CHICAGO, ILLINOIS, July 248¢ ee Mr. M. A. Browning, 1216 First Sec varity Ogden, Utah. Dear Mr. Bank Building, Brownings Since my arr ival here on Wednesday morning, we have been engaged in an analysis of the various’ ¢ontracts with Colt!s in an effort to ascertain just what Col. Herrstrom has royalty under in-mind in requesting a segregation the agreement of December, 1938, as that which is consit#red to be paid to the contractual obligations and of between for “services BD Aaa omc that which is considered "royalty", A study that we effect of designated upon the the contract $6.00 date of of of December, a $35.00 the payment contract in '22% 1938, reveals which as was in royalty, leav- ing a balance of $29.00 which could’ be ascribed to "services® or possibly a better term would: be hate) coment technical service that which and advtean, after May would 10, In 1944 leave the the contract, nothing will This and Brownings "services" and the as to be paid also provides at is made "rroyalty", under $2 5.00 our oub of a payable at the tine te considered royalty in the .40 Caliber gun. In other words, VUolt's made this segregation "royalties". is percentages, paid $35.00 contract and It be entire contract, total of $75.00 connection with provision felt that by Long Messrs. and before Hume placed we and a value entered the Huxley that upon war. these 1s 6/35ths applicable to 1/3rd to the .50 sume proportions Caliber for the gun should year 1943, follow through in and also should be the .30 Caliber, considered - connection with the estimate for the year 1944. Both ar Hume and Ur. Huxley feel that it is fertunate that such a lar se proportion of the amounts paid represent. under this construction of the contract, payments for "Development. etc." ; asding We for are the inclined information to believe that Col. Herrstrom is requested with the thought mind in of eliminating that portion of the payments made which under the contract is considered as "royalty" after the date