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This is an issue with using the floating license server. It is important to have the server be the same build as vfr and also make sure that the server is installed correctly. This can sometimes be troublesome when updating the server. It is very important to make sure that the VRLserver is completely shut down by every user on the server machine to be updated. We've had instances where users have tried to install when the vrlserver was still running under another account. This will prevent all of the necessary dependencies to be updated and cause the water mark.
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