The section distinguishes between (1) agreements where a grant to use informational property rights vests independent of any copy, and (2) agreements where the purpose is to obtain rights associated with a copy of information. It deals only with transactions in which, under the agreement, the vesting of rights to use informational property is independent of delivery of a copy. The Section describes the relationship between a tender of a copy in such cases and cancellation the entire contract or cure of the tender. Consistent with Section 2B-601, it indicates that refusal of the copy does not necessarily permit or result in cancellation of the contract. This is because the independent grant of rights (already vested) is an independent, performed part of the agreement and the copy may be a non-material aspect of the transaction.

If the refused tender of a copy does not materially breach the entire contract, the tendering party has a right to cure the defective tender by acting in a commercially reasonable time. That right is cut off only if tender and a failed or delayed cure constitute a material breach of the whole agreement.

2. Nature of the Transaction. The section applies only if the grant to use the informational property rights vests and can be exercised without receipt of a copy. Whether or when this circumstance exists depends on the agreement. It is, however, a routine type of transaction in information industries, especially with respect to distribution relationships and performance rights. In cases where this form of transaction exists, the parties view any copy as a mere conduit to complete an already vested conveyance. In such cases, a court must not view a material defect in the copy as necessarily material to the entire contract.

In contrast to cases under this section, if the agreement does not create a prior vesting of intellectual property use rights and the transaction does not entail an installment contract, a material defect in the copy and associated rights to which the transaction pertains is more often material to the entire transaction. This may benefit or disadvantage either party depending on the circumstances. Thus, if the contract is for rights associated with a copy, the licensee that refuses the copy is left solely with an action for damages; refusal in essence cancels the contract. If the intellectual property rights have vested by agreement independent of a copy, the licensee can refuse the copy and still (1) expect and insist on performance and (2) exercise rights under the non-cancelled contract.