definiens: ( Standard Cost is defined as average actual cost to OPT of material plus incoming freight plus yield loss adjustment ) plus mark - up of [ 81 % for administration and carrying costs . Quoted Price of Material does not include, without limitation, new or non - recurring costs associated with establishing, testing or manufacturing changes in components or new material such as reference standards, reagents, art charges, die costs, mold or tooling costs, plate costs, and packaging equipment change parts required as a result of changes to existing specifications by Company or pursuant to regulatory requirements . These items will be invoiced to COMPANY at OPT 's cost on a net thirty ( 30 ) 10 basis . COMPANY agrees to reimburse OPT for any such authorized expenditures made on COMPANY 's behalf . OPT 's Quoted Price of Material will be adjusted once annually at the beginning of each calendar year and Schedule A shall be amended accordingly . In the event, however, the cost of a raw material increases or decreases greater than ten percent ( 10 % ), OPT may notify COMPANY and, with COMPANY 's approval, adjust its invoice price for said material to COMPANY to compensate for the increase or decrease . In the event of an increase in the cost of raw materials, COMPANY may, ( to the extent available ) require OPT to obtain competitive bids from vendors of affected raw materials prior to approving any adjustment to OPT 's invoice price