CLAUSE 24. Another form.. 25. Licensor to send person to manufactory to affix the patent marks 26. Stamping patent articles with a die-Licensees also to stamp articles sent by other Licensees-Charges to be debited to Licensors-Dies to be property of Licensors. PAGE 235 235 235 27. Clause to be inserted in other licences for Licensees to bring articles to Licensees hereof to be stamped 236 28. No amendment of Specification by Licensor without consent of Licensee 236 29. Covenant by Licensor as to no prior licences and not to use Invention or grant other licences within district 236 ..... 30. Covenant by Licensee to manufacture only according to Specifi ... 236 237 237 33. Another form [terms set out] 237 34. Licensor not to grant other licences on terms more favourable than hereunder 238 35. Liberty for Licensor to inspect factory 238 36. Licensee not to dispute validity of patent.. 238 37. Licensor to pay fees or permit Licensee so to do and deduct from royalties and to observe conditions of patent 238 38. Licensor to defend patent and at cost of Licensee to take proceedings for infringements or permit him &c. ... 238 39. Licensee to detect infringements and give notice thereof and assist Licensor in proceedings 239 40. Power for either party to determine licence on notice.... 239 41. Power of revocation on default in payments or breach of other obligations or bankruptcy of Licensee 239 42. Another form [additional to last, referring to unprofitable working and ceasing to work] 239 43. Power for Licensee to determine licence if patent void ... 240 ... 44. Mutual Covenant as to Improvements &c. 240 45. Covenant by Licensor as to Improvements made by him 46. Option to purchase patent after three years—but purchase to be completed within three months from exercise 47. Licensor not to engage in like business within district 48. Licensee not to manufacture but Licensor to do so for Licensee.. 241 49. Sale only through Brokers common to both parties-Meetings to regulate prices... 50. Exclusive licence to become non-exclusive if unprofitable working or non-user of Invention Covenant to 1. The licensee shall during the continuance of this licence pay pay royalties to the licensor half-yearly on every (fixed sums). Royalties and sales. Royalties on sale moneys after satisfac tion of cost price and manufac for every day of and day of manufactured by the licensee hereunder and in the half-years then ending respectively sold by him a royalty of £- (a) [Or say "the royalty specified in the Schedule hereto," and add (if appropriate) " according to the size and description of such article"] (b). 2 (c). The licensee shall during the continuance of this licence pay to the licensor half-yearly on every day of and day of manufactured by the licensee hereunder in the half-years then ending respectively a royalty of £and for every sold by him as aforesaid for every therein respectively a royalty of £ 3. The gross returns on the sale of each machine by the licensee shall be applied first in satisfaction to him of a sum of £- - or such lesser sum as such returns will amount to which sum shall be taken to include both the cost price of the article and the profit thereon of the licensee as manufacturer thereof and as to the turer's profit balance (if any) of such returns shall be divided equally between (licensee being manufacturer the said parties (d). and seller). Proviso that in lieu of royalties on sales, lower royalties may be paid both Variations of the above in certain cases. 4 (e). PROVIDED ALWAYS that the licensee may at the end of each half-year without giving any previous notice to the licensor of his intention so to do [but not so as thereby to reduce the rent (f)] vary the amount of royalties in respect of any of the articles aforesaid not being less than in number then in his possession (a) Or (as to manufacture only) write "manufactured by the licensee hereunder in the half-years then ending respectively a royalty of £——.” Where the royalty is to be paid, not on an article but on a fixed quantity of material, write (instead of the above) "for every [say] hundred weight of manufactured, &c.," and add (if thought fit) "and so proportionately for any less quantity. Provided, however, that any quantity less than [say] 7 pounds not otherwise liable to a royalty shall be treated as weighing 7 pounds." Where the invention is such that it may only be applied to existing or unpatented articles or material, write (instead of the expression as to manufacture) "for every &c. to which the said invention may be applied by the licensee &c." Where royalties are to be paid on sales (with or without previous royalties on manufactures), it will be found convenient to use also Clause 5, post, as to reduced royalties on articles unsold at end of licence. (b) In this clause, and other later ones, the assigns of either party or of both of them may be taken to be implied by means of a Transmission Clause. See Clause 52, post. (c) For variations in the language of this clause as to the nature of the invention, see note (a). (d) The final share of the licensee will be his profit as a licensee. Clause 5, post, might be adapted to form a proviso to the above clause, by making the reduced royalty depend on the average selling price for the previous few months or so. (e) As to this clause, see ante, p. 204. () That is, if rout be reserved. tures and and unsold by debiting himself therefor in the accounts for such on manufachalf-year with royalties at the rate of article (9) sales. shillings per article (g) and so that at the end of any succeeding half-year in which the articles last aforesaid shall be sold he shall debit himself in the accounts with further royalties at the rate of article (h). shillings per at end of 5 (i). PROVIDED ALWAYS that at the end or sooner determination Proviso that of this licence all articles in the possession of the licensee not then unsold articles already sold whether actually complete or only in course of manu- term shall facture shall bear the royalties which would respectively become bear reduced payable under Clause as if the same had been actually sold royalties. less however a discount of per cent. thereof (j). day of way of royalty at the rate of on as if 6 (). The licensee shall during the continuance of this licence Covenant to pay to the licensor the annual sum of £- — (hereinafter called pay rent and "the rent") by two equal instalments of £each on every royalties. and day of respectively by shillings per hundred weight hundred weight half-yearly of the said such quantity shall in each such half-year have actually been manufactured hereunder by the licensee () and also except as next hereinafter provided (m) a royalty on the same half-yearly days respectively at the same rate for every hundred weight or lesser quantity of manufactured by him hereunder in each such hundred weight (»). half-year in excess of such quantity of 7. The licensee doth hereby covenant &c. [Use Clause I., ante, Another form. p. 228, as to the covenant to pay royalties.] AND ALSO such further sum (if any) as together with the said royalties shall amount to the sum of £ (hereinafter called "the rent") [that is to say a sum equal to the amount of royalties on articles (o)] (p). (g) Or say of the said "the royalties in this behalf mentioned in the Schedule hereto." (j) This clause must be varied for the case of the original royalties not being of fixed amount, e.g. as in Clause 3, ante. In every such case the reduced royalty might conveniently be some percentage on the average selling price for the last few months or so. (k) For another form, see next clause. 66 (1) Or (if the royalties are to be on sales) say, 'as if such quantity had actually been manufactured, and in each such half-year been sold by him." (m) This refers to the Average Clause. See Clauses 8 and 9, post. (n) Or (as to sales) say, "manufactured by him hereunder, and in each such half-year sold by him in excess, &c." (0) If the words in brackets be used care should be taken that the calculation is correct. (p) See the next two clauses (Average Clauses). Average clause. Another form. Royalties on carloads. Royalties per shuttle according to width of fabric and 8. PROVIDED ALWAYS that if the rent for any half-year shall exceed the total amount of royalties due therefor the licensee shall be entitled for any one or more succeeding half-years (so far as necessary for the purpose) for which respectively the total amount of royalties due shall exceed the rent to a remission of so much of the latter excess as will make up to him the excess of payment made in the half-year for which the rent shall have exceeded the royalties due therefor as aforesaid (2). 9 (r). PROVIDED ALWAYS that if the licensees shall for the period between the date hereof and the first day of January next or for any succeeding year pay a royalty or royalties according to the covenant hereinbefore contained without having actually sold within such period or year the engine or engines on which such royalty or royalties were so paid they shall be at liberty in any succeeding year or years, without paying any further royalty in respect thereof to sell to the number requisite to make up such past deficiency aforesaid an engine or engines of the lowest class or (but subject to the payment of the difference in royalties) an engine or engines of any different class or classes. for every carload of 10. A royalty of £-imported by the licensees into their works for the manufacture as hereinbefore authorized which term carload shall be deemed to mean a quantity of aforesaid of the weight of cwt. (s) and so proportionately for any lesser quantity. PROVIDED HOWEVER that no apportionment of any royalty shall be made in respect of any quantity less than 7 lbs. (t). 11 (u). Pay. . . . for every shuttle used in weaving as aforesaid the said fabrics without silk and either in warp or weft to a width not exceeding three inches the sum of five shillings for every day or fraction of a day of such use and to a width exceeding three period of use. inches but not exceeding six inches the further sum of two shillings for every day or fraction of a day of such use and to a width exceeding six inches but not exceeding nine inches the still further sum of two shillings for every day or fraction of a day of such use and so on at the rate of two shillings per day or fraction of a day of such use for each and every further extra width of three inches or less. And for every shuttle &c. [Similar provision as to the manufacture of the fabrics with silk.] (9) For another form, see next clause. (r) This proviso is to meet the case of royalties of different amounts having been reserved on the sales of engines of different classes, and an annual rent having been fixed covering the royalties on the sales of a certain number of engines of the lowest class. (8) Or (if applicable) write, (t) Or superficial feet. (u) This clause is adapted from a clause in a precedent in Coryton (Appendix No. 3). warmers, to which the 12. A royalty of £ for the application of the said inven- Royalties on tion to the first 1000 foot-warmers or other apparatuses of a similar railway footcharacter used by the company or any lesser number and £ for the like application to every additional 100 and so proportion- invention may ately in respect of any less number than 100 of such additional be applied. apparatuses. be reduced to licences. 13 (). The royalties for any articles aforesaid shall be reduced Royalties to from time to time so as to equal the lowest royalties for corre- lowest for sponding articles for the time being provided to be paid in similar time being cases in any other then subsisting licence granted for the said in other district or any part thereof (w). AND FURTHER the licensor shall give to the licensee information in writing at the earliest oppor- to be given to Early notice tunity of any reduction of royalties which ought to be made as licensee of aforesaid and of the circumstances relating to such reduction: any licence involving the PROVIDED ALWAYS that the licensor shall not without the written reduction. consent of the licensee grant any other such licence unless there be reserved thereunder royalties of the like kinds respectively as are reserved hereunder payable half-yearly (x). PROVIDED ALSO Reduced that no royalties reduced as aforesaid so as not to exceed the royalties not royalties of any other licence shall be liable to be increased by if other reason only of the expiration of such licence. to be increased licence be determined. for infringe ments. 14 (y). If the licensee shall at any time during the continuance Suspension of of this licence have reasonable cause to believe that an infringe- rent and ment of the said letters patent had taken or was then taking place while licensor royalties within the said district and shall serve the licensor with a notice in omits to take writing requiring him at the expense of the licensee (z) to take proceedings proceedings legal or otherwise with all due speed in order to prevent or restrain the said infringement or any renewal thereof and the licensor shall for the space of one week or more after such service unreasonably neglect or refuse so to do or having commenced shall for the like space unreasonably neglect or refuse to continue such proceedings the licensee may at any time thereafter while the said infringement or renewal thereof shall remain unprevented or unrestrained on serving the licensor with a further notice in writing for the purpose be at liberty to withhold payment of any rent or royalties aforesaid thereafter becoming due hereunder (a): PROVIDED HOWEVER that the suspended payments shall revive (if at all) either on the termination of any proceedings aforesaid (v) As to this clause, see ante, p. 207. For a shorter clause, see Clause 34, post. (w) Or let there be no limit in the area, e. g. if the intended licence be an exclusive one. (x) Or as provided in the present licence. (y) As to this clause, see ante, pp. 205-6; and note (g) to Licence X., post, p. 280. See also Henderson v. Mostyn Copper Co., L. R. 3 C. P. 202. (z) Or at the expense of the licensor. In the latter case the proviso in brackets at the end of this clause should be inserted. (a) Or provide, as in Clause 19, that the payments shall be made to trustees. |