Stetson University College of Law
21 Annual Conference on Law and Higher Education
February 10 - 12, 2000
st
DOING BUSINESS WITH FACULTY OWNED COMPANIES:
POLICY CONSIDERATIONS
John J. Biancamano
Associate General Counsel
The Ohio State University
33 West 11th Avenue, Suite 209
Columbus, Ohio 43201
(614) 292-0611
biancamano.2@osu.edu
A. Introduction
Many colleges and universities are currently entering into business relationships with
private commercial entities that would have been unheard of in the recent past. This
change in attitude has been motivated in large part by declining revenues and increased
costs, which have forced institutions to seek new ways of generating revenue. The higher
education community has also recognized that these partnerships can benefit society and
the economy by making products of university research more readily available to the
business community.
In line with this institutional trend, many individual faculty are looking for
opportunities to supplement their incomes by engaging in private sector commercial
ventures related to their university work.
For some, this entrepreneurial spirit is
manifested by an increasing interest in private consulting, which has long been permitted,
and in fact, encouraged by most colleges and universities.
In the past, consulting
connoted the occasional speaking engagement or applied research in which the professor
assisted a private firm in refining existing technology. Basic research was reserved for
the university lab. Today, faculty often enter into long-term consulting relationships in
which they assist private firms in creating new inventions and discoveries. They may
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hold formal positions within the company management structure and sometimes may take
ownership positions in these firms.
In recent years, the consulting concept has been expanded to encompass faculty
participation in business transactions involving their university employer. That is, the
professor seeks to hold a personal financial interest in a company contracting with the
university to commercialize his or her research. In a typical case, a researcher who has
invented a marketable technology may create a company for the express purpose of
marketing the technology, often with financing from private investors.
In other
situations, the faculty researcher may receive stock or stock options from a pre-existing
company in return for consulting services. The company licenses the technology from
the university and may seek to sponsor further research in university facilities, with the
faculty inventor as principle investigator. The university may receive royalties under the
license agreement as well as a grant for the research. Some institutions have elected to
accept an equity interest in the faculty company in lieu of royalties or sponsored research
funds.
This paper will focus on the policy implications of these transactions. Litigation risks
are discussed in the accompanying paper by Stephen J. Hirschfeld, "The Faculty Member
as Entrepreneur."
Institutional Policies
The technology transfer agreement with a faculty owned company is a relatively new
phenomenon and many institutions are only now developing policies to manage these
transactions. One of the more detailed treatments of the subject to date appears in
University of Pittsburgh Policy No. 11-02-03.1 This policy allows faculty, staff and
students to hold equity in companies that license their technologies provided that these
relationships are reviewed and approved by their department chair, their dean and an
oversight committee. Other issues addressed include the amount of equity that may be
owned, annual financial disclosures and research sponsored by the company. Policies
from other institutions that may be instructive include those promulgated by University of
Pennsylvania,2 Rutgers,3 Stanford,4 and Michigan State University.5
2
These policies quite properly devote a great deal of attention to conflict of interest
issues and almost no mention is made of the business aspects of the transaction. It may
not be desirable to define the business terms in any detail in an inflexible institutional
policy.
However, an evaluation of the business capability of the faculty member's
company is essential to the achievement of the university's technology transfer goals.
B. Evaluating Faculty Owned Companies
Universities typically cite two institutional interests to justify contracts with faculty
owned companies. First, it is argued that faculty participation in the technology transfer
transaction will facilitate the university's goal of making its inventions available for
practical applications in the marketplace. The opportunity to realize a financial gain
beyond a university salary operates as an incentive to faculty for the development of
inventions with practical applications. In addition, these arrangements recognize the
critical role that the faculty inventor plays in the commercialization process.
The
inventor has the best understanding of the technology and his or her continuing
involvement is essential to the development effort. Some firms are unwilling to license
university owned technology unless they know that the inventor will be available to assist
with the applications research. The faculty inventor's commitment in these efforts is
assured if he or she has an interest in the company.
The second institutional interest is the university's need to attract and retain qualified
faculty. It is said that if a university does not afford faculty the opportunity to participate
in these transactions, they will migrate to other institutions that will let them do so.
These interests are not entirely consistent. Despite the importance of entrepreneurial
opportunities to the faculty hiring process, many factors may make a faculty inventor's
company the least desirable vehicle for bringing an invention to market. For example,
university researchers are often untrained and inexperienced in business matters. If the
faculty inventor insists on personally controlling the management of the company, the
financial viability of the venture may be compromised.
The company may have
insufficient experience, facilities or financial resources. Finally, transactions involving
the university, its faculty employee and a private company raise difficult issues relating to
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conflicts of interest and research integrity, and they present a minefield of potential legal
disputes.
If these factors result in a major disruption or the failure of the business, the
university's interest in commercializing its technology is obviously defeated.
An
otherwise marketable invention can be tied up for years in legal wrangling. Moreover, if
business disputes arise in the course of the transaction, the university's interest in
retaining a valuable professor is in jeopardy. If the institution attempts to protect its
interests in these situations, it runs the risk of alienating the professor. For example, if
the professor's company does not make satisfactory progress in developing the invention,
will the university be willing to terminate the license agreement? If it does so, the
professor’s interest in the company may be rendered worthless and his future relationship
with the university is not likely to be happy, or productive. If the university is somehow
able to regain control of the technology and attempts to market it to another firm, the
faculty inventor may have an understandable reluctance to work with the new licensee.
A technology transfer agreement with a company in which the faculty inventor has an
interest clearly presents risks not seen in similar transactions with other companies.
These risks are increased if university administrators and the faculty entrepreneur fail to
appreciate the true nature of the proposed affiliation. The parties are accustomed to
dealing with each other in an employer-employee relationship complicated by issues such
as tenure, academic freedom and faculty governance. The proposed contract between the
faculty member's company and the university is something entirely different - a business
relationship in which the profit margin is the only indicia of success.
The profitability of university activities usually ranks low on the list of institutional
priorities. Faced with a proposal from a faculty-owned company, academic administrators
may give inadequate attention to the institution's financial goals and may fail to consider
other more desirable technology transfer options.
Faculty may approach these
transactions with an expectation that they are entitled to the deal and may be offended if
the university makes demands or requires performance benchmarks or other assurances.
In order to ensure the success of the venture, the viability of the business should be
the first consideration for both parties. The university should perform a rigorous analysis
of the business merits of the faculty member's proposal and should make it clear from the
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outset that it will not contract with the faculty member's company unless it determines
that the arrangement presents the best opportunity to develop the technology.
In
performing this analysis, the following questions should be addressed.
Has the faculty member created a viable business entity?
The faculty company should be required to demonstrate that it has access to capital,
operating funds, and other resources sufficient to make the business work. It should also
have credible and experienced management.
Does the company have a business plan?
The company should be required to submit a business plan that demonstrates an
understanding of the technology and its potential market and that contains a realistic and
effective commercialization strategy.
Is the faculty-owned company the best vehicle for developing the technology?
The university should make a thorough evaluation of the invention's economic
potential and the pool of potential licensees before it decides on the most advantageous
method for developing the technology. In some instances, an established company with
prior experience in the area may present a greater probability for success. In this regard,
it is important to resist suggestions to commit to the faculty company too early in the
research process. Faculty sometimes want to start a business and sign a university
contract when the technology is at an early stage of development, before either party
understands its full potential. It is not realistic to believe that the faculty company can
attract financial backers at this point, and more importantly, it is difficult for the
university to determine whether other commercialization options are more appropriate.
Both parties must recognize that it is in nobody's interest for the university to forego
an agreement with a promising licensee in favor of an arrangement with a less capable
faculty owned company. If the unrelated company succeeds in marketing the technology,
the faculty member will at least receive royalties through the university. Obviously, if
the faculty member's company fails, everyone loses.
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Protecting the Credibility of the Transaction
Finally, a due diligence review of the transaction will help to address the conflict of
interest concerns discussed below. Technology transfer arrangements with faculty
companies can be criticized as "sweetheart deals" if preferential treatment is given to the
faculty inventor, to the detriment of the university. The credibility of the transaction, and
that of the faculty participants, will be enhanced if the university performs a thorough
evaluation of the proposal and signs a contract that adequately protects institutional
interests.
C. Conflicts of Interest
When faculty and administrators focus their attention on the market potential
of university research, they should also take steps to ensure that traditional
academic values are not compromised.
In particular, the parties must be
concerned about conflicts of interest that arise when faculty participate in
university transactions commercializing their research.
PHS Regulations
Recognizing the entrepreneurial trend in university research, the Public Health
Service promulgated regulations effective October 1, 1995 which established standards to
ensure that research funded by PHS will not be biased by any conflicting financial
interest of the investigators responsible for the research.6
The National Science
Foundation issued a policy applicable to NSF funded projects that was substantially
similar to the PHS regulations.7
The PHS regulations require institutions to maintain a written and enforced policy on
conflicts of interest and to inform each investigator of that policy. The policy must
require investigators planning to participate in PHS funded research to disclose
significant financial interests (i) that would reasonably appear to be affected by the
research, and (ii) in entities whose financial interests would reasonably appear to be
affected by the research. The institution must designate an official to solicit and review
the financial disclosure statements and the policy must provide guidelines for the
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designated official to identify conflicting interests and to take appropriate action to ensure
that they will be managed, reduced or eliminated.
The conflicts of interest8 that arise when the university contracts with a faculty owned
company are readily apparent.
In addition to the potential for bias in conducting
research, these transactions raise concerns about improper use of university facilities,
staff and students.
When asked to file financial disclosure statements mandated by university policy,
some faculty may argue that as individuals, their behavior has been and will continue to
be above reproach. They may contend that it is unfair to attribute to them the motives of
a few bad actors and to subject them to the inconvenience of conflict of interest
disclosures and restrictions.
This argument fails to recognize that conflicts of interest are in large part problems of
perception. Whether we like it or not, society as a whole, and the press in particular,
assume that a personal financial interest is highly likely to influence an individual’s
professional judgment. Actual behavior is irrelevant. It is the perception that counts. If
the author of a scholarly article evaluating a new drug is found to have an interest in the
company that sponsored his or her research, many people will question the credibility of
the article.
While this generalization may be inaccurate and unfair when applied to individuals, it
is sometimes grounded in fact. On a regular basis, we read reports of scientific
misconduct motivated by a desire for pecuniary gain.9 The number of these cases is
insignificant in light of the huge volume of research conducted at colleges and
universities but they reinforce the common perception. We should also be aware that
while most of us would not give in to blatant corruption, a personal financial interest can
exert subtle influences on our professional behavior in ways that we may not fully
understand.10
Strategies for Managing Conflicts of Interest
Conflicts of interest that arise out of a technology transfer agreement with a faculty
owned company can be managed or reduced by putting in place administrative safeguards
that limit the entrepreneurial professor’s ability to make self serving decisions and
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eliminate any appearance of impropriety. These safeguards should be memorialized in a
conflicts management plan signed by the faculty members involved as well as the
university administrators charged with the responsibility for enforcing it. The document
attached as Appendix A is an example of such a plan. An exhaustive discussion of all the
conflict of interest issues that may arise is beyond the scope of this paper. Appendix A
may contain provisions that some may deem unwise and it is offered only to illustrate
some of the questions that should be considered.
The parties to the management plan are the university, the inventors of a marketable
technology, (Professors A and B) and the company that will commercialize the
technology. Prof. A is a founder of the company and holds a significant percentage of its
stock. The more conservative Prof. B has declined the offer to invest in the company.
However, he plans to consult for the company and receive stock options in payment for
his services.
Under a separate agreement, the university has licensed the technology to the
company and the company has agreed to sponsor further research at the university to
bring the technology to market. Prof. A will be the principle investigator for this research
and Prof. B will be a co-investigator.
Disclosure
The disclosure requirements constitute the most important conflicts management
strategy contained in the plan. The professors must file annual disclosures of their
interests in the company, (Para. 5), quarterly reports of time and effort spent working for
the company, (Para. 8), and quarterly reports on sponsored research activities, (Para 2b).
In the eyes of most people, secrecy lends credence to the presumption that a personal
financial interest will bias research.
Disclosure imposes a measure of public
accountability and demonstrates that the researcher and the institution have nothing to
hide. It is particularly important that consulting relationships or financial interests in
companies sponsoring research be disclosed when the results of that research are
published.
8
Administrative Oversight
Oversight by disinterested administrators is an obvious strategy for allaying conflict
of interest concerns.
In this case, the professors' department chair is assigned the
responsibility for overseeing sponsored research, (Para. 2b), consulting activities, (Para.
3b), use of facilities, (Para. 6), and the hiring of students, (Para. 7). This transaction will
require a level of attention from the chair that is greater than the supervision he or she
may exercise with respect to other faculty activities. Administrators do not always
welcome added responsibilities such as this.
However, the active participation of
administrators is essential to the success of these ventures.
Use of University Facilities
The professors must obtain prior approval for the use of university facilities in
connection with their consulting activities for the company and the university must be
reimbursed for the fair market value of the facilities, (Para. 6). If the university wishes to
be supportive of the company, would it be appropriate to accept reimbursement on a cost
basis, rather than fair market value?
Hiring Students
The draft plan discourages the hiring of students by the company, but stops short of
an outright prohibition. There clearly are risks of abuse if students are pressed into
service against their will, but in many instances, the students are anxious to gain the
experience derived from working for the company.
If this is the case, student
employment may be approved if the students are made fully aware of their rights and a
clear line of demarcation is drawn between their duties as company employees and their
academic careers.
Appendix B is a draft student employment disclosure form that
attempts to achieve this result.
Level of Involvement with the Company
A professor who serves as a director, officer or manager of the company
commercializing his research may find that the time demands of these positions interfere
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with the performance of his university duties. More important than the conflict of
commitment issue is the problem of divided loyalties.
Directors, officers and managers have a responsibility to act in the best interests of
the company. A professor has an obligation to comply with the policies of his or her
institution.
While the university and the company share a mutual goal of
commercializing the technology, there may be considerable divergence between their
financial interests and their institutional missions.
For example, if the professor
conceives of an invention in an area of interest to the company, should he disclose it to
the company, or to his employer as required by the university patent policy?
Membership on the board of directors or acceptance of a managerial position could
present a university professor with an irreconcilable conflict of interest. For the same
reasons, ownership of a controlling interest in the company may also be problematic.
The draft management plan attempts to address these issues by limiting the
professors' level of involvement with the company. Equity interests are limited to a
percentage of issued shares. (Para. 3e). Conditions are placed on the exercise of stock
options. (Para. 3g). The professors are prohibited from serving as directors, officers or
managers. (Para. 4a). They acknowledge the primacy of their university obligations.
(Para. 4b).
Company Sponsored Research
The company is sponsoring research at the university, and Professors A and B are
permitted to serve as investigators. While they clearly have a financial interest in the
outcome of the research, it is not practical to avoid the conflict by prohibiting their
involvement. As the inventors, their participation is essential, and there is probably no
one else in their department with the background necessary to oversee the research.
It should be noted that some institutions take a more restrictive approach to this
problem. For example, Section II (C) (3) of the University of Pittsburgh policy states that
a professor with equity in the sponsor company cannot serve as the principal investigator
on the project. Application of such a rule in this case would effectively preclude the
research agreement with the professors' company.
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D. Questions for the Future
It is difficult to describe standard approaches to the conflict of interest problems
mentioned above because most arrangements with faculty owned companies are at
present negotiated on a case by case basis without benefit of an overriding university
policy. This situation will change over time as institutions gain more experience with
these transactions and develop commonly accepted methods of conflict of interest
management. When this happens, we are likely to find that conflict of interest concerns
are no greater than those existing in private sector companies.
There is no doubt that some entrepreneurial initiatives can be quite successful and
that they can enhance the mission of the university if they are properly structured. It
should also be apparent that an emphasis on the entrepreneurial aspects of research may
result in subtle changes in the way research is conducted and in the relationships between
members of the university community.

Will some institutions and individual faculty focus their research priorities only on
projects with a potential for commercial development?

If faculty view their research as opportunities personal gain, will they come to look
upon their departmental colleagues as potential competitors and refuse to share
information with them?

Does the opportunity to build a business out of one’s research operate as an incentive
for the retention of valuable faculty? Or, will the professor's allegiance to his or her
company erode the loyalty that, in the ideal world, ought to exist between faculty and
university?
These and similar questions should be carefully considered as colleges and
universities pursue entrepreneurial opportunities.
1. University of Pittsburgh Policy 11-02-03
<www.pitt.edu/DOC/94/271/42590/policies/11/11-02-03.html>
2. University of Pennsylvania, Layman's Guide to Conflict of Interest.
<http://www.upenn.edu/VPR/COI1b.html>
3. Rutgers University. Faculty or Staff Involvement with Commercial Enterprise
Contracts with the University. <http://info.rutgers.edu:80/orsp/coi1.html>
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4. Stanford University, Faculty Policy on Conflict of Commitment and Interest,
<http://www-portfolio.stanford.edu/100906>
5. Michigan State University, Faculty Handbook, Interim Guidelines for Potential
Conflicts of Interest in Academic Areas of the University,
<http://www.msu.edu/unit/facrecds/FacHand/interimguidelines.html>
6. 42 CFR 50.601, et seq. These regulations were issued pursuant to Section 164 of the
National Institutes of Health Revitalization Act of 1993, (P.L. 103-43), in which
Congress required the Secretary of Health and Human Services to promulgate
regulations defining "the specific circumstances that constitute the existence of a
financial interest in a project on the part of an entity or individual that will, or may be
reasonably expected to, create a bias in favor of obtaining results in such project that
are consistent with such financial interest." 42 U.S.C. Sec. 289b-1
7. Federal Register, Vol. 60, No. 132, July 11, 1995
8. For a helpful definition of conflict of interest, see Thompson; Understanding
Financial Conflicts of Interest. New England Journal of Medicine 1993; 329: 573576. "A conflict of interest is a set of conditions in which professional judgment
concerning a primary interest (such as a patient's welfare or the validity of research)
tends to be unduly influenced by a secondary interest (such as financial gain)." The
primary professional obligations of a college or university professor include the
performance of sound and objective research and fostering the intellectual growth and
general welfare of students. A situation in which the existence of a personal financial
interest may influence a professor’s judgment concerning the conduct of research or
the welfare of students constitutes a conflict of interest.
9. Dying for a cure. U.S. News & World Report, October 11, 1999.
A Doctor's Drug Studies Turn Into Fraud. The New York Times, May 17, 1999.
Drug Trials Hide Conflicts for Doctors. The New York Times, May 16, 1999.
Conflict of Interest Fears Rise as Universities Chase Industry Support, The Chronicle
of Higher Education, May 22, 1998.
10. See Hillman, Joseph, Mabry, Sunshine, Kennedy, Noether; Frequency and Costs of
Diagnostic Imaging in Office Practice - a Comparison of Self-Referring and
Radiologist-Referring Physicians. New England Journal of Medicine 1990;
323:1604-8. The authors found that physicians who maintained X-ray equipment in
their own offices (and profited from the use of this equipment) ordered more
examinations and charged more than those who referred patients to outside
radiologists. We cannot conclude on the basis of this study that the physicians had
fraudulent intent. But, it would be naïve to assume that the correlation between
frequency of testing and the opportunity for profit was entirely coincidental.
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Appendix A
(A Sample Conflict of Interest Management Plan)
Memorandum of Understanding
This Memorandum of Understanding ("MOU") is by and between University, Professor
A, Professor B (collectively "the Faculty Members") and Company and is entered into
simultaneously with the execution of a Technology Development and License Agreement
("the Development Agreement") between University and Company. This MOU and the
Development Agreement shall be read together and shall comprise the entire agreement
between the parties.
The Development Agreement provides that certain technology invented by Professor A
and Professor B, and owned by University, shall be licensed to Company in return for the
payment of royalties, fees and expenses. It further provides that Company shall sponsor
additional research projects ("Sponsored Research Projects") to develop the technology.
Professor A is a founder of Company and currently owns % of Company's outstanding
and issued shares. The parties recognize that the ownership of an equity interest in
Company by the Faculty Members creates potential conflicts of interest. The purpose of
this MOU is to clarify the relationships between the parties in order to avoid and/or
manage such conflicts of interest. This MOU shall also serve as a conflict of interest
management plan as defined in the University Conflicts of Interest Policy.
1. Term.
a. This MOU shall become effective on the effective date of the Development
Agreement and shall remain in effect as long as the Development Agreement is in
effect. This MOU may not be terminated by the parties unless the Development
Agreement is simultaneously terminated.
2. Sponsored Research Projects
a. Sponsored Research Projects performed by University for Company under the
Development Agreement shall be handled as standard sponsored research projects
under the terms commonly used by University for industrial agreements.
Professor A shall serve as the Principle Investigator on the Projects and Professor
B shall be the co-investigator.
b. The Faculty Members shall submit quarterly reports to their department chair
detailing their activities, expenditures and significant findings in connection with
the Sponsored Research Projects.
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3. Consulting by the Faculty Members
a. Company may enter into consulting agreements with the Faculty Members
("Consulting Agreements") under the conditions set forth in this MOU. The
Faculty Members must comply in all respects with the University policies on
Outside Consulting, Conflicts of Interest and Intellectual Property. In particular,
Faculty Members acknowledge the applicability of Section of the University
Policy on Outside Consulting, which states that, as a general rule, the level of
professional effort devoted to outside consulting activities should be no more than
one day per week.
b. Any Consulting Agreements between Company and the Faculty Members must be
reviewed and approved by their department chair. The scope of work of the
Consulting Agreement shall not overlap with or be of the same nature as work
that would be performed under a sponsored research project. If the scope of work
in an approved Consulting Agreement should change, the Faculty Members shall
submit the revised scope of work to their department chair. The chair shall have
final authority to decide whether work proposed to be performed under a
Consulting Agreement is more appropriately performed as a Sponsored Research
Project.
c. Any Intellectual Property that is conceived under approved Consulting
Agreements solely by the Faculty Members shall be owned exclusively by
University. Any Intellectual Property that is conceived solely by Company
employees shall be owned exclusively by Company. Any Intellectual Property
that is conceived under approved Consulting Agreements jointly by the Faculty
Members and Company employees shall be owned jointly by the University and
Company.
d. The Faculty Members may be paid for services under approved Consulting
Agreements in cash or with stock options.
e. The total amount of equity interest, including stock options, to be held by each
Faculty Member and any member of his immediate family, shall not exceed an
aggregate of % of Company's outstanding and issued shares.
f. The stock options shall provide that they may not be exercised by the Faculty
Members until such time as one of the following events occurs:
i. the sale of Company;
ii. one year after the first commercial sales of products derived from the
Intellectual Property licensed under the Development Agreement;
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iii. the termination of all Sponsored Research Projects performed by the Faculty
Members, with no present intention to engage in further Sponsored Research
Projects;
iv. receipt of written approval from the University conflicts officer.
4. Level of Involvement with Company
a. The Faculty Members shall not serve as directors, officers, managers or in any
other decision-making capacity on behalf of Company. The Faculty Members
may serve as scientific advisors for Company pursuant to approved Consulting
Agreements.
b. The Faculty Members acknowledge that their teaching, research and service
duties within the University remain their primary professional obligations and
they affirm that they will not allow their activities with, or interests in Company
to interfere with their performance of these responsibilities.
5. Disclosure
a. The Faculty Members shall file annual disclosure statements with the University
conflicts officer detailing all relationships with Company, including any
ownership of stock or stock options. The first such statement must be filed upon
the execution of this MOU. Statements shall be filed annually thereafter, or
earlier if any significant changes should occur in the relationships previously
disclosed.
6. Use of Facilities
a. University facilities shall not be used for consulting purposes under approved
Consulting Agreements unless prior approval is obtained from the Faculty
Members' department chair. The University must receive reimbursement for the
fair market value of such use.
7. Students
a. The employment of University students by Company is discouraged. In
exceptional circumstances, such employment may be permitted if prior written
approval is obtained from the student's department chair. If such approval is
obtained, the student must sign the Student Disclosure Form attached to this
MOU as Exhibit 1.
8. Time and Effort Reporting
a. Each Faculty Member shall provide to his department chair a quarterly report of
time and effort spent on work for Company.
15
Professor A
Date
Professor B
Date
Chair
Date
Company
Date
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Appendix B
(Sample Student Disclosure Agreement)
Agreement
This agreement is between University, an institution of higher education located at
, Company, a corporation with its principle place of business at
and Student, a graduate student in the
Department at the University.
Whereas, in order to govern the relationships among the University, its faculty and staff,
and Company and to avoid or manage any conflicts of interest that may arise by virtue of
these relationships, the University and Company entered into a Memorandum of
Understanding executed on
; and
Whereas, the Student desires to accept an employment position with Company and also
proposes to enroll in courses at University;
Now, therefore, the parties agree as follows:
The following conditions shall apply to the employment of the student by Company
during the period beginning
and ending
.
1. The student is free to accept or reject an offer of employment by Company and may
terminate this employment at any time.
2. The manner in which the student performs his duties while an employee of Company
and the voluntary or involuntary termination of his employment shall bear no relation
to his status as a student of the University or the evaluation of his academic
performance.
3. Employment with Company will not affect consideration of the student for a
subsequent appointment as a graduate assistant or for other University financial
support.
4. Employment with Company will not contribute to progress towards a degree.
5. University employees shall not be involved in any way in the supervision of the
student or the evaluation of his performance while he is acting as an employee of
Company.
6. There will be no overlap between work performed by the student in his capacity as an
employee of Company and the work he performs at the University on research
projects sponsored by Company.
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7. The student will receive monetary compensation for his work at Company. The
student shall not be compensated through the issuance of shares of stock or stock
options.
8. Company agrees that it does not intend, by virtue of the employment of the student, to
acquire intellectual property rights that would otherwise by owned by the University.
9. Company shall disclose to the University the terms of employment and the nature of
the work to be performed by the student. This disclosure will assure that work
performed by the student will not continue, derive or carry forward work performed
previously at the University as sponsored research.
10. A copy of this agreement shall be provided to the Chair of the
Department,
who shall advise the student concerning any issues that may arise in connection with
his Company employment.
Student
Date
Company
Date
Chair
Date
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