GRANT AGREEMENT This grant agreement (this ?Agreement?) is made effective on October 3, 2017 (the ?Effective Date?) between Iowa State University Foundation, an Iowa nonpro?t corporation (the ?Foundation?), Iowa State University of Science and Technology (the ?University?), an instrumentality of the state of Iowa, and the Charles Koch Foundation, a Kansas nonpro?t corporation (the for the bene?t ofthe Program for the Study of Midwest Economies (the ?Frog which will be created at the Unive1sity. The term of this Agreement is hunt the Effective Date to the later of July 31, 2022, or until the Foundation and the University have spent all of the Contributed Amount, unless earlier terminated pursuant to this Agreement The Foundation, the University, and the Donor are sometimes referred to in this Agreement individually as a ?Party? and collectively as the ?Parties.? The Parties agree as follows: . 1. Promoting Academic Freedom. Consistent with the Donor?s principles of supporting a diversity of ideas in higher education, the Donor?s grant is intended to help promote an environment at the University where ideas can be exchanged freely and useful knowledge will bene?t the well-being of individuals and society. Thus, the Parties agree that the academic freedom of the University, the Program, and their faculty, students, and staff is" important to the success of the Program?s research, scholarship, teaching, and service and will abide by the University?s policies with respect to academic freedom and academic responsibility as articulated in the University?s Faculty Handbook, Section 5.2. . The University and its faculty, stalf, and students each have the right to release 01? publish scholarly information at their discretion in accordance with University policies. 2. The Program. The University desires to support the Program to advance the Program?s and University?s educational missions as follows: a. The Program?s Mission and Director. As stated in the Iowa State University Proposal, which is hereby incorporated into and made part of this Agreement and attached as Attachment A (the ?Proposal? the University has informed the Donor, and the Donor is relying on such representation, that the Program?s mission is accurately stated in the ?Vision? and ?Mission Statement? sections of the Proposal (the ?Program?s Mission?). Dr. Peter Orazem is the director of the Program (the ?Program Director?). b. The Grant Components. To support the s_ Mission the Un1vers1ty desires to create the, following positions and activities affiliated with the Program, collectively referred to as the ?Grant Components.? The Grant Components are desc?bed more fully 1n the Proposal and include the following positions and suppoit: one or two ?New Tenure?track Facultyf? ?Existing Faculty Support; ?Student Support; ?Research Support; ?Communications and Outreach -;Support ?Program Support; and ?Postdoctoral Support.? The Foundation and the University shall each use any funds received under this Agreement solely to support the Grant Components in accordance with the terms of this Agreement. According to the University?s normal policies and procedures, the Program Director 15 responsible for directing the Grant Components. Therefore, the Program Director has the authority (subject to and consistent with the University?s policies and piecedures) to administer and allocate the Program 3 budget, supervise Center staff, provide mentorship, ful?ll other duties to advance the Program 3 Mission as deemed appropriate by the P1 ogram Director, or to delegate any of these responsibilities. Selection. In keeping with the University 3 and the Donor? shared commitment to academic f1 eedom the selection of all positions associated with the Grant Components must follow the University 3 normal - procedures and be consistent with the University 3 commitment to non?disc1 1mination in the hiring of employees and admission of students. As part of the University 3 normal procedures, the Program D11 ector and other appropriate members of the University?s faculty and administration will have an opportunity to provide feedback on the hiring of individuals who will hold a position with the Program. 3. The University?s Commitment to and Support for the Program. a. Generally. The University shaii provide administrative, logistical, and other relevant support for the Grant Components to advance the Program?s Mission and University?s mission during the Term. The University, in its sole discretion, may elect to continue to provide support for the Grant Components and the Program after the Term. b. The University?s Speci?c Support for the Program. i. Of?ce Space. The University shall ensure that the Program has adequate space to achieve the Program?s Mission. The University shall make available space for the Program, including office space for the individuals holding the Program?s various positions as well as shared conference and meeting space for the Grant Components. ii. Student Support. As part of the Student Support, the University shall provide graduate student full tuition scholarships to three students and a graduate fellowship to one student, all of whom will be selected according to the University?s normal p'roceddres. NewTenure?track Faculty Support. The University shall provide for moving costs and startup funds for the New Tenure-track Facuity in accordance with University policies. 4. The Donor?s Support for the Grant Components. a. Contributed Ampunt. Subject to the terms of this Agreement, the Donor agrees to contribute funds to the Foundation solely to support the Grant Components to advance the Program?s Mission (all or part of such funds are referred to as the ?Contributed The maximum aggregate Contributed Amount under this Agreement is $1,685,000 if no ?Matching Amount? (de?ned in Section is previded. Subject to Section the maximum aggregate Contributed Amount is $2,485,000 if the maximum Matching Amount is provided. The maximum aggregate Contributed Amount in each instance is as follows: Grant Components Maaimnmgaatribnted. .Masimamgantrihnted . . Amount Without Amount With Matching Amount Matching Amount Salary and fringe bene?ts for two New Tenure~Track Up to 866,000 Up to 1,282,000 Faculty Salary and fringe bene?ts for Existing Faculty Up to 279,000 Up to 452,000 Support Costs and expenses for Student 'Suppmt Up to 405,000 Up to 451,500 Costs and expenses for Research Support Up to 60,000 Up to 210,000 Costs and expenses for Communications and Up to 42,000 Up to 42,000 Outreach Support Costs and eXpenses fer the Program Support Up to 33,000 Up to 47,500 Total Maximum Aggregate Contributed Amount: I $1,685,000 $2,485,000 b. Other Support. If the University and Donor mutually agree, the Donor may also contribute in- kind services to the University to help promote the work of the University, the Program, or the University facility, students, and staff. 5. Foundation Grant Reg nest; Proposed Grant Award Process and Schedule. a. The Foundation Grant Request. The Foundation shall submit an annual written request according to the schedule below to the Donor (the ?Foundation Grant Request?) and an accou'ntin of the expenditure of any Contributed Amount or ?Matching Amount? (de?ned in Section previously received. If the Donor approves the Foundation Grant Request, the Donor shall make a contribution up to the amount listed in the below schedule to the Foundation, and the Foundation agrees to accept such Contributed Amount on behalf of the University as stated in the schedule in Section If the Donor declines to provide any Contributed Amount in response to the Foundation Grant Request, it shall notifythe Foundation and the University and provide them an opportunity to cure or address the circumstances underlying the decision as stated in Section b. The Fund. The Foundation shall place all of the Contributed Amount in a segregated and restricted fund on its books and records called the Fund? (the ?Fund?). The Fund shall be used solely to support the Grant Components and Pregram?s Mission as stated in this Agreement. The Fund shall not be used directly or indirectly for any of the Foundation?s or the University?s overhead fees. The Foundation shall make the Fund available for contributions from other donors. If another donor makes a contribution to the Fund, the Foundation shall notify the Donor of the amount donated and, if permitted by the other donor, the name of the other donor. 0. Matching Amount. i. Matching Amount Provided. The Foundation or the University may provide funds directly or the Foundation or the University may provide funds from a donor, including the Donor, solely to support the Grant Components (the ?Matching The Foundation shall provide written notice of such Matching Amounts in the Foundation Grant Request. The maximum Contributed Amount available will increase by an amount equal to the Matching Amount up to the maximum Matching Amount as stated in Section By way of example, if the Foundation notifies the Donor in the June 1, 2018, Foundation Grant Request that a Matching Amount was provided in the amount of $50,000, the maximum Contributed Amount in Section 5(d) corresponding to the Foundation Grant Request made on June 1, 2018, will increase by $50,000 up to $521,000. By way of further example, if the Donor provides a Matching Amount in connection with the June 1, 2018, Foundation in the e1n0unt0f$50,000, the masterinppnuibatsdAmount in Section 5th corresponding to the Foundation Grant Request made on June 1, 2018, will inorease by $50,000 up to $521,000, and the Donor will have provided $571,000 to the Foundation ($50,000 Matching Amount plus $521,000 Contributed Amount). ii. Matching Amount Not Provided. If there is no Matching Amount for a Foundation Grant Request, the Donor has no obligation to increase its Contributed Amount. Nothing in the foregoing requires the Foundation or the University to provide a Matching Amount, and no breach shall be deemed to have occurred if the Foundation and the University do not provide a Matching Amount. d. Foundation Request and Proposed Grant Award Schedule Foundation Grant Request Donor Response and Maximum Maximum Contributed Amount Date Proposed Contribution Matching Date Amount . The Donor shall consider Within sixty days (60) $0 Up to $524,000 Attachment A a request for days of the Parties up to $524,000 for the Grant signing this Agreement Components June 1, 2018 On or about August 1, $102,000 Up to $573,000 if the maximum 2018 Matching Amount is provided . Up to $471,000 if no Matching Amount is. provided June 1, 2019 On or about August $216,000 Up to $537,000 if the maximum 2019 MatehiugAmount- is provided Up to $321,000 if no Matching- Amount is. provided. June 1,2020 On 01? about August 1, $221,000 Up to $551,000 if the ?maximum 2020 Matching Amount is provided Up to $329,000 if'no Matching Amount is provided June 1, "2021 On or about. August 1, $260,000 Up to $300,000 2021 Matching Amount it proyitied Up to $430 01101an Matching Amount 13 p10v1ded 6. Contributed Amount Used 8011111? for EducationalPurposes farthe-Grant'Comuonente a. as Status. Accmding to IRS 1eooids, the Foundation 15 an o1ga11iz'ation desc11bed within the meaning of inte1 11111 Revenue Code (the ?Code?) sections 501(c)(3) and 509(a)C1) and the Univelsity is an organization described within the meaning of Code sections 115 and 170(c)(1) The Foundation and the University agree to immediately notify the Donor if their respective tax statuses change. 13. Educationai Pu'1p'ose; The Conitibuted Amount will be eXpend'ed solely for the Giant Components, which is an educational p111 pose desct ibed 111 section 170(c)(2xs) of the Code. The Connibuted Amoiint will not be used to in?uence legislaticm as desel'ibed' 111 section 4945(d)(i) of the Code, to influence the of. any. election. .fo1. poll?neal campalgn o.1 .inte1ve11'tio',n .11) 112111131. voter d11ve _or- any..- othel put pose that would jeopardize the Douol? tax-exempt status or subject the Dono1 to penalties under. Chaptet 4-2 of the Code 0' G1 ant Components. The- Foundatlon and the Un1ve1s1ty shall use all Conn: ibuted Amounts solely to support the G1 ant Components as stated 111 this A'glee'ment and shall rein: to the Donor any Contributed Amount not expended fo1 the Giant Components. 7. _General'ProVisiOns. a, The Donor has the right to te1 Initiate this Agreement 01 decline to ovtde any Contubuted Amount in response to a Foundation G1 ant Request if: the Foundation or the Univeisity breaches any tel 111 of- this Agreement; (ii) the Giant Components me not ad'yanoing' the P1 0g1 am ?s Mission; 01 sudh action" is 1160633111 to comply with any law applicable to the Foundation, the Unive1sity, 01 the Doom The Donor? decisiOn not to 111 ovide any Conn ibute'd Auteunt 111 tesponse to a Foundation Giant Request 01 to te; inmate this Agreement is effective upon the expiration of thiity business "days from the date notice was provided by the Donor 101111; Foundation During the pendency of the thirty business days, the Dono1 shall p1 ovide the Foundation and decision If the Agieement is teiminated by the Donot, the Foundation and the Un1ve131ty shall letu'tn all unen'euinhei ed Contributed Amounts to the Donm within thirty days of the Donor? tequest and the Donm is under no obligation to provide. any fuither ContributedAmountsto the Foundation 01: the University 4 . b. The Foundation and the University have the right to terminate this Agreement if: the Donor breaches any term of this Agreement; (ii) the Donor does not provide any Contributed Amount in response to a Foundation Grant Request; or such action is necessary to comply with any law applicable to the Foundation, University, or the Donor. Such termination is effective upon the expiration ofthiity business days from the date notice was provided by the Foundation or the University to the Donor. if the Agreement is terminated by the Foundation or the University, the Foundation and the University shall return all unencumbered Contributed Amounts to the Donor within thirty days of the Donor 3 request, and the Donor IS under no obligation to provide any ?irther Contributed Amounts to the Foundation or the University c. Neither Party shall use the name or trademarks of the other Party or the name of any of its employees in any publicity or advertising, including endorsements, without the prior written consent of the other Party. Notwithstanding the foregoing, each party may use the name of the other Party and its employees for ful?lling any reporting obligations, d. Certain records of the Foundation and the University are subject to the Iowa open records law. Therefore, this Agreement and related information may be made available if required under Iowa open records law. The Agreement may also be released if required under other applicable law. Otherwise, the Foundation and the University agree not to disclose to any third party this Agreement or related information without express written approval from the Donor. Before the Foundation or the University disclose this Agreement er related information, the Foundation and the University agree to provide the Donor with at least 5 days? advance written notice of such disclosure unless legally prohibited from providing such notice. e. I The terms centained in this Agreement supersede all prior oral or written agreements and understandings between the Parties related to the matters contained in this Agreement and shall constitute the entire agreement between the Parties with respect to the matters contained in this Agreement. f. In the event of a con?ict between the provisions stated in the body of this Agreement and those stated in the Proposal, this Agreement shall control. g. This Agreement sha11 not be modi?ed or amended except b_y_ dulyi executgd the? Parties to this Agreement 11. The provisions of this Agreement are deemed severable and should any part, term, or provision of this Agreement be construed by any court of competent jurisdiction to be illegal, invalid, or unenforceable, the legality, validity, and enforceability of the remaining parts, terms, and provisions will not be affected thereby. i. No delay or failure on any Party?s part to enforce any right or claim which it may have hereunder shall constitute a waiver of such right or claim. Any waiver by any Party of any term, provision, or Condition of this Agreement, or of any subsequent default under this Agreement in any one or more instances shall not be deemed to be a further or?coutinuing waiver of such term, provision, or condition or of any subsequent default hereunder. j. This Agreement shall not confer any rights or remedies upon any third party other than the Parties to this Agreement and their respective successors and permitted assigns. k. The Foundation and the University may not transfer or assign their respective interests in the Agreement or any amount to be contributed pursuant to this Agreement without the express written consent of the Donor. 1. All notices, approvals, or requests in connection with this Agreement shall be in writing and shall be deemed given when delivered personally by hand or one business day after the day sent by overnight courier (in each case with written con?rmation of receipt or transmission, as the case may be) at the following address (or to such other address as a Party may have speci?ed by notice to the other Party pursuant to this provision): If to the Foundation: If to the University: Iowa State University Foundation Iowa State University 2505 University Boulevard 1550 Beardshear Hall Ames, Iowa 50010 515 Merrill Road Attn: Chief Financial and Administrative Officer Ames, Iowa 50011 Attn: Senior Vice President and Provost cc: Office of University Counsel If to the Donor: Charles Kach Foundation 1320 N. Courthouse Road, Suite 500 Arlington, VA 22201 Attn: Grant Administrator cc: General Counsel?s Of?ce In. This Agreement may be executed in several counterparts, each of which shall constitute an original and all of which, when taken together, shall constitute one agreement or direction. Copies of signatures (whether facsimile or other electronic transmission) to this Agreement shall be deemed to be originals and may be relied upon to the same extent as the originals. [Signature Page allows] The Parties have hereby executed this Agreement as dated below, but agree that this Agreement is effective as of the Effective Date. IOWA STATE UNIVERSITY FOUNDATION IOWA STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY 23% (Bili- mm By: Name: Lisa M. Eslinger Name: Jonathan A. Wiekert Title: Chief Financial and Administrative Officer Title: Senior Vice President and Provost Datei??sflilTZ/MJQZ/ 20?, 20] 7 Date: CHARLES KOCH FOUNDATION Name: Brian Hooks Title: President Date: ATTACHMENT A Iowa State University Proposal to the Charles Koch Foundation to Support the Program for the Study of Midwest Ectmomies Vision - Midwest labor, product and capital markets are atypically thin compared to markets on the east and west coasts. Agglemeratlons of customers, suppl1e1s, and educated workers have been used to explain the century-long shitt of population from rural to urban a1eas, the' 1ncreasing concentration of patenting and entrepreneurship' 1n cities, and the higher wages for urban workers compared to rural workers As a result, studies of entrepreneurship, innovation, and economic growth haVe focused most on the experiences in cities. This also occurs because data to analyze these questions has been much more available for urban than rural markets. Nevertheless, 29% of the Midwest population lives in nonmetropolitan areas compared to 15% for the nation as a whole, and so it is important to understand how thin markets function in a world where agglomeration economies are increasingly important, and how policy choices can enhance or diminish economic outcomes. Mission Statement This Program will be focused on: I Entrepreneurship in thin Midwestern markets; I Entrepreneurial ?nance, with an emphasis on the examination of the supply of and demand for venture capital in thin Midwestern markets; I Education policy, growth, and returns, with an emphasis on identifying how Midwest states can attract and retain critical human capital in thin markets, and on how government policies enhance or restrict returns to human capital; I Analyzing the roles of government tax, expenditure, and regulatory policies on entrepreneurship and economic growth; and I Developing and applying the ?Border Index? (defined below). . . . . New Tenure?track Faculty At least one and up to two individuals holding New Tenure-Track Faculty will be hired. They will be af?liated with and actively advanCe the Program?s Mission. Existing Faculty" Support Existing faculty who are af?liated with the Program will receive support for course release andlor stipends to facilitate their work to advance the Program?s Mission. The Program?s activities and ?nances will be under the supervision of the Program Director, Dr. Peter Orazern. If Dr. Orazem leaves the employ of the University or otherwise becomes unable to serve as the Program Director, the University shall appoint a new individual to serve as the Program Director and notify the Donor. Student Support The Program will support up to 3 graduate student fellowships, up to six unde1g1aduate scholarships, and an underg1aduate program. Fellowship and scholarship students will be af?liated with and help advance the Program? 5 Mission. Research Support The Program will engage in research projects, including projects utilizing the Central Plains Research Data Center and the construction and promotion of the Border Index. The Border Index will construct an index of the most and least competitive borders within the United States, which will complement existing indexes that rate states on their business climates. Communications and Outreach Support The Program will conduct conferences and other public events to help disseminate the Program?s work. Program Suppert The Program will engage in travel and incur miscellaneous expenses to advance the Program?s Mission. Postdoc Support The Program may select a postdoctoral fellow to engage in activities associated with the Program. Reporting The Program Director and the new tenure-track faculty member(s) will report to the Chair of the Department of Economics at the University and shall be subject to the University?s Faculty Handbook and other applicable University policies.