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(b) No rights are granted or implied by the agreement under any other patents other than as provided above or by operation of law.

(C) Nothing contained herein shall limit any rights which the Government may have obtained by virtue by prior contracts or by operation of law or otherwise.

(b) License term. One of the following clauses may be used as appropriate.

(ALTERNATE A)

LICENSE TERM

The license hereby granted shall remain in full force and effect for the full term of each of the patents referred to in the "License Grant" clause of this contract and any and all patents hereafter issued on applications for patent referred to in such “License Grant" clause.

(ALTERNATE B)

LICENSE TERM

formity with the final decision rendered on such appeal.

(c) Termination.

The following clause is an example for use in contracts providing for the payment of a running royalty. This clause may be modified or omitted as appropriate for particular circumstances, but only upon the advice of cognizant patent or legal counsel.'

TERMINATION Notwithstanding any other provision of this contract, the Government shall have the right to terminate the within license, in whole or in part, by giving the Contractor not less than thirty (30) days notice in writing of the date such termination is to be effective: Provided, however, That such termination shall not affect the obligation of the Government to pay royalties which have accrued prior to the effective date of such termination. $ 9.409-3 Additional clauses contracts

except running royalty contracts. The following clauses are examples for use in patent release and settlement agreements, and license agreements not providing for payment by the Government of a running royalty. (a) License grant.

LICENSE GRANT (a) The Contractor hereby grants to the Government an irrevocable, nonexclusive, nontransferable, and paid up license under the following patents, applications for patent, and any patents granted on such applications, and under any patents which may issue as the result of any reissue, division or continuation thereof, to practice by or cause to be practiced for the Government throughout the world, any and all of the inventions thereunder, in the manufacture and use of any article or material, in the use of any method or process, and in the disposition of any article or material in accordance with law: U.S. Patent No.

Date.-.
Application Serial No.

Filing Date--

together with corresponding foreign patents and foreign applications for patents, insofar as the Contractor has the right to grant licenses thereunder without incurring an obligation to pay royalties or other compensation to others solely on account of such grant.

The license hereby granted shall terminate on the ----- day of

19------; Provided, however, That said termination shall be without prejudice to the completion of any contract entered into by the Government prior to said date of termination or to the use or disposition thereafter of any articles or materials manufactured by or for the Government under this license. $ 9.409-4 Additional clauses-contracts

providing for payment of a running

royalty. The clauses set forth below are examples which may be used in patent release and settlement agreements, and license agreements, when it is desired to cover the subject matter thereof and the contract provides for payment of a running royalty.

(a) License grant. No Military Department shall be obligated to pay royalties unless the contract is signed on behalf of such Department. Accordingly, the following License Grant clause should be limited to the practice of the invention by or for the signatory Department or Departments:

LICENSE GRANT (a) The Contractor hereby grants to the Government, as represented by the Secretary

an irrevocable, nonexclusive, nontransferable license under the following patents, applications for patent, and any patents granted on such appli. cations, and under any patents which may issue as the result of any reissue, division, or continuation thereunder to practice by, or cause to be practiced for the Department of

---, throughout the world, any and all of the inventions there

of

? For the Department of the Army: Chief, Patents Division, Office of The Judge Advocate General for the Department of the Air Force: Chief, Patents Division, Office of The Judge Advocate General; and for the Defense Supply Agency: The Patent Counsel.

9

under in the manufacture and use of any article or material, in the use of any method or process, and in the disposition of any article or material in accordance with law: U.S. Patent No.

Date
Application Serial No.

Filing Date

together with corresponding foreign patents and foreign applications for patent, insofar as the Contractor has the right to grant licenses thereunder without incurring an obligation to pay royalties or other compensation to others solely on account of such grant.

(b) No rights are granted or implied by the agreement under any other patents other than as provided above or by operation of law.

(c) Nothing contained herein shall limit any rights which the Government may have obtained by virtue of prior contracts or by operation of law or otherwise. (b) License

term.

The following clause is a sample form for expressing the license term.

LICENSE TERM The license hereby granted shall remain in full force and effect for the full term of each of the patents referred to in the “License Grant" clause of this contract and any and all patents hereafter issued on applications for patent referred to above unless sooner terminated as elsewhere herein provided.

(c) Computation of royalties. The following clause, providing for the computation of royalties, may be of varying scope depending upon the nature of the royalty bearing article, the volume of procurement, and the type of contract pursuant to which the procurement is to be accomplished.

COMPUTATION OF ROYALTIES Subject to the conditions hereinafter stated, royalties shall accrue to the Contractor under this agreement on all articles or materials embodying, or manufactured by the use of, any or all inventions claimed under any unexpired U.S. patent licensed herein, upon acceptance thereof by the Department of

at the rate of I--- percent of the net selling price of such articles or materials) [(amount) per (name of item) ] 8 whether manufactured by the Government or procured under a fixed price contract, and at the rate of (amount) per (name of item) acquired or manufactured by a Contractor performing under a cost-reimbursement contract. With respect to such articles or ma. terials made by the Department of

“net selling price," as used

in this paragraph, means the actual cost of direct labor and materials without allowance for overhead and supervision.

(d) Reporting and payment of royalties. (1) The contract should contain a provision specifying the office designated within the specific Department involved to make any necessary reports to the contractor of the extent of use of the Licensed subject matter by the entire Department, and such office shall be charged with the responsibility of obtaining from all procuring offices of that Department the information necessary to make the required reports and corresponding vouchers necessary to make the required payments. The following clause is a sample for expressing reporting and payment of royalties requirements:

REPORTING AND PAYMENT OF ROYALTIES

(a) The (procuring office) shall, on or before the sixtieth (60th) day next following the end of each yearly period ending

during which royalties have accrued under this license, deliver to the Contractor, subject to military security regulations, a report in writing furnishing necessary information relative to royalties which have accrued under this contract.

(b) Royalties which have accrued under this contract during the yearly 10 period end

shall be paid to the Contractor (if appropriations therefor are available or become available) within sixty (60) days next following the receipt of a voucher from the Contractor submitted in accordance with the report referred to in (a) of this clause: Provided, That the Government shall not be obligated to pay, in respect of any such yearly period, on account of the combined royalties accruing under this contract directly and under any separate licenses granted pursuant to the "License to Other Government Agencies” clause (if any) of this contract, amount greater than

--) dollars; and if such combined royalties exceed the said maximum yearly obligation, each departo ment or agency shall pay a pro rata share of the said maximum yearly obligation as determined by the proportion its accrued royalties bear to the combined total of accrued royalties.

(2) Where more than one Department or Government Agency is licensed and

ing

an

• The frequency, date, and length of reporting periods should be selected as appropriate to the particular circumstances of the contract.

10 The frequency, date, and length of reporting periods should be selected as appropriate to the particular circumstances of the contract.

8 Use bracketed matter as appropriate.

there is a ceiling on the royalties payable in any reporting period, the licensing Departments or Agencies shall coordinate with respect to the pro rata share of royalties to be paid by each.

(e) License to other Government agencies. When it is intended that a license on the same terms and conditions be available to other departments and agencies of the Government, the following clause is an example which may be used: LICENSE TO OTHER GOVERNMENT AGENCIES

The Contractor hereby agrees to grant & separate license under the patents, applications for patents, and improvements referred to in the “License Grant" clause of this contract, on the same terms and conditions as appear in this license contract, to any other department or agency of the Government at any time on receipt of a written request for such a license from such department or agency: Provided, however, That as to royalties which accrue under such separate 11censes, reports and payments shall be made directly to the Contractor by each such other department or agency pursuant to the terms of such separate licenses. The Contractor shall notify the Licensee hereunder promptly upon receipt of any request for license hereunder. $ 9.410 Assignments.

(a) The following clause is an example which may be used in contracts of assignment of patent rights to the Government:

ASSIGNMENT The Contractor hereby conveys to the Government, as represented by the Secretary of

the entire right, title, and interest in and to the following patents (and applications for patent), in and to the inventions thereof, and in and to all claims and demands whatsoever for infringement thereof heretofore accrued, the same to be held and enjoyed by the Government through its duly appointed representatives to the full end of the term of said patents (and to the full end of the terms of all patents which may be granted upon said applications for patent, or upon any division, continuation-in-part or continuation thereof): U.S. Patent No. Date Name of Inventor

(b) To facilitate proof of contracts of assignments, the acknowledgement of the contractor should be executed before a notary public or other oficer author. ized to administer oaths (35 U.S.C. 261). $ 9.411 Procurement of rights in inven

tions, patents and copyrights. Even though no infringement has occurred or been alleged, it is the policy of the Department of Defense to procure rights under patents, patent applications, and copyrights whenever it is in the Government's interest to do so and the desired rights can be obtained at a fair price. The required and suggested clauses in $$ 9.409 and 9.410 shall be required and suggested clauses, respectively, for license agreements and assignments made under this paragraph. The instructions in $$ 9.409 and 9.410 concerning the applicability and use of those clauses shall be followed insofar as they are pertinent. (35 FR. 6833, Apr. 30, 1970) $ 9.412 Contract format.

The following format, appropriately modified where necessary, may used for contracts of release, license, or assignment:

Contract No PATENT LICENSE

RELEASE CONTRACT This contract is effective as of the day of

19.-, between the United States of America (hereinafter called the Government), and

(hereinafter called the Contractor), (a corporation organized and existing under the laws of the State of --------,) (a partnership consisting of

------,) (an individual trading as ----------,) ) of the City of --

in the State of

---Whereas, Contractor warrants that he has the right to grant the within license and release, and the Government desires to procure the same, and

Whereas, this contract is authorized by law, including 10 U.S.C. 2386,

Now therefore, in consideration of the grant, release and agreements hereinafter recited, the parties have agreed as follows:

Article 1. License Grant.u

(Insert the clause in 8–409.3(a) for a paid up license, or the clause in 9-409.4(a) for a Ucense on a running royalty basis.)

Article 2. License Term.u

AND

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1 I only a release is procured delete this article; if an assignment 18 procured, use the alause in 9-410.

(Insert the appropriate alternative clause Sec. in 9-409.3(b) for a paid up license, or the 10.101-2 Annual bid bond. clause in 9-409.4(b) for a license on a run- 10.101-4 Bid guarantee. ning royalty basis.)

10.101-5 Consent of surety. Article 3. Release of Past Infringement. 10.101-6 Construction contract or subcon(Insert the clause in 9 409.2(a).)

tract. Article 4. Nonestoppel.

10.101-7 Fidelity bond. (Insert the clause in 9-409.1(1).)

10.101-8 Forgery bond or policy. Article 5. Payment.

10.101–10 Payment bond. The Contractor shall be paid the sum 10.101-11 Penal sum or amount. of Dollars ($

--) in full 10.101-12 Performance bond. compensation for the rights herein granted 10.102 Bid guarantees. and agreed to be granted. (For a license on 10.102-1 Applicability. å running royalty basis, insert the clause in 10.102-2 Limitations. 9-409.4(c) in accordance with the instruc- 10.102-3 Amount required. tions therein, and also the clause as specified 10.1024 Solicitation provisions. in 9 409.2(b) and 9-409.4 (d) and (e).)

10.102-5 Noncompliance with bid guaranArticle 6. Officials Not to Benefit.

tee requirements. (Insert the clause in 7-103.19.)

10.103 Performance and payment bonds Article 7. Covenant Against Contingent

for construction contracts. Fees.

10.103-1 Performance bonds. (Insert the clause in 7–103.20.)

10.103–2 Payment bonds. Article 8. Assignment of Claims.

10.103-3 Waiver of performance and pay(Insert the clause in 7–103.8.)

ment bonds. Article 9. Gratuities.

10.103-4 Furnishing information to sub(Insert the clause in 7–104.16.)

contractors and suppliers. Article 10. Disputes.

10.103-5 Requirements and indefinite (Insert the clause in 7–103.12.)

quantity contracts. Article 11. Successors and Assignees.

10.104 Performance and payment bonds This Agreement shall be binding upon tho

for contracts other than con. Contractor, his successors 12 and assignees,

struction contracts. but nothing contained in this Article shall

10.104-1 General. authorize an assignment of any claim against

10.104-2 Performance bonds.

10.1043 the Government otherwise than as permitted

Payment bonds.

10.105 by law.

Other types of bonds.

10.105-1 Advance payment bonds. In witness whereof, the parties hereto have

10.105-3 Fidelity and forgery bonds. executed this contract.

10.105 4 Other types of bonds. UNITED STATES

10.110 THE

AMERICA

Substitution of surety bonds. OY

10.111 Additional bond and increase of Ву Date

penalty.

10.111-1 Additional bond. By

10.111-2 Consent of surety. (Signature and title of contractor) 10.111-3 Additional bond-new surety. Date

10.112 Execution and administration of

bonds and consents of surety. $ 9.413 Recordation. Executive Order No. 9424 of February

Subpart B-Sureties 18, 1944, requires all executive Depart

10.200 General.

10.201 ments and agencies of the Government

Requirements of sureties.

10.201-1 Corporate sureties and cosureties. to forward through appropriate channels

10.201-2 Individual sureties. to the Commissioner of Patents for re- 10.201-3 Partnerships as sureties. cording, all Government interests in 10.201-4 Substitution or replacement of patents or applications for patents.

surety.
10.202 Options in lieu of sureties.

10.202-1 United States bonds or notes. PART 10—BONDS, INSURANCE, AND

10.202–2 Certified or cashier's checks, bank INDEMNIFICATION"

drafts, money orders, or cur

rency. Subpart A-Bonds Sec.

Subpart (-Insurance; General 10.101 Deiinitions.

10.300 Scope of subpart. 10.101-1 Advance payment bond.

10.301 General.

10.302 Notice of cancellation or change. u When the contractor is an individual, 10.303 Insurance against loss of or damchange "successors" to "heirs"; 11 a partner

age to Government property. ship, modify appropriately.

10.304 Procedures to be followed in tho 1 29 F.R. 9761, July 21, 1964.

event of loss of or damage to 10.101-3 Annual performance bond.

Government property.

Subpart D-Insurance Under Fixed-Price

Contracts Sec. 10.400 Scope of subpart. 10.401 Policy. 10.402 Government property. 10.403 Workmen's compensation and war

hazard insurance overseas. 10.404 Aircraft-ground and fight risk. 19.405 Work on a Government installa

tion. 10.406 Capture and detention of contrac

tor employees. Subpart E-Insurance Under Cost-Reimbursement

Type Contracts 10.500 Scope of subpart. 10.501 Policy. 10.501-1 Workmen's compensation and em

ployers' liability insurance. 10.501-2 General liability insurance. 10.501-3 Automobile liability insurance. 10.501-4 Aircraft public and passenger 11

ability insurance. 10.501-5 Vessel collision liability and pro

tection and indemnity liability

insurance. 10.502 Self-Insurance. 10.503

Government property. 10.504 Aircraft-flight risk. 10.505 Group Insurance plans under cost

reimbursement type contracts. 10.506 Capture and detention of contrac

tor employees. Subpart F-Special Casualty Insurance Rating

Plans 10.600 Scope of subpart. 10.601 Purpose of plan. 10.602 Description of plan. 10.603 Use and eligibility for plan. 10.604 Agreement for settlement of pre

miums under National Defense

Projects Rating Plan. 10.605 Limitation of coverage on auto

mobile liability. Subpart G Indemnification of Contractors and

Subcontractors 10.700 Scope. 10.701 Indemnification under research and

development contracts against un

usually hazardous risks. 10.702 Indemnification under other than

research and development contracts against unusually hazardous risks and nuclear risks not con

sidered unusually hazardous. 10.703 Indemnification under contracts in

volving both research and development and work that cannot be 80 classified.

Subpart A-Bonds 6 10.101 Definitions.

As used in this subpart, the terms in $ $ 10.101–1 to 10.101-6 shall have the meanings set forth therein. 125 F.R. 14254, Dec. 31, 1960) $ 10.101-1 Advance payment bond.

“Advance payment bond” means & bond which secures the performance and the fulfillment of a contractual provision for the making of advance payments. (29 F.R. 6933, May 27, 1964) 8 10.101-2 Annual bid bond.

"Annual bid bond" means a single bond (in lieu of separate bid bonds), without limitation as to penal amount, which secures all bids (on other than construction contracts) requiring bonds submitted by a contractor during a specific fiscal year of the Government in response to formal advertising. (29 F.R. 6933, May 27, 19641 § 10.101-3 Annual performance bond.

This term means a single bond (in lieu of separate performance bonds for each contract) which secures the performance of contracts (other than construction contracts) which require bonds and are entered into by a contractor during a specific fiscal year of the Government. Such bonds may be in different forms, including the following three: The first providing for penal sums separately applicable to each covered contract, regardless of the total amount of covered contracts; the second providing a gross penal sum cumulatively applicable to the total amount of all covered contracts but without a separate limit applicable to each contract; and the third providing both, separate contract and cumulative limits. [34 F.R. 13844, Aug. 29, 1969) § 10.101-4 Bid guarantee.

“Bid guarantee" means a form of security accompanying a bid or proposal as assurance that the bidder (a) will not withdraw his bid within the period specified therein for acceptance, and (b) will execute a written contract and furnish such bonds as may be required within the period specified in the bid (unless a longer period is allowed) after receipt of the specified forms. (29 F.R. 6933, May 27, 1964]

AUTHORITY: The provisions of this part 10 issued under 10 U.S.C. 2202, 2301-2314, E.O. 9001, 6 F.R. 6787, as amended by E.O. 9296, 8 F.R. 1429, 3 CFR 1943 Cum. Supp.

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