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m , Contract ~Io. 30 I~ AGREEMENT BETWEEN ~ THE COUNCIL FOR TOBACCO RESEARCH - U.S.A., INC. q AND RICROBIOLOGICAL ASSOCIATES ~ This agreement wiil serve to approve the extension of the contract between The Council for Tobacco Research - U.S.A., Inc., hereinafter sometimes called CTR, and 14icrobiological Associates, hereinafter sometimes called HA, in an amount not to exceed $I,]70,000 covering the period September I, 1978 through August 31, 1979 in accordance with ~4A's Proposed Studies for CTR-O030 "Smoke Inhalation Carclno- genesis Studies in Mice," dated August 24, 1978. The Council agrees to make payment to f'.~ on a monthly basis, within approximately twenty (20) days of receipt of an invoice detailing charges incurred in performance of the contract. For.bil]Ing purposes, it is understood that MA operates on a flfty-two week fiscal year basis beginning approximately November I and continuing through approximately October 31. • lhe first month of each fiscal quarter contains five~(5) weeks and the second and third months of each fiscal quarter contain four (4) weeks. The Couhcil wi~l be bil]ed for actual direct costs Incurred during each billing period plus G & A and overhead. G & A will be billed at a fixed percentage of direct costs incurred and overhead as agreed in the budget. Overhead is a fixed dollar amount as agreed in the budget. Five fifty- seconds (5/52's) of the fixed dollar amount will be billed in the first week of each quarter and four flfty-seconds (4/5Z's) of the fixed dollar amount will be bill ed in the ~c~ ~t~.=~ week$of each quarter. At its option and expense, The Council may arrange for an independent audit of those charges billed to CTR. It is understood that any such audit will be performed by an independent auditor selected by The Council; -~.___~.w_ever, MA shall have the right to veto up to two (2) selected auditors. Suc~h a~may commence at any time during the budgetary period or for a period of~x (6) months after the expiration date of this extension. -this~co~, ~llkdirect coststsha11 be subject to audit] ,;)'verbead and G & A,~nottsubject to av(lit except to verify the billing computation described abdve. ~ [ ~., Should any deviations from the protocols seem necessary due to results observed during the course of the study, HA will notify The Council in writing. Any such proposed change to the protocol and any revision in cost will be submitted and will depend upon written confirmation and approval of CTR. CTR COHTRRCTS 027B01 CIIR 9B CONG O0'l E,

I It is understood and agreed that any major additions 5o or changes in the protocol which ei(her party to this agreement might request will be covered by mutually acceptable separate written addenda to this Agreement. Should any unforeseen change in circumstances make it appropriate to curtail or terminate the study, The Council for Tobacco Research - U.S.A., Inc. shall have the privllege of doing so upon sixty (6D) days o¢~rAu~'~ v~ritten notice by registered letter to ~icrobiological Associates. ~eve~t of any ~'~both parties shall negotlate reduced charges for the necessary remaining services including necessery curtailment ~ termination costs. In case of termination, no penalt.~gsts shall]be assessed. HA will not be liable for and will be excused for failure to perform under this Agreement which failure results from causes beyond its rea- sonable control. All data obtained and all inventions, dev61opments, findings or discoveries whether or not patentable, made by HA in the course of, or "as a result of, work done under this Agreement shall be the sole and exclusive property of CTR. MA will execute assignments and •cooperate in the making of patent applications and In the executing of all other necessary papers, as well as requiring execution by its employees, where necessary. MA agrees to keep secret and confidential any information, kno~41edge or data obtained in connection with, or as a result of,' ~ork done under this Agreement. NA further agrees not to use such information for itself or for others elther directly or indirectly, or disclose it to any third party outside of CTR without The Council's prior ~qritten approval. The Smoke Exposure Machine (S£~), Walton Horizontal Smoking llachines. and all documents, books, records, notes or other materials or data furnished by or on behalf of CTR in connection with ~ork done under this Agreement shall at all times be the property of CTR and shall bE returned by NA to the respective owner as designated by CTR at the termination of this Agreement, or at any time that CTR may request. However, ~A shall reserve the right to maintain all necessary book~ and records required for internal record keeping purposes. In the event that this Agreement is not extended, the facillties rearrangement shall become the property of RA. Further, with respect to property: A. CTR Furni%hed Property. From'time to time, as CTR may deem it necessary, they have the right to furnish property required for the performance of the work under %his contract. It is required that a transfer letter, in tr|pl~cate be provided indicating the follbwlng information: • Item number a Description (include model, type, capacity, dimensions, etc.) a Quahtity a Hanufacturer's serial number CTR COHTRRCTS 027802 Cl-tq 98 CLqr,ll3 00117

1 I Condition (new, good, fair, poor) • Acquisition value Upon receipt of the furnished property, one copy will be signed by an authorized representative of Microbiological Associates and returned to The Council for Tobacco Research. D, C. Title. Title to all property furnished by CTR shall remain in CTR. Title to ell property purchased by MA, the cost of which HA is entitled to be reimbursed, shall pass to and vest In CTR. Hicrobiological Associates shall maintain and administer in ' ~ccordance with sound business practice a program for the main- tenance, repair, protection and preservation, control of, and accountability for, The Council for Tobacco Research property so as to assure its full availability and usefulness for the per- formance of this contract. D° E, Cost of Insurance, State and Local Personal Property Taxes, Though title to personal property may be vested in CTR, MA will properly insure it and be responsible for filing state end local personal property tax returns. Charges for insurance coverage and attributable personal property taxes will be paid direct]y by ~ and costs thereof to be e pert of the proposed overhead, Disposition of Property. Upon completion or expiration of this contract HA shall render an accounting of all CTR property which had come into the possession or custody Of HA under this contract. HA agrees to purchase available property, from CTR as follows: Period of time after year in which the equipment was purchased ]st Year 2nd Year 3rd Year 4th Year 5th Year Thereafter Purchase price % ....... ~f acqulred' va)ue 20% 20% 20% 15% I0% :U..oo THE COURCIL FOR TOBACCO RESEARCH, -USA., INC. BY: - Executive Vice President ACCEPTED: MICROBIOLOGICAL ASSOCIATES DirYector of Cgo°~r~Yct Admini(~stratlo. Z CTR COHTRRCTS 027803 E:TR 98 CO/,I5 00118