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C C LAW OFFICES FRANK R SENREE (i8S4-1940) , SAMB. SEBREE (1886-1968) EDGARSHOOK. (IB94-1970)! . DAVID R. HARDY. (1917-197B) , CHARLES L. BACON DAVID H,.CLARK LANE CU BAUER FRANK P. SEBREE, D FREDERICK BEIHL WILLIAM W. SHINN JOHN C.DODS : DONALD K, HOEL. EVERETT A:OLSON, JR. , JOHN T.MARTIN . DAVID W. SHINN. WILLIAM K. WAUGH, JR. ; LEE E. STANFORO SHOOK, HARDY & BACON TWENTIETH FLOOR, MERCANTILEBA:NKTOWER 11O1I WALN UT KANSAS CITY, MISSOURI 64106 (616i 474-6550 DAVIDK,.HARDT WILLIAM G 2IMMERMAN, ROBERT E. NORTHRIP PATRICK.MCLARNE7. HARVEY L.KAPLAN JOHN.C. MONICA CHARLES R.WALL SAM L.COLVILLE GENE E. VOIGT$ JAMES T. NEWSOM JAMES. H.,OTT'.MAN OF COUNSEL December 29, 1976 Messrs. Thomas F. Ahrensfeld Joseph Greer Cyril F. Hetsko Ernest Pepples Henry C. Roemer Arthur J. Stevens RU55ELL S. NO.BLET. LOGAN J..W'ILS.ON STEPHEN D.ALIBER LEO P, DREY.ERPATRICK M. SIRRIDGE DAVIDR: MORRIS ALLEN 5. RUSSELL LAUREL H. CORN JOHN R. WEISENFELS ALLEN'R. PURVIS STEVEN C. PARRISH RICHARD D: WOODS LARRY R. O'NEAL BERNARD V.,O'NEILL,JR. GARY, R..LONG TENTH'.FLOOR- 1776 K STREET, N. W. WASH IN GTON,, 0. C. 20006 (2O21i, 331-0787 Please find enclosed a letter dated December 6, 1976, from Henry C. Meadow, Senior Associate Dean for Administration, Harvard Medical School, together with his propo'sed changes to the extension~agreement which I sent Mr. Meadow (and you) on November 8. My comments, based in part on a number of subsequent discus- sions with Mr. Meadow and Dr. Huber, follow. No proposed changes are suggested for the introductory paragraph. Paragraph 1 has been modified to eliminate any reference to indirect costs and to provide that 10% of the principal amount shall be paid "as supplemental funds not as project costs." I have advised Mr. Meadow that we must have assurances that neither Harvard nor Beth Israel will ask for any indirect costs, overhead, etc., during the extension period. He has agreed to provide letters from Beth,Israel and the Harvard Medical School that cover this point. 03'y.4,84 5U The new proposed'paragraph 1 also includes a provi,sion for termination. I have further modified this clause, after dis- cussion with Mr. Meadow, to read as follows: "If, in accordance with paragraph l of the original agreement, the sponsoring com- panies do not approve a substitute investigator, reasonable and necessary expenses required'to terminate the work in progress in an orderly but expeditious manner shall be payable from proj'ect monies

General Counsel December 29, 1976 Page Two available or to be made available during the current fiscal year. Any monies not required for such purpose shall be held for dispo- sition as directed by the grantors." I favor Meadow's proposal to eliminate the reference to indirect costs and to provide instead 10% as "supplemental funds." This will help eliminate a continuing source of disagreement and yet be an amount within our originally contemplated total cost. provision for an orderly termination of the project also seems reasonable. It would come into play only if Dr. Huber became unavailable and a substitute investigator was not approved. I phrased the provision with regard to monies that might remain in the event of a termination so that Harvard could be directed to utilize the funds in another way or return them. Paragraph 2, as proposed, eliminates any reference to indirect costs and makes it clear that Harvard Medical School can arrange for housing, services and the like rather than providingg them directly. Paragraph 3 as modified by Mr. Meadow to permit equipment usage is not acceptable and I have so advised him. He is presently considering the guidelines which I sent to Dr. Huber, with a copy to you, on November 24. He seemed confident that the matter could be resolved. There was no dispute with regard to ownership. I have no objection to the modification of paragraph 4. Paragraph 5 remains unchanged. Dr. Epstein has been added to those signing the contract but there will be no reference to Beth Israel in his title since the agreement is with Harvard Medical School. 03748951 I believe that we are quite close to r~ummating ari agreement and would appreciate receiving any cor as soon as possible. I would like to be in a position to s. a final docu- ment consistent with~the foregoing to Mr. Meadow :~ soon as there is a satisfactory response concerning the use of project equipment and assurances that all indirect cost problems have been settled.

General Counsel .December 29, 1976 Page Three A copy of my December 28 letter to Mr. Meadow is also enclosed. The Harvard Medical School offices have been closed during the holiday season. Sincerely, William W. Shinn cc: DeBaun Bryant Max H. Crohn, Jr. Alexander Holtzman Horace Kornegay Lester Pollack O ~ T c0 Cn N