Initial Operating System Requirements: Customers cannot acquire full Windows 95/98, Windows NT Workstation and Windows 2000 Pro licenses through the Select 5.0, Select 4.0, Select 3.0, or Open License programs. Therefore, a customer must first have a full operating system installed on their machine before they are eligible to acquire an upgrade license for Windows 95/98, Windows NT Workstation, or Windows 2000 Pro via Microsoft's volume licensing programs. Full operating system licenses can be acquired through an original equipment manufacturer ("OEM").

Transferring Operating Systems: Windows 95/98, Windows NT Workstation and Windows 2000 Professional upgrade licenses acquired via the Select 5.0, Select 4.0, Select 3.0, or Open License programs are tied to the machine on which they are first installed. That is, customers may not transfer the operating system licenses from the original machine to a different machine. In addition, the Upgrade Advantage rights acquired for an operating system license cannot be transferred to a new or replacement PC if that Upgrade Advantage was used to upgrade a license on the existing PC. A customer may only transfer the Upgrade Advantage rights to a new or replacement PC if the operating system has not been upgraded using Upgrade Advantage.

QUESTION: What if a volume licensing customer purchases new machines that do not have an operating system pre-installed?

ANSWER: It is important to note that all new machines should come with a bootable operating system pre-installed (i.e., MS-DOS with Windows 3.11, OS/2, etc.). For example, a customer who has an OEM version of MS-DOS 6.22 and Windows 3.11 pre-installed on a new machine is eligible to acquire a Windows 98 Version Upgrade or enroll in Windows Upgrade Advantage or he/she may acquire a Windows 2000 Pro Competitive Upgrade. The Select 5.0, Select 4.0, Select 3.0 and Open License programs only offer upgrade licenses, so the customer cannot acquire a "naked" PC and install a full operating system license under any Microsoft volume licensing program.

QUESTION: A customer had an older machine that came pre-installed with MS-DOS and Windows 3.1 and the customer then acquired a Windows 98 upgrade license via the Select or Open License program. If the customer decided to donate the machine to a charity, could they remove Windows 98 from that machine and then transfer the Windows 98 upgrade license to a different machine within their organization?

ANSWER: No. Under Select 5.0, Select 4.0, Select 3.0, and Open License, operating system licenses are tied to the machine on which they are first installed. If a customer acquires a Windows 98 upgrade license via Select or Open and then installs Windows 98 on a given machine, the license is then tied to that machine and may not be transferred to another machine, regardless of whether or not the Windows 98 software is removed from the original machine.

QUESTION: A Select customer is replacing an older PC and wants to order the replacement PC without an operating system license and acquire their initial full license through their Select agreement. Can they do this?

ANSWER: No. A customer cannot acquire an initial or "full" license through their Select agreement or through any other Microsoft Volume Licensing Program. The customer must first acquire a Windows 95/98, Windows NT Workstation or Windows 2000 Pro license from OEM or from full packaged product.

License Definition

Transfer of Licenses: For additonal information, please see Section 12(d)(v) of the Select 4.0 Master Agreement, Section II(A) of the Select 4.0 Product Use Rights Addendum, Section 3(e)(B) of the Select 3.0 License agreement, Section II(A) Page 7 of the Select 3.0b sample license confirmation, and Section 1(b)(i) of the Open License agreement.