5.4.6 Distribution of Income

To encourage further development of intellectual property and as authorized by BOR, OTL shall use the following income distribution mechanism.  

The first Two Thousand Five Hundred Dollars ($2,500) of gross licensing income derived from the Commercialization of any intellectual property shall be paid to the Creator(s) of Record. Thereafter, the net income, computed on a cumulative basis, shall be distributed as follows: 
  

	Net $500 K	$501 K - $1,000 K	> $1,000 K
Creator(s) of Record	33%	33%	33%
Unit	17%	27%	33%
GTRC	50%	40%	34%

All licensing net income from royalties and similar income, i.e., Gross Income less all expenses attributable to that specific disclosure (e.g., patent costs, attorney costs, evaluation costs, marketing costs, reproduction, mailing, consumables, and unreimbursed development costs, etc.), shall be distributed annually by GTRC to the Creator(s) of Record and/or unit.  

Reinvestment funds are intended to seed additional research and development of new Intellectual Property. Distribution of a portion of royalties, and similar or related income, for reinvestment will be made in the form of a GTRC grant to the primary home unit of the principal Creator for use in funding additional research and development or other scholarly activities at the unit level. 
The portion of royalty and similar or related income that accrues to GTRC shall be used to partially offset the costs of technology transfer or dissemination not allocable to specific licensed intellectual property and to support the research and teaching infrastructure and programs of GIT. 

In the event that equity in a company is offered to and accepted by GTRC as part of consideration for a license to technology and/or to any other intellectual property, GTRC, through OTL, and the Creator(s) of Record shall agree in writing on how the Creator(s) of Record will receive equity shares and other related matters, provided that the Creator(s) of Record have made proper disclosures to and received approval from the Conflict of Interests review group.   

Subject to the company’s subscription or shareholders agreement provisions requiring that GTRC not receive shares with an intent to sell, upon any sale of the equity shares retained by GTRC, the net proceeds received therefrom, will be distributed to the unit, to the Creator(s) of Record, and to GTRC according to the mechanism described in this policy. 

Retention of Ownership 

Ownership of intellectual property rights will normally be retained by GTRC. This is to ensure that all licensable knowledge created or invented will be available for public use. Exclusive licensing agreements by GTRC will contain a due diligence provision to require the license to revert to GTRC within a reasonable period of time if the licensee does not make the intellectual property available to the public according to the terms of a fully executed agreement.