(a) The Institute shall have the option, but not the obligation, to pursue protection of the applicable Intellectual Property Rights and/or to commercialize or otherwise bring to practical application the applicable Project Results either directly or through one or more licensees, in the event of the following:
  (1) Upon receipt of Grant Recipient's notice of its election to abandon, waive or disclaim any Intellectual Property Rights or to cease its efforts to commercialize or otherwise bring to practical application any particular Project Results; or
  (2) Grant Recipient's failure to materially comply with its obligations to protect the Intellectual Property Rights or to use diligent and commercially reasonable efforts to commercialize or otherwise bring to practical application the Project Results in accordance with the Grant Recipient's commercial development plan(s), and Grant Recipient fails to cure such non-compliance within a reasonable period of time following written notice from the Institute specifically describing the events of non-compliance.
(b) If the Institute elects to exercise its options pursuant to this section, it shall notify the Grant Recipient in writing of such election. Upon receipt of notification, the Grant Recipient shall:
  (1) Fully cooperate with the Institute's efforts to protect, commercialize or otherwise bring to practical application the applicable Project Results at the Institute's cost, including but not limited to the transfer to the Institute or the Institute's designee of the Grant Recipient's rights, title and interest in and to the applicable Project Results, to the maximum extent allowed by law;
  (2) Not take any action that would materially impede the Institute's ability to protect, commercialize or otherwise bring to practical application the applicable Project Results.
(c) If the Institute exercises its option under this section, the Grant Recipient shall have no further claim to or interest in to the applicable Project Results and shall not be entitled to any share of the revenue or other compensation with respect to such Project Results, except to the minimum extent required by law, if any.
(d) The Institute's exercise of rights pursuant to this section is subject to any applicable rights of the United States government.

Source Note: The provisions of this §703.19 adopted to be effective August 1, 2010, 35 TexReg 6656; amended to be effective March 2, 2014, 39 TexReg 1386