**3.5. INTELLECTUAL PROPERTY**

3.5-1 Authorization and Consent

AUTHORIZATION AND CONSENT (APRIL 1996)

\(a\) The Government authorizes and consents to all use and manufacture,
in performing this contract or any subcontract at any tier, of any
invention described in and covered by a United States patent

\(1\) Embodied in the structure or composition of any article the
delivery of which is accepted by the Government under this contract or

\(2\) Used in machinery, tools, or methods whose use necessarily results
from compliance by the Contractor or a subcontractor with

\(i\) Specifications or written provisions forming a part of this
contract or

\(ii\) Specific written instructions given by the Contracting Officer
directing the manner of performance. The entire liability to the
Government for infringement of a patent of the United States may be
determined solely by the provisions of the "Indemnity" clause, if any,
included in this contract or any subcontract hereunder (including any
lower-tier subcontract), and the Government assumes liability for all
other infringement to the extent of the authorization and consent
hereinabove granted.

\(b\) The Contractor agrees to include, and require inclusion of, this
clause, suitably modified to identify the parties, in all subcontracts
at any tier for supplies or services (including construction,
architect-engineer services, and materials, supplies, models, samples,
and design or testing services. However, omission of this clause from
any subcontract does not affect this authorization and consent.) (*End
of clause*)

Alternate I

The following is substituted for paragraph (a) of the clause:

\(a\) The Government authorizes and consents to all use and manufacture
of any invention described in and covered by a United States patent in
the performance of this contract or any subcontract at any tier.

Alternate II

The following is substituted for paragraph (a) of the clause:

\(a\) The Government authorizes and consents to all use and manufacture
in the performance of any order at any tier or subcontract at any tier
placed under this contract for communication services and facilities for
which rates, charges, and tariffs are not established by a Government
regulatory body, of any invention described in and covered by a United
States patent

\(1\) Embodied in the structure or composition of any article the
delivery of which is accepted by the Government under this contract or

\(2\) Used in machinery, tools, or methods whose use necessarily results
from compliance by the contractor or a subcontractor with specifications
or written provisions forming a part of this contract or with specific
written instructions given by the Contracting Officer directing the
manner of performance.

3.5-2 Notice and Assistance Regarding Patent and Copyright Infringement

NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT
(APRIL 1996)

\(a\) The Contractor shall report to the Contracting Officer, promptly
and in reasonable written detail, each notice or claim of patent or
copyright infringement based on the performance of this contract of
which the Contractor has knowledge.

\(b\) In the event of any claim or suit against the Government on
account of any alleged patent or copyright infringement arising out of
the performance of this contract or out of the use of any supplies
furnished or work or services performed under this contract, the
Contractor shall furnish to the Government, when requested by the
Contracting Officer, all evidence and information in possession of the
Contractor pertaining to such suit or claim. Such evidence and
information may be furnished at the expense of the Government except
where the Contractor has agreed to indemnify the Government.

\(c\) The Contractor agrees to include, and require inclusion of, this
clause in all subcontracts at any tier for supplies or services
(including construction and architect-engineer subcontracts and those
for material, supplies, models, samples, or design or testing
services).. (*End of clause*)

3.5-3 Patent Indemnity

PATENT INDEMNITY (APRIL 1996)

\(a\) The Contractor shall indemnify the Government and its officers,
agents, and employees against liability, including costs, for
infringement of any United States patent (except a patent issued upon an
application that is now or may hereafter be withheld from issue pursuant
to a Secrecy Order under 35 U.S.C. 181) arising out of the manufacture
or delivery of supplies, the performance of services, or the
construction, alteration, modification, or repair of real property
(hereinafter referred to as construction work) under this contract, or
out of the use or disposal by or for the account of the Government of
such supplies or construction work.

\(b\) This indemnity shall not apply unless the Contractor shall have
been informed as soon as practicable by the Government of the suit or
action alleging such infringement and shall have been given such
opportunity as is afforded by applicable laws, rules, or regulations to
participate in its defense. Further, this indemnity shall not apply to

\(1\) An infringement resulting from compliance with specific written
instructions of the Contracting Officer directing a change in the
supplies to be delivered or in the materials or equipment to be used, or
directing a manner of performance of the contract not normally used by
the Contractor,

\(2\) An infringement resulting from addition to or change in supplies
or components furnished or construction work performed that was made
subsequent to delivery or performance, or

\(3\) A claimed infringement that is unreasonably settled without the
consent of the Contractor, unless required by final decree of a court of
competent jurisdiction.

(*End of clause*)

Alternate I

The following paragraph (c) is added to the clause:

\(c\) This patent indemnification shall not apply to the following
items: \_\_\_\_\_\_\_\_\_ \[Contracting Officer list and/or identify the
items to be excluded from this indemnity\]

Alternate II

The following paragraph (c) is added to the clause:

\(c\) This patent indemnification shall cover the following
items:\_\_\_\_\_\_\_\_\_\_ \[List and/or identify the items to be
included under this indemnity\]

Alternate III

The following paragraph is added to the clause:

( ) As to subcontracts at any tier for communication service, this
clause shall apply only to individual communication service
authorizations over the amount agreed to by the parties and covering
those communications services and facilities

\(1\) That are or have been sold or offered for sale by the Contractor
to the public,

\(2\) That can be provided over commercially available equipment, or

\(3\) That involve relatively minor modifications.

3.5-4 Patent Indemnity-Construction Contracts

PATENT INDEMNITY-CONSTRUCTION CONTRACTS (APRIL 1996)

Except as otherwise provided, the Contractor agrees to indemnify the
Government and its officers, agents, and employees against liability,
including costs and expenses, for infringement upon any United States
patent (except a patent issued upon an application that is now or may
hereafter be withheld from issue pursuant to a Secrecy Order under 35
U.S.C. 181) arising out of performing this contract or out of the use or
disposal by or for the account of the Government of supplies furnished
or work performed under this contract.

(*End of clause*)

Alternate I

Designate the first paragraph as paragraph(a) and add the following to
the basic clause as paragraph (b):

\(b\) This patent indemnification shall not apply to the following
items:

\_\_\_\_\_\_\_\_\_\_\_ \[Contracting Officer specifically identify the
item to be excluded\]

Note: Exclusion from indemnity of specified, identified patents, as
distinguished from items, is the exclusive prerogative of the agency
head or designee.

3.5-5 Waiver of Indemnity

WAIVER OF INDEMNITY (APRIL 1996)

Any provision or clause of this contract to the contrary
notwithstanding, the Government hereby authorizes and consents to the
use and manufacture, solely in performing this contract, of any
invention covered by the United States patents identified below and
waives indemnification by the Contractor with respect to such patents:

\_\_\_\_\_\_\_\_\_\_\_ \[Contracting Officer identify the patents by
number or by other means if more appropriate\]

(*End of clause*)

3.5-6 Royalty Information

ROYALTY INFORMATION (APRIL 1996)

\(a\) Cost or charges for royalties. When the response to this
solicitation contains costs or charges for royalties totaling more than
\$250, the following information may be included in the response
relating to each separate item of royalty or

license fee:

\(1\) Name and address of licenser.

\(2\) Date of license agreement.

\(3\) Patent numbers, patent application serial numbers, or other

basis on which the royalty is payable.

\(4\) Brief description, including any part or model numbers of

each contract item or component on which the royalty is payable.

\(5\) Percentage or dollar rate of royalty per unit.

\(6\) Unit price of contract item.

\(7\) Number of units.

\(8\) Total dollar amount of royalties.

\(b\) Copies of current licenses. In addition, if specifically requested
by the Contracting Officer before execution of the contract, the offeror
shall furnish a copy of the current license agreement and an
identification of applicable claims of specific patents.

*(End of clause)*

Alternate I

Substitute the following for the introductory portion of paragraph (a)
of the basic clause:

When the response to this solicitation covers charges for special
construction or special assembly that contain costs or charges for
royalties totaling more than \$250, the following information shall be
included in the response relating to each separate item of royalty or
license fee:

3.5-7 Patents-Notice of Government Licensee

PATENTS-NOTICE OF Government LICENSEE (APRIL 1996)

The Government is obligated to pay a royalty applicable to the proposed
acquisition because of a license agreement between the Government and
the patent owner. The patent number is

  ------------ ------------------------------- ---------------------------
                                               \[Contracting Officer fill
                                               in\]

                                               \[Contracting Officer fill
                                               in\]
  ------------ ------------------------------- ---------------------------

If the offeror is the owner of, or a licensee under, the patent,
indicate below:

( ) Owner ( ) Licensee

If an offeror does not indicate that it is the owner or a licensee of
the patent, its offer will be evaluated by adding thereto an amount
equal to the royalty.

*(End of clause)*

3.5-8 Refund of Royalties

REFUND OF ROYALTIES (APRIL 1996)

\(a\) The contract price includes certain amounts for royalties payable
by the Contractor or subcontractors or both, which amounts have been
reported to the Contracting Officer.

\(b\) The term royalties as used in this clause refers to any costs or
charges in the nature of royalties, license fees, patent or license
amortization costs, or the like, for the use of or for rights in patents
and patent applications in connection with performing this contract or
any subcontract hereunder.

\(c\) The Contractor shall furnish to the Contracting Officer, before
final payment under this contract, a statement of royalties paid or
required to be paid in connection with performing this contract and
subcontracts hereunder together with the reasons.

\(d\) The Contractor will be compensated for royalties reported under
paragraph (c) above, only to the extent that such royalties were
included in the contract price and are determined by the Contracting
Officer to be properly chargeable to the Government and allocable to the
contract. To the extent that any royalties that are included in the
contract price are not in fact paid by the Contractor or are determined
by the Contracting Officer not to be properly chargeable to the
Government and allocable to the contract, the contract price may be
reduced. Repayment or credit to the Government may be made as the
Contracting Officer directs.

\(e\) If, at any time within 3 years after final payment under this
contract, the Contractor for any reason is relieved in whole or in part
from the payment of the royalties included in the final contract price
as adjusted pursuant to paragraph (d) above, the Contractor shall
promptly notify the Contracting Officer of that fact and shall reimburse
the Government in a corresponding amount.

\(f\) The substance of this clause, including this paragraph (f), shall
be included in any subcontract in which the amount of royalties reported
during negotiation of the subcontract exceeds \$250.

(*End of clause*)

3.5-9 Filing of Patent Applications-Classified Subject Matter

FILING OF PATENT APPLICATIONS-CLASSIFIED SUBJECT MATTER (APRIL 1996)

\(a\) Before filing or causing to be filed a patent application in the
United States disclosing any subject matter of this contract classified
Secret or higher, the Contractor shall, citing the 30-day provision
below, transmit the proposed application to the Contracting Officer. The
Government shall determine whether, for reasons of national security,
the application should be placed under an order of secrecy, sealed in
accordance with the provision of 35 U.S.C. 181-188, or the issuance of a
patent otherwise delayed under pertinent United States statutes or
regulations. The Contractor shall observe any instructions of the
Contracting Officer regarding the manner of delivery of the patent
application to the United States Patent Office, but the Contractor shall
not be denied the right to file the application. If the Contracting
Officer shall not have given any such instructions within 30 days from
the date of mailing or other transmittal of the proposed application,
the Contractor may file the application.

\(b\) Before filing a patent application in the United States disclosing
any subject matter of this contract classified Confidential, the
Contractor shall furnish to the Contracting Officer a copy of the
application for Government determination whether, for reasons of
national security, the application should be placed under an order of
secrecy or the issuance of a patent should be otherwise delayed under
pertinent United States statutes or regulations.

\(c\) Where the subject matter of this contract is classified for
reasons of security, the Contractor shall not file, or cause to be
filed, in any country other than in the United States as provided in
paragraphs (a) and (b) of this clause, an application or registration
for a patent containing any of the subject matter of this contract
without first obtaining written approval of the Contracting Officer.

\(d\) When filing any patent application coming within the scope of this
clause, the Contractor shall observe all applicable security regulations
covering the transmission of classified subject matter and may promptly
furnish to the Contracting Officer the serial number, filing date, and
name of the country of any such application. When transmitting the
application to the United States Patent Office, the Contractor shall by
separate letter identify by agency and number the contract or contracts
that require security classification markings to be placed on the
application.

\(e\) The Contractor agrees to include, and require the inclusion of,
this clause in all subcontracts at any tier that cover or are likely to
cover classified subject matter.

(*End of clause*)

3.5-10 Patent Rights-Retention by the Contractor (Short Form)

PATENT RIGHTS-RETENTION BY THE CONTRACTOR (SHORT FORM) (APRIL 1996)

\(a\) Definitions.

\(1\) Invention means any invention or discovery which is or may be
patentable or otherwise protectable under title 35 of the United States
Code, or any novel variety of plant which is or may be protected under
the Plant Variety Protection Act (35 U.S.C. 2321, et seq.).

\(2\) Made when used in relation to any invention means the conception
of first actual reduction to practice of such invention.

\(3\) Nonprofit organization means a university or other institution of
higher education or an organization of the type described in section
501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and
exempt from taxation under section 501(a) of the Internal Revenue Code
(26 U.S.C. 501(a)) or any nonprofit scientific or educational
organization qualified under a state nonprofit organization statute.

\(4\) Practical application means to manufacture, in the case of a
composition of product; to practice, in the case of a process or method,
or to operate, in the case of a machine or system; and, in each case,
under such conditions as to establish that the invention is being
utilized and that its benefits are, to the extent permitted by law or
Government regulations, available to the public on reasonable terms.

\(5\) Small business firm means a small business concern as defined at
section 2 of Pub. L. 85-536 (15 U.S.C. 632) and implementing regulations
of the Administrator of the Small Business Administration. For the
purpose of this clause, the size standards for small business concerns
involved in Government procurement and subcontracting at 13 CFR 121.3-8
and 13 CFR 121.3-12, respectively, will be used.

\(6\) Subject invention means any invention of the contractor conceived
or first actually reduced to practice in the performance of work under
this contract, provided that in the case of a variety of plant, the date
of determination (as defined in section 41(d) of the Plant Variety
Protection Act, 35 U.S.C. 2401(d)) must also occur during the period of
contract performance.

\(b\) Allocation of principal rights. The Contractor may retain the
entire right, title, and interest throughout the world to each subject
invention subject to the provisions of this clause and 35 U.S.C. 203.
With respect to any subject invention in which the Contractor retains
title, the Federal Government may have a nonexclusive, nontransferable,
irrevocable, paid-up license to practice or have practiced for or on
behalf of the United States the subject invention throughout the world.

\(c\) Invention disclosure, election of title, and filing of patent
application by contractor.

\(1\) The Contractor will disclose each subject invention to the Federal
agency within 2 months after the inventor discloses it in writing to
Contractor personnel responsible for patent matters. The disclosure to
the agency shall be in the form of a written report and shall identify
the contract under which the invention was made and the inventor(s). It
shall be sufficiently complete in technical detail to convey a clear
understanding to the extent known at the time of the disclosure, of the
nature, purpose, operation, and the physical, chemical, biological or
electrical characteristics of the invention. The disclosure shall also
identify any publication, on sale or public use of the invention and
whether a manuscript describing the invention has been submitted for
publication and, if so, whether it has been accepted for publication at
the time of disclosure. In addition, after disclosure to the agency, the
contractor will promptly notify the agency of the acceptance of any
manuscript describing the invention for publication or of any on sale or
public use planned by the Contractor.

\(2\) The Contractor will elect in writing whether or not to retain
title to any such invention by notifying the Federal agency within 2
years of disclosure to the Federal agency. However, in any case where
publication, on sale or public use has initiated the 1 year statutory
period wherein valid patent protection can still be obtained in the
United States, the period for election of title may be shortened by the
agency to a date that is no more than 60 days prior to the end of the
statutory period.

\(3\) The Contractor will file its initial patent application on a
subject invention to which it elects to retain title within 1 year after
election of title, or, if earlier, prior to the end of any statutory
period wherein valid patent protection can be obtained in the United
States after a publication, on sale, or public use. The Contractor will
file patent applications in additional countries or international patent
offices within either 10 months of the corresponding initial patent
application or 6 months from the date permission is granted by the
Commissioner of Patents and Trademarks to file foreign patent
applications where such filing has been prohibited by a Secrecy Order.

\(4\) Requests for extension of the time for disclosure election, and
filing under subparagraphs (c) (1), (2), and (3) of this clause may, at
the discretion of the agency, be granted.

\(d\) Conditions when the Government may obtain title. The Contractor
will convey to the Federal agency, upon written request, title to any
subject invention-

\(1\) If the Contractor fails to disclose or elect title to the subject
invention within the times specified in paragraph (c) of this clause, or
elects not to retain title; provided, that the agency may only request
title within 60 days after learning of the failure of the Contractor to
disclose or elect within the specified times.

\(2\) In those countries in which the Contractor fails to file patent
applications within the times specified in paragraph (c) of this clause;
provided, however, that if the Contractor has filed a patent application
in a country after the times specified in paragraph (c) of this clause,
but prior to its receipt of the written request of the Federal agency,
the Contractor may continue to retain title in that country.

\(3\) In any country in which the Contractor decided not to continue the
prosecution of any application for, to pay the maintenance fees on, or
defend in reexamination or opposition proceeding on, a patent on a
subject invention.

\(e\) Minimum rights to Contractor and protection of the Contractor
right to file.

\(1\) The Contractor will retain a nonexclusive royalty-free license
throughout the world in each subject invention to which the Government
obtains title, except if the Contractor fails to disclose the invention
within the times specified in paragraph (c) of this clause. The
Contractor\'s license extends to its domestic subsidiary and affiliates,
if any, within the corporate structure of which the Contractor is a
party and includes the right to grant sublicenses of the same scope to
the extent the Contractor was legally obligated to do so at the time the
contract was awarded. The license is transferable only with the approval
of the Federal Agency, except when transferred to the successor of that
part of the Contractor\'s business to which the invention pertains.

\(2\) The Contractor\'s domestic license may be revoked or modified by
the funding Federal agency to the extent necessary to achieve
expeditious practical application of subject invention pursuant to an
application for an exclusive license submitted in accordance with
applicable provisions at 33.5 CFR part 404 and agency licensing
regulations (if any). This license will not be revoked in that field of
use or the geographical areas in which the Contractor has achieved
practical application and continues to make the benefits of the
invention reasonably accessible to the public. The license in any
foreign country may be revoked or modified at the discretion of the
funding Federal agency to the extent the Contractor, its licensees, or
the domestic subsidiaries or affiliates have failed to achieve practical
application in that foreign country.

\(3\) Before revocation or modification of the license, the funding
Federal agency will furnish the Contractor a written notice of its
intention to revoke or modify the license, and the Contractor will be
allowed 30 days (or such other time as may be authorized by the funding
Federal agency for good cause shown by the Contractor) after the notice
to show cause why the license should not be revoked or modified. The
Contractor has the right to appeal, in accordance with applicable
regulations in 33.5 CFR part 404 and agency regulations, if any,
concerning the licensing revocation of modification of the license.

\(f\) Contractor action to protect the Government\'s interest.

\(1\) The Contractor agrees to execute or to have executed and promptly
deliver to the Federal agency all instruments necessary to (i) establish
or confirm the rights the Government has throughout the world in those
subject inventions to which the Contractor elects to retain title, and
(ii) convey title to the Federal agency when requested under paragraph
(d) of this clause and to enable the Government to obtain patent
protection throughout the world in that subject invention.

\(2\) The Contractor agrees to require, by written agreement, its
employees, other than clerical and nontechnical employees, to disclose
promptly in writing to personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor each subject invention made under contract in order that the
Contractor can comply with the disclosure provisions of paragraph (c) of
this clause, and to execute all papers necessary to file patent
applications on subject inventions and to establish the Government\'s
rights in the subject inventions. This disclosure format should require,
as a minimum, the information required by subparagraph (c)(1) of this
clause. The Contractor may instruct such employees, through employee
agreements or other suitable educational programs, on the importance of
reporting inventions in sufficient time to permit the filing of patent
applications prior to U.S. or foreign statutory bars.

\(3\) The Contractor will notify the Federal agency of any decisions not
to continue the prosecution of a patent application, pay maintenance
fees, or defend in a reexamination or opposition proceeding on a patent,
in any country, not less than 30 days before the expiration of the
response period required by the relevant patent office.

\(4\) The Contractor agrees to include, within the specification of any
United States patent application and any patent issuing thereon covering
a subject invention, the following statement, "The invention was made
with Government support under (identify the contract) awarded by
(identify the Federal agency). The Government has certain rights in the
invention."

\(g\) Subcontracts.

\(1\) The Contractor will include this clause, suitably modified to
identify the parties, in all subcontracts, regardless of tier, for
experimental, developmental, or research work to be performed by a small
business firm or domestic nonprofit organization. The subcontractor will
retain all rights provided for the Contractor in this clause, and the
Contractor will not, as part of the consideration for awarding the
subcontract, obtain rights in the subcontractor\'s subject inventions.

\(2\) The Contractor will include in all other subcontracts, regardless
of tier, for experimental, developmental, or research work the patent
rights clause required to adequately protect the FAA's interests.

\(3\) In the case of subcontracts, at any tier, the agency,
subcontractor, and the Contractor agree that the mutual obligations of
the parties created by this clause constitute a contract between the
subcontractor and the Federal agency with respect to the matters covered
by the clause; provided, however, that nothing in this paragraph is
intended to confer any jurisdiction under the FAA disputes resolution
process in connection with proceedings under paragraph (j) of this
clause.

\(h\) Reporting on utilization of subject inventions. The Contractor
agrees to submit, on request, periodic reports no more frequently than
annually on the utilization of a subject invention or on efforts at
obtaining such utilization that are being made by the Contractor or its
licensees or assignees. Such reports may include information regarding
the status of development, date of first commercial sale or use, gross
royalties received by the Contractor, and such other data and
information as the agency may reasonably specify. The Contractor also
agrees to provide additional reports as may be requested by the agency
in connection with any march-in proceeding undertaken by the agency in
accordance with paragraph (j) of this clause. As required by 35 U.S.C.
202(c)(5), the agency agrees it will not disclose such information to
persons outside the Government without permission of the Contractor.

\(i\) Preference for United States industry. Notwithstanding any other
provision of this clause, the Contractor agrees that neither it nor any
assignee will grant to any person the exclusive right to use or sell any
subject invention in the United States unless such person agrees that
any product embodying the subject invention or produced through the use
of the subject invention will be manufactured substantially in the
United States. However, in individual cases, the requirement for such an
agreement may be waived by the Federal agency upon a showing by the
Contractor or its assignee that reasonable but unsuccessful efforts have
been made to grant licenses on similar terms to potential licensees that
would be likely to manufacture substantially in the United States or
that under the circumstances domestic manufacture is not commercially
feasible.

\(j\) March-in rights. The Contractor agrees that, with respect to any
subject invention in which it has acquired title, the Federal agency has
the right in accordance with the procedures in 33.5 CFR 401.6 and any
supplemental regulations of the agency to require the Contractor, an
assignee or exclusive licensee of a subject invention to grant a
nonexclusive, partially exclusive, or exclusive license in any field of
use to a responsible applicant or applicants, upon terms that are
reasonable under the circumstances, and if the Contractor, assignee, or
exclusive licensee refuses such a request the Federal agency has the
right to grant such a license itself if the Federal agency determines
that\--

\(1\) Such action is necessary because the Contractor or assignee has
not taken, or is not expected to take within a reasonable time,
effective steps to achieve practical application of the subject
invention in such field of use;

\(2\) Such action is necessary to alleviate health or safety needs which
are not reasonably satisfied by the Contractor, assignee, or their
licensees;

\(3\) Such action is necessary to meet requirements for public use
specified by Federal regulations and such requirements are not
reasonably satisfied by the Contractor, assignee, or licensees;

\(4\) Such action is necessary because the agreement required by
paragraph (i) of this clause has not been obtained or waived or because
a licensee of the exclusive right to use or sell any subject invention
in the United States is in breach of such

agreement.

\(k\) Special provisions for contracts with nonprofit organizations. If
the Contractor is a nonprofit organization, it agrees that\--

\(1\) Rights to a subject invention in the United States may not be
assigned without the approval of the Federal agency, except where such
assignment is made to an organization which has as one of its primary
functions the management of inventions, provided that such assignee will
be subject to the same provisions as the Contractor;

\(2\) The Contractor will share royalties collected on a subject
invention with the inventor, including Federal employee co-inventors
(when the agency deems it appropriate) when the subject invention is
assigned in accordance with 35 U.S.C. 202(e) and 33.5 CFR 401.10;

\(3\) The balance of any royalties or income earned by the Contractor
with respect to subject inventions, after payment of expenses (including
payments to inventors) incidental to the administration of subject
inventions will be utilized for the support of scientific research or
education; and

\(4\) It will make efforts that are reasonable under the circumstances
to attract licensees of subject inventions that are small business
firms, and that it will give a preference to a small business firm when
licensing a subject invention if the Contractor determines that the
small business firm has a plan or proposal for marketing the invention
which, if executed, is equally as likely to bring the invention to
practical application as any plans or proposals from applicants that are
not small business firms; provided, that the Contractor is also
satisfied that the small business firm has the capability and resources
to carry out its plan or proposal. The decision whether to give a
preference in any specific case will be at the discretion of the
contractor. However, the Contractor agrees that the Secretary of
Commerce may review the Contractor\'s licensing program and decisions
regarding small business applicants, and the Contractor will negotiate
changes to its licensing policies, procedures, or practices with the
Secretary of Commerce when the Secretary\'s review discloses that the
Contractor could take reasonable steps to more effectively implement the
requirements of this subparagraph (k)(4).

\(l\) Communications. (Complete according to agency instructions.)

(*End of clause*)

Alternate I

Add the following to the end of paragraph (b) of the basic clause.

The license may include the right of the Government to sublicense
foreign government , their nationals and international organizations
pursuant to the following treaties or international agreements: \-\-- \*

\[\*Contracting Officer complete with the names of applicable existing
treaties or international agreements. The above language is not intended
to apply to treaties or agreements that are in effect on the date of the
award but are not listed.\]

Alternate II

Add the following to the end of paragraph (b) of the basic clause.

The agency reserves the right to unilaterally amend this contract to
identify specific treaties or international agreements entered into or
to be entered into by the Government after the effective date of the
contract and effectuate those license or other rights which are
necessary for the Government to meet its obligations to foreign
government , their nationals and international organizations under such
treaties or international agreements with respect to subject inventions
made after the date of the amendment.

Alternate III

Substitute the following in place of paragraph (k)(3) of the basic
clause.

\(3\) After payment of patenting costs, licensing costs, payments to
inventors, and other expenses incidental to the administration of
subject inventions, the balance of any royalties or income earned and
retained by the Contractor during any fiscal year on subject inventions
under this or any successor contract containing the same requirement, up
to any amount equal to 5 percent of the budget of the facility for that
fiscal year, may be used by the Contractor for the scientific research,
development, and education consistent with the research and development
mission and objectives of the facility, including activities that
increase the licensing potential of other inventions of the facility. If
the balance exceeds 5 percent, 75 percent of the excess above 5 percent
may be paid by the Contractor to the Treasury of the United States and
the remaining 25 percent may be used by the Contractor only for the same
purposes as described above. To the extent it provides the most
effective technology transfer, the licensing of subject inventions may
be administered by Contractor employees on location at the facility.

Alternate IV

Include the following subparagraph in paragraph (f) of the basic clause.

\(5\) The Contractor may establish and maintain active and effective
procedures to ensure that subject inventions are promptly identified and
timely disclosed, and may submit a description of the procedures to the
Contracting Officer so that the Contracting Officer may evaluate and
determine their effectiveness.

3.5-11 Patent Rights-Retention by the Contractor (Long Form)

PATENT RIGHTS-RETENTION BY THE CONTRACTOR (LONG FORM) (APRIL 1996)

\(a\) Definitions.

\(1\) Invention means any invention or discovery which is or may be
patentable or otherwise protectable under title 35 of the United States
Code or any novel variety of plant that is or may be protectable under
the Plant Variety Protection Act (35 U.S.C. 2321 et seq.).

\(2\) Made when used in relation to any invention means the conception
or first actual reduction to practice of such invention.

\(3\) Nonprofit organization means a domestic university or other
institution of higher education or an organization of the type described
in section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C.
501(c)) and exempt from taxation under section 501(a) of the Internal
Revenue Code (26 U.S.C. 501(a)) or any nonprofit scientific or
educational organization qualified under a state nonprofit organization
statute.

\(4\) Practical application means to manufacture in the case of a
composition or product, to practice in the case of a process or method,
or to operate in the case of a machine or system; and, in each case,
under such conditions as to establish that the invention is being
utilized and that its benefits are, to the extent permitted by law or
Government regulations, available to the public on reasonable terms.

\(5\) Small business firm means a small business concern as defined at
section 2 of Pub. L. 85-536 (15 U.S.C. 532) and implementing regulations
of the Administrator of the Small Business Administration. For the
purpose of this clause, the size standards for small business concerns
involved in Government procurement and subcontracting at 13 CFR 121.3-8
and 13 CFR 121.3-12, respectively, will be used.

\(6\) Subject invention means any invention of the Contractor conceived
or first actually reduced to practice in the performance of work under
this contract; provided, that in the case of a variety of plant, the
date of determination (as defined in section 41(d) of the Plant Variety
Protection Act, 35 U.S.C. 2401(d)) must also occur during the period of
contract performance.

\(b\) Allocation of principal rights. The Contractor may elect to retain
the entire right, title, and interest throughout the world to each
subject invention subject to the provisions of this clause and 35 U.S.C.
203. With respect to any subject invention in which the Contractor
elects to retain title, the Federal Government may have a nonexclusive,
nontransferable, irrevocable, paid-up license to practice or have
practiced for or on behalf of the United States the subject invention
throughout the world.

\(c\) Invention disclosure, election of title, and filing of patent
applications by Contractor.

\(1\) The Contractor shall disclose each subject invention to the
Contracting Officer within 2 months after the inventor discloses it in
writing to Contractor personnel responsible for patent matters or within
6 months after the Contractor becomes aware that a subject invention has
been made, whichever is earlier. The disclosure to the Contracting
Officer shall be in the form of a written report and shall identify the
contract under which the invention was made and the inventor(s). It may
be sufficiently complete in technical detail to convey a clear
understanding, to the extent known at the time of the disclosure, of the
nature, purpose, operation, and physical, chemical, biological, or
electrical characteristics of the invention. The disclosure may also
identify any publication, on sale, or public use of the invention and
whether a manuscript describing the invention has been submitted for
publication and, if so, whether it has been accepted for publication at
the time of disclosure. In addition, after disclosure to the Contracting
Officer, the Contractor shall promptly notify the Contracting Officer of
the acceptance of any manuscript describing the invention for
publication or of any on sale or public use planned by the Contractor.

\(2\) The Contractor shall elect in writing whether or not to retain
title to any such invention by notifying the Federal agency at the time
of disclosure or within 8 months of disclosure, as to those countries
(including the United States) in which the Contractor will retain title;
provided, that in any case where publication, on sale, or public use has
initiated the 1-year statutory period wherein valid patent protection
can still be obtained in the United States, the period of election of
title may be shortened by the agency to a date that is no more than 60
days prior to the end of the statutory period.

\(3\) The Contractor shall file its initial patent application on an
elected invention within 1 year after election or, if earlier, prior to
the end of any statutory period wherein valid patent protection can be
obtained in the United States after a publication, on sale, or public
use. The Contractor shall file patent applications in additional
countries (including the European Patent Office and under the Patent
Cooperation Treaty) within either 10 months of the corresponding initial
patent application or 6 months from the date permission is granted by
the Commissioner of Patents and Trademarks to file foreign patent
applications where such filing has been prohibited by a Secrecy Order.

\(4\) Requests for extension of the time for disclosure to the
Contracting Officer, election, and filing may, at the discretion of the
funding Federal agency, be granted, and will normally be granted unless
the Contracting Officer has reason to believe that a particular
extension would prejudice the Government\'s interest.

\(d\) Conditions when the Government may obtain title. The Contractor
may convey to the Federal agency, upon written request, title to any
subject invention-

\(1\) If the Contractor elects not to retain title to a subject
invention;

\(2\) If the Contractor fails to disclose or elect the subject invention
within the times specified in paragraph (c) above (the agency may only
request title within 60 days after learning of the Contractor\'s failure
to report or elect within the specified times);

\(3\) In those countries in which the Contractor fails to file patent
applications within the times specified in paragraph ( ) above;
provided, however, that if the Contractor has filed a patent application
in a country after the times specified in paragraph (c) above, but prior
to its receipt of the written request of the Federal agency, the
Contractor may continue to retain title in that country; or

\(4\) In any country in which the Contractor decides not to continue the
prosecution of any application for, to pay the maintenance fees on, or
defend in reexamination or opposition proceeding on, a patent on a
subject invention.

\(e\) Minimum rights to Contractor.

\(1\) The Contractor shall retain a nonexclusive, royalty-free license
throughout the world in each subject invention to which the Government
obtains title except if the Contractor fails to disclose the subject
invention within the times specified in paragraph (c) above. The
Contractor\'s license extends to its domestic subsidiaries and
affiliates, if any, within the corporate structure of which the
Contractor is a part and includes the right to grant sublicenses of the
same scope to the extent the Contractor was legally obligated to do so
at the time the contract was awarded. The license is transferable only
with the approval of the funding Federal agency except when transferred
to the successor of that part of the Contractor\'s business to which the
invention pertains.

\(2\) The Contractor\'s domestic license may be revoked or modified by
the funding Federal agency to the extent necessary to achieve
expeditious practical application of the subject invention pursuant to
an application for an exclusive license submitted in accordance with
applicable provisions in the Federal Property Management Regulations and
agency licensing regulations (if any). This license may not be revoked
in that field of use or the geographical areas in which the Contractor
has achieved practical application and continues to make the benefits of
the invention reasonably accessible to the public. The license in any
foreign country may be revoked or modified at the discretion of the
funding Federal agency to the extent the Contractor, its licensees, or
its domestic subsidiaries or affiliates have failed to achieve practical
application in that foreign country.

\(3\) Before revocation or modification of the license, the funding
Federal agency may furnish the Contractor a written notice of its
intention to revoke or modify the license, and the Contractor may be
allowed 30 days (or such other time as may be authorized by the funding
Federal agency for good cause shown by the Contractor)

after the notice to show cause why the license should not be revoked or
modified. The Contractor has the right to appeal, in accordance with
applicable agency licensing regulations and 33.5 CFR 404 concerning the
licensing of Government-owned inventions, any decision concerning the
revocation or modification of its license.

\(f\) Contractor action to protect the Government\'s interest.

\(1\) The Contractor agrees to execute or to have executed and promptly
deliver to the Federal agency all instruments necessary to

\(i\) Establish or confirm the rights the Government has throughout the
world in those subject inventions to which the Contractor elects to
retain title, and

\(ii\) Convey title to the Federal agency when requested under paragraph
(d) above and subparagraph (n)(2) below, and to enable the Government to
obtain patent protection throughout the world in that subject invention.

\(2\) The Contractor agrees to require, by written agreement, its
employees, other than clerical and nontechnical employees, to disclose
promptly in writing to personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor each subject invention made under contract in order that the
Contractor can comply with the disclosure provisions of paragraph (c)
above, and to execute all papers necessary to file patent applications
on subject inventions and to establish the Government\'s rights in the
subject inventions. This disclosure format should require, as a minimum,
the information required by subparagraph (c)(1) above. The Contractor
shall instruct such employees through employee agreements or other
suitable educational programs on the importance of reporting inventions
in sufficient time to permit the filing of patent applications prior to
U.S. or foreign statutory bars.

\(3\) The Contractor may notify the Federal agency of any decision not
to continue the prosecution of a patent application, pay maintenance
fees, or defend in a reexamination or opposition proceeding on a patent,
in any country, not less than 30 days before the expiration of the
response period required by the relevant patent office.

\(4\) The Contractor agrees to include, within the specification of any
United States patent application and any patent issuing thereon covering
a subject invention, the following statement: "This invention was made
with Government support under \_\_\_\_\_\_\_\_\_\_\_\_\_\_ (identify the
contract) awarded by \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (identify the
Federal agency). The Government has certain rights in this invention.'

\(5\) The Contractor shall establish and maintain active and effective
procedures to assure that subject inventions are promptly identified and
disclosed to Contractor personnel responsible for patent matters within
6 months of conception and/or first actual reduction to practice,
whichever occurs first in performance of work under this contract. These
procedures shall include the maintenance of laboratory notebooks or
equivalent records and other records as are reasonably necessary to
document the conception and/or the first actual reduction to practice of
subject inventions, and records that show that the procedures for
identifying and disclosing the inventions are followed. Upon request,
the Contractor may furnish the Contracting Officer a description of such
procedures for evaluation and for determination as to their
effectiveness.

\(6\) The Contractor agrees, when licensing a subject invention, to
arrange to avoid royalty charges on acquisitions involving Government
funds, including funds derived through Military Assistance Program of
the Government or otherwise derived through the Government, to refund
any amounts received as royalty charges on the subject invention in
acquisitions for, or on behalf of, the Government, and to provide for
such refund in any instrument transferring rights in the invention to
any party.

\(7\) The Contractor shall furnish the Contracting Officer the
following:

\(i\) Interim reports every 12 months (or such longer period as may be
specified by the Contracting Officer) from the date of the contract,
listing subject inventions during that period and certifying that all
subject inventions have been disclosed or that there are no such
inventions.

\(ii\) A final report, within 3 months after completion of the
contracted work, listing all subject inventions or certifying that there
were no such inventions, and listing all subcontracts at any tier
containing a patent rights clause or certifying that there were no such
subcontracts.

\(8\) The Contractor shall promptly notify the Contracting Officer in
writing upon the award of any subcontract at any tier containing a
patent rights clause by identifying the subcontractor, the applicable
patent rights clause, the work to be performed under the subcontract,
and the dates of award and estimated completion. Upon request of the
Contracting Officer, the Contractor may furnish a copy of such
subcontract, and no more frequently than annually, a listing of the
subcontracts that have been awarded.

\(9\) In the event of a refusal by a prospective subcontractor to accept
one of the clauses in subparagraph (g)(1) or (2) below, the Contractor
(i) shall promptly submit a written notice to the Contracting Officer
setting forth the subcontractor\'s reasons for such refusal and other
pertinent information that may expedite disposition of the matter and
(ii) may not proceed with such subcontracting without the written
authorization of the Contracting Officer.

\(10\) The Contractor shall provide, upon request, the filing date,
serial number and title, a copy of the patent application (including an
English-language version if filed in a language other than English), and
patent number and issue date for any subject invention for which the
Contractor has retained title.

\(11\) Upon request, the Contractor shall furnish the Government an
irrevocable power to inspect and make copies of the patent application
file.

\(g\) Subcontracts.

\(1\) The Contractor shall include the clause at 3.5-10, suitably
modified to identify the parties, in all subcontracts, regardless of
tier, for experimental, developmental, or research work to be performed
by a small business firm or nonprofit organization. The subcontractor
may retain all rights provided for the Contractor in this clause, and
the Contractor shall not, as part of the consideration for awarding the
subcontract, obtain rights in the subcontractor\'s subject inventions.

\(2\) The Contractor shall include this clause (3.5-11) in all other
subcontracts, regardless of tier, for experimental, developmental, or
research work.

\(3\) In the case of subcontracts, at any tier, when the prime award
with the Federal agency was a contract (but not a grant or cooperative
agreement), the agency, subcontractor, and the Contractor agree that the
mutual obligations of the parties created by this clause constitute a
contract between the subcontractor and the Federal agency with respect
to those matters covered by this clause.

\(h\) Reporting utilization of subject inventions. The Contractor agrees
to submit on request periodic reports no more frequently than annually
on the utilization of a subject invention or on efforts at obtaining
such utilization that are being made by the Contractor or its licensees
or assignees. Such reports may include information regarding the status
of development, date of first commercial sale or use, gross royalties
received by the Contractor, and such other data and information as the
agency may reasonably specify. The Contractor also agrees to provide
additional reports as may be requested by the agency in connection with
any march-in proceedings undertaken by the agency in accordance with
paragraph (j) of this clause. To the extent data or information supplied
under this paragraph is considered by the Contractor, its licensee or
assignee to be privileged and confidential and is so marked, the agency
agrees that, to the extent permitted by law, it may not disclose such
information to persons outside the Government.

\(i\) Preference for United States industry. Notwithstanding any other
provision of this clause, the Contractor agrees that neither it nor any
assignee will grant to any person the exclusive right to use or sell any
subject invention in the United States unless such person agrees that
any products embodying the subject invention will be manufactured
substantially in the United States. However, in individual cases, the
requirement for such an agreement may be waived by the Federal agency
upon a showing by the Contractor or its assignee that reasonable but
unsuccessful efforts have been made to grant licenses on similar terms
to potential licensees that would be likely to manufacture substantially
in the United States or that under the circumstances domestic
manufacture is not commercially feasible.

\(j\) March-in rights. The Contractor agrees that with respect to any
subject invention in which it has acquired title, the Federal agency has
the right in accordance with the agency procedures to require the
Contractor, an assignee, or exclusive licensee of a subject invention to
grant a nonexclusive, partially exclusive, or exclusive license in any
field of use to a responsible applicant or applicants, upon terms that
are reasonable under the circumstances, and if the Contractor, assignee,
or exclusive licensee refuses such a request, the Federal agency has the
right to grant such a license itself if the Federal agency determines
that\--

\(1\) Such action is necessary because the Contractor or assignee has
not taken, or is not expected to take within a reasonable time,
effective steps to achieve practical application of the subject
invention in such field of use;

\(2\) Such action is necessary to alleviate health or safety needs which
are not reasonably satisfied by the Contractor, assignee, or their
licensees;

\(3\) Such action is necessary to meet requirements for public use
specified by Federal regulations and such requirements are not
reasonably satisfied by the Contractor, assignee, or licensees,

\(4\) Such action is necessary because the agreement required by
paragraph (i) of this clause has not been obtained or waived or because
a licensee of the exclusive right to use or sell any subject invention
in the United States is in breach of such agreement.

\(k\) Special provisions for contracts with nonprofit organizations.
\[Reserved\]

\(l\) Communications. (Complete according to agency instructions.)

\(m\) Other inventions. Nothing contained in this clause may be deemed
to grant to the Government any rights with respect to any invention
other than a subject invention.

\(n\) Examination of records relating to inventions.

\(1\) The Contracting Officer or any authorized representative may,
until 3 years after final payment under this contract, have the right to
examine any books (including laboratory notebooks), records, and
documents of the Contractor relating to the conception or first
reduction to practice of inventions in the same field of technology as
the work under this contract to determine whether\--

\(i\) Any such inventions are subject inventions;

\(ii\) The Contractor has established and maintains the procedures
required by subparagraphs (f)(2) and (f)(3) of this clause;

\(iii\) The Contractor and its inventors have complied with the
procedures.

\(2\) If the Contracting Officer determines that an inventor has not
disclosed a subject invention to the Contractor in accordance with the
procedures required by subparagraph (f)(5) of this clause, the
Contracting Officer may, within 60 days after the determination, request
title in accordance with subparagraphs (d)(2) and (d)(3) of this clause.
However, if the Contractor establishes that the failure to disclose did
not result from the Contractor\'s fault or negligence, the Contracting
Officer may not request title.

\(3\) If the Contracting Officer learns of an unreported Contractor
invention which the Contracting Officer believes may be a subject
invention, the Contractor may be required to disclose the invention to
the agency for a determination of ownership rights.

\(4\) Any examination of records under this paragraph may be subject to
appropriate conditions to protect the confidentiality of the information
involved.

\(o\) Withholding of payment (this paragraph does not apply to
subcontracts).

\(1\) Any time before final payment under this contract, the Contracting
Officer may, in the Government\'s interest, withhold payment until a
reserve not exceeding \$50,000 or 5 percent of the amount of the
contract, whichever is less, may have been set aside if, in the
Contracting Officer\'s opinion, the Contractor fails to\--

\(i\) Establish, maintain, and follow effective procedures for
identifying and disclosing subject inventions pursuant to subparagraph
(f)(5) above;

\(ii\) Disclose any subject invention pursuant to subparagraph (c)(1)
above;

\(iii\) Deliver acceptable interim reports pursuant to subdivision
(f)(3.5)(i) above; or

\(iv\) Provide the information regarding subcontracts pursuant to
subparagraph (f)(8) of this clause.

\(2\) Such reserve or balance may be withheld until the Contracting
Officer has determined that the Contractor has rectified whatever
deficiencies exist and has delivered all reports, disclosures, and other
information required by this clause.

\(3\) Final payment under this contract may not be made before the
Contractor delivers to the Contracting Officer all disclosures of
subject inventions required by subparagraph (c)(1) above, an acceptable
final report pursuant to subdivision (f)(3.5)(ii) above, and all past
due confirmatory instruments.

\(4\) The Contracting Officer may decrease or increase the sums withheld
up to the maximum authorized above. No amount may be withheld under this
paragraph while the amount specified by this paragraph is being withheld
under other provisions of the contract. The withholding of any amount or
the subsequent payment thereof may not be construed as a waiver of any
Government right.

(*End of clause*)

Alternate I

Add the following sentence to the end of paragraph (b).

The license shall include the right of the Government to sublicense
foreign government , their nationals, and international organizations
pursuant to the following treaties or international agreements:\*

\[\*Contracting Officer complete with the names of applicable existing
treaties or international agreements. The above language is not intended
to apply to treaties or agreements that are in effect on the date of the
award but are not listed.\]

Alternate II

Add the following sentence to the end of paragraph (b).

The agency reserves the right to unilaterally amend this contract to
identify specific treaties or international agreements entered into or
to be entered into by the Government after the effective date of this
contract and effectuate those license or other rights which are
necessary for the Government to meet its obligations to foreign
government , their nationals, and international organizations under such
treaties or international agreement with respect to subject inventions
made after the date of the amendment.

3.5-12 Patent Rights-Retention by Government

PATENT RIGHTS-ACQUISITION BY THE GOVERNMENT (APRIL 1996)

\(a\) Definitions.

\(1\) Invention, as used in this clause, means any invention or
discovery which is or may be patentable or otherwise protectable under
title 35 of the United States Code or any novel variety of plant that is
or may be protectable under the Plant Variety Protection Act (35 U.S.C.
2321, et seq.).

\(2\) Subject invention, as used in this clause, means any invention of
the Contractor conceived or first actually reduced to practice in the
performance of work under this contract; provided, that in the case of a
variety of plant, the date of determination (as defined in section 41(d)
of the Plant Variety Protection Act, 35 U.S.C. 2401(d)) must also occur
during the period of contract performance.

\(3\) Practical application, as used in this clause, means to
manufacture, in the case of a composition or product; to practice, in
the case of a process or method; or to operate, in the case of a machine
or system; and, in each case, under such conditions as to establish that
the invention is being utilized and that its benefits are, to the extent
permitted by law or Government regulations, available to the public on
reasonable terms.

\(b\) Allocations of principal rights.

\(1\) Assignment to the Government. The Contractor agrees to assign to
the Government the entire right, title, and interest throughout the
world in and to each subject invention, except to the extent that rights
are retained by the Contractor under subparagraph (b)(2) and paragraph
(d) below.

\(2\) Greater rights determinations

\(i\) The Contractor, or an employee-inventor after consultation with
the Contractor, may retain greater rights than the nonexclusive license
provided in paragraph (d) below, in accordance with agency procedures. A
request for a determination of whether the Contractor or the
employee-inventor is entitled to retain such greater rights must be
submitted to the Head of the Contracting Agency or designee at the time
of the first disclosure of the invention pursuant to subparagraph (e)(2)
below, or not later than 8 months thereafter, unless a longer period is
authorized in writing by the Contracting Officer for good cause shown in
writing by the Contractor. Each determination of greater rights under
this contract normally may be subject to paragraph (c) below, and to the
reservations and conditions deemed to be appropriate by the Head of the
Contracting Agency or designee.

\(ii\) Upon request, the Contractor shall provide the filing date,
serial number and title, a copy of the patent application (including an
English-language version if filed in a language other than English), and
patent number and issue date for any subject invention in any country
for which the Contractor has retained title.

\(iii\) Upon request, the Contractor shall furnish the Government an
irrevocable power to inspect and make copies of the patent application
file.

\(c\) Minimum rights acquired by the Government. (1) With respect to
each subject invention to which the Contractor retains principal or
exclusive rights, the Contractor agrees as follows:

\(i\) The Contractor hereby grants to the Government a nonexclusive,
nontransferable, irrevocable, paid-up license to practice or have
practiced each subject invention throughout the world by or on behalf of
the Government of the United States (including any Government agency).

\(ii\) The Contractor agrees that with respect to any subject invention
in which it has acquired title, the Federal agency has the right to
require the Contractor, an assignee, or exclusive licensee of a subject
invention to grant a nonexclusive, partially exclusive, or exclusive
license in any field of use to a responsible applicant or applicants,
upon terms that are reasonable under the circumstances, and if the
Contractor, assignee, or exclusive licensee refuses such a request, the
Federal agency has the right to grant such a license itself if the
Federal agency determines that\--

\(A\) Such action is necessary because the Contractor or assignee has
not taken, or is not expected to take within a reasonable time,
effective steps to achieve practical application of the subject
invention in such field of use;

\(B\) Such action is necessary to alleviate health or safety needs which
are not reasonably satisfied by the Contractor, assignee, or their
licensees;

\(C\) Such action is necessary to meet requirements for public use
specified by Federal regulations and such requirements are not
reasonably satisfied by the Contractor, assignee, or licensees;

\(D\) Such action is necessary because the agreement required by
paragraph (i) of this clause has neither been obtained nor waived or
because a licensee of the exclusive right to use or sell any subject
invention in the United States is in breach

of such agreement.

\(iii\) The Contractor agrees to submit on request periodic reports no
more frequently than annually on the utilization of a subject invention
or on efforts at obtaining such utilization of a subject invention or on
efforts at obtaining such utilization that are being made by the
Contractor or its licensees or assignees. Such reports shall include
information regarding the status of development, date of first
commercial sale or use, gross royalties received by the Contractor, and
such other data and information as the agency may reasonably specify.
The Contractor also agrees to provide additional reports as may be
requested by the agency in connection with any march-in proceedings
undertaken by the agency in accordance with subdivision (ii) above. To
the extent data or information supplied under this section is considered
by the Contractor, its licensee, or assignee to be privileged and
confidential and is so marked, the agency agrees that, to the extent
permitted by law, it will not disclose such information to persons
outside the Government.

\(iv\) The Contractor agrees, when licensing a subject invention, to
arrange to avoid royalty charges on acquisitions involving Government
funds, including funds derived through a Military Assistance Program of
the Government or otherwise derived through the Government, to refund
any amounts received as royalty charges on a subject invention in
acquisitions for, or on behalf of, the Government, and to provide for
such refund in any instrument transferring rights in the invention to
any party.

\(v\) The Contractor agrees to provide for the Government\'s paid-up
license pursuant to subdivision (i) above in any instrument transferring
rights in a subject invention and to provide for the granting of
licenses as required by subdivision (ii) above, and for the reporting of
utilization information as required by subdivision (iii) above, whenever
the instrument transfers principal or exclusive rights in a subject
invention.

\(2\) Nothing contained in this paragraph (c) may be deemed to grant to
the Government any rights with respect to any invention other than a
subject invention.

\(d\) Minimum rights to the Contractor.

\(1\) The Contractor is hereby granted a revocable nonexclusive,
royalty-free license in each patent application filed in any country on
a subject invention and any resulting patent in which the Government
obtains title, unless the Contractor fails to disclose the subject
invention within the times specified in subparagraph (e)(2) below. The
Contractor\'s license extends to its domestic subsidiaries and
affiliates, if any, within the corporate structure of which the
Contractor is a part and includes the right to grant sublicenses of the
same scope to the extent the Contractor was legally obligated to do so
at the time the contract was awarded. The license is transferable only
with the approval of the funding Federal agency except when transferred
to the successor of that part of the Contractor\'s business to which the
invention pertains.

\(2\) The Contractor\'s domestic license may be revoked or modified by
the funding Federal agency to the extent necessary to achieve
expeditious practical application of the subject invention pursuant to
an application for an exclusive license submitted in accordance with
applicable provisions in 33.5 CFR part 404 and agency licensing
regulations. This license will not be revoked in that field of use or
the geographical areas in which the Contractor has achieved practical
application and continues to make the benefits of the invention
reasonably accessible to the public. The license in any foreign country
may be revoked or modified at the discretion of the funding Federal
agency to the extent the Contractor, its licensees, or its domestic
subsidiaries or affiliates have failed to achieve practical application
in that foreign country.

\(3\) Before revocation or modification of the license, the funding
Federal agency will furnish the Contractor a written notice of its
intention to revoke or modify the license, and the Contractor will be
allowed 30 days (or such other time as may be authorized by the funding
Federal agency for good cause shown by the Contractor) after the notice
to show cause why the license should not be revoked or modified. The
Contractor has the right to appeal, in accordance with applicable agency
licensing regulations and 33.5 CFR part 404 concerning the licensing of
Government-owned inventions, any decision concerning the revocation or
modification of its license.

\(4\) When the Government has the right to receive title, and does not
elect to secure a patent in a foreign country, the Contractor may elect
to retain such rights in any foreign country in which the Government
elects not to secure a patent, subject to the Government\'s rights in
subparagraph (c)(1) of this clause.

\(e\) Invention identification, disclosures, and reports.

\(1\) The Contractor shall establish and maintain active and effective
procedures to assure that subject inventions are promptly identified and
disclosed to Contractor personnel responsible for patent matters within
6 months of conception and/or first actual reduction to practice,
whichever occurs first in the performance of work under this contract.
These procedures shall include the maintenance of laboratory notebooks
or equivalent records and other records as are reasonably necessary to
document the conception and/or the first actual reduction to practice of
subject inventions, and records that show that the procedures for
identifying and disclosing the inventions are followed. Upon request,
the Contractor may furnish the Contracting Officer a description of such
procedures for evaluation and for determination as to their
effectiveness.

\(2\) The Contractor shall disclose each subject invention to the
Contracting Officer within 2 months after the inventor discloses it in
writing to Contractor personnel responsible for patent matters or, if
earlier, within 6 months after the Contractor becomes aware that a
subject invention has been made, but in any event before any on sale,
public use, or publication of such invention known to the Contractor.
The disclosure to the agency shall be in the form of a written report
and shall identify the contract under which the invention was made and
the inventor(s). It may be sufficiently complete in technical detail to
convey a clear understanding, to the extent known at the time of the
disclosure, of the nature, purpose, operation, and physical, chemical,
biological, or electrical characteristics of the invention. The
disclosure shall also identify any publication, on sale, or public use
of the invention and whether a manuscript describing the invention has
been submitted for publication and, if so, whether it has been accepted
for publication at the time of disclosure. In addition, after disclosure
to the agency, the Contractor shall promptly notify the agency of the
acceptance of any manuscript describing the invention for publication or
of any on sale or public use planned by the Contractor.

\(3\) The Contractor shall furnish the Contracting Officer the
following:

\(i\) Interim reports every 12 months (or such longer period as may be
specified by the Contracting Officer) from the date of the contract,
listing subject inventions during that period, and certifying that all
subject inventions have been disclosed (or that there are not such
inventions) and that the procedures required by subparagraph (e)(1)
above have been followed.

\(ii\) A final report, within 3 months after completion of the
contracted work, listing all subject inventions or certifying that there
were no such inventions, and listing all subcontracts at any tier
containing a patent rights clause or certifying that there were no such
subcontracts.

\(4\) The Contractor agrees to require, by written agreement, its
employees, other than clerical and nontechnical employees, to disclose
promptly in writing to personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor each subject invention made under contract in order that the
Contractor can comply with the disclosure provisions of paragraph (c)
above, and to execute all papers necessary to file patent applications
on subject inventions and to establish the Government\'s rights in the
subject inventions. This disclosure format should require, as a minimum,
the information required by subparagraph (2) above.

\(5\) The Contractor agrees that the Government may duplicate and
disclose subject invention disclosures and all other reports and papers
furnished or required to be furnished pursuant to this clause.

\(f\) Examination of records relating to inventions.

\(1\) The Contracting Officer or any authorized representative may,
until 3 years after final payment under this contract, have the right to
examine any books (including laboratory notebooks), records, and
documents of the Contractor relating to the conception or first actual
reduction to practice of inventions in the same field of technology as
the work under this contract to determine whether-

\(i\) Any such inventions are subject inventions;

\(ii\) The Contractor has established and maintains the procedures
required by subparagraphs (e)(1) and (4) of this clause; and

\(iii\) The Contractor and its inventors have complied with the
procedures.

\(2\) If the Contracting Officer learns of an unreported Contractor
invention which the Contracting Officer believes may be a subject
invention, the Contractor may be required to disclose the invention to
the agency for a determination of ownership rights.

\(3\) Any examination of records under this paragraph will be subject to
appropriate conditions to protect the confidentiality of the information
involved.

\(g\) Withholding of payment (this paragraph does not apply to
subcontracts).

\(1\) Any time before final payment under this contract, the Contracting
Officer may, in the Government\'s interest, withhold payment until a
reserve not exceeding \$50,000 or 5 percent of the amount of this
contract, whichever is less, may have been set aside if, in the
Contracting Officer\'s opinion, the Contractor fails to\--

\(i\) Establish, maintain, and follow effective procedures for
identifying and disclosing subject inventions pursuant to subparagraph
(e)(1) above;

\(ii\) Disclose any subject invention pursuant to subparagraph (e)(2)
above;

\(iii\) Deliver acceptable interim reports pursuant to subdivision
(e)(3)(i) above; or

\(iv\) Provide the information regarding subcontracts pursuant to
subparagraph (h)(4) below.

\(2\) Such reserve or balance may be withheld until the Contracting
Officer has determined that the Contractor has rectified whatever
deficiencies exist and has delivered all reports, disclosures, and other
information required by this clause.

\(3\) Final payment under this contract shall not be made before the
Contractor delivers to the Contracting Officer all disclosures of
subject inventions required by subparagraph (e)(2) above, and acceptable
final report pursuant to subdivision (e)(3)(ii) above, and all past due
confirmatory instruments.

\(4\) The Contracting Officer may decrease or increase the sums withheld
up to the maximum authorized above. No amount shall be withheld under
this paragraph while the amount specified by this paragraph is being
withheld under other provisions of the contract. The withholding of any
amount or the subsequent payment thereof may not be construed as a
waiver of any Government rights.

\(h\) Subcontracts.

\(1\) The Contractor shall include this clause (suitably modified to
identify the parties) in all subcontracts, regardless of tier, for
experimental, developmental, or research work. The subcontractor shall
retain all rights provided for the Contractor in this clause, and the
Contractor shall not, as part of the consideration for awarding the
subcontract, obtain rights in the subcontractor\'s subject inventions.

\(2\) In the event of a refusal by a prospective subcontractor to accept
such a clause the Contractor-

\(i\) Shall promptly submit a written notice to the Contracting Officer
setting forth the subcontractor\'s reasons for such refusal and other
pertinent information that may expedite disposition of the matter; and

\(ii\) Shall not proceed with such subcontract without the written
authorization of the Contracting Officer.

\(3\) In the case of subcontracts at any tier, the agency,
subcontractor, and Contractor agree that the mutual obligations of the
parties created by this clause constitute a contract between the
subcontractor and the Federal agency with respect to those matters
covered by this clause.

\(4\) The Contractor shall promptly notify the Contracting Officer in
writing upon the award of any subcontract at any tier containing a
patent rights clause by identifying the subcontractor, the applicable
patent rights clause, the work to be performed under the subcontract,
and the dates of award and estimated completion. Upon request of the
Contracting Officer, the Contractor shall furnish a copy of such
subcontract, and, no more frequently than annually, a listing of the
subcontracts that have been awarded.

\(i\) Preference for United States industry. Unless provided otherwise,
no Contractor that receives title to any subject invention and no
assignee of any such Contractor shall grant to any person the exclusive
right to use or sell any subject invention in the United States unless
such person agrees that any products embodying the subject invention
will be manufactured substantially in the United States. However, in
individual cases, the requirement may be waived by the Government upon a
showing by the Contractor or assignee that reasonable but unsuccessful
efforts have been made to grant licenses on similar terms to potential
licensees that would be likely to manufacture substantially in the
United States or that under the circumstances domestic manufacture is
not commercially feasible.

(*End of clause*)

Alternate I

Add to the end of paragraph (c)(1)(i).

The license shall include the right of the Government to sublicense
foreign government , their nationals, and international organizations
pursuant to the following treaties or international agreements:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \*

\[\*Contracting Officer complete with the names of applicable existing
treaties or international agreements. The above language is not intended
to apply to treaties or agreements that are in effect on the date of the
award but are not listed.\]

Alternate II

Add to the end of paragraph (c)(1)(i).

The agency reserves the right to unilaterally amend this contract to
identify specific treaties or international agreements entered into or
to be entered into by the Government after the effective date of this
contract, and effectuate those license or other rights which are
necessary for the Government to meet its obligations to foreign
government , their nationals, and international organizations under such
treaties or international agreements with respect to subject inventions
made after the date of the amendment.

3.5-13 Rights in Data-General

RIGHTS IN DATA-GENERAL (APRIL 1996)

\(a\) Definitions.

\(1\) Computer software, as used in this clause, means computer
programs, computer data bases, and documentation thereof.

\(2\) Data, as used in this clause, means recorded information,
regardless of form or the media on which it may be recorded. The term
includes technical data and computer software. The term does not include
information incidental to contract administration, such as financial,
administrative, cost or pricing, or management information.

\(3\) Form, fit, and function data, as used in this clause, means data
relating to items, components, or processes that are sufficient to
enable physical and functional interchangeability, as well as data
identifying source, size, configuration, mating, and attachment
characteristics, functional characteristics, and performance
requirements; except that for computer software it means data
identifying source, functional characteristics, and performance
requirements but specifically excludes the source code, algorithm,
process, formulae, and flow charts of the software.

\(4\) Limited rights, as used in this clause, means the rights of the
Government in limited rights data as set forth in the Limited Rights
Notice of subparagraph (g)(2) if included in this clause.

\(5\) Limited rights data, as used in this clause, means data (other
than computer software) that embody trade secrets or are commercial or
financial and confidential or privileged, to the extent that such data
pertain to items, components, or processes developed at private expense,
including minor modifications thereof.

\(6\) Restricted computer software, as used in this clause, means
computer software developed at private expense and that is a trade
secret; is commercial or financial and is confidential or privileged; or
is published copyrighted computer software; including minor
modifications of such computer software.

\(7\) Restricted rights, as used in this clause, means the rights of the
Government in restricted computer software, as set forth in a Restricted
Rights Notice of subparagraph (g)(3) if included in this clause, or as
otherwise may be provided in a collateral agreement incorporated in and
made part of this contract, including minor modifications of such
computer software.

\(8\) Technical data, as used in this clause, means data (other than
computer software) which are of a scientific or technical nature.

\(9\) Unlimited rights, as used in this clause, means the right of the
Government to use, disclose, reproduce, prepare derivative works,
distribute copies to the public, and perform publicly and display
publicly, in any manner and for any purpose, and to have or permit
others to do so.

\(b\) Allocations of rights.

\(1\) Except as provided in paragraph (c) of this clause regarding
copyright, the Government shall have unlimited rights in-

\(i\) Data first produced in the performance of this contract;

\(ii\) Form, fit, and function data delivered under this contract;

\(iii\) Data delivered under this contract (except for restricted
computer software) that constitute manuals or instructional and training
material for installation, operation, or routine maintenance and repair
of items, components, or processes delivered or furnished for use under
this contract; and

\(iv\) All other data delivered under this contract unless provided
otherwise for limited rights data or restricted computer software in
accordance with paragraph (g) of this clause.

\(2\) The Contractor shall have the right to\--

\(i\) Use, release to others, reproduce, distribute, or publish any data
first produced or specifically used by the Contractor in the performance
of this contract, unless provided otherwise in paragraph (d) of this
clause;

\(ii\) Protect from unauthorized disclosure and use those data which are
limited rights data or restricted computer software to the extent
provided in paragraph (g) of this clause;

\(iii\) Substantiate use of, add or correct limited rights, restricted
rights, or copyright notices and to take other appropriate action, in
accordance with paragraphs (e) and (f) of this clause; and

\(iv\) Establish claim to copyright subsisting in data first produced in
the performance of this contract to the extent provided in subparagraph
(c)(1) of this clause.

\(c\) Copyright.

\(1\) Data first produced in the performance of this contract. Unless
provided otherwise in paragraph (d) of this clause, the Contractor may
establish, without prior approval of the Contracting Officer, claim to
copyright subsisting in scientific and technical articles based on or
containing data first produced in the performance of this contract and
published in academic, technical or professional journals, symposia
proceedings or similar works. The prior, express written permission of
the Contracting Officer is required to establish claim to copyright
subsisting in all other data first produced in the performance of this
contract. When claim to copyright is made, the Contractor shall affix
the applicable copyright notices of 17 U.S.C. 401 or 402 and
acknowledgment of Government sponsorship (including contract number) to
the data when such data are delivered to the Government, as well as when
the data are published or deposited for registration as a published work
in the U.S. Copyright Office. For data other than computer software the
Contractor grants to the Government, and others acting on its behalf, a
paid-up, nonexclusive, irrevocable worldwide license in such copyrighted
data to reproduce, prepare derivative works, distribute copies to the
public, and perform publicly and display publicly, by or on behalf of
the Government. For computer software, the Contractor grants to the
Government and others acting in its behalf, a paid-up nonexclusive,
irrevocable worldwide license in such copyrighted computer software to
reproduce, prepare derivative works, and perform publicly and display
publicly by or on behalf of the Government.

\(2\) Data not first produced in the performance of this contract. The
Contractor shall not, without prior written permission of the
Contracting Officer, incorporate in data delivered under this contract
any data not first produced in the performance of this contract and
which contains the copyright notice of 17 U.S.C. 401 or 402, unless the
Contractor identifies such data and grants to the Government, or
acquires on its behalf, a license of the same scope as set forth in
subparagraph (c)(1) of this clause; provided, however, that if such data
are computer software the Government may acquire a copyright license as
set forth in subparagraph (g)(3) of this clause if included in this
contract or as otherwise may be provided in a collateral agreement
incorporated in or made part of this contract.

\(3\) Removal of copyright notices. The Government agrees not to remove
any copyright notices placed on data pursuant to this paragraph (c), and
to include such notices on all reproductions of the data.

\(d\) Release, publication and use of data.

\(1\) The Contractor shall have the right to use, release to others,
reproduce, distribute, or publish any data first produced or
specifically used by the Contractor in the performance of this contract,
except to the extent such data may be subject to the Federal export
control or national security laws or regulations, or unless otherwise
provided in this paragraph of this clause or expressly set forth in this
contract.

\(2\) The Contractor agrees that to the extent it receives or is given
access to data necessary for the performance of this contract which
contain restrictive markings, the Contractor shall treat the data in
accordance with such markings unless otherwise specifically authorized
in writing by the Contracting Officer.

\(e\) Unauthorized marking of data.

\(1\) Notwithstanding any other provisions of this contract concerning
inspection or acceptance, if any data delivered under this contract are
marked with the notices specified in subparagraph (g)(2) or (g)(3) of
this clause and use of such is not authorized by this clause, or if such
data bears any other restrictive or limiting markings not authorized by
this contract, the Contracting Officer may at any time either return the
data to the Contractor, or cancel or ignore the markings. However, the
following procedures shall apply prior to canceling or ignoring the
markings.

\(i\) The Contracting Officer shall make written inquiry to the
Contractor affording the Contractor 30 days from receipt of the inquiry
to provide written justification to substantiate the propriety of the
markings;

\(ii\) If the Contractor fails to respond or fails to provide written
justification to substantiate the propriety of the markings within the
30-day period (or a longer time not exceeding 90 days approved in
writing by the Contracting Officer for good cause shown), the Government
shall have the right to cancel or ignore the markings at any time after
said period and the data will no longer be made subject to any
disclosure prohibitions.

\(iii\) If the Contractor provides written justification to substantiate
the propriety of the markings within the period set in subdivision
(e)(1)(i) of this clause, the Contracting Officer shall consider such
written justification and determine whether or not the markings are to
be canceled or ignored. If the Contracting Officer determines that the
markings are authorized, the Contractor shall be so notified in writing.
If the Contracting Officer determines, with concurrence of the head of
the contracting activity, that the markings are not authorized, the
Contracting Officer shall furnish the Contractor a written
determination, which determination may become the final agency decision
regarding the appropriateness of the markings unless the Contractor
files suit in a court of competent jurisdiction within 90 days of
receipt of the Contracting Officer\'s decision. The Government shall
continue to abide by the markings under this subdivision (e)(1)(iii)
until final resolution of the matter either by the Contracting
Officer\'s determination becoming final (in which instance the
Government may thereafter have the right to cancel or ignore the
markings at any time and the data will no longer be made subject to any
disclosure prohibitions), or by final disposition of the matter by court
decision if suit is filed.

\(2\) The time limits in the procedures set forth in subparagraph (e)(1)
of this clause may be modified in accordance with agency regulations
implementing the Freedom of Information Act (5 U.S.C. 552) if necessary
to respond to a request thereunder.

\(3\) RESERVED.

\(4\) Except to the extent the Government\'s action occurs as the result
of final disposition of the matter by a court of competent jurisdiction,
the Contractor is not precluded by this paragraph (e) from filing a
contract dispute, including pursuant to the "Contract Disputes" clause
of this contract, as applicable, that may arise as the result of the
Government removing or ignoring authorized markings on data delivered
under this contract.

\(f\) Omitted or incorrect markings.

\(1\) Data delivered to the Government without either the limited rights
or restricted rights notice as authorized by paragraph (g) of this
clause, or the copyright notice required by paragraph (c) of this
clause, may be deemed to have been furnished with unlimited rights, and
the Government assumes no liability for the disclosure, use, or
reproduction of such data. However, to the extent the data has not been
disclosed without restriction outside the Government, the Contractor may
request, within 6 months (or a longer time approved by the Contracting
Officer for good cause shown) after delivery of such data, permission to
have notices placed on qualifying data at the Contractor\'s expense, and
the Contracting Officer may agree to do so if the Contractor-

\(i\) Identifies the data to which the omitted notice is to be applied;

\(ii\) Demonstrates that the omission of the notice was inadvertent;

\(iii\) Establishes that the use of the proposed notice is authorized;

\(iv\) Acknowledges that the Government has no liability with respect to
the disclosure, use, or reproduction of any such data made prior to the
addition of the notice or resulting from the omission of the notice.

\(2\) The Contracting Officer may also (i) permit correction at the
Contractor\'s expense of incorrect notices if the Contractor identifies
the data on which correction of the notice is to be made, and
demonstrates that the correct notice is authorized, or (ii) correct any
incorrect notices.

\(g\) Protection of limited rights data and restricted computer
software. When data other than that listed in subdivisions (b)(1) (i),
(ii), and (iii) of this clause are specified to be delivered under this
contract and qualify as either limited rights data or restricted
computer software, if the Contractor desires to continue protection of
such data, the Contractor may withhold such data and not furnish them to
the Government under this contract. As a condition to this withholding,
the Contractor may identify the data being withheld and furnish form,
fit, and function data in lieu thereof. Limited rights data that are
formatted as a computer data base for delivery to the Government are to
be treated as limited rights data and not restricted computer software.

\(h\) Subcontracting. The Contractor has the responsibility to obtain
from its subcontractors all data and rights therein necessary to fulfill
the Contractor\'s obligations to the Government under this contract. If
a subcontractor refuses to accept terms affording the Government such
rights, the Contractor shall promptly bring such refusal to the
attention of the Contracting Officer and not proceed with subcontract
award without further authorization.

\(i\) Relationship to patents. Nothing contained in this clause shall
imply a license to the Government under any patent or be construed as
affecting the scope of any license or other right otherwise granted to
the Government.

Alternate I

Substitute the following definition in paragraph (a).

Limited rights data, as used in this clause, means data (other than
computer software) developed at private expense that embody trade
secrets or are commercial or financial and confidential or privileged.

Alternate II

Insert the following in paragraph (g).

(g)(2) Notwithstanding subparagraph (g)(1) of this clause, the contract
may identify and specify the delivery of limited rights data, or the
Contracting Officer may require by written request the delivery of
limited rights data that has been withheld or would otherwise be
withholdable. If delivery of such data is so required, the Contractor
may affix the following Limited Rights Notice to the data and the
Government will thereafter treat the data, subject to the provisions of
paragraphs (e) and (f) of this clause, in accordance with such Notice:

LIMITED RIGHTS NOTICE

\(a\) These data are submitted with limited rights under Government
Contract No. \_\_\_\_\_\_\_\_\_\_\_ (and
subcontract\_\_\_\_\_\_\_\_\_\_\_\_, if appropriate). These data may be
reproduced and used by the Government with the express limitation that
they will not, without written permission of the Contractor, be used for
purposes of manufacture nor disclosed outside the Government; except
that the Government may disclose these data outside the Government for
the following purposes, if any, provided that the Government makes such
disclosure subject to prohibition against further use and disclosure:
\[Agencies may list additional purposes or if none, so state\]

\(b\) This Notice may be marked on any reproduction of these data, in
whole or in part.

*(End of notice)*

Alternate III

Insert the following in paragraph (g).

(g)(3)(i) Notwithstanding subparagraph (g)(1) of this clause, the
contract may identify and specify the delivery of restricted computer
software, or the Contracting Officer may require by written request the
delivery of restricted computer software that has been withheld or would
otherwise be withholdable. If delivery of such computer software is so
required, the Contractor may affix the following Restricted Rights
Notice to the computer software and the Government will thereafter treat
the computer software, subject to paragraphs (e) and (f) of this clause,
in accordance with the Notice:

RESTRICTED RIGHTS NOTICE

\(a\) This computer software is submitted with restricted rights under
Government Contract No. \_\_\_\_\_\_\_\_\_\_\_ (and subcontract
\_\_\_\_\_\_\_\_\_\_\_, if appropriate). It may not be used, reproduced,
or disclosed by the Government except as provided in paragraph (b) of
this Notice or as otherwise expressly stated in the contract.

\(b\) This computer software may be-

\(1\) Used or copied for use in or with the computer or computers for
which it was acquired, including use at any Government installation to
which such computer or computers may be transferred;

\(2\) Used or copied for use in a backup computer if any computer for
which it was acquired is inoperative;

\(3\) Reproduced for safekeeping (archives) or backup purposes;

\(4\) Modified, adapted, or combined with other computer software,
provided that the modified, combined, or adapted portions of the
derivative software incorporating restricted computer software are made
subject to the same restricted rights;

\(5\) Disclosed to and reproduced for use by support service Contractors
in accordance with subparagraphs (b) (1) through (4) of this clause,
provided the Government makes such disclosure or reproduction subject to
these restricted rights; and

\(6\) Used or copied for use in or transferred to a replacement
computer.

\(c\) Notwithstanding the foregoing, if this computer software is
published copyrighted computer software, it is licensed to the
Government, without disclosure prohibitions, with the minimum rights set
forth in paragraph (b) of this clause.

\(d\) Any other rights or limitations regarding the use, duplication, or
disclosure of this computer software are to be expressly stated in, or
incorporated in, the contract.

\(e\) This Notice shall be marked on any reproduction of this computer
software, in whole or in part. *(End of notice)*

\(ii\) Where it is impractical to include the Restricted Rights Notice
on restricted computer software, the following short- form Notice may be
used in lieu thereof:

RESTRICTED RIGHTS NOTICE (SHORT FORM)

Use, reproduction, or disclosure is subject to restrictions set forth in
Contract No. \_\_\_\_\_\_\_\_\_\_\_ (and subcontract
\_\_\_\_\_\_\_\_\_\_\_, if appropriate) with \_\_\_\_\_\_\_\_\_\_\_
(name of Contractor and subcontractor).

*(End of notice)*

\(iii\) If restricted computer software is delivered with the copyright
notice of 17 U.S.C. 401, it will be presumed to be published copyrighted
computer software licensed to the Government without disclosure
prohibitions, with the minimum rights set forth in paragraph (b) of this
clause, unless the Contractor includes the following statement with such
copyright notice: Unpublished-rights reserved under the Copyright Laws
of the United States.

Alternate IV

Substitute for paragraph (c)(1).

\(c\) Copyright.

\(1\) Data First Produced in the Performance of the Contract. Except as
otherwise specifically provided in this contract, the Contractor may
establish claim to copyright subsisting in any data first produced in
the performance of this contract. When claim to copyright is made, the
Contractor shall affix the applicable copyright notice of 17 U.S.C. 401
or 402 and acknowledgment of Government sponsorship (including contract
number) to the data when such data are delivered to the Government, as
well as when the data are published or deposited for registration as a
published work in the U.S. Copyright Office. For data other than
computer software, the Contractor grants to the Government, and others
acting on its behalf, a paid-up, nonexclusive, irrevocable, worldwide
license for all such data to reproduce, prepare derivative works,
distribute copies to the public, and perform publicly and display
publicly, by or on behalf of the Government. For computer software, the
Contractor grants to the Government and others acting on its behalf, a
paid up, nonexclusive, irrevocable worldwide license for all such
computer software to reproduce, prepare derivative works, and perform
publicly and display publicly, by or on behalf of the Government.

Alternate V

Add the following paragraph (j).

\(j\) The Contractor agrees, except as may be otherwise specified in
this contract for specific data items listed as not subject to this
paragraph, that the Contracting Officer or an authorized representative
may, up to three years after acceptance of all items to be delivered
under this contract, inspect at the Contractor\'s facility any data
withheld pursuant to paragraph (g)(1) of this clause, for purposes of
verifying the Contractor\'s assertion pertaining to the limited rights
or restricted rights status of the data or for evaluating work
performance. Where the Contractor whose data are to be inspected
demonstrates to the Contracting Officer that there would be a possible
conflict of interest if the inspection were made by a particular
representative, the Contracting Officer may designate an alternate
inspector.

3.5-14 Representation of Limited Rights Data and Restricted Computer
Software

REPRESENTATION OF LIMITED RIGHTS DATA AND RESTRICTED COMPUTER SOFTWARE
(APRIL 1996)

\(a\) This Screening Information Request (SIR) sets forth the work to be
performed if a contract award results, and the Government\'s known
delivery requirements for data. Any resulting contract may also provide
the Government the option to order additional data under the "Additional
Data Requirements" clause, if included in the contract. Any data
delivered under the resulting contract will be subject to the "Rights in
Data-General" clause that is to be included in this contract. Under the
latter clause, a Contractor may withhold from delivery data that qualify
as limited rights data or restricted computer software, and deliver
form, fit, and function data in lieu thereof. The latter clause also may
be used with its Alternates II and/or III to obtain delivery of limited
rights data or restricted computer software, marked with limited rights
or restricted rights notices, as appropriate. In addition, use of
Alternate V with this latter clause provides the Government the right to
inspect such data at the Contractor\'s facility.

\(b\) As an aid in determining the Government\'s need to include any of
the aforementioned Alternates in the clause "Rights in Data-General,"
the offeror\'s response to this Screening Information Request (SIR) may,
to the extent feasible, complete the representation in paragraph (b) of
this provision to either state that none of the data qualify as limited
rights data or restricted computer software, or identify which of the
data qualifies as limited rights data or restricted computer software.
Any identification of limited rights data or restricted computer
software in the offeror\'s response is not determinative of the status
of such data should a contract be awarded to the offeror.

REPRESENTATION CONCERNING DATA RIGHTS

Offeror has reviewed the requirements for the delivery of data or
software and states (offeror check appropriate block)\--

\[ \] None of the data proposed for fulfilling such requirements
qualifies as limited rights data or restricted computer software.

\[ \] Data proposed for fulfilling such requirements qualify as limited
rights data or restricted computer software and are identified as
follows:

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

       

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

Note: Limited rights data and Restricted computer software are defined
in the contract clause titled "Rights In Data-General."

*(End of provision)*

3.5-15 Additional Data Requirements

ADDITIONAL DATA REQUIREMENTS (APRIL 1996)

\(a\) In addition to the data (as defined in the "Rights in
Data-General" clause, or other equivalent included in this contract)
specified elsewhere in this contract to be delivered, the Contracting
Officer may, at any time during contract performance or within a period
of 3 years after acceptance of all items to be delivered under this
contract, order any data first produced or specifically used in the
performance of this contract.

\(b\) The "Rights in Data-General" clause or other equivalent included
in this contract is applicable to all data ordered under this
"Additional Data Requirements" clause. Nothing contained in this clause
shall require the Contractor to deliver any data the withholding of
which is authorized by the "Rights in Data-General" or other equivalent
clause of this contract, or data which are specifically identified in
this contract as not subject to this clause.

\(c\) When data are to be delivered under this clause, the Contractor
will be compensated for converting the data into the prescribed form,
for reproduction, and for delivery.

\(d\) The Contracting Officer may release the Contractor from the
requirements of this clause for specifically identified data items at
any time during the 3-year period set forth in paragraph (a) of this
clause.

3.5-16 Rights in Data-Special Works

RIGHTS IN DATA-SPECIAL WORKS (APRIL 1996)

\(a\) Definitions.

\(1\) Data, as used in this clause, means recorded information
regardless of form or the medium on which it may be recorded. The term
includes technical data and computer software. The term does not include
information incidental to contract administration, such as financial,
administrative, cost or pricing or management information.

\(2\) Unlimited rights, as used in this clause, means the right of the
Government to use, disclose, reproduce, prepare derivative works,
distribute copies to the public, and perform publicly and display
publicly, in any manner and for any purpose whatsoever, and to have or
permit others to do so.

\(b\) Allocation of Rights.

\(1\) The Government shall have\--

\(i\) Unlimited rights in all data delivered under this contract, and in
all data first produced in the performance of this contract, except as
provided in paragraph (c) of this clause for copyright.

\(ii\) The right to limit exercise of claim to copyright in data first
produced in the performance of this contract, and to obtain assignment
of copyright in such data, in accordance with subparagraph (c)(1) of
this clause.

\(iii\) The right to limit the release and use of certain data in
accordance with paragraph (d) of this clause.

\(2\) The Contractor shall have, to the extent permission is granted in
accordance with subparagraph (c)(1) of this clause, the right to
establish claim to copyright subsisting in data first produced in the
performance of this contract.

\(c\) Copyright.

\(1\) Data first produced in the performance of this contract.

\(i\) The Contractor agrees not to assert, establish, or authorize
others to assert or establish, any claim to copyright subsisting in any
data first produced in the performance of this contract without prior
written permission of the Contracting Officer. When claim to copyright
is made, the Contractor may affix the appropriate copyright notice of 17
U.S.C. 401 or 402 and acknowledgment of Government sponsorship
(including contract number) to such data when delivered to the
Government, as well as when the data are published or deposited for
registration as a published work in the U.S. Copyright Office. The
Contractor grants to the Government, and others acting on its behalf, a
paid-up nonexclusive, irrevocable, worldwide license for all such data
to reproduce, prepare derivative works, distribute copies to the public,
and perform publicly and display publicly, by or on behalf of the
Government.

\(ii\) If the Government desires to obtain copyright in data first
produced in the performance of this contract and permission has not been
granted as set forth in subdivision (c)(1)(i) of this clause, the
Contracting Officer may direct the Contractor to establish, or authorize
the establishment of, claim to copyright in such data and to assign, or
obtain the assignment of, such copyright to the Government or its
designated assignee.

\(2\) Data not first produced in the performance of this contract. The
Contractor may not, without prior written permission of the Contracting
Officer, incorporate in data delivered under this contract any data not
first produced in the performance of this contract and which contain the
copyright notice of 17 U.S.C. 401 or 402, unless the Contractor
identifies such data and grants to the Government, or acquires on its
behalf, a license of the same scope as set forth in subparagraph (c)(1)
of this clause.

\(d\) Release and use restrictions. Except as otherwise specifically
provided for in this contract, the Contractor may not use for purposes
other than the performance of this contract, nor may the Contractor
release, reproduce, distribute, or publish any data first produced in
the performance of this contract, nor authorize others to do so, without
written permission of the Contracting Officer.

\(e\) Indemnity. The Contractor may indemnify the Government and its
officers, agents, and employees acting for the Government against any
liability, including costs and expenses, incurred as the result of the
violation of trade secrets, copyrights, or right of privacy or
publicity, arising out of the creation, delivery, publication, or use of
any data furnished under this contract; or any libelous or other
unlawful matter contained in such data. The provisions of this paragraph
do not apply unless the Government provides notice to the Contractor as
soon as practicable of any claim or suit, affords the Contractor an
opportunity under applicable laws, rules, or regulations to participate
in the defense thereof, and obtains the Contractor\'s consent to the
settlement of any suit or claim other than as required by final decree
of a court of competent jurisdiction; nor do these provisions apply to
material furnished to the Contractor by the Government and incorporated
in data to which this clause applies.

(*End of clause*)

3.5-17 Rights in Data-Existing Works

RIGHTS IN DATA-EXISTING WORKS (APRIL 1996)

\(a\) Except as otherwise provided in this contract, the Contractor
grants to the Government, and others acting on its behalf, a paid-up
nonexclusive, irrevocable, worldwide license to reproduce, prepare
derivative works, and perform publicly and display publicly, by or on
behalf of the Government, for all the material or subject matter called
for under this contract, or for which this clause is specifically made
applicable.

\(b\) The Contractor shall indemnify the Government and its officers,
agents, and employees acting for the Government against any liability,
including costs and expenses, incurred as the result of (1) the
violation of trade secrets, copyrights, or right of privacy or
publicity, arising out of the creation, delivery, publication or use of
any data furnished under this contract; or (2) any libelous or other
unlawful matter contained in such data. The provisions of this paragraph
do not apply unless the Government provides notice to the Contractor as
soon as practicable of any claim or suit, affords the Contractor an
opportunity under applicable laws, rules, or regulations to participate
in the defense thereof, and obtains the Contractor\'s consent to the
settlement of any suit or claim other than as required by final decree
of a court of competent jurisdiction; and do not apply to material
furnished to the Contractor by the Government and incorporated in data
to which this clause applies.

(*End of clause*)

3.5-18 Commercial Computer Software-Restricted Rights

COMMERCIAL COMPUTER SOFTWARE-RESTRICTED RIGHTS (APRIL 1996)

\(a\) As used in this clause, restricted computer software means any
computer program, computer data base, or documentation thereof, that has
been developed at private expense and either is a trade secret, is
commercial or financial and confidential or-privileged, or is published
and copyrighted.

\(b\) Notwithstanding any provisions to the contrary contained in any
Contractor\'s standard commercial license or lease agreement pertaining
to any restricted computer software delivered under this purchase
order/contract, and irrespective of whether any such agreement has been
proposed prior to or after issuance of this purchase order/contract or
of the fact that such agreement may be affixed to or accompany the
restricted computer software upon delivery, vendor agrees that the
Government may have the rights that are set forth in paragraph (c) of
this clause to use, duplicate or disclose any restricted computer
software delivered under this purchase order/contract. The terms and
provisions of this contract, including any commercial lease or license
agreement, shall be subject to paragraph (c) of this clause and shall
comply with applicable Federal laws.

(c)(1) The restricted computer software delivered under this contract
shall not be used, reproduced or disclosed by the Government except as
provided in subparagraph (c)(2) of this clause or as expressly stated
otherwise in this contract.

\(2\) The restricted computer software may be-

\(i\) Used or copied for use in or with the computer or computers for
which it was acquired, including use at any Government installation to
which such computer or computers may be transferred;

\(ii\) Used or copied for use in or with backup computer if any computer
for which it was acquired is inoperative;

\(iii\) Reproduced for safekeeping (archives) or backup purposes;

\(iv\) Modified, adapted, or combined with other computer software,
provided that the modified, combined, or adapted portions of the
derivative software incorporating any of the delivered, restricted
computer software shall be subject to same restrictions set forth in
this purchase order/contract;

\(v\) Disclosed to and reproduced for use by support service Contractors
or their subcontractors, subject to the same restrictions set forth in
this purchase order/contract; and

\(vi\) Used or copied for use in or transferred to a replacement
computer.

\(3\) If the restricted computer software delivered under this purchase
order/contract is published and copyrighted, it is licensed to the
Government, without disclosure prohibitions, with the rights set forth
in subparagraph (c)(2) of this clause

unless expressly stated otherwise in this purchase order/contract.

\(4\) To the extent feasible the Contractor may affix a Notice
substantially as follows to any restricted computer software delivered
under this purchase order/contract; or, if the vendor does not, the
Government has the right to do so: Notice‑Notwithstanding any other
lease or license agreement that may pertain to, or accompany the
delivery of, this computer software, the rights of the Government
regarding its use, reproduction and disclosure are as set forth in
Government Contract No. \_\_\_\_\_\_\_\_\_\_.)

\(d\) If any restricted computer software is delivered under this
contract with the copyright notice of 17 U.S.C. 401, it will be presumed
to be published and copyrighted and licensed to the Government in
accordance with subparagraph (c)(3) of this clause, unless a statement
substantially as follows accompanies such copyright notice:
Unpublished-rights reserved under the copyright laws of the United
States.

(*End of clause*)

3.5-19RESERVED