You really need to read the two contracts. One of them being an addendum related to COVID-19. That's why I provided links to everything. The only reason I had to summarize my findings is that HN limits posts to 2,000 characters...so it's hard to explore corner cases in an initial post.

For example, if we take the text you posted, we are looking at a 12 month unpaid pilot, during which you agree to grant an irrevocable (etc...) license to your IP that explicitly allows them to build, replicate and use your product without paying you a dime. Furthermore, you grant an extension of this license for 9 to 12 months (depending on how you read it) past the pilot period. And, to make it even more fun, you grant them the right to transfer this license to anyone else.

In our case the product is hardware with software and an ML/AI component. It represents a non-trivial amount of investment in both time and money --self funded. In order to participate in this program we have to be willing to watch a random entity reproduce our system and USE IT for basically two years, potentially without compensation. What do you want to bet that the market for these specific COVID-19 devices is very different 18 to 24 months from now?

And then there's the potential for them to grant our IP license to <insert large well-embedded company here> and effectively cut us completely out of the loop.

The more I read and extrapolate these terms the more they seem to stink.