

Statement of Work

 

1.07 Book Film Scanning (Dissertations & BOD)

 

Dissertations and Books on Demand (BOD) pages will be scanned from film (or, for
BOD, regardless of input) according to the requirements in SOW Schedule A. Final
output files will be delivered to Seller to be wrapped as PDF for deposit in
Seller PQDD vault for Dissertations, or maintained as TIFF for BOD and delivered
to Seller jukeboxes and Buyer Print Operations. Any rescans required will be
completed at no cost to Seller if the error resulted from the scan or print
process rather than a problem with the source film

 

BOD

 

1) Seller retains rights management and product maintenance in Exodus BOD system

 

2) Seller will keep the Workman jukebox (Seller asset digital archive)

 

3) Buyer will have access to this digital archive.

 

4) Seller may request Buyer to print hard-copy—xerography print and bind.

 

5) If the content is not in the jukebox, Buyer pulls the film or book, then
scans to file directly to jukebox. The cost structure should be the same as
scanning film or paper scanning and confirms to the standards for these
services.

 

Preservation Dissertations (Bound, Un-Bound, Backfile and Delicate)

 

DAAP – Dissertations Archival and Access Program

 

Retro – Film Scant (exists in the vault to be digitized. Sold as per project)

 

Publishing – Start from original (never published)

 

Scanning of Non-Standard dissertations (maps, folders, color, size): This is a
project #185 that will be managed through the process outlined in Section 2.6 of
the Manufacturing Agreement (Change in Services).

 

29

--------------------------------------------------------------------------------

Statement of Work

 

1.08 Product Distribution and Fulfillment

 

Specifications:

 

Some shipping and distribution issues are being resolved in the Transitional
Services Agreement. Until those are resolved Buyer will perform all shipping and
distribution for Seller including, beyond Transition, complete distribution
services for all Seller products that require a physical shipment to Seller
customers.

 

Buyer will produce customer copies resulting from monthly/daily Seller orders by
existing turnaround times and revenue forecasts in SOW Schedules B and D. Based
on timing of order receipt and volume demands, Buyer from time to time may not
be able to complete production within cycle time requirements. In these cases
Buyer will contact the appropriate Seller Relationship Manager to review and
agree upon an alternate approach or appropriate remedy. These occurrences will
be tracked and reported.

 

Services:

 

Buyer will manage fulfillment of Seller released orders in such a way that
adheres to current print master storage and handling practices and ensures
completeness and accuracy of order to Seller customer. All materials used by
Buyer for Seller product fulfillment must meet existing product specifications
according to the requirements in SOW Schedule E.

 

For Film:

 

From time to time items may be backordered (in cases such as Vendor Film). Buyer
will respond to replacement requests from Seller Customer Service for any
defined as production error at no charge. These occurrences will be tracked and
reported along with corrective action processes implemented to mitigate repeat
occurrence. Buyer will extract film from Buyer’s Working or Archive vault as
appropriate to fulfill orders. Film will be inspected for physical defects prior
to submission to print and again after print fulfillment is completed. Film will
be re-filed in Buyer’s Vault in the same file sequence from which it was pulled.
Any defects found on Seller film, either prior to printing, post printing or in
the course of normal vault management activities will be reported to Seller.
Replacement masters, either working or archive, will be completed at Buyer
expense if damaged in the process. Defects found pre-process will be resolved at
Seller’s discretion.

 

For Collections:

 

Purchased Film: Seller owns acquiring film and Buyer will provide vault services
and fulfillment.

 

Purchased Master: Seller owns acquiring master and Buyer creates working master.

 

30

--------------------------------------------------------------------------------

For Dissertations:

 

1) For dissertations to be returned to submitting institution or author, Seller
will provide packing slip/transmittal list to Buyer who will pick dissertations
from storage area and ship to school location indicated. For recyclable
dissertations, Seller will provide Buyer with lists on a weekly basis of items
that can be disposed for recycling.

 

2) Seller will create masters for dissertation indexes and will own the
relationship with outside vendor(s) or other printers and will provide Buyer
with hard-copy for customer fulfillment. (Note: Buyer will provide pick, pack
and ship for customer fulfillment).

 

3) Seller retains ownership of dissertation copy fulfillment activities and
Seller owns relationship with outside vendor(s). Buyer provides support for
current processes. This assumption is for school, author and one-time hard-copy
sales.

 

4) Dissertations copies follows the same process as fulfillment process for BOD.

 

5) Buyer will provide fulfillment services for all Film Copies of Dissertations
including one time sales and Library of Congress standing order.

 

Dissertation Indexes

 

1) Seller Manages with outside vendor – Buyer ships, Seller will provide Buyer
with a Shipping Label Feed.

 

HQ books—Not in stock, DDP prints from electronic files

 

1) This product is owned by Seller and pick/print ship fulfilled by Buyer.

 

2) Electronic files on are network, a set of CDs from Salt Lake and on a box in
the data center

 

3) Transition issue: Buyer will print customer copies from electronic files
provided by Seller.

 

Newspaper indexes

 

1) Seller works with vendor to print.

 

2) For annual, Seller provides Buyer with copies to fulfill

 

3) For monthly, Seller provides e-file to Buyer and Buyer produces customer
copies and distribution.

 

Culture Grams and Enduring Issue

 

1) Seller will facilitate all printing and production of the products; Buyer
will pick, pack and ship.

 

Guides

 

1) Buyer charge back for printing/assembling guides.

 

2) Seller maintains inventory and Buyer warehouses the inventory.

 

31

--------------------------------------------------------------------------------

3) Continue to use current DDP work order print request process to facilitate
Buyer work.

 

CD-ROM

 

1) Seller will retain the CD-ROM mastering activities and relationship with the
Vendor. Seller will be responsible for order assembly. Buyer will provide
packaging and distribution services for these products.

 

Phone Fiche This has been announced as a discontinued product. Buyer will
continue the distribution on its current monthly release schedule through the
2005 publishing year, at which time it will be discontinued.

 

32

--------------------------------------------------------------------------------

[intentionally omitted]

 

33

--------------------------------------------------------------------------------

SCHEDULE C

 

Initial Estimated Monthly Requirements

 

34

--------------------------------------------------------------------------------

DELIVERABLE PRICING MODEL AND SERVICE LEVEL AGREEMENTS

NON-PERIODICAL VOLUME FORECAST (NOV 2005 JAN 2006)

 

Functional Area

--------------------------------------------------------------------------------

   Service
Level
Agreement

--------------------------------------------------------------------------------

  

Manufacturing Process

--------------------------------------------------------------------------------

  Deliverable
Unit

--------------------------------------------------------------------------------

  CPU

--------------------------------------------------------------------------------

  Nov
2005
Forecast

--------------------------------------------------------------------------------

  Estimated
NAPC
Cost

--------------------------------------------------------------------------------

  Estimated
NAPC
Invoice

--------------------------------------------------------------------------------

  Dec
2005
Forecast

--------------------------------------------------------------------------------

  Estimated
NAPC
Cost

--------------------------------------------------------------------------------

  Estimated
NAPC
Invoice

--------------------------------------------------------------------------------

  Jan
2006
Forecast

--------------------------------------------------------------------------------

  Estimated
NAPC
Cost

--------------------------------------------------------------------------------

  Estimated
NAPC
Invoice

--------------------------------------------------------------------------------

Mastering

   1.01    Planetary Camera Filming   Pages       CONFIDENTIAL TREATMENT
REQUESTED

Mastering

   1.01    EBR Filming   Pages      

Mastering

   1.01    35mm Print Masters   Titles/Pubs      

Mastering

   1.01    16mm Print Masters   Titles/Pubs      

Mastering

   1.01    105mm Print Masters   Titles/Pubs      

Mastering

   1.01    Vault Duplication Print Masters   Titles/Pubs      

Convert to Digital

   1.03    Paper Scan Periodicals   Pages      

Convert to Digital

   1.03    Paper Scan Dissertations   Pages      

Convert to Digital

   1.04    Conversion of PDF Dissertations   Pages      

Convert to Digital

   1.03    Paper Scan Newspaper (Estimated)   Pages      

Convert to Digital

   1.05    Conversion of PDF Newspapers (Estimated)   Pages      

Convert to Digital

   1.06    HNP Film Scanning   Pages      

Convert to Digital

   1.06    APS & HMO Film Scanning   Pages      

Convert to Digital

   1.07    Dissertation Film Scanning   Pages      

Convert to Digital

   1.07    BOD   Pages      

Convert to Digital

   1.06    EEBO   Pages      

Convert to Digital

   1.06    Various Other   Pages      

Convert to Digital

   1.06    Service Model   Pages      

Fulfillment

   x    Dissertation Copies   Impressions      

Fulfillment

   x    Books On Demand   Impressions      

Fulfillment

   x    In-House Production   Impressions      

Fulfillment

   1.08    Orders for Microfilm Prep (3.5.2)   Each      

Fulfillment

   1.09    35mm Copies (80% Silver, 20% Vesicular)   Reels      

Fulfillment

   1.09    16mm Copies (90% Silver, 10% Diazo)   Reels      

Fulfillment

   1.09    105mm Copies (52% Silver, 26% Ves., 22% Diazo)   Fische      

Mastering

   1.01    Wooster Newpapers Filming   Pages      

Fulfillment

   1.09    Wooster 35mm Copies 50/50 Silver/Ves   Reels      

Mastering

   N/A    Wooster Phonefische TDC Filming   Pages      

Fulfillment

   N/A    Wooster Phonefische Copies   Fische      

Fulfillment

   1.1    Distribution   Packages      

 

35

--------------------------------------------------------------------------------

SCHEDULE D

 

Components of Buyer’s Cost and Overhead

 

36

--------------------------------------------------------------------------------

DELIVERABLE PRICING MODEL AND SERVICE LEVEL AGREEMENTS

 

FUNCTIONAL
AREA

--------------------------------------------------------------------------------

   SERVICE
LEVEL
AGREEMENT

--------------------------------------------------------------------------------

 

MANUFACTURING PROCESS

--------------------------------------------------------------------------------

   DELIVERABLE UNIT

--------------------------------------------------------------------------------

  2005
VOLUMES

--------------------------------------------------------------------------------

  COST
PER
UNIT

--------------------------------------------------------------------------------

Mastering

   1.01   Planetary Camera Filming    Pages   CONFIDENTIAL
TREATMENT
REQUESTED

Mastering

   1.01   EBR Filming    Pages  

Mastering

   1.01   35mm Print Masters    Titles/Pubs  

Mastering

   1.01   16mm Print Masters    Titles/Pubs  

Mastering

   1.01   105mm Print Masters    Titles/Pubs  

Mastering

   1.01   Vault Duplication Print Masters    Titles/Pubs  

Convert to Digital

   1.03   Paper Scan Periodicals    Pages  

Convert to Digital

   1.03   Paper Scan Dissertations    Pages  

Convert to Digital

   1.04   Conversion of PDF Dissertations    Pages  

Convert to Digital

   1.03   Paper Scan Newspaper (Estimated)    Pages  

Convert to Digital

   1.05   Conversion of PDF Newspapers (Estimated)    Pages  

Convert to Digital

   1.06   HNP Film Scanning    Pages  

Convert to Digital

   1.06   APS & HMO Film Scanning    Pages  

Convert to Digital

   1.07   Dissertation Film Scanning    Pages  

Convert to Digital

   1.07   BOD    Pages  

Convert to Digital

   1.06   EEBO    Pages  

Convert to Digital

   1.06   Various Other    Pages  

Convert to Digital

   1.06   Service Model    Pages  

Fulfillment

   X   Dissertation Copies    Impressions  

Fulfillment

   X   Books On Demand    Impressions  

Fulfillment

   X   In-house Production    Impressions  

Fulfillment

   1.08   Orders for Microfilm Prep (3.5.2)    Each  

Fulfillment

   1.09   35mm Copies (80% Silver, 20% Vesicular)    Reels  

Fulfillment

   1.09   16mm Copies (90% Silver, 10% Diazo)    Reels  

Fulfillment

   1.09   105mm Copies (52% Silver, 26% Ves., 22% Diazo)    Fiche  

Mastering

   1.01   Wooster Newspapers Filming    Pages  

Fulfillment

   1.09   Wooster 35mm Copies 50/50 Silver/Ves    Reels  

Mastering

   N/A   Wooster Phonefiche TDC Filming    Pages  

Fulfillment

   N/A   Wooster Phonefiche Copies    Fiche  

Fulfillment

   1.10   Distribution    Packages        1.02   Vault Management   
Monthly Service Fee        1.11   Logistics/Warehousing    Monthly Service Fee  

 

37

--------------------------------------------------------------------------------

COST PER UNIT MODELING FOR NEMO

2004 Actual, 2005 - 09 Forecast

 

Product
ID

--------------------------------------------------------------------------------

  RFP
ID

--------------------------------------------------------------------------------

 

Functional
Area

--------------------------------------------------------------------------------

  SLA
Ref

--------------------------------------------------------------------------------

 

Unit
Description

--------------------------------------------------------------------------------

  Units

--------------------------------------------------------------------------------

  Volume

--------------------------------------------------------------------------------

  FTE

--------------------------------------------------------------------------------

  Budget
Center

--------------------------------------------------------------------------------

  AVG
SALARY

--------------------------------------------------------------------------------

   Direct
Labor

--------------------------------------------------------------------------------

   Direct
CPU

--------------------------------------------------------------------------------

   Indirect
LABOR

--------------------------------------------------------------------------------

   Indirect
CPU

--------------------------------------------------------------------------------

   Raw
Material

--------------------------------------------------------------------------------

   Supplier,
Other

--------------------------------------------------------------------------------

   Total
Material

--------------------------------------------------------------------------------

   2005
Material
Cost Per
Unit

--------------------------------------------------------------------------------

   2005
Total
Cost

--------------------------------------------------------------------------------

   2005
Total
Cost
Per
Unit

--------------------------------------------------------------------------------

DIRECT LABOR PROCESSES

          1.00   3.3.2   Mastering   1.01   Planetary Camera Filming   Pages  
CONFIDENTIAL
TREATMENT
REQUESTED   19.0   DB304   CONFIDENTIAL TREATMENT REQUESTED      2.00   3.3.2  
Mastering   1.01   EBR Filming   Pages     4.0   DB304        3.00   3.3.3  
Mastering   1.01   35mm Print Masters   Titles/Pubs     3.0   PD308        3.00
  3.3.3   Mastering   1.01   16mm Print Masters   Titles/Pubs     1.0   PD308  
     3.00   3.3.3   Mastering   1.01   105mm Print Masters   Titles/Pubs     5.0
  PD308        4.00   3.3.3   Mastering   1.01   Vault Duplication Print Masters
  Titles/Pubs     8.0   PD308        5.00   3.3.4   Convert to Digital   1.03  
Paper Scan Periodicals   Pages     7.0   DB304        6.00   3.3.4   Convert to
Digital   1.03   Paper Scan Dissertations   Pages     12.0   DB304        7.00  
3.3.4   Convert to Digital   1.04   Conversion of PDF Dissertations   Pages    
2.5   DB304        8.00   3.3.4   Convert to Digital   1.05   Paper Scan
Newspaper (TBD)   Pages     0.0   DB304        9.00   3.3.4   Convert to Digital
  1.04   Conversion of PDF Newspapers (TBD)   Pages     0.0   DB304        10.00
  3.4.3   Convert to Digital   1.06   HNP Film Scanning   Pages     40.0   DB304
       11.00   3.4.3   Convert to Digital   1.06   APS & HMO Film Scanning  
Pages     13.5   DB304        12.00   3.4.3   Convert to Digital   1.07  
Dissertation Film Scanning   Pages     12.5   DB304        13.00   3.4.3  
Convert to Digital   1.07   BOD   Pages     1.0   DB304        14.00   3.4.3  
Convert to Digital   1.06   EEBO   Pages     2.5   DB304        15.00   3.4.3  
Convert to Digital   1.06   Various Other   Pages     8.0   DB304        16.00  
3.4.3   Convert to Digital   1.06   Service Model   Pages     1.0   DB304       
        Fulfillment   x   Dissertation Copies   Impressions     2.0   DB304     
          Fulfillment   x   Books On Demand   Impressions     0.5   DB304       
        Fulfillment   x   In-House Production   Impressions     1.0   DB304     
  17.00   3.5.3   Fulfillment   1.08   Orders for Microfilm Prep (3.5.2)   Each
    8.5   PD301        18.00   3.5.3   Fulfillment   1.09   35mm Copies (80%
Silver, 20% Vesicular)   Reels     8.0   PD301        19.00   3.5.3  
Fulfillment   1.09   16mm Copies (90% Silver, 10% Diazo)   Reels     0.0   PD301
       20.00   3.5.3   Fulfillment   1.09   105mm Copies (52% Silver, 26% Ves.,
22% Diazo)   Fische     7.5   PD301        21.00   3.6.2   Mastering   1.01  
Wooster Newpapers Filming   Pages     23.0   OM306        22.00   3.6.2  
Fulfillment   1.09   Wooster 35mm Copies 50/50 Silver/Ves   Reels     2.0  
OM311        23.00   3.6.3   Mastering   N/A   Wooster Phonefische TDC Filming  
Pages     2.0   OM310        24.00   3.6.3   Fulfillment   N/A   Wooster
Phonefische Copies   Fische     2.0   OM310        25.00   3.5.6   Fulfillment  
1.10   Distribution   Packages     7.0   DB304        ALL BELOW ALLOCATED TO
ABOVE                      3.3.4   Convert to Digital       Image QC   Pages    
4.0   DB304            3.4.3   Convert to Digital       Image QC and Split  
Pages     12.0   DB304            3.5.3   Fulfillment       QC of Print Check
Rolls   Reels     1.0   DB304            3.5.5   Fulfillment       Finishing
(Stripe, Cut, Wind and Box)   Units     13.0   DB304                           
      30.0                                    SUBTOTAL   234                  
                                                    1.02   Vault Management    
                                                                             
1.11   Logistics/Warehousing                                                  
                   

 

38

--------------------------------------------------------------------------------

    

Process

--------------------------------------------------------------------------------

   unit

--------------------------------------------------------------------------------

   volume

--------------------------------------------------------------------------------

   raw
material

--------------------------------------------------------------------------------

   boxes/
cartons

--------------------------------------------------------------------------------

   reels

--------------------------------------------------------------------------------

   chemicals

--------------------------------------------------------------------------------

   paper

--------------------------------------------------------------------------------

   binding,
other pap,
fuser, glue

--------------------------------------------------------------------------------

   16mm
cart.

--------------------------------------------------------------------------------

   In-house
print

--------------------------------------------------------------------------------

Mastering

  

Planetary Camera Filming

   Pages    CONFIDENTIAL TREATMENT REQUESTED

Mastering

  

EBR Filming

   Pages   

Mastering

  

35mm Print Masters

   Titles/Pubs   

Mastering

  

16mm Print Masters

   Titles/Pubs   

Mastering

  

105mm Print Masters

   Titles/Pubs   

Mastering

  

Vault Duplication Print Masters

   Titles/Pubs   

Fulfillment

  

Dissertation Copies

   Impressions   

Fulfillment

  

Books On Demand

   Impressions   

Fulfillment

  

In-House Production

   Impressions   

Fulfillment

  

Orders for Microfilm Prep (3.5.2)

   Each   

Fulfillment

  

35mm Copies (80% Silver, 20% Vesicular)

   Reels   

Fulfillment

  

16mm Copies (90% Silver, 10% Diazo)

   Reels   

Fulfillment

  

105mm Copies (52% Silver, 26% Ves., 22% Diazo)

   Fische   

Mastering

  

Wooster Newpapers Filming

   Pages   

Fulfillment

  

Wooster 35mm Copies 50/50 Silver/Ves

   Reels   

Mastering

  

Wooster Phonefische TDC Filming

   Pages   

Fulfillment

  

Wooster Phonefische Copies

   Fische   

 

39

--------------------------------------------------------------------------------

Average of Salary end of 05    E/NE

--------------------------------------------------------------------------------

  

NE

--------------------------------------------------------------------------------

  

Grand Total

--------------------------------------------------------------------------------

Budget Ctr

--------------------------------------------------------------------------------

   E

--------------------------------------------------------------------------------

     

DB304

   CONFIDENTIAL
TREATMENT
REQUESTED    CONFIDENTIAL
TREATMENT
REQUESTED

DB432

     

DB433

     

DV301

     

MR301

     

OM301

     

OM306

     

OM308

     

OM310

     

OM311

     

PD301

     

PD308

     

Grand Total

      Sum of Salary end of 05    E/NE

--------------------------------------------------------------------------------

  

NE

--------------------------------------------------------------------------------

  

Grand Total

--------------------------------------------------------------------------------

Budget Ctr

--------------------------------------------------------------------------------

   E

--------------------------------------------------------------------------------

     

DB304

   CONFIDENTIAL
TREATMENT
REQUESTED    CONFIDENTIAL
TREATMENT
REQUESTED

DB432

     

DB433

     

DV301

     

MR301

     

OM301

     

OM306

     

OM308

     

OM310

     

OM311

     

PD301

     

PD308

     

Grand Total

           LOADED           Count of Salary end of 05    E/NE

--------------------------------------------------------------------------------

  

--------------------------------------------------------------------------------

  

Grand Total

--------------------------------------------------------------------------------

Budget Ctr

--------------------------------------------------------------------------------

   E

--------------------------------------------------------------------------------

   NE

--------------------------------------------------------------------------------

  

DB304

   CONFIDENTIAL
TREATMENT
REQUESTED    CONFIDENTIAL
TREATMENT
REQUESTED

DB432

     

DB433

     

DV301

     

MR301

     

OM301

     

OM306

     

OM308

     

OM310

     

OM311

     

PD301

     

PD308

     

Grand Total

     

INDIRECT

--------------------------------------------------------------------------------

   AVG

--------------------------------------------------------------------------------

   SUM

--------------------------------------------------------------------------------

   FTE

--------------------------------------------------------------------------------

DB432

   CONFIDENTIAL
TREATMENT
REQUESTED    5

DB433

      7

DV301

      6

MR301

      1

OM301

      21

OM308

      4         44

 

40

--------------------------------------------------------------------------------

ProQuest Square Footage Estimates

 

Allocation Determines Non-Data Center Utilities Split – Adjusted Quarterly

 

Film Related Manufacturing

--------------------------------------------------------------------------------

   Current
Space

--------------------------------------------------------------------------------

   TOTAL

--------------------------------------------------------------------------------

   ALLOC

--------------------------------------------------------------------------------

    NAPC

--------------------------------------------------------------------------------

    ALLOC

--------------------------------------------------------------------------------

    PQIL

--------------------------------------------------------------------------------

    TOTAL
ALLOCATED

--------------------------------------------------------------------------------

 

Archival Vault Floor Space *

   16,700    16,700    25 %   4,175     75.00 %   12,525     16,700  

Working Vault Floor Space *

   15,400    15,400    75 %   11,550     25.00 %   3,850     15,400  

Wooster Vault **

   6,049    6,049    0 %   0     100.00 %   6,049     6,049  

Unvaulted Film

   1,520    1,520    0 %   0     100.00 %   1,520     1,520  

HardCopy Vault (*), (***)

   14,050    14,050    100 %   14,050     0.00 %   0     14,050  

Mastering ***

   13,922    13,922    75 %   10,442     25.00 %   3,481     13,922  

Prep and Print ***

   21,263    21,263    50 %   10,632     50.00 %   10,632     21,263  

Processing ***

   5,050    5,050    75 %   3,788     25.00 %   1,263     5,050  

Research Collections

   2,200    2,200    0 %   0     100.00 %   2,200     2,200  

Total Film Space

   96,154    96,154    57 %   54,636     43.00 %   41,519     96,154  

Paper Print Manufacturing

                                        

Printing

   2,450    2,450    85 %   2,083     15.00 %   368     2,450  

Binding

   3,400    3,400    95 %   3,230     5.00 %   170     3,400  

Total Print Space

   5,850    5,850    91 %   5,313     9.00 %   538     5,850  

Electronic Manufacturing

                                        

Film Scanning

   2,150    2,150    0 %   0     100.00 %   2,150     2,150  

Paper Scanning

   1,500    1,500    0 %   0     100.00 %   1,500     1,500  

QC

   650    650    0 %   0     100.00 %   650     650  

e-Feeds, Mapping, PM and PQDZ check-in

   1,400    1,400    0 %   0     100.00 %   1,400     1,400  

Total Electronic Space

   5,700    5,700    0 %   0     100.00 %   5,700     5,700  

Fulfillment

                                        

Shipping

   5,850    5,850    50 %   2,925     50.00 %   2,925     5,850  

Receiving

   4,300    4,300    50 %   2,150     50.00 %   2,150     4,300  

Lit Fulfillment

   670    670    0 %   0     100.00 %   670     670  

POF

   2,275    2,275    0 %   0     100.00 %   2,275     2,275  

Wooster

   300    300    0 %   0     100.00 %   300     300  

Total Fulfillment Space

   13,395    13,395    38 %   5,075     62.00 %   8,320     13,395  

Warehouse

                                        

Zeeb - on site

   663    663    100 %   663     0.00 %   0     663  

Warehouse 1

   9,000    9,000    100 %   9,000     0.00 %   0     9,000  

Warehouse 2

   9,000    9,000    0 %   0     100.00 %   9,000     9,000  

Warehouse 3

   9,000    0    0 %   0     100.00 %   0     0  

Wooster

   500    3,000    0 %   0     100.00 %   3,000     3,000  

Total Warehouse Space

   28,163    21,663    45 %   9,663     55.00 %   12,000     21,663  

Support Areas

                                        

CS

   1,600    1,600    25 %   400     75.00 %   1,200     1,600  

Tech Support

   800    800    0 %   0     100.00 %   800     800  

IS/HelpDesk/IT

   4,815    4,815    50 %   2,408     50.00 %   2,408     4,815  

Total Support Areas

   7,215    7,215    39 %   2,808     61.00 %   4,408     7,215  

Other

                                        

Periodicals ****

   2,500    2,500    100 %   2,500     0.00 %   0     2,500  

Dissertations ****

   6,663    6,663    0 %   0     100.00 %   6,663     6,663  

Product/Bib

   2,400    2,400    20 %   480     80.00 %   1,920     2,400  

VIP Offices ***

   500    500    50 %   250     50.00 %   250     500  

Total Acquisitions Space

   12,063    12,063    27 %   3,230     73.00 %   8,833     12,063  

Additional Admin/Mgmt & Support

   2,675    2,675    100 %   2,675     0.00 %   0     2,675  

Total Admin/Mgmt

   2,675    2,675    100 %   2,675     0.00 %   0     2,675  

Total Huxley Space

   171,215    164,715    51 %   83,399     49.00 %   81,317     164,715         
              51 %         49 %   100 %

Total Minus Film Vaults and Warehouse

   103,383    103,383          58,011           45,373     103,383  

Headcount in AA and Wooster

   516    516          516           516     516  

Square Feet per Person

   201    201          113           88     201  

Less Warehouse / Wooster

   143,415                                    

 

41

--------------------------------------------------------------------------------

DELIVERABLE PRICING MODEL AND SERVICE LEVEL AGREEMENTS

VOLUME PLAN 2006

 

FUNCTIONAL AREA

--------------------------------------------------------------------------------

   SERVICE
LEVEL
AGREEMENT

--------------------------------------------------------------------------------

  

MANUFACTURING PROCESS

--------------------------------------------------------------------------------

   DELIVERABLE
UNIT

--------------------------------------------------------------------------------

   FY 2006 Plan

--------------------------------------------------------------------------------

Mastering

   1.01    Planetary Camera Filming    Pages    CONFIDENTIAL
TREATMENT
REQUESTED

Mastering

   1.01    EBR Filming    Pages   

Mastering

   1.01    35mm Print Masters    Titles/Pubs   

Mastering

   1.01    16mm Print Masters    Titles/Pubs   

Mastering

   1.01    105mm Print Masters    Titles/Pubs   

Mastering

   1.01    Vault Duplication Print Masters    Titles/Pubs   

Convert to Digital

   1.03    Paper Scan Periodicals    Pages   

Convert to Digital

   1.03    Paper Scan Dissertations    Pages   

Convert to Digital

   1.04    Conversion of PDF Dissertations    Pages   

Convert to Digital

   1.03    Paper Scan Newspaper (Estimated)    Pages   

Convert to Digital

   1.05    Conversion of PDF Newspapers (Estimated)    Pages   

Convert to Digital

   1.06    HNP Film Scanning    Pages   

Convert to Digital

   1.06    APS & HMO Film Scanning    Pages   

Convert to Digital

   1.07    Dissertation Film Scanning    Pages   

Convert to Digital

   1.07    BOD    Pages   

Convert to Digital

   1.06    EEBO    Pages   

Convert to Digital

   1.06    Various Other    Pages   

Convert to Digital

   1.06    Service Model    Pages   

Fulfillment

   X    Dissertation Copies    Impressions   

Fulfillment

   X    Books On Demand    Impressions   

Fulfillment

   X    In-house Production    Impressions   

Fulfillment

   1.08    Orders for Microfilm Prep (3.5.2)    Each   

Fulfillment

   1.09    35mm Copies (80% Silver, 20% Vesicular)    Reels   

Fulfillment

   1.09    16mm Copies (90% Silver, 10% Diazo)    Reels   

Fulfillment

   1.09    105mm Copies (52% Sliver, 26% Ves., 22% Diazo)    Fiche   

Mastering

   1.01    Wooster Newspapers Filming    Pages   

Fulfillment

   1.09    Woostar 35mm Copies 50/50 Silver/Ves    Reels   

Mastering

   N/A    Wooster Phonefiche TDC Filming    Pages   

Fulfillment

   N/A    Wooster Phoneftche Copies    Fiche   

Fulfillment

   1.10    Distribution    Packages   

 

42