Section 3364-70-13 - Disposition of start-up equity(A) Policy statement The university of Toledo ("university") may accept equity or warrants in a start-up company as partial consideration for a license agreement. The license agreement will include language that allows university to assign its rights in any such equity interest to a third party designee. University has designated rocket innovations or a direct or indirect affiliate of rocket innovations to receive equity interests or warrants in start-up companies, subject to acceptance and approval of the assignee.
(B) Purpose of policy Provide a procedure for the assignment and liquidity of equity interests or warrants obtained by university through a license agreement.
(C) Procedure (1) University will promptly notify rocket innovations, in writing that it is in the process of licensing technology to a start-up company that includes an equity interest.(2) University will execute an agreement with rocket innovations before the equity interest is transferred that defines the terms of the equity interest.(3) University will promptly notify rocket innovations, in writing, as soon as it receives notice from the licensee that it is planning a liquidity event which may include, but is not limited to, an initial public offering, purchase and sale of an ownership interest, merger, and any other type of exit strategy or liquidation used by the licensee.(4) In the event that university has assigned its right in any equity interest, the assignee will have sole discretion and control in the disposition of equity interests assigned by university. The assignee shall exercise independent judgment in evaluating, negotiating, and accepting the terms and conditions of any liquidity event.(5) If the liquidity event is a sale of equity in the public market, the assignee will make arrangements for the sale of the equity in the public market in an orderly fashion at the end of any "lock-up" period.(6) Upon completion of the liquidation event, the assignee will transfer the proceeds to the university's office of research so it may distribute the funds in accordance with university's patent rule 3364-70-04.Ohio Admin. Code 3364-70-13
Effective: 3/23/2018
Promulgated Under: 111.15
Statutory Authority: 3364
Rule Amplifies: 3364