have access to and the right to examine any directly pertinent books, documents, papers, and records of such subcontractor involving transactions related to the subcontract until the expiration of three years after final payment under this contract. The term "subcontract” as used herein means any purchase order or agreement to perform all or any part of the work or to make or furnish any materials required for the performance of this contract, but does not include (i) purchase orders not exceeding $1,000.00, (ii) subcontracts or purchase orders for public utility services at rates established for uniform applicability to the general public, or (iii) subcontracts or purchase orders for general inventory items not specifically identifiable with the work under this contract.

3. Nothing in this contract shall be deemed to preclude an audit by the General Accounting Office of any transaction under this contract.

ARTICLE XV-WALSH-HEALEY ACT

To the extent that this contract is subject to the Walsh-Healey Public Contracts Act, as amended (41 U. S. C. 35-45), there are hereby incorporated by reference the representations and stipulations required by said Act and regulations issued thereunder by the Secretary of Labor, such representations and stipulations being subject to all applicable rulings and interpretations of the Secretary of Labor which are now or may hereafter be in effect.

ARTICLE XVI-CHANGES

The Contracting Officer may at any time, by a written order, make changes, within the general scope of this contract, in any one or more of the following: (1) specifications for UsOs concentrate (ii) method of shipment or packing for UsOs concentrate; (iii) place of delivery; and (iv) place of weighing, sampling, and assaying. If any such change causes an increase or decrease in the cost of, or the time required for performance of this contract, an equitable adjustment shall be made in the contract price or delivery schedule, or both, and the contract shall be modified in writing accordingly. Any claim by the Contractor for adjustment under this clause must be asserted within thirty (30) days from the date of receipt by the Contractor of the notification of change; provided, however, that the Contracting Officer, if he decides that the facts justify such action, may receive and act upon any such claim asserted at any time prior to final payment under this contract. Failure to agree to any adjustment shall be a dispute concerning a question of fact within the meaning of the clause of this contract entitled, "Disputes." However, nothing in this clause shall excuse the Contractor from proceeding with the contract as changed.

ARTICLE XVII—ASSIGNMENT AND ASSIGNMENT OF CLAIMS

Neither this contract nor any interest therein nor claim thereunder shall be assigned or transferred by the Contractor, except as hereinafter in this Article provided, or except as otherwise expressly authorized in writing by the Contracting Officer.

Pursuant to the provisions of the Assignment of Claims Act of 1940 (31 U. S. Code 203, 41 U. S. Code 15) moneys due or to become due from the Government under this contract may be assigned to any bank, trust company, or other financing institution, including any Federal lending agency, and may thereafter be further assigned to any such institution. Any such assignment or reassignment shall cover all amounts payable under this contract and not already paid, and shall not be made to more than one party except that any such assignment or reassignment may be made to one party either for its account or as agents or trustee for two or more parties participating in such financing.

ARTICLE XVIII-SECURITY

1. Contractor's Duty to Safeguard Restricted Data and Other Classified Information. In the performance of the work under this contract the Contractor shall, in accordance with the Commission's security regulations and requirements, be responsible for safeguarding restricted data and other classified matter and protecting against sabotage, espionage, loss and theft, the classified documents, materials, equipment, processes, etc., as well as such other material of high intrinsic or strategic value as may be in the Contractor's possession in connection with performance of work under this contract. Except as otherwise expressly provided in the specifications the Contractor shall, upon completion or

termination of this contract, transmit to the Commission any classified matter in the possession of the Contractor or any person under the Contractor's control in connection with performance of this contract.

2. Regulations. The Contractor agrees to conform to all security regulations and requirements of the Commission.

3. Definition of Restricted Data. The term "Restricted Data" as used in this Article means all data concerning (1) design manufacture or utilization of atomic weapons; (2) the production of special nuclear material; or (3) the use of special nuclear material in the production of energy, but shall not include data declassified or removed from the Restricted Data Category pursuant to Section 142 of the Atomic Energy Act of 1954.

4. Security Clearance of Personnel. Except as the Commission may authorize, in accordance with the Atomic Energy Act of 1954, the Contractor shall not permit any individual to have access to Restricted Data until the designated investigating agency shall have made an investigation and report to the Commission on the character, associations, and loyalty of such individual and the Commission shall have determined that permitting such person to have access to Restricted Data will not endanger the common defense and security. As used in this paragraph, the term "designated investigating agency" means the United States Civil Service Commission or the Federal Bureau of Investigation, or both, as determined pursuant to the provisions of the Atomic Energy Act of 1954.

5. Criminal Liability. It is understood that disclosure of information relating to the work or services ordered hereunder to any person not entitled to receive it, or failure to safeguard and Restricted Data or any top secret, secret or confidential matter that may come to the Contractor or any person under the Contractor's control in connection with work under this contract, may subject the Contractor, his agents, employees, and subcontractors to criminal liability under the laws of the United States. (See the Atomic Energy Act of 1954, 68 Stat. 919). (See also Executive Order 10104 of February 1, 1950, 15 F. R. 597.)

ARTICLE XIX-RECORDS, REPORTS AND INSPECTIONS

The Contractor agrees to submit such reports covering the period of this contract on inventories of ores, ores in process, finished products, and tailings and metallurgical recoveries, as the Commission may reasonably request, and agrees that the Commission shall have the right to inspect the records, work, and activities of the Contractor under this contract at such time and in such manner as the Commission shall deem appropriate.

ARTICLE XX-DEFINITIONS AND SPECIFICATIONS

1. The term "Commission" as used in this contract means the United States Atomic Energy Commission or any duly authorized representative thereof, including the Contracting Officer except for the purpose of deciding an appeal under the Article entitled, "Disputes."

2. The term "lot," as used in this contract to describe a quantity of uranium concentrate, shall mean a quantity of approximately ten thousand (10,000) pounds of uranium concentrate unless otherwise agreed upon by the Commission and the Contractor.

3. The specifications determined on a dry weight basis for uranium concentrate under this contract are:

a. Minimum UзO, content of 75.00%.

b. Maximum V2Os content of 2.00% of the UsOs content.

c. Maximum phosphate (PO4) content shall not exceed the sum of 1.31 times the iron (Fe) content plus 2.00% of the UsOs content, provided that the total phosphate content shall not exceed 6.00% of the UsOs content.

d. Maximum molybdenum (Mo) content of 0.60% of the U.O. content. e. Maximum boron (B) content of 0.030% of the U.Os content.

f. Maximum halogens, Cl, Br, and I, expressed as Cl, content of 0.10% of the USO, content.

g. Maximum fluorine (F) content of 0.10% of the UsOs content. h. Maximum copper (Cu) content of 1.70% of the UsOs content. i. Maximum arsenic (As) content of 0.80% of the U.O. content. j. Maximum carbonate (CO) content of 1.00% of the U.Os content. k. Maximum sulfate (SO4) content of 15.00% of the U.O. content, provided that multiplying 100 times the ratio of the calcium (Ca) content to

UsOs content by 100 times the ratio of sulfate (SO4) content to UsOs content will give a product that does not exceed the number 8.50.

1. Maximum moisture (H2O) content of 10.0% (determined on an "as received" basis and drying at 110° C.).

All uranium concentrate shall be dried at a temperature of 500° C. or less and shall pass through a quarter-inch screen.

4. Unless otherwise provided, weights are avoirdupois dry weights. example, the term "ton" means a short ton of 2,000 pounds avoirdupois.

For

5. The term "Contracting Officer" means the person executing this contract on behalf of the Government and includes his successors or any duly authorized representative of any such person.

In witness whereof, the parties hereto have executed this agreement as of the day and year first above written, intending to be legally bound thereby. UNITED STATES OF AMERICA,

Witnesses:

/s/

UNITED STATES ATOMIC ENERGY COMMISSION, /s/ ALLAN E. JONES, Manager, GJOO.

COTTER CORPORATION (No Stockholder's Liability),
PARKER WILSON, President.

/s/W. SPENCER HUTCHINSON, Jr.

/s/ESTON B. STEPHENSON.

/s/R. J. GASKIN, Secretary.

ACKNOWLEDGMENT

I, R. J. Gaskin, certify that I am the Secretary of the corporation named as the Contractor herein; that Parker Wilson who signed this contract on behalf of the Contractor was then President of said corporation; that said contract was duly signed by and on behalf of said corporation by authority of its governing body and is within the scope of its corporate powers.

In witness whereof, I have hereto affixed my hand and the seal of said corporation this 14th day of May, 1957.

[CORPORATE SEAL]

/s/ R. J. GASKIN, Secretary

APPENDIX A

When uranium concentrate which fails to meet the specifications as set forth in Article XX of this contract is accepted by the Commission under the provisions of Article III of this contract, the price payable for the U.Os content of each such lot of concentrate as computed in accordance with the provisions of this contract shall be reduced in accordance with the schedules set forth below. Fractional parts of a pound shall be computed to the nearest one-hundredth of one pound.

Uranium Oxide (U308)

Concentrate lots containing less than seventy-five percent (75.00%) UsOs but not less than fifty percent (50.00%) UsOs shall be reduced in price by an amount for each pound of contained U.Os as follows:

Concentrate lots containing less than fifty percent (50%) UзO, may be accepted by the Commission upon agreement by the Commission and the Contractor as to an appropriate reduction in the price to be paid for such concentrate lots.

Vanadium Oxide (V205)

Concentrate lots containing a total number of pounds of V2O, in excess of 2.00% of the total number of pounds of contained U.O, shall be reduced in price by an amount equal to $0.75 for each pound of contained excessive V2O, pus an additional $0.25 for each pound of contained V2O, in excess of 5.00% of the number of pounds of contained U3O8.

APPENDIX B

Contract No. AT (05-1)-735

The Contractor shall package uranium concentrate delivered under this contract in the following manner:

1. Concentrate shall be packaged in fifty-five gallon steel (18-gauge minimum) full open head drums equipped with (a) bolt locking ring closures of proper size to hold the tops of drums securely and (b) rubber gaskets to prevent spillage of concentrate while in transit.

2. All drums shall be 341⁄2 inches high and 221⁄2 inches in diameter, plus or minus one-half inch.

3. Concentrate in any individual container shall not exceed one thousand (1,000) pounds.

4. Empty drums must be briefly weighed and the weight of each such drum marked thereon in the presence of the Commission's representative, unless otherwise waived in writing by the Commission.

5. The inside of the drum must be clean and free of foreign matter at time of packaging.

6. The outside of the drum must be clean.

7. Each drum shall be stenciled or otherwise marked with paint in a legible manner on top and side with the contract number, lot number, drum number, and tare weight.

8. The Commission reserves the right to refuse to accept any lot of uranium concentrate not packaged in accordance with the foregoing conditions and requirements, until such time as the Contractor meets such conditions and requirements.

Phosphate (PO1)

Concentrate lots containing a total number of pounds of phosphate (PO) in excess of the sum of 1.31 times the number of pounds of contained iron (Fe) plus 2.00% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to Five Dollars ($5.00) per dry short ton of concentrate plus twenty-five cents ($0.25) for each pound of contained excessive phosphate, provided that concentrate lots containing phosphate (PO1) in excess of 6.00% of the U.Os content shall be reduced by an additional Sixty Dollars ($60.00) per dry short ton of concentrate for each one percent (1.00%) of contained phosphate in excess of 6.00% of the U.O, content.

Molybdenum (Мо)

Concentrate lots containing a total number of pounds of molybdenum (Mo) in excess of 0.60% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to One Dollar ($1.00) for each pound of contained excessive molybdenum plus an additional Three Dollars ($3.00) for each pound of contained molybdenum in excess of 2.40% of the number of pounds of contained U2O8.

Boron (B)

Concentrate lots containing a total number of pounds of boron in excess of 0.030% but not in excess of 0.100% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to the product of two cents ($0.02) times the number of pounds of contained U3O. Concentrate lots containing a total number of pounds of boron in excess of 0.100% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to the product of fifty cents ($0.50) for each multiple of 0.100% which the boron content is of the U.O, content, times the number of pounds of contained UзOs.

Halogens (Chlorine, Ol; Bromine, Br; and Iodine, I)

Concentrate lots containing a total number of pounds of combined halogens, expressed as Cl, in excess of 0.10% of the total number of pounds of contained U.O, shall be reduced in price by an amount equal to the sum of four cents ($0.04) plus one cent ($0.01) for each 0.10% in excess of the first 0.10%, times the number of pounds of contained UsOs.

Fluorine (F)

Concentrate lots containing a total number of pounds of fluorine (F) in excess of 0.10% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to $25.00 per dry short ton of concentrate, plus $14.50 for each pound of contained excessive fluorine.

Copper (Cu)

Concentrate lots containing a total number of pounds of copper (Cu) in excess of 1.70% of the total number of pounds of contained U.O, shall be reduced in price by an amount equal to $32.00 per dry short ton of concentrate. Concentrate lots containing a total number of pounds of copper (Cu) in excess of 10.00% of the total number of pounds of contained U.O, shall be reduced in price by an amount equal to $0.30 times the number of pounds of contained UзO8.

Arsenic (As)

Concentrate lots containing a total number of pounds of arsenic (As) in excess of 0.80% of the total number of pounds of contained U:O, shall be reduced in price by an amount equal to $5.00 per dry short ton of concentrate, plus $0.25 for each pound of contained excessive arsenic.

Carbonate (CO3)

Concentrate lots containing a total number of pounds of carbonate (CO3) in excess of 1.00% of the total number of pounds of contained UзO, shall be reduced in price by an amount equal to $40.00 per dry short ton of concentrate. Sulfate (SO4)

Concentrate lots containing a total number of pounds of sulfate (SO) in excess of 15.00% of the total number of pounds of contained U:Os, or if multiplying 100 times the ratio of calcium (Ca) content to UsOs content by 100 times the ratio of sulfate (SO4) content to UsOs content gives a product that exceeds the number 8.50, shall be reduced in price by an amount equal to $50.00 per dry short ton of concentrate.

Moisture (H2O)

Concentrate lots containing moisture in excess of 10.00% on an "as received" basis shall be reduced in price by an amount equal to One Dollar ($1.00) for each pound of contained moisture in excess of 10.00% moisture on an "as received" basis.

Screen Size

Concentrate lots which the Commission determines to contain an excessive amount of plus quarter-inch particles will be rejected and all particles in the lot must be reduced by the Contractor to pass a quarter-inch screen before the lot will be accepted by the Commission.

Rejection

Compensation in the amount of $50.00 for each lot rejected shall be made to the Commission by the Contractor.

Chairman DURHAM. You are going to continue to go forward under this contract?

Mr. WILSON. Yes, sir; we must.

Chairman DURHAM. What is there to fear, then? You have an extension of time by the Commission to complete it?

Mr. WILSON. Yes, sir; we have a 3-month extension which moves the period forward.

Our problem is this: A small pilot mill will not take care of the area and right along it was contemplated that following on the heels