Ball State University

[Introduction]

1. Mechanisms of Contractual Control

A. IDEOLOGICAL CONDITIONS FOR DONOR WITHDRAW

At universities where the public has been able to see a contract between by a university and the Charles Koch Foundation, a common stipulation is that any activities comply with the a provision of the contract that CKF calls its “Objectives and Purposes.” In later contracts, this provision is restructured so that the activities must comply with a predefined "mission" of the program.

At Ball State University, the Charles Koch Foundation and the John H. Schnatter Family Foundation are donor partners in the creation of the John H. Schnatter Institute for Entrepreneurship and Free Enterprise. The 2016 Grant Agreement  very cautiously establishes the “Institute’s Mission” as:

the University has informed the Donor, and the Donor is relying on such representation, that the Institute's mission is to become a national model for values- and ethics-based entrepreneurship, developing research and talent to help solve contemporary problems and promote understanding of the characteristics and virtues of free enterprise in helping people improve their lives (the "Institute's Mission") (BSU Agreement, Sec. 2.a)  

Broadly, the agreement gives Koch and Schnatter the “sole and absolute discretion” to withdraw their funding for any part of the Institute Programs, at any time:

The Donor has the right to terminate this Agreement or decline to provide any Contributed Amount in response to a Foundation Grant Report if, in its sole and absolute discretion: (i) the Foundation or the University has materially breached this Agreement; (ii) the Institute Programs are not advancing the Institute's Mission as stated in this Agreement; or (iii) such action is necessary to comply with any law applicable to the Foundation, the University, or the Donor. Such termination or decision not to provide any Contributed Amount in response to a Foundation Grant Report shall be deemed effective upon the expiration of thirty (30) days from the date notice was provided by the Donor to the Foundation or the University. In the event the Donor terminates the Agreement, the Foundation and the University each agree to return all uncommitted Contributed Amounts to the Donor within fifteen (15) days of the Donor's request. (BSU Grant Agreement, 8.a)