(a) Except as addressed by the Request for Applications or this rule, only Texas-based entities are eligible to receive Grant Awards.
(b) Grant Applicants responding to a Request for Applications may be located outside the state of Texas when the Grant application is submitted and reviewed. However, the Institute requires the Grant Applicant to demonstrate that it will relocate to Texas as a condition of the Grant Award.
(c) A Grant Applicant for a Product Development Grant Award may demonstrate compliance with subsection (b) by fulfilling a majority of the following requirements:
  (1) The U.S. headquarters is physically located in Texas;
  (2) The Chief Executive Officer resides in Texas;
  (3) A majority of the company's personnel, including at least two other C-level employees (or equivalent) reside in Texas;
  (4) Manufacturing activities take place in Texas;
  (5) At least 90% of Grant Award funds are paid to individuals and entities in Texas, including salaries and personnel costs for employees and contractors;
  (6) At least one clinical trial site in Texas; and
  (7) Collaboration with a medical research organization in Texas, including a public or private institution of higher education.
(d) The location criteria to be fulfilled by the Grant Recipient are reflected in the Grant Contract.
(e) Unless otherwise specified by the Grant Contract, the Grant Recipient must fulfill the requirements within one year of receiving the disbursement of Grant Award funds.
(f) The Grant Recipient will report on the location criteria at least annually.
(g) The Institute will monitor compliance with this policy. Failure to meet and maintain the Texas location requirements may result in suspension of the Grant Award, termination of the Grant Contract, repayment of Grant Award funds; or other appropriate action as determined by the Chief Executive Officer and reported to the Oversight Committee.
(h) Nothing herein prohibits the Grant Recipient from proposing and the Institute from approving one or more alternative or additional location requirements. The Chief Executive Officer shall notify the Oversight Committee of the alternative criteria at an open meeting. The proposed alternative location requirement is approved unless a simple majority of the Oversight Committee votes to reject the Chief Executive Officer's recommendation.

Source Note: The provisions of this §701.19 adopted to be effective March 2, 2014, 39 TexReg 1380; amended to be effective December 7, 2016, 41 TexReg 9526