Clemson 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 Clemson University, the 2009 MOU is distinct from some other MOUs, in that it references a  that “[t]he University, within its College of Business and Behavioral Science, has established CISC,” the Clemson Institute for the Study of Capitalism. In addition to requiring that the “Donor Supported Faculty Positions” comply with the Objectives and Purposes, the agreement suggests that Koch’s Objectives and Purposes were already the primary objectives of CISC:

I. Objectives and Purposes
(a) The University, within its College of Business and Behavioral Science, has established CISC. The primary objectives and purposes of CISC are to advance the understanding and practice of those free and voluntary processes and principles that promote social progress, human well-being, individual freedom, opportunity and prosperity based on the rule of law, constitutional government, private property and the laws, regulations, organizations, institutions and social norms upon which they rely. It is the Parties’ intention that the objectives and purposes of CISC will be further advanced by CGK Foundation’s provisioning of funds to recruit and hire positions (hereinafter referred to as the “Donor Supported Faculty Positions") at CISC to help strengthen this foundation and extend efforts related to research, publication, dissemination, teaching, and continued academic and public use of the and support the research into the causes, measurements, impact, and appreciation of economic freedom. (Clemson 2008 MOU, Section I.a )

All aspects of the programs set forward in the MOU are obligated to comply with the Koch Foundation’s “Objectives and Purposes,”  and compliance is actively enforced. The Koch foundation:

reserves the right to discontinue or withhold any amount offending to be made under this Agreement if, in CGK Foundation’s reasonable discretion, University has not fully complied with the terms and conditions of this Agreement; the Donor Supported Faculty Positions are not advancing the Purposes and Objectives set forth in Section I above
[...]
The parties acknowledge that the funding commitment made by CGK Foundation under this Agreement is subject to the satisfaction of the terms and agreements set forth in this agreement and that a breach by University of any commitment, agreement, obligation, covenant, representation or warranty, made or required under this Agreement shall give CGK Foundation the ability to terminate this Agreement. (Clemson 2008 MOU, Sections VI.B and VI.I, pages 5 and 6)

The Koch foundation reserves the right to give only 15 days notice before withdrawing all funds

Such termination shall be deemed effective upon the expiration of said fifteen (15) days from the date notice was provided by CGK Foundation to University, if University has not therefore corrected the events of default or performed the acts described in the notice. During the pendency of this 15-day period, CGK Foundation will not be obligated to contribute any funds pursuant to this Agreement and University will suspend any further payments pending the corrective action by the University. In the event of termination of this Agreement, notwithstanding any contrary provision herein, CGK Foundation shall have the right to require that all unexpended Contributed Amounts be returned to CGK Foundation. (Clemson 2008 MOU, Section VI.I)