REGENTS OF THE UNIVERSITY OF CALIFORNIA, THE (2)

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attempted to commercialize the results of the Contract unless a license was obtained from the otherparty. Where the parties determine that background technology may exist, in accordance with the terms of Paragraph B of this Article, consideration will be given to negotiating license rights which will allow the practice and commercialization of the results from the Contract. No rights to any background intellectual property of either party are granted under this Contract. B. Project Intellectual Property (a) "Project Intellectual Property" means the legal rights to patentable new or improvement inventions, patent applications or patents first conceived and first actually reduced to practice in the performance of research under the Contract. (b) The rights of the parties to Project Intellectual Property made by their employees in the performance of the Contract shall be as set forth in the Patent Rights clause of 37 CFR 401.14. The Prime Agency may obtain title to any Project Intellectual Property not elected by a party as set forth in the Patent Rights clause. Unless otherwise agreed in writing, Project Intellectual Property shall be owned by the party whose employees make or generate the Project Intellectual Property. Jointly made or generated Project Intellectual Property shall be jointly owned by the parties unless otherwise agreed in writing. In addition to the Government's rights under the Patent rights clause of 37 CFR 401.14, the parties agree that the Government shall have an irrevocable, royalty free, non-exclusive license to practice or have practiced on behalf of the United States in any Project Intellectual Property as defined in Article 3(B)(a) above. (c) The parties agree to disclose to each other, in writing, each and every Project Intellectual Property, which may be patentable or otherwise protectable under the United States patent laws in Title 35, United States Code. The parties acknowledge that they will disclose Project Intellectual Property to each other within sixty (60) days after their respective inventor(s) first discloses the invention in writing to the person(s) responsible for patent matters of the disclosing party. All written disclosures of such inventions shall contain sufficient detail of the invention, identification of any statutory bars, and shall be marked confidential, in accordance with 35 U.S.C. Section 205. Disclosures to the Prime Agency shall be within the time provided in paragraph (c)(1) of the Patent rights clause of 37 CFR 401.14. (d) Each party hereto may use Project Intellectual Property of the other nonexclusively and without compensation for research or development purposes only in connection with activities for the project under this Contract, including inclusion in project reports to the Prime Agency and proposals to the Prime Agency for continued funding of this project through additional phases.