GENERAL PROVISIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP61-00763A000100040164-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 40
• Document Creation Date: December 14, 2016
• Document Release Date: September 12, 2002
• Sequence Number: 164
• Publication Date: April 18, 1958
• Content Type: REGULATION

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INDEX OF GENERAL PROVISIONS
1, DEFINITIONS. 41.0,,..... . 1
2, CHANGES,
est J.
3. LIMITATION OF COST 2
******* **so* 2
4,. ALLOWABLE COST, FIXED FEE; 'AND PANT 3
5, INSPECTION AND CORRECTION OF DITECTS. * 5
ASSIGNMENT OF ****** 7
7. OOOOOOOOO O ......e...9........... OOOOO .* 7
8, SUBCONTRACTS .00000000**004040?00*OOU403 OOOOOOOOOOOOO *OD 9
9. UTILIZATION OF SMALL BUSINESS CONCERNS ? 10
10, TERMINATION O OOOOO 00,0*** * 10
11* EXCUSABLE DELAYS.... ? 15
.v4.,015
12, DISPUTES....* ..............0 .
13. NOTICE AND ASSISTANCE REGARDING PATENT INFRI1TGaSNT..?16
14, BUY AMERICAN ACT Sew* 4 ,17
34', CONVICT LAPOR ......17
16. EIGHT?HOUR LAW OF 1912,... OOOOOOOOO OQO OOOOO *011446 OOOOOO .17
17, NONDISCRIMINATION IN EMPLOYMENTS..... .OW00000404 OOOOOO eaS
18, OFFICIALS NOT TO BENEFIT 19
19, COVENANT AULINST CONTINGENT FEES 19
20, PATENT RIGH7Soo....-.... ? OOOOOOOOO ? OOOO
21, GOVERNMENT ?RUERTY 24
22, INSURANCE?LIABILITY TO THIRD PERSONS ow...ona OOOOOOOOOO 29
234 AUTHORIZATIO1 AND CONSENT 30
44. FILING OF PATENT APPLICATIONS. 31
25. REPORTING OF ROYALTIES 46.4.0., 31
26, RIGHTS IN DA1'A,UNLI1ITED,..4 33
27, MILITARY SECURITY REQUIREMENTS 34
28. WALSH...HEALEY PUBLIC CONTRACTS ACTS 35
29, GRATUITIES..., 36
30, NEGOTIATED OVERHEAD RATES 36
31. DELAY IN DELIVERY OF
32. SUPERSEDING SPECIFICATIONS...mos .....oecnoeo OOOOOOO *03r.7
33. FLIGHT RISK... OOOOOOO ......................p.., 38
34. ALTERATIONS... OOOOO 041400410 OOOOO 0-00414094100G0 OOOOOOOO 00039
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GENERAL PROVISIONS
DEIINITIONS (ASPR 7-103.1 AFPI 7-403.1)
As used throughout this contract, the following terms shall
have the meanings set forth below:
(a) The term "Secretary" means the Secretary, the Under
Secretary, or any Assistant Secretary of the Department and the
head or ary assistant head of the exenutive agency; and the term
"his duly authorized representative" means any person or persons
o- hoard (other than the Contracting Officer) authorized to act
for th, Sceretary.
(h) The term "Contracting Officer" means the person executing
this contract on behalf of the Government, and any other officer
or civilian employee who is a properly designated Contracting
Officer; end the term includes, except as otherwise provided in
thle contract, the authorized representative of a Contracting
Officer acting within the limits of his authority.
(c) Except as otherwise provided in this contract, the term
"subcontracts" inclWes purchase orders under this contract.
(d) (AFPI 7-3,1) The term "contract work" moans all work
to ee performed unden ..L,his contract including any studies covering
fendamental, theoretical, or experimental investigations; any
enension of the invetigative findings and theories of a
enientific or technical nature into practical apelic?tion; any
tanginle items, hereinafter referred to as "sunpliee0" furnished
to the Government; and any reports, date, computations, plans,
drawings, and specifications with respect to any of the foregoing.
2. CHANGES (AFPI 7-403.2)
The Contracting Officer may at any time by a written order, make
changes in or additions to the drawings and specifications, issue
additional instructions, require additional work within the general scope
of the contract, or change the place of delivery, method of shipment,
or the amount of Government-Furnished property. If any such change
cane:es an increase or decrease in the estimated cost of/ or the time
required for performance of this contract, or otherwise affects any
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otle3r provision of this contract, an equitable adjustment shall be
m (i) in the estimated cost or delivery schedule, or both (ii)
in ;he amount of any fixed fee to be paid to the Contractor, and
' in such other provisions of the contract as may be so affected,
the contract shall be modified Writing accordingly i Any claim
the Contractor for adjustment un6er this clause must be assertdd
,hin sixty (60) days from the date of receipt by the Contractor of
_e no!ification of change; Provided, however, That the Contracting
Officer, if he decides that the facto 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
di-pute concerning a question of fact within the meaning of the clause
of this contract entitled "Disputes.P Howev, nothing in this clause
shall excuse the Contractor from proceeding 'th the contract as
changed.
LIMITATION OF COST (ASPR 7-203.3 AFPI 7-403.3)
(a) It is estimated that the total cost to the :Jovernment,
exelusive of any fixed fee, for the performance of th:s contract will
r exceed the estimated cost set forth in the Schedule, and the
Contractor agrees to use its best efforts to perform the work specified
in the Schedule and all obligations under this contract within such
estimated cost. If at any time the Contractor has reason to bdieve
that the costs which it expects to incur in the performance of this
contract in the next succeeding thirty (30) days, when added to all
costs previously ineurred, will exceed eighty-five percent (85%) of the
estimated cost then set forth in the Schedule, or if at any time, the
Contractor has reasoa to believe that the total cost to the Government,
ex-lusive of any fixed fee, for the performance of this contract will
la eubstantially greater or less than the then estimated cost thereof, the
Contractor shall notify the Contracting Officer in writing to that
effect, giving its revised estimate of such total cost for the
p,rformance of this contract.
(b) The Government shall not be obligated to reimburse the
Contractor for costs incurred in excess of the estimated cost set
forth in the Schedule and the Contractor shall not Le obligated to
continue performance under the contract or to incur coots in excess of
the estimated cost set forth in the Schedules unless and until the
Contracting Officer shall have notified the Contractor in writing that
such estimated cost has been increased and shall have specified in such
notice a revised estimated cost which shill thereupon constitute :ne
estimated cost of performance of this contract. When and to the
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(,..tent that the estimated cost set ferth in the Schedule has been
increased, any cost incurred by the Contractor in excess tf such
estimated cost prior to the increas?n estimated cost shall be
allowable to the same extent as if such cste had been incurred
after such increase in estimated cos, '
h. ALLOWABLE COST, FIXED FEE, AND PAYLENT (ASPR 7-203,4 AFPI 7-403.4)
(a) For the performance of this contract, the Government shall
pf-f to the Contractor the cost thereof determined by the Contracting
Officer to be allowable in accordance with Part 2 of Section XV of
the Armed Services Procurement Regulation as in effect on the date
of this contract and the Schedule (hereinafter referred to as "Allow?
able Cc)st"), plus such fixed fee, if any, as may be provided for in
thc Schedule,
(b) Once each month (or at more frequent intervuls, if approved
by the Contracting Officer) the Contractor may submit to an authorized
representative of the Contracting Officer, in such form and reasonable
detail as such representative may require, an invoice or public voucher
supported by a statement of cost incurred by the Contractor in the
performance of this contract and claimed to constitute Allowable Cost.
Each statement of cost shall be certified by an officer or other
responsible official of the Contractor authorized by it to certify
such statement,
(c) As promptly as may be practicable after receipt of each
invoice or voucher and statement of cost, the Government shall, except
as hereinafter provieed and subject to the provisions of paragraph (d)
te_ew, make payment thereon as approved by the Contracting Officer.
After payment of set forth
in the Schedule, as from time to time amended, further payment on
account of the fixed fee shall be withheld until a reserve of either
whichever amount is less, shall have been set aside, such reserve or
the balance thereof to be retained until the execution and delivery
of a release by the Contractor as provided in paragraph (e) hereof,
(d) At any time or tines prior to final payment under this contract
the Contracting Officer may cause to be made such audit of the invoices
or vouchers and statements of cost as shall be deemed necessary. Each
payment theretofore made shall be subject to reduction to the extent of
am( ents included in the related invoice or voucher and statement of cost
which are found by the Contracting Officer on the basis of such audit not
to constitute Allowable Cost, and shall also be subject to reduction for
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overrayment or to increase for underpayments on prededing invoices
or vouchers. On receipt of the voucher or invoice designated by the
Contractor as the "completion voucher" or "completion invoice" and
statement of cost, which shall be Submitted by the Contractor as
promptly as may be practicable following completion of the work under
this contract but in no event later than Ono, (1) year (or such longer
period as the Contracting Officer may, in his discretion, approve in
writing) from the date of such completion, and following compliance
by the Contractor with all provisions of this contract (including,
without limitation, provisions relating to patents and the provisions
of paragraphs (e) and (f) of this clause), the Government shall as
promptly as may be practicable pay any balance of Allowable Cost.
(e) The, Contractor and each assignee under an assnment
ente...:ed into under this contract -Ind 1,31 offoct nt th(b_tira of fin3
payment under this contract shall execute and deliver at the time of
and as a condition precedent to final payment under this contract, a
release discharging the Goverment, its officers, agents and employees
Neer of and from all liabilities, obligations and claims arising out of or
under this contract, subject only to the following exceptions:
(1) Specified claims in stated amounts or in estimated
amounts where the amounts are not susceptible of
exact statement by the Contractor,
(2) Claims, together with reasonable expenses inciden-
tal thereto, based upon the liabilities of the
Contractor: to third parties arising out of the per-
formance of the contract, which are not known to the
Contractor on the date of the execution of the
release, and of which the Contractor gives notice
in writing to the Contracting Officer not :more than
six (6) years after the date of the release or the
date of any notice to the Contractor that the
Government is prepared to make final payment, which-
ever is earlier.
(3)
Claims for reimbursement of costs (other than
expenses of the Contractor by reason of its indem-
nification of the Government against patent liabil-
ity), including reasonable expenses incidental
thereto, incurred by the Contractor_under the
provisions of the contract relating to -atonts.
(f) The Contractor agrees that any refunds, rebates or credits
(including any interest thereon) accruing to or received by the
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Contractor or any assignee which arise out of the performance of this
contract and on account of which the Contractor has received reimburse-
ment shall be paid by the Contrnctor to the Government. The Contractor
and each assignee under an assignment entered into under this contract
and in effect at the time of final payment under this contract shall
execute and deliver at the time of and as a condition precedent to
tnal payment under this contract, at assignment to the Government of
:neCunds? rebates or credits (including any interest thereon) arising out
of the performance of this contract, in form and substance satisfactory
to the Contracting Officer. Reasonable expenses incurred by the
Contractor for the purpose of securing any such refunds, rebates or
credits shall constitute Allowable Cost when approved by the Contracting
Officer.
(n) Any cost incurred by the Contractor under the terms of this
eenraet which would constitute Allowable Cost under the provisions of
this clause shall be incinied in determinfng the amount payable under
tete contract, notwithstanding any provisions contained in the epecifi-
eatione or other documente incorporated in this contract by reference,
,eignating services to be performed or materials to be furnished by
,e Contractor at its expense or without cost to the Government.
(h) Payment of the fixed fee shall be made to the Contractor as
provided in the SCeedule subject, however, to the withholding provisions
of paragraph (c) h.neof.
5. :NSPECTION AND CORRECTION OF DEFFCTS (AFPI 7-403,5)
(a) All work nnder this contract shall be subject to inspection
and test by the Government, to the extent practicable at all reasonable
'eines and places including the period of performance, and in Lni event
prior to final acceptance. The Contractor shall provide and maintain
an inspection system acceptable to the Government covering the work
hereunder. The Government, through any authorized representative, may
inspect the plant or plants of the Contractor or of any of its subcon-
tractors engaged in the perfdnunce of this contract. If any inspection
or test is made by the Government on the premise of the Contractor or a
subcontractor, the Contractor shall provide and shall require subcon-
tractors to provide all reasonable facilities and assistance for the
safety and convenience of the Government inspectors in the performance
of their duties. All inspections and tests by the Government shall be
performed in such a manner as will not unduly delay the work. Final
inspection and acceptance by the Government shall be made as promptly as
rracticable after delivery. The time and place of delivery, final
inspection, and acceptance shall be as set forth in the Scheduleo
(b) The Contractor war-ants that the services rendered in the
nenformance of this contract will conform to the requirements of this
cnntract and to Lfgh professional standards in the field and that any
-eticle delivered to the Government under this contract will conform
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to the requirements of this contract and will not be defective in material
or w-rknanship,
(c) At any tine during performance of this contract, but not later
than F.,x (6) months (or such other period as nay be provided in the
schedule) after find l acceptance, the Government may require the Contractor
to remedy by correction or replacement as directed by the Contracting
Officer, any failure by the Contractor to comply with its obligations under
paragraph (e) hereof. Except as otherwise provided in paragraph (d) here-
of, the cost of any such replacement or correction shall be included in
"Allowable Cost" determined as provided in the clause of this contract
entitled "Allowable Cost, Fixed Fee and Payment," but no additional fee
shall be payable with respect thereto, Corrected articLs shall not be
tende3o1 again for acceptance unless the fori.or tender and the require-
ment of correction is disclosed. If the Contractor fails to proceed with
reasonable promptness to perform such replacement or correction, the
Government (i) may by contract or otherwise perform such replacement or
correction Lrld charge to the Contractor any increased cost occasioned
the Government thereby, or may reduce any fixed fee payable under this
contract (or require repayment of any fixed fee theretofore paid) in such
amount as nay be equitable under the circumstances; or (ii) in the case
of articles not delivered, may require the doliv Ty of such articles and
shall have the right to reduce any fixed fee payable under this contract
(or to require repayment of any fixed foe theretofore paid) in such
amount as may be equitable under the circumstances; or (iii) may terminate
this contract for default as provided in the clause of this contract
entitled "Ternination." Failure to agree on the amount of any such
Incrcas-1 cost to be charf,ed to the Contractor or to such reduction in,
or repa'_Jent of, the fixed fee shall be a dispute concerning a question
of fac within the meaning of the clause of this contract entitled
"Di spates
(d\ Notwithstanding the provisions of paragraph (c) hereof, the
Government may at any time rocrkire the contractor to remedy by correction
or replaconent, without cost to the Government, any failure by the
Contractor to comply with its obligations under paragraph (b) hereof,
if such failure is due to fraud, lack of good faith, or willful mis-
conduct on the part of any of the contractor's directors or officers, or
on the part of any of its managers, superintendents, or other equivalent
representatives, who has supervision or direction of (i) all or
substantially all of the Cortractoris business; or (ii) all or substan-
tially all of the Contractor's operations at any one pl'nt or separate
location in which this contract is being performed; or (iii) a separate
and complete major industrial operation in connection with the perform-
Ince on this contract, Fraud, lack of good faith, or willful misconduct
on the part of any of such suporvisdry personnel shall be deemed to
include the selection of individual employees or the retention of employees
after any of such supervisory personnel has reason to believe that such
employees are habitually careless or otherwise unqualified.,
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(e) Corrected articles tendered as replacements shall be subject to
the previsions of thid clause in the same manner.and to the Same extent
as supplies originally delivered Under thig conti'aAi
(1, The Contractor shall make its recordd of all inspection work
avail 'e to the Government during the performance of this contract and
for su a longer periods as may be specified in this contract.
(g) Except as provided in this clause and as may be provided in the
ehedule, the Contractor shall have no obligation or liability to correct
or replece supplies or lots of supplies which at the time of delivery are
defective in materials or workmanship or otherwise not in conformity with
the requirements of this contract.
ASSIGYAEPT OF cLaDis (ASPR 7-103.8 AFPI 7-403.6)
(a) Pursuant to the provisions of the Assignment of Claims Act of
1940 as amended (31 U.S. Code 203, 0 U.S. Code 15), if this contract
.provides for payments aggregating &i,00n or more, claims for monies due
,r to become due the Contractor from the Government under this contract
may be esigned to a bank, trust company, or other financing institution,
including any Federal Lending agency, and may thereafter be further
assigned and reassigned to any such institution. Any such assignment or
-enassignment 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 reugnment may be made to one party as agent or
trustee) for two or more parties participating in such financing. Not-
ibhstanding any provision of this contract, payments to an assignee of
my moniee due or to become due under this contract shall not, to the
Ictent plovidcd in said Act as amended, be subject to reduction or set-off.
(b) In no event shall copies of this contract or of any plans,
pecificatiens, or other similar documents relating to work under this
:entract, if marked "Top Secret", "Secret", or "Confidential", be
'iamished to any assignee of any claim arising under this contract or
Nim0/0 any other person not entitled to receive the same; provided, That
copy of any part or all of this contract so marked may be furnished,
e any information contained therein may be disclosed, to sueh assignee
pon the prior written authorization of the Contracting Officer.
cos (ASPR 7-203.7 AFPI 7-403.7)
(a)(1) The Contractor agrees to maintain books, records, documents
nd other evidence pertaining to the costs and expenses of this contract
lereinafter collectively called the "records") to the extent and in such
)tail as will properly reflect all net costs, direct and indirect of
,lbor, materials, equipment, supplies and services, and other costs
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and expendeS of Whatever nature for which reimbursement is claimed under
the provisions of this contract. The Contxlacterls accounting procedures
and practices shall be subject to the approVal of the Contracting Officer;
provided, however, that no material change will be required to be made
Ln the Contractorls accounting procedurea and practices if they conform
to generally accepted accounting practices and if the costs properly
applicable to this contract are readily ascertainable therefrom.
(2) The Contractor agrees to make available at the office of the
Contractor at all reasonable tines during the period set forth in sub-
paragrlph (4) below any of the records for inspection, audit or repro-
duction by an authorized representative of the Contracting Officer.
(3) In the event the Contracting Officer or any of his du3y authorized
representatives determines that his audit of the amounts reimbursed under
this contract as transportation charges will be made at a place other
than the office of the Contractor, the Contractor agrees to deliver, with
the reimburefment voucher covering such charges or as nay be otherwise
"low specified within two years after reimbursement of charges covered by any
such voucher, to such representative as nay be designated for that
purpose through the Contracting Officer such documentary evidence in
support of transportation costs as may be required by the Contracting
Officer or any of his duly authorized represent-tives.
(4) Except for documentary evidence delivered to the Government
pursuant to subparagrapa (3) above, the Contractor shell preserve and
make available its records for a period of six years (unless a longer
period, of time is provided by applicable statute) from the date of the
voucher or invoice submitted by the Contractor after the completion of
the work under the contract and design-ted by the Contractor as the
"completion voucher" or ?completion invoice" or, in the event this con-
tract has been completely terminated, from the date of the termination
settlement agreement; provided, however, the records which relate to
(11) appeals under the clause of this contract entitled "Dispute,
(13) litigation or the settlement of claims arising out of the performance
of this contract, or (0) costs or expenses of the contract as to
which exception has been taken by the Contracting Officer or any of his
duly authorized representatives, shall be retained by the Contractor
until such appeals, litigation, claims, or exceptions have been disposed
Of, but in no event for less than the six-year period mentioned above.
(5) Except for documentary evidence delivered pursuant to sub-
paragraph (3) above, and the records described in the proviso of sub-
paragraph (4) above, the Contractor may in fulfillment of its
obligation to retain its records as required by this clause substitute
photographs, -licrophotographs or other authentic reproductions of such
records, after the expiration of two years following the last d-y of
the month of roinbursenont to the Contractor of the invoice or voucher
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to which such records relate, unless e. period period is authorized by
the Contracting Officer with the concUrtenge of the Comptroller of the
Contracting Government Agency or his atith4ized representatives.
(6) The provisions of thig paragraph (a), including this sub-
paragraph (6), shall be applicable to and included in each subcontract
heeeunder which is on a cost, cost-plue-a-fixed-fee, time-and-material
or labor-hour basis.
(b) The Contractor further agrees to include in each of his sub-
coitracts hereunder, other than those set forth in subparaaraph (a)
(6) above, a provision to the effect that the subcontractor agrees that
the Contracting Officer or any of his duly authorized representatives,
shall, until the expiration of three years after final payment under
thr subcontract, have access to and the right to exa-ine any directly
pertinent books, documents, papers, and records of such subcontractor
involving transactions related to the subcontract. The term "set-
contract," as used in this paragraph (b) only excludes (i) purchase
arc-J.31"s ri:t exceeding 3.0000 and (ii) subcontracts 02 purchase orders
for public utility services at rates established for uniform applic-
ability to the general public.
8. SUBCONTRACTS (ASPR 7-203.8 AFPI 7-403.8)
(a) The Contra': tar shall give advance notification to the Con-
trecting Officer of proposed subcontract hereunder which (i) is
oa a cost or cost-p3as-a-fixed-fee basin, or (ii) is on a fixed-price
l'ee.ts exceeding i dollar amount either ',25,000 or five percent (5%)
total estimated: cost of this contract.
(b) The Contractor shall not, without the prior written consent
of the Contracting Officer, place any subcontract which (i) is on a
cost or cost-plus-a-fixed-fee basis, or (ii) is on a fixed-price basis
exceeding in dollar amount either (l,25,000 or five percent (5%) of the
total estimated cost of this contract, or (iii) provides for the
fabrication, purchase, rental, installation or other acquisition, of
any item of industrial facilities, or of special tooling having a value
in excess of ,?1,0000 or (iv) is on a tine-and-material or labor-hour
basis,
or (v) involves research and development work. The Contracting
Officer may, in his discretion, ratify in writing any such subcontract;
such action shall constitute the consent of the Contracting Officer as
reciaired by this paragraph (b).
(c) The Contractor agrees that no subcontract placed under this
contract shall provide for payment on a cost-plus-a-percentage-of-cost
basis.
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(d) The Contracting Officer ray, in his discretion, specifically
approve in writing any of the provisions of a subcontract. However,
such approval or the consent of the Contracting Officer obtained as
required by this clause shall not be construed to constitute a deter?
ninat'en of the allowability of any cost under this contract, unless
such approval specifically provides that it constitutes a detenlination
of the allowability of such cost4
(e) The Contractor shall give the Contracting Officer ionediate
notice in writing of any action or suit filed, and prompt notice of
any claim made against the Contractor by any subcontractor or vendor
which, in the opinion of the Contractor, nay result in litigation,
relat'd in any way to this contract with respect to which the Con?
tractor nay be entitled to reimbursement from the Goverleient,
(f) (AFPI 7-203.8) The Contracting Officer may approve all
or part of the Contractor's purchasing system and from time to time
rescind or reinstate such approval, Such approval shall be doomed
to fulfil tho requirements for obtaining the Contracting Officerls
consent to subcontracts as prescribed in paragraph (b) above.
UTILIZATION OF aAT.T, BUSINESS CONCERNS (ASPR 7-104.14 AFFI 7-403.9)
.=1) It is the policy of the Government as declared by the
Congress to bring about the greatest utilization of small business
concerns which is consietent with efficient production.
(') The Contractor agrees to accomplish the maximum amount of
subcorracting to suall business concerns that the Contractor finds
to be consistent with the efficient perfemanue of this contract.
TERhIPATIOh (As PR 8-702 AFFI 7-403,10)
(a) The performance of work under the contract me.y be terminated
by the Government in accordance with this clause in whole, or from time
to time in part, (1) whenever the Contractor shall default in performance
of this contract in accordance with its terms (including in the term
"default" any such failure by the Contractor to make progress in the
prosecution of the work hereunder as endangers such performance), and
shall fail to cure such default within a period of ti days (or such
longer periods as the Contracting Officer nay allow) after receipt from
the Contracting Officer of a notice specifying the default, or (2) when?
ev x for any reason the Contracting Officer shall determine that such
termination is in the best interest of the Government. Any such
termination shall be effected by delivery to the Contractor of a
Notice of Termination specifying whether termination is for the default
of the Contractor or for the convenience of the Government, the extent
to which performance of work under the contract is terminated, and the
date upon which such termination becomes effective. If after notice of
termination of this contract for default under (1) above, it is
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determined that the Contractor's failure to perform or to make progress
in performance is due to causes beyond the control and without the
fault or negligence of the Contractor pursuant to the provisions of the
clause of this contract relating to excusable delays, the Notice of
Termination shall be deemed to have been issued under (2) above, and the
rights and obligations of the parties hereto shall in such event be
governed accordingly.
(b) After receipt of a Notice of Termination and except as other-
wise directed by the Contracting Officer, the Contractor shall (1) stop
work under the contract on the date and to the extent specified in the
Notice of,Trarmanationf2) place no further orders or suboontraets for
wateritts, services, or faciliUe4-exo,ept as may be necessary for com-- -
/Dilation of such portion of the work under the contract as is not
terminated; (3) terminate all orders and subcontracts to the extent that
they relate to the performance of work terminated by the Notice of
Termination; (4) assign to the Government, in the manner and to the
extent directed by the Contracting Officer, all of the right, title,
and interest of the Contractor under the orders or subcontracts so
terninatedlin which case the Government shall have the right in its
discretion, to settle or pay any or all claims arising out of the
termination of such orders and subcontracts; (5) with the approval or
ratification of the Contracting Officer, to the extent he may require,
which approval or ratification shall be final and conclusive for all
purposes of this c::_ause? settle all outstanding liabilities and all
claims arising out of such termination of orders and subcontracts the
cost of which would be reimbursable, in whole or in part, in accord-
ance with the provisions of this contract; (6) transfer title (to the
extent that title has not already been transferred) and, in the manner,
to the extent, and at the times directed by the Contracting Officer,
deliver to the Government (i) the fabricated or unfabricated parts, work
in process, completed work, supplies, and other material produced as a
part of, _oi.acqirir-ociin respect of the performance of, the work terminated
by the Notice of Termination, (ii) the oenploted". or paetially completed
plahs,'Idrawings? information, and other property which, if the contract
had been completed, would be required to be furnished to the Government,
and (iii) the jigs, dies, and fixtures, and other specie1-toolz
acquired or manufactured for the performance of this contract for the
cost of which the Contractor has been or will be reimbursed under
this contract; (7) use its best efforts to sell in the manner, at the
times, to the extent, and at the price or prices directed or authorized
by the Contracting Officer, any property of the types referred to in
provision (6) of this paragraph, provided, however, that the Contractor
(i) shall not be reauired to extend credit to any purchaser, and (ii)
may acquire any such property under the conditions prescribed by and
at a price or prices approved by the Contracting Officer; and provided
further that the proceeds of any such transfer or disposition shall be
applied in reduction of any payments to be made by the Government to the
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Contractor under t cortract or shall otherwise bmwereaitea to tn.
price or cost of the work covered by this contract or paid in such other
manner as the Contracting Officer may direct; (8) complete performance
of such part of the work as shall not have been terminated by the Notice
of Termination; and (9) take such action as may be necessary, or as the
Contracting Officer may direct, for the protection and preservation of
the property related to this contract which is in the possession of the
Contractor and in which the Government has or may acquire an interest.
The Contractor shall proceed immediately with the performance of the
above obligations notwithstanding any delay in determining or adjusting
the amount of the fixed-fee, or any item or reimbursable cost under this
clause. At any time after expiration of the plant clearance period, as
defined in Section VIII, Armed Services Procurement Regulation, as it
may be amended from time to time, the Contractor may submit to the
Contracting Officer a list, certified as to quantity and quality, of any
or all items of termination inventory not previously disposed of.#
exclusive of items the disposition of which has been direeted or author-
ized by the Contracting officer) and may request the Government to remove
such items or enter into a storage agreement covering them. Not later than
fifteen (15) days thereafter, the Government will accept title to such
items and remove them or enter into a storage agreement covering the
same, provided that the list submitted shall be subject to verification
by the Contracting Officer upon removal of the items, or if the items
are stored, within forty-five (45) days from the date of submission of
the list, and any necessary adjustment to correct the list as submitted
shall be made prior to final settlement.
(c) After receipt of a Notice of Termination, the Contractor shall
submit to the Contracting Officer its termii,ation claim in the form and
with the certification prescribed by the Contracting Officer. Such
claim shall be submitted promptly but in no event inter than two years
from the effective date of termination, unless one or more extensions in
writing are granted by the Contracting Officer upon request of the
Contractor made in writing within such two-year period or authorized
extension thereof. However, if the Contracting Officer determines that
the facts justify such action, he may receive and act upon any such
termination claim at any time after such two-year period or any extension
thereof. Upon failure of the Contractor to submit its termination claim
within the time allowed, the Contracting Officer may determine, on the
basis of information available to him, the amount, if any, due to the
Contractor by reason of the termination and shall thereupon pay to the
Contractor the amount so determined.
(d) Subject to the provisions of paragraph (c), the Contractor
and the Contracting Officer may agree upon the whole or any part of the
amount or amounts to be paid (including an allowance for the fixed-fee)
to the Contractor by reason of the total or partial termination of work
pursuant to this clause. The contract shall be amended accordingly,
and the Contractor shall be paid the agreed amount.
(CPFF Apr. 18, '58)
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(e) In the event of the failure of the Contractor and the
CcnUrac'ing Officer to agree in whole or in part, as provided in
pe?ueraph (d) above, as to the amounts with respect to costs and
fid-fee, or as to the amount of the fixed-fee, to be paid to the
C ractor in connection with the termination of work pursuant to this
ase, the Contracting Officer shall determine, on the basis of
i'l'onnation available to him, the amount, if any, due to the
Centractor by reason of the termination and shall pay to the
Contractor the amount determined as follows:
(1) If the settlement includes coat and fixed-fee
(i) There shall be included therein all costs and
expenses reimbursable in accordance with this contract, not pre-',..ously
te the Contractor for the performance of this centrac5 prIc to the
ei.eetie date of the Notice of Termination, and 3-L3,1, of these coe...e as
may continue for a reasonalle time thereafter with the aprrowl of or
as directed by the Contracting Officer, provided, however, that --e
Contractor shall proceed as rapidly as practicable to disconi-,enne
such costs.
(ii) There shall be included therein so far as aot
included under (i) above, the cost of settling and paying clams a.ising
out of the terminatf,on of work under subcontracts or orders, as provided
in paragraph (b)(5) above, which are properly charEea ble to the terminated
portion of the contract.
(iii) There shall be included therein the reasonable costs
of eettlement, including accounting, legal, clerical, and other expenses
reaeonably necessary for the preparation of settlement claims and
sorting data with respect to the terminated portion of the cont-act
and for the termination and settlement of subcontracts thereunder,
together with reasonable storage, transportation, and other cost e incurred
in connection with the protection or disposition of termination inventory;
provided, however, that if the termination is for default of the
Contractor there shall not be included any amounts for the preparation
of the Contractor's settlement proposal.
(iv) There shall be included therein a portion of the
fixed-fee payable under the contract determined as follows:
(A) In the event of the termination of this
contract for the convenience of the Government and not for the of,fault
of V-4) Contractor, there shall be paid a percentage ef the fee oeujew-ent
to the percentage of the completion of work contemplated by thq 000Iact,
less fixed-fee payments preyiously made hereunder.
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(B) In the event of the termination of this
contract for the default of the Contractor, the total fixed-fee payable
be such proportionate part of the fee (or, if this contract
eLf.-ie for articles of different types, of such part of the fee ac is
reasonably allocable to the type. of articles under consideration) as the
total number of articles delivered to and accepted by the Government
bears to the total number of articles of 'a like kind called for by this
coretract.
If the amount determined under this 1,aragraph is
less than the total payment of fixed-fee theretofore made to he
Contractor, the Contractor shall repay to the Government the excess
amount,
(2) If the settlement includes only the fixed-fee, the
amount thereof will be determined in accordance with subparegraple (e)
(1)(iv) above.
(f) The Contractor shell have the right of appeal, under the;
clue of this contract entitled "Disputes," from any determinat4en
made by the Contracting Officer under paragraphs (c) or (e) abov-, except
that if the Contractor has failed to submit its claim within the time
provided in paragrW, (c) above and has failed to request extension of
su time, he shall have no such right of appeal. In any case where
the Contracting Officer has made a determination of he amount due
under paragraph (c) Jr (e) above, the Government shall pay to he
Contractor the following: (i) if there is no right of appeal hereunder
or =:f no timely appeal has been taken, the amount so determined by the
Contracting Officer, or (ii) if an appeal has been taken, the amount
finally determined on such appeal.
(7) In arriving at the amount clue the Contractor under this
clauee there shall be c'educted (1) all unliquidated advance or other
unliquidated payments theretofore rade to the Contractor, (2) ay
claim which the Government may have against the Contractor in
connection with this contract, and (3) the agreed price for, or the
proceeds of sale of, any materials, supplies, or other things e-4uire,1
by the Contractor or sold pursuant to the provisions of this c-ause
and not otherwise recovered by or credited to the Government.
(h) In the event of a partial termination, the portion of the
fixed-fee which is payable with respect to the work under the continued
portion of the contract snail be equitably adjusted by agreereent between
the Contractor and the Contracting Officer, and such adjustment hall be
evidenced by an amendment to this contract.
(i) The Government may from time to time, under such terms and
conditions as it may prescribe, make partial payments and payments
on account against costs incurred by the Contractor in connection with
the terminated portion of the contract whenever in the opinion of the
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Contracting Officer the aggregate of such payments shall be within the
amount to which the Contractor will be entitled hereunder. If the total
of such payments is in excess of the amount finally determined to be due
under this clause, such excess shall be payable by the Contractor to the
Govornnont upon demand, together with interest computed at the rate of
6% per annun, for the period from the date such excess payment is received
)7r L C n+racter to the date on which such excess is repaid to the Govern-
ment; 1,1.evided, however, that no interest shall be charged with respect to
any such excess paymont attributable to a reduction in the Contractors
clam by reason of retention or other disposition of termination inventory
until ton days after the date of such retention or disposition.
(j) The provisions of this clause relating to the fixed-fee shall
be inapplicable if this contract does not provide for payment of a fixed
-
fee.
(k) Unless otherwise provided for in this contract, or by applicable
statute, the Contractor from the effective date of terrdnation and for
Amp' a period of six years after final settlement under this contract, shall
preserve and make available to the Government at all reasanable tines at
the office .of the Contractor, but without direct charge to the Govern-
ment, all its books, records, documents, and other evidence bearing on
the cost and expenses of the Contractor under this contract and relating
to the work terminated hereunder, or, to the extent approved by the
Contracting Officer, photographs, microphotographs, or other authentic
reprodeAions thereof.
Nave
EXCUSABLE DELAYS (ASPR 7-203.11 AFPI 7-303.10)
(a) The Contractor shall not be in default by reason of any fail7.ee
in performance of this contract in accordance with its torus (including
any failure by the Contractor to make progress in the prosecution of the
work hereunder which endangers such performance) if such failure arises out
of causes beyond the control and without the fault or negligence of the
Contr-.otor. Such causes include, but are not restricted to: acts of God
or of the public enemy; acts of the Government; fires; floods, epidemics;
quarantine restrictions; strikes; freight embargoes, unusually severe
weather; and failure of subcontractors to perform or make progress due to
such cc uses, unless the Contracting Officer shall have determined that the
supplies or services to be furnished under the subcontract were obtainable
from other sources and shall have ordered the Contractor in writing to
procure such services or supplies from such other sources, and the Contractor
shall have failed reasonably to comply with such order. Upon request of the
Contractor, the Contracting Officer shall ascertain the facts and extent
of such failure and, if he shall doternino that such failure was occasioned
by any one or mere of the said causes, the delivery schedule shell be
revised acconling]y, subject to the rights of the Government under the
clause hereof entitled "Ton]ination".
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(b) If the Contractor beceides unable to complete tho contract work
and make delivery at the time specified in tho Schedule because of technical
difficulties, notwithstanding the exercise of good faith and diligent
efforts in tho p)rfornance of the work called for hereunder, it nay give
tho Contracting Officer written notice of the anticipated clef-mit with
reasons therefor. Such notice and reasons shall be delivered not less
than forty-five (45) days before the completion date specified in the
Schedule or within such tine as tho Contracting Officer doons sufficient.
If such notice is duly given, then to the extent the interest of the
Govern: ent makes an extension desirable the Contracting Officer may, in
his di,cretien, extend the period of time specified in the Schedule for
such poriod as he deems advisable, and this contract shall then be modified
in writing accordingly4
DISPUTTS (ASPR 7-103.12 AFPI 7-403.12)
(n) Except as otherwise provided in this contract, any dispute
concerning a question of fact arising under this contract which is net
disposed of by agreement shall be decided by the Contracting Officer, who
shall rouce his decision to writing and mail or otherwise furnish a
copy thereof to tho Contractor. The decision of the Contracting Officer
shall be final and conclusive unless, within 30 days from the date of
receipt of such copy, the Contractor nails or otherwise furnishcs to the
Contracting Officer a written appeal addrossed to the Secretary. The
dec!ision of the Secretary or his duly authorized ronr,sentative for the
tun of such ak _-is shall be final and conclusive unless
deter-jnod by a court of competent jurisdiction to have boon fraudulent,
or capricious, or arbitr-ry, or so grossly erroneous as necesarily to
imply hod faith, or not supported by substantial evidence. In connection
with an,- appeal proceeding under this clause, tho Contractor shall be
afforded an opportunity to be heard and to offer evidence in support of
its appoal. Pending final decision of a dispute hereunder, the Contractor
shall proceed diligently with the performance of the contract and in
accordance with the Contracting Officer's decision.
(b) This "Disputes" clause does not preclude consideration of law
?luestions in connection with decisions provided for in paragraph (a)
)bovo: Provided, That nothing in this contract shall be construed as
making final the decision of any adminlstrtive official, representative, or
board on a question of law.
NOTICE AND ASSISTANCE REGARDING PATENT INFIZINGFI/ENT (ASPR 9-104 AFPI 7-404.13)
Tho provisions of this clause shall be applicable only if the amount
this contract is in excess of ,5,000.
(a) The Contractor shall report to the Contracting Officer, promptly
Lnd in reasonable written detail, each notice or claim of patent infringo-
lent based on the performance of this contract of which tho Contractor
Las knowledge.
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(b) In the event of litigation against the Government on account of
any claim of patent infringement arising out of the performance of this
contract or out of the use of any supplies furnished or work or services
performed hereunder, the Contractor sh&t11 furnish to the Government, upon
r-quo-, all evidence and information in possession of the Contractor
portang to such litigation. Such evidence and information shall be
furnished at the expense of the Government except in those cases in which
thc Cortractor has agreed to indemnify the Government against thc claim
being sscrted?
BUY AFIERICAN ACT (ASPR 7-103.14 AFPI 7-403.14)
(a) In acquiring end products, the Buy AnTican Act (41 U.S. Code
10a-d) provides that the Govornment give preference to domestic source
ond products, For the purpose of this clause:
(i) "components" mails those articles, materials, and supplies,
which are directly incorporated in the end products;
(ii) "end products" loans those articles, materials, and supplies,
which are to be acquired under this contract for public use; and
(iii) a "domestic source end product" means (A) an unmanufacturod
end pr duct which has been mined or produced in the United States and (B)
an end product manufactured in the United States if the cost of the
components thereof which are mined produced, or manufactured in the United
States exceeds 50 percent of the cost of all its components, For the
purposes of the (a)(iii)(B), components of foreign origin of the sane type
or kirt:', as the products suferred to in (b)(ii) or (iii) of this clause
shall be treated as components mined, produced, or manufactured in the
United States.
(b) The Contractor agrees that there will be delivered under this
conticL only domestic source end products, excer.t end products:
(i) which are for use outside the United States;
(ii) which the Government determines are not mined, produced, or
manufactured in the United States in sufficient and reasonably available
connercial quantities and of a satisfactory quality;
(iii) as to which the Secretary determines the deflostic preference
to be inconsistent with the public interest; or
(iv) as to which the Secretary determines the cost to the Govern-
ment to bo unrelsonable.
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COVICT LABOR (ASPR 12-.203 AFPI 7-403.15)
In connection with tho performance of work under this contract,
the Contractor agrees not to employ any. person undergoing sentence of
-imprisonment at hard labor.
EIGHT-HOUR LAW OF 1912 (ASPR 12-303.1 AFPI 7-403416)
This contract, to the extent that it is of a character spocifiod in
the Eight-Hour Law of 1912 as amended (4n U.S. Code 324-326) and is not
covox. , by the Walsh-Healey Public Contracts act (41 U.S. Code 35-.45), is
subject to the following provisions and cxceptions of said Eight-Hour
Law of 1912, as amended, and to all othor provisions and exceptions of
said Law:
No laborer or mechanic doing any part of the work contemplated by
this contract, in the employ of the Contractor or any subcontractor
contracting for any part of the said work contemplated, shall be required
or permitted to work more than eight hours in any one calendar day upon
such work, except upon the condition that compensation is paid to such
laborer or mechanic in accordance with the provisions of this clause.
The wages of every laborer and mechanic employed by the Contractor or
any subcontractor engagod in the performance of this contract shall be
computed on a basic day rate of eight hours per day; and work in excess
of eight hours per day is permitted only upon the condition that ovary
such laborer and mechanic shall be compensated for all hours worked in
excess of eight hours per day at not loss than one and one-half tines the
basic rote of pay. For each -triplation of the requirements of this clause
a penrLty of five dollars shall bo imposed for each laborer or mechanic for
every calendar day in which such employee is required or permitted to
labor more than eight hours upon said work without receiving compensation
computed in accordance with this clause, and all penalties thus imposed
shall be withheld for the use and benefit of the Government.
NONDISCRILINATION IN Fo.PLOYLENT (ASPR 12-802 AFPI 7-403.17)
(a) In connection with the performalace of work under this contract,
the Contractor agrees not to discriminate against any employee or applicant
for el,p2oyment because of race, religion, color, or national origin. The
aforesaid provision shall include, but not be limited to, the following:
employment, upgrading, demotion/or transfer; recruitment or recruitment
advertising; layoff or termination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship. The
Contractor agrees to post hereafter in conspicuous places, available for
employees and applicants for employment, notices to be provided by the
Contracting Officer setting forth the provisions of the nondiscrimination
clause.
(b) The Contractor further agrees to insert the foregoing provision
in all subcontracts hereunder, except subcontracts for standard commercial
wappflos or raw materials.
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OFFICIALS NOT TO BENNEFIT (ASPR 7-103.19 AFPI 7-403.18)
No member of or delegate to Congress, or rosidont commissioner,
shall be admitted to any share or part of this contract, or to any
benefit that may arise therefrom; but this provision shall not be
construed to extend to this contract if made With a corporation for
its general benefit.
COVENANT AGAINST CONTINGENT FEES (ASFR 7-103.20 AFPI 7-403419)
The Contractor warrants that no person or selling agency has
been omployel or retained to solicit or secure this contract upon
an agreement or understanding for a commission, percentage, broker-
age, or contingent fee, excepting bona fide employees or bona fide
established commercial or selling agencies maintained by the Contractor
for the purpose of securing business. For broach or violation of this
warranty the Government shall have the right to annul this contract
without liability or in its discretion to deduct from the contract
price or consideration, or otherwise recover, the full amount of such
coraission, percentage, brokerage or contingent foe.
PATENT RIGHTS (LSPR 9-107
AFPI 7-403.20)
(a) As used in this clause the following toms shall havo the
meanings sot, forth below:
(1) Tho term "Subject Invention" moans any invention,
improvement or discovery whether or not patentable) conceived or first
a;tually reduced to practice either (A) in the performance of the
experLisntal, developmental, or research work called for or required
under this contract: or (B) in the performance of any experimental,
developmental, or research work relating to the subject matter of
this contract which was done upon an understanding in writing that a
contract would bo awarded; provided that the term "Subject Invention"
Noe shall not includo any invention which is specifically identified and
listed in the Schedule for the purpose of excluding it from the
license granted by this clause.
(ii) The torn "Technical Personnel" moans any person employed
by or working under contract with the Contractor (other than a sub-
contractor whose responsibilities with respect to rights accruing to
the Government in inventions arising under subcontracts set forth in
paragraphs (g), (h), and (i) below) who, by reason of the nature of
his duties in connection with the p rformance of this contract, would
roas .ncbly be oxpoctod to make invontions.
(iii) The terms "subcontract" and "subcontractor" moan any
subcontract or subcontractor of the Contractor, and any lower-tier
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subcontract or subcontractor under this 0 ntracti
(b)(1) The Contractor agreed to and does hereby grant to the
Govern_ont an irrevocable, nonexclusive, nontransferable, and royalty?
free :license to practice, and cause to be practiced by or for the United
States Government throughout the world, each Subject Invention in the
manui, :ture? use and disposition according to law, of any article or
later ci, and in the DSO of any method. No license granted herein
shall convey any right to the Government to manufacture, have manufactured,
or use any Subject Invention for the purpose of providing services or
supplies to the g-ncral public in competition with the Contractor or
the Coltractorls commercial licensees in the licensed fields.
(2) With respect to:
( i)
Personnel;
any Subject Invention made by other than Technical
(ii) any Subject Invention conceived prior to, but first
actually reduced to practice in the course of, any of the experimental,
devolopment-1, or research work specified in (a) (i) above; and
(iii) the practice of any Subject Invention in foreign
countries; the obligation of the Contractor to grant a license as
provided in (b)(1) above; to convey title as provided in (d)(ii)(B)
or (d)iv) below, and to convey foreign rights as provided in (e)
below, shall be limited to the extent of the Contractoris right to
grant the same without incurring any obligation to pay royalties or
other compensation to others solely on account of said grant.
Nothing contained in this Patent bights clause shall be deemed to
grant any license under any invention other than a Subject Invention,'
(c) The Contractor shall furnish to the Contracting Officer the
following information and reports concerning Subject Invention which
reasonably appears to be patentable:
(1) a written disclosure promptly after conception or first
actual reduction to practice of each such Invention together with a
written st tonont specifying whether or not a United States patent
application claiming the Invention has been or will be filed by or
on behalf of the Contractor;
(ii) interim reports, at least ovary twelve months,
commencing with the date of this contract, each listing all such
Inventions conceived or first actually reduced to practice more than
throe months prior to the date of the report, and not listed on a
prior inu:,c3m rupert or certifying that there are no such unreported
Inventions; and
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(iii) prior to final settlement of this contract, a final
report listing all such Inventions including all those previously
listed in interim reports.
(d) In connection with each Subject Invention referred to in
(r4(i) above, the Contractor shall do the following:
(i) if the Contractor specifies that a United States patent
a-lication claiming such Invention will be filed, the Contractor shall
file or cause to be filed such application in due form and time; however,
i the Contractor, after having specified that such an application
w ald be filed, decides not to file Or cause to be filed said application,
t_e Contractor shall so notify the Contracting Officer at the earliest
practicable date and in any event not later than eiLht months after
first publication, public use or sale.
(ii) if the Contractor specifies that a United States
patent application claiming such Invention has not been filed and will
not be filed (or having specified that such an application will be
filed thereafter notifies he Contracting Officer to the contrary),
the Contracting Officer s]Lall:
(A) inform the Contracting Officer in writing at the
earliest practicable date of any publication of such Invention made by
or known to the Contractor or, where applicable, of any contemplated
publication by the contractor, stating the date and identity of such
publication or contmplated publication; and
(B) convey to the Government the Contractor's entire
right, title, and interest in such Invention by deliverying to the
Contracting Officer upon written request such duly executed instruments
(prepared by the Government) of assignment and application, and such
other papers as are deemed necessary to vest in the Government the
Contractor's right, title and interest aforesaid, and the right to
apply for and prosecute patent applications covering such Invention
throughout the world, subject, however, to the right of the Contractor
specified in (e) below to file foreign applications, and subject
further to the reservation of a non-exclusive and royalty-free
license to the Contractor (and to its existing and future associated
and affiliated companies, if any, within the cox.] orate structure of
which the Contractor is a part) which license shall be assignable to
the successor of that part of the Contractor's business to which such
Iavention pertains;
(iii) the Contractor shall furnish promptly to the
Contracting Officer on request an irrevocable power of attorney to
inspect and make copies of each United States patent application
filed by or on behalf of the Contractor covering any such
Invention;
-21-
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Approved Fo-ckplease 2002/a1CIWA-RDP61-0076W00100040164-9
(iv) In the event the Contractor, or those other than the
Government deriving rights from the Contractor, elects not to continue
prosecution of any such United States patent application filed by or
on behalf of the Contractor, the Contractor shall so notify the
Contracting Officer not less than si*ty days before the expiration of
the response period and, upon written revest, deliver to the Contracting
Officer such duly executed instruments (prepared by the Government) as
are deemed necessary to vest in the Government the Contractor's entire
right, title, and interest in such Tnvention and theapplication, subject
tc the reservation as specified in (d)(ii) above; and
(v) the Contractor shall deliver to the Contracting Officer
duly executed instruments fully confirmatory of any license rights
herein agreed to be granted to the Government.
(e) The Contractor, or those other than the Government deriving
rights from the Contractor, shall have the exclusive rights to file
applications on Subject Inventions in each foreign country withn:
(i) nine months from the date a corresponding United States
application is filed;
(ii) six months from the date permission is granted to file
foreign anplications where such filing had been prohibited for security
reasons; or
(iii) such longer period as may be approved by the Contracting
Officer. The Contractor shall, upon written request of the Contracting
Of icer, convey to tie Government the Contractor's entire right, title,
and interest in each Subject Invention in each foreign country in which
an application has not been filed within the time above specified,
subject to the reservation of a non-exclusive and royalty-free license
to the Contractor together with the right of the Contractor to grant
sublicenses, which license and right shall be assignable to the
successor of that part of the Contractor's business to which the Subject
Invention pertains.
(f) If the Contractor fails to deliver to the Contracting Officer
the interim reports required by (c)(ii) above, or fails to furnish the
written disclosures for all Subject Inventions required by (c)(i) above
shown to be due in accordance with any interim report delivered under
(c)(ii) or otherwise known to be unreported, there shall be withheld
from payment until the Contractor shall have corrected such failures
either ten percent (10%) of the amount of this contract, as from time
to time amended, or five thousand dollars (,50000), whichever is less.
After payment of eighty percent (80%) of the amount of this contract,
as from time to time amended, payment shall be withheld until a reserve
of either ten percent (10%) of such amount, or five thousand dollars
(t',50000), whichever is less, shall have been set aside, such reserve
(CPFF Ar1d r5()Release 20024-1*19rfIA-RDP61-00763A000100040164-9
abAL
Approved Fv?Oelease 2gart : CIA-RDP61-0076000100040164-9
or balance thereof to be retained until the Contractor shall have
furnished to the Contracting Officer:
(i) tho final report required by (c)(iii) above;
(ii) written disclosures for all Subject Inventions required
by (c)(1) above which are shown to be due in accordance with intcrim
report delivered under (c)(ii) above or in accordance with such final
reports or are otherwise known to be unreported; and
(iii) the information as to any subcontractor required by (h)
below. Tho naxinun amount which may be withhold under this paragraph
(f) shall not exceed ten percent (10%) of the amount of this contract or
five thousand dollars (625,000), whichever is loss, and no amount shal7,
be withhold under this paraLraph (f) when the amount specified by t,:is
paragraph (f) is being withheld under other provisions of this contract.
the withholding of any amount or subsequent payment thereof to the
Contractor shall not be construed as a waiver of any rights accruing to
Nose the Government under this contract. This paragraph (f) shall not be
construed as requiring the Contractor to withhold any amounts from a
subcontractor to enforce compliance with patent previsions of a subcontract.
(g) The Contractor shall exert all reasonable effort in negotiating
for the inclusion of this Patent hights clause in any subcontract here?
under of three thousand dollars e.3,000) or ;lore having experimental,
deveaeental, or research work as one of its purposes. In the event of
refusal by a subcontractor to accept the Patent Rights clause, the
Contractor shall not proceed with the subcontract without written
authorization of the Contlacting Officer, and upon obtaining such
autherfaticn, shall cooperate with the Government in the negotiation
with such subcontractor of an ac eptablc patent rights clause; provided,
however, that the Contractor shall in any event require the subcontractor
to grant to the Government patent rights under Subject Inventions of no
loss scope and, on no less favorable terms than these which the Contractor
has under such subcontracts, except that in no event shall the subcontractor
be required to grant to the Goverment patent rights in excess of those
herein agreed to be granted to the Government by the Ccntractor.
(h) The Contractor shall, at the earliest practicable date, notify
the Contracting Officer in writing of any subcontract containing a
patent rights clause, furnish the Contracting Officer a copy of such
clause, and notify the Contracting Officer when such subcontract is
completed. It is understood that with respect to such subcontract
clause, the Government is a third party beneficiary, and the Contractor
hereby assigns to the Government all the rights that the Contractor would
have to enforce the subcontractorls obligations for the benefit of the
Government with respect to Subject Inventions. The Contractor shall not
be obligated to enforce, the agreements of any
Noe
? 23 ?
(CITY Apr. 18, 158)
Approved For Release 2002004P1IA-RDP61-00763A000100040164-9
1,4,0Aut,
Approved FOfjplease 20028E0E4:1A-RDP61-007644000100040164-9
subcontractor hereunder relating to Subject Inventions.
(i) When the Contractor shows that it has been delayed in
the performance of this contract by reason of its inability to obtain
in accordance with (g) above a suitable patent rights clause from a
qualified subcontractor for any item or service required under this
colLtract for which the Contractor itself does not have available
fa3ilities or qualified personnel, the Contractor's delivery dates
shall be extended for a period of time equal to the duration of such
delay; and, upon request of the Contractor, the Contracting Officer
sLell determine to what extent, if any, an additional extension of
the delivery dates and an increase it' contract prices based upon
additiorll cost incurred by such delay are proper under the
circumstances; and the contract shall be modified accordingly. If
the Contractor, after exerting all reasonable effort, is unable to
obtain a qualified subcontractor as set forth above, the Contractor
ra;- submit to the Contracting Officer a written request for wailer or
n lification of the requirement that a suitable patent rights clause
I:. included in the subcontract.
Such request shall specifically state that the Contractor has
mad all reasonable effort to obtain such qualified subcontractor, and
shall cite the waiver or termination provision hereinafter set forth.
If, within thirty-fie (35) days after the date of receipt of such
request for a waiver or modification of said requirement, the Contracting
C'ficer shall fail to deny in writing such request, the requirement
shall he deemed to have been waived by the Government. If within such
perDod the Contractor shall receive a written denial of such request by
the Contracting Officer, this contract shall thereupon automatically
te.Lednate and the rights and obligations of the parties shall be govern-
ed by the provisions ef the clause of this contract providing for
termination for the convenience of the Government.
21. GOVERMENT PROPERTY (SPR 13-503 AFPI 7-403.21)
(a) The Government shall deliver to the Contractor, for use in
connection with and under the terms of this contract, the property
described in the Schedule or specifications, together with such related
data and irformation as the Contractor may request and as may reasonably
be required for the intended use of such property (hereinafter referred
to as "Government-furnished Property"). The delivery or performance
dates for the supplies or services to be furnished by the Contractor
under this contract are based upon, the expectation that Government-
furnished Property suitable for use will be delivered to the Contractor
at the times stated in the Schedule or, if not so stated, in sufficient
tile to enable the Contractor to meet such delivery or performance
dates. In the event that Government-furnished Property is not
delivered to the Contractor by such time or times, the Contracting
Officer shall, upon timely written request made by the Contractor,
make a determination of the delay occassioned the Contractor and shall
-24-
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SECK
\we
Approved Forftbelease 200N
TUA-RDP61-007133A000100040164-9
impe .
equitably adjust the ostinatod cost, fixed fee, or delivery or porfornance
date, or all of them, and any other contractUal provisions affoctod
by such delay, in accordance with the procedures provided for in the
clause of this contract entitled "Changes." In the event that Govern-
nent-firnished Property is received by tie 'Contractor in a condition
not suitable for the intended use, the Contractor shall, upon recoipt
thereof notify the Contracting Officer of such fact and, as directed
by the Contracting Officer, either (i) return such property at the
Govern-on-Os expense or otherwise dispose of the propJrty or (ii)
effect repairs or -aodifications. Upon completion of (i) or (ii) above,
the Contracting Officer upon written requost of the Contractor shar
equitably adjust the estimated cost, fixed fee, or delivery or performance
dates, or all of them, and any other contractual provision affected
by the return or.dispesitinn, or the repair or modification, in accord-
ance wfth the procedures provided for in the clauso of this contract
entitled "Changes." The foregoing provisions for adjustment aro exclusive
and the Government shoji not be liable to suit for broach of contract
by reason of any delay in delivery of Government-furnished Property
or dolivery of such prop, rty in a condition not suitable for its
intended use,
(to) Title to all property furnished by the Government shall remain
in the Government. Title to all property purchasod by the Contractor,
for the cost of which the Contractor is entitled to be roimbursod as a
direct iton of cost under this contract, shall pass to and vest in the
Government upon delivery of such property by the vendor. Title to
other property, the cost of which is reimbursable to the Contractor
under this contract, shall pass to and v st in the Government upon (i)
issuance for use of such property in the performanco of this contract,
or (ii) 'co'n)ncement of processing or use of such property in the
performance of this contract, or (iii) reimbursement of the cost thcroof
by the Government, whichever first occurs. All Government-furnished
Property, together with all property acquired by the Contractor title
to which vests in the Government under this paragraph, aro subject
to the provisions of this clause and are hereinafter co3loctivoly
referred to as "Government Property."
(c) Title to the Govornment Property shall not bo affected by the
incorporation or attachment thereof to any property not owned by the
Government, nor shall such Government Property, or any part thereof, be
or bec-Le a fixture or lose its identity as personalty by reason of
affixation to any realty. The Ccntractor shall maintain adequate
property control records of the Government Property and shall identify
the Government Property as such in accordance with the requirements
of the Trmanral for Control of Government Property in Possession of
Contractors" (Appendix B Armed Services Procurement Regulation), as
in effect on the date of the contract, which Manual is hereby incor-
porated 17 roferonco and In :10 LI part of this contract.
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(d) The Government Property provided or furnished pursuant td
the terms of this contract shill, unless ethe?wise .Trevidod herein,
be used only for the performance of this contract.
(e) The Contractor shall maintain. ad_anister, in accordance
with sniand industrial practice, a progr,.za 'DIV the maintenance, repair,
protection anr:? preservation of GtIvernmant prolierty, so as to assure
its full availability and usefulness for the performance of this
centract. The Contractor shall take all reasonable steps to comply
with all appropriate directions or instructions which the Contracting
Officer- my prescribe as reasonably nedessary_fer the protection of
Government property.
(f) () The Contractor shall no be liable- for any loss of or
damage to the Government property, or for expenses incidental to
such loss or damage, except that the Contractor shall he responsible
for any sunh loss or canage (including :expenses incidental thereto)
(A) which results from willful misconduct or lack of good faith on the
part of any of the Contractorls directors or offcers, or on the part
of any of its managers, superintendents, or other equivalent represen?
ttives, who have supervision or direction of (1) all or substantially
all of the CentractrIs business, or (II) all or substantially all
of the Contract/Iris operations at any one plant or separate location
In which ti-is contract is being performed, or (III) a separate and
Crap etc major industrial operation in connection with the performance
of this contract; or (E) which results from a failure,on the part of
the Contractor, due to the willful misconduct or lack of good faith
on the part of any of its directors, officers, or other representatives
menticnee in subparagraph. (A) above, (I) to maintain and administer,
in aeordance with sound industrial practice, the program for maintenance,
repair, protection and preservation of Goverment property as reeuired
pragraph (e) hereof, or (II) to take all reas,vnable steps to comply
with any appropriate written directions rf the Contractina Officer
under paragraph (e) hereof; or (C) for which the Contractor is
otherwise responsible under the express terms of the clause or
clauses designated in. the Schedule; or (b.) which results from a risk
expressly required to be insured under tl-is contract, but enly to
the extent of the issurance so required to Le procured and maintained,
or to the extent of insurance actually procured and maintained, which?
ever is greater; or (E) which result from a risk which is in fact
orivereq by insurance or for whiCh the Contract s otherwise reimburse,
out only to, the extent of such insurance or reimbursement; provided that,
if morn than one of the alve exceptions shal be op-olio:able is. any
case, the Oontracterts liahility 'under any one exception shall llot be
lisdted by any -other exception. This clause shall not be construed
as relieving a subcontractor from liability for loss pr destruction of
or dodace to Government property in its possession or control, except
tO tho oxtent th,t ss-c.ntr,Mt, with thr prior ooroval Of the
O,ontrirg C,Tfleur1.1, *12 Lciilf ? +.1jo -n-Wocontra.CtOr
? 26 ?
..,1,2)%prvef15F.cfr Release 2002/13itilf-RDP61-00763A000100040164-9
Approved Foi.ielease 2002/18fee-RDP61-007641000100040164-9
from such liability. In the absen0s, 0 such approval, the subcontract
shall contain appropriate provisions requiring the return of all Govern-
ment property in as good condition as when received, except for reasonable
wear and tear or for the utilization of the property in accordance
with the provisions of the prime contract.
(ii) The Contractor shall ,tot be reimbursed for, and shall
not include as an item of overhead, the cost of insurance, or any
prevision for a reserve, covering the risk of loss of or damage to
the Government property, except to the extent that the Government may
have required the Contractor to carry such insurance under any other
provision of this contract.
(iii) Upon the happening of loss or destruction of or
damage to the Government Property, the Contractor shall notify the
Contracting Officer therof, and shall communicate with the Loss and
Salvage Organization, if any, now or hereafter designated by the
Ccntractl_ng Officer, and with the assistance of the Loss and Salvage
Orc;anization so designated (unless the Contracting Officer has designated
that no each organization te employed), shall take all reasonable steps
to protect the Government Property from further damage, separate the
damaged and undamaged Government Property, put all the Government
Property in the best possible order, and furnish to the Contracting
Officer a statement of (A) the lost, destroyed and damaged Govern-
ment Property, (B) t')e, time and origin of the loss, destruction or
0. (C) all known interests in commingled property of which the
Cpvernment Property is a part, and (D) the insurance, if any, covering
any part of or intereJt in such commingled property. The Contractor
shall make repairs and renovations of the damaged Government Property
or take such other action, as the Contracting Officer directs.
(iv) In the event the Contractor is indemnified, reimbursed,
or otherwise compensated for any loss or destruction of or damage to
the Government Property, it shall use the proceeds to repair, renovate
or replace the Government Property involved, or shall credit such
proceeds against the cost of the work covered by the contract, or shall
otherwise reimburse the Government, as directed by the Contracting
OfPicer, The Contractor shall do nothing to prejudice the Government's
right to recover against third parties for any such loss, destruction
or damage and, upon the request of the Contracting Officer, shall, at
the Government's expense, furnish to the Government all reasonable
assistance and cooperation (including the prosecution of suit and the
execution of instruments of assignment in favor of the Government) in
obtaining recovery. In addition, where the subcontractor has not been
relieved from liability for any loss or destruction of or damage to
Government property, the Contractor shall enforce the liability of the
subcontractor for such loss or destruction of or damage to the
Government property for the benefit of the Government?
(CPFF 4R3, riirldr5Velease2002WIL:CIA-RDP61-00763A000100040164-9
dErgr
Approved FOTZelease 20CSECREICIA-RDP61-0076&00100040164-9
For use where applicable:
(v) In the event any aircraft are to be furnished under this
contract, any loss or destruction of, or damage to, such aircraft or other
Government property occurring in connection with operations of said air?
craft will be governed by the clause of this contract captioned "Flight
Risks", to the extent such clause is, by its terms, applicable.
(g) The Government shall at all reasonable tines have access to the
premises whore any of the Government property is located,
(h) The Government Property shall rennin in the possession of the
Contractor for such period of tine as is required for the performance of
this contract unless the Contracting Officer determines that the interests
of the Government require removal of such property. In such case the
Contractor shall promptly take such action as the Contracting Officer nay
direct with respect to tho removal and shipping of Gow,rnmont Property.
In any such instance, the contract nay be amended to accomplish an equitable
loweadjustnent in tho terns and provisions thereof.
(i) Upon the completion of this contract, or at such earlier dates as
may be fixed by the Contracting Officer, the Contractor shall submit to the
Contracting Officer in a form acceptable to him, inventory schedules covering
all items of the Government Property not consumed in the porformnnce of
this contract or not theretofore delivered to tho Government, and shall
deliver or makc, such other disposal of such Government property as may be
-1Irecte-_', or authorized by the Contracting Officer, The not proceeds of any
such disposal shall be creited to the cost of the work covered by the
contract or shall be paid in such manner as the Contracting Officer nay
direct., The foregoing provisions shall apply to scrap from Government
Property prtvided, however, that the Contracting Officer may authorize or
direct the Contractor to mit from such inventory schedules any scrap
consisting of cutting and processing waste, such as chips, cuttings borings,
turnings, short ends, circles, trimmings, clippings, and remnants, and
. to dispose of such scrap in accordance with the Contractorts normal practice
Noe
and account therefor as a part of general overhead or other reimbursable
:est in accordance with the ContractorTs established accounting procedures.
(j) Unless otherwise provided heroin, the Government shall not be under
any duty or obligation to restore or rehabilitate, or to pay the cost of the
restoration or rehabilitation of the Contractorts plant or any portion thereof
rhich is affected by the removal of any Government Property.
(k) Directions of the Contracting Officer and communications of tho
lontracter issued pursuant to this clause shall be in writing.
(1) As provided in paragraph (i) of the above clause, the Contracting
Tficer nay, subject to Departmental procedures, authorize or approve use
f the Contractorts established scrap disposal and accounting procedures
henevor tho amount and recoverable value of scrap from the Government
roperty are relatively minor and the Contractor TA established procedures far
-ccumulatAng and disposing of scrap and crediting tho proceeds thereof to
:cneral overhead or other uneral cost will permit the Government to share
,quitably in such scrqp rpayorar2
ost factor a#13PRYT-A9-M5Rmen lual011111CTf
.70A00400040$84141.
CPFF Apr. 18, t58) tkrrg
Approved FOoelease 2002 I ETIA-RDP61-007W000100040164-9
II.,'SUI,WCE-1_,L,EILITY. TO THIRD FTESONS (16Ft. 7-2i322 AFPI 7-403.22)
(a) The Contractor shall procure and thereafter maintain workmen's
compensation, employer's liability, comprehensive general liability (bodily
injury) and comprehensive automobile liability (bodily injury and
property damage) insurance, with respect. to performance under this
cont:_ act, and such other insurance as the Contracting Officer may
from time to time require with respect to performance under this
contract; provided, that the Contractor in fulfillment of its
ch-iigation to procure workmen's compensation insurance may, with
the approval of the Contracting :.)-fficer and pursuant to statutory'
authority, maintain a self-insurance program. All insurance required
pursuant to the provisions of this paragraph shall be in such form,
in such amounts, and for such periods Of tine as the Contracting
Officer may from time to time require Or approve, and uith insurers
approved by the Contracting Officer.
(b) The Oontractor agrees, to the extent and in the manner
required by the Contracting Officer, to submit for the approval of
the Contracting Officer any other insurance maintained by the Oontraotor
in connection with the performance of this contract and for which the
Contractor seeks ref.rlursement hereunder.
(c) The Contractor shall be reimbursedt (i) for bhe pf)rtion
allocable to this contract of the reasonable csost of insurance as
required or approved pursuant to the provisions of this clause, and
(ii) for liabilities to third persons for loss or for damage to
prop-rty (other than property (A) owned, occupied or used by the
Contractor er rented to the Contractor or (E) in the care, custody,
or control of the Contractor), or for death or bodily injury, not
nompenzated by insurance or otherwise, arising out ef the performance
of this contract, whether or not caused by the negligence of the
Contractor, its agents, servants or employees, provided such
liabilities are represented by final judgments or by settlements
app-roved in writing by the Government, and expenses incidental to
such liabilities, except liabilities (1) for which the Contractor
is otherwise respnsible under the express terms of the clause or
clauses, if any, specified in the Schedule, or (II) with respect
to which the Contractor has failed to insure as required or maintain
insurance as approved by the Contracting Officer or (III) which results
from willful misconduct or lack of good faith on the part of any of
the Contractor's directors or officers, or on the part of any of its
managers, superintendents, or other equivalent representatives, who
has supervision or direction of (1) all or subs tantiall all of the
Contractor's business, or (2) all or substantially all of the Con-
tractor's operations at any one plant or separate location in w'ich
this contract is being performed, or (3) a separate and complete
major industrial operation in connection with the performance of
this contract. The foregoing shall not restrict the right of the
Contractor to be reimbursed for the cost of insurance maintained by
the Contractor in connection with the perforraance of this contract,
other thoa An.ourano roc:Iv-tired ho eulfli.bt7d fcr approval or required
Approved For Release 2002/1s
(C,TEF pr. 181 158)
VRDP61-007614000100040164-13
Approved Fb.4.1ease 2002/RftetA-RDP61-0076V00100040164-9
ZIEJfAMI
to be procurn..d and procured and maintained purSuant to the provisions
Of this clause, provided such cost woUld Constitute Allowable Costs
Under the clause of this contract entitled t%llowablo Cost, Fixed Fee
and Payment."
(ci) The Contractor shall give the Government or its representatives
immediate notice of any suit or action filed, or prompt notice of any
claim made, against the Contractor arising out of the performance of this
contract, the cost and expense of which nay be reJubursable to the
Contractor under the provisions of this contract, and the risk of which is
then uninsured or in which the amount claimed exceeds the amount of
coverage, The Contractor shall furnish immediately to the Government
copies of all pertinent papers received by the Contractor. If tho amount
of the liaLiiity claimed exceeds the amount of coverage, the Contractor
shall authorize representatives of the Government to collaborate with
counsel for the insurance carrier, if any, in settling or defending
such claim. If the liability is not insured or covered by bond, tho
Contractor shall, if required by the Government, authorize representatives
of the Government to settle or defend any such claim and to represent
the Contractor in or take charge of any litigation in connection therewith;
provided, however, that the Contractor may, at its own expense, be
associated with the representatives of the Government in the settle-
ment or defense of any such claim or litigation.
AUTHORIZATION AND CONSENT (ASPR 9-102.2 AM 7-403.23)
The Government hereby gives its authorization and consent for all
use and manufacture of any patented invention in the performance of this
contract or any part hereof or any amendment hareto or any subcontract
hereunder (including any lower-tier subcontract).
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Approved Fo&lease 2002/8? EtA-RDP61-007W000100040164-9
FILING OF PATENT APPLICATIONS (SPR 9-106 AFPI 7-404.3)
(a) Before filing or causing to be filed a patent application
disclosing any subject natter of this contract, which subject mattor is
classified "Secret" or higher, the Contractor shall, citing the
thirty (30) day provision below, transmit the proposed application
to tho Contracting Officer for determination whether, for reasons of
national security? such application should be placed under an order
of secrecy or sealed in accordanco with the provisions of 35 U. S.
Code 2`a-188 or the issuance of o patent should be otherwise delayed
under pertinent statutes or regulations; and the Contractor shall
observe any instructions of the Contracting Officer with rospoct to
the manner of delivery of the patent application to the U. S. Patent
Office for filing, but the Contractor shall not be denied the right
to filo such patent application. If the Contracting Officer shall
not have given any such instructions within thirty (30) days from
the date of nailing or other transmittal of the proposed applic,tion
the Contractor nay file theopplication.
A The Contractor shall furnish to the Contracting Officer,
at the time ,f or prior to the ti o when the Contractor files or
cause;_, to bo filed a patent application disclosing any subject natter
of this contract, which subject natter is classified "Confidential",
a copy of such application for determination whether,
for raccoons of national security, such application should be placed
under an order of secrecy or the issuance of a patent should be
oliorwise delayed under pertinent statutes or regulation
(c) In filing any patent application coning within the scope of
this clause, the Contractor shall observe all applicable security
regulations cov)ring the transmission of classified subject matter.
REPORTING OF ROYALTIES (ASPR 9110 AFT' 7-404.4)
a
Tho provisions of this clause shall be applical.lc only if the
:eunt cf the contract is in excess of 50,000.
(a) The Contractor shall report in writing (in quadruplicate)
to the Contracting Officer as soon as practicable after execution of
this ccntract whothcr or not any royalties in excess of 2.50 have
been paid or are to be paid by the Contractor directly to any person
or firm in connection with the performance of this contract. If
royalties in excess of 250 have boon paid or are to be paid to any
person or firm, the report shall include the following items of
information with respect to such royalties (including the initial t2.50).
(1) The name and address of each licensor to whom royalties
in excess of ',250 have boon paid or are to be paid,
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(2) The patent numbers, patent application serial numbers
(with filing dates), or other idontificatim of the basis for such
royalties,
(3) The manner of computing the royalties consisting of (i)
a brief identification of each royalty-boaring unit or process, (ii)
tho total amount of royalties, and (iii) the percentage rate or dollars
and cents amount of royalties on each such unit or process, provided
that it the royalties cannot be computed in terns of units or dollars
and cents value, then other data showing the manner in which the
Contractor computes the royalties.
(b) In lieu of furnishing a report under paragraph (a), the
Contractor may furnish a single, consolidated report for each account-
ing period of the Contractor during which the Contractor has contracts
with the Government, provided the Contractor has requested and obtained
the prior written approval of the Contracting Officer. Such consolidated
reports shall be furnished, who/a the furnishing thereof has boon
approved, in the number of copies as approve"., as seen as practicable
'41"' after the close of the accounting period covered by the report. Such
consolidated report shall be made in accordance with Contractorts
established accounting practice and shall include, for the accounting
periods thc total amount of royalties accruing to each licensor at a
rate in excess of000 per annum on the Contractorts over-all business,
together with (i) the name and address of each such licenser, (ii) the
patent numbers, patent application serial numbers (with filing dates),
or other identification of the basis for such royalties, (iii) a brief
description cf the subject matter of the license under which royalties
are charged, (iv) the percentage rate or unit am-,unt, or if the
royalties 1,o not accrue by rate or unit amount, such other data showing
the Liann-a- by which the royalties accrue to licensor, and (v) an
estimate or approximation (without detailed accounting) of the portion
of such royalties that nay be attributable to Government contracts
Tho Contractor shall, if requested by the Government, furnish at Govern-
ment expense a more detailed allocation of such royalty payments
Nwr attributable to Government dontracts.
(c) In the event that the Contractor requests written approval
to furnish consolidated reports under paragraph (b) above, Lho
Contracting Officer shall promptly consider the request and furnish
to the Contractor a letter stating whether or not the request is
approved and, notwithstanding any such approval, the Contracting
Officer shall have the right to question any such subseqhontly
furnished report as to accuracy or completeness of data and to ask
for additional information. The Contractor shall furnish a copy
of such letter of approval to the Contracting Officer administering
this contract.
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(d) After paynont of eighty percent (80%) of the amount of this
contract, as froD tine to tine ,-nended, furthor payment shall he Withheld
,rntil a reserve of either (i) ton percent (10%) of such anuunt or (ii)
which over is less, shall have been sot aside, such reserve or
the balance thereof to be retained until the Contractor shall have
furnished to the Contracting Officer the report called for by paragraph
(a) hcrof or the copy of the letter approving the Contractor's request
to furnish the report ander paragraph (b); prol,ided that no amount shall
continuo to be withheld from payment for the causes specified in this
paragraph (d) if the Contracting Officer shall find that the Contractor
has not boon furnished a letter as required by paragraph (c) within a
reasonable tine after making written request to subnit a single.,
consolidated report under the provisions of paragraph (b) of this clause;
and provided further that the Contracting Officer nay, in his discretion,
order payment to be withhold in the ancunt and manner above provided if
the report called for by paragraph (a) is unsatisfactoryor the report
Galled for by paragraph (b) is lite hut has not been received, or if
received, is found to be unsatisfactory. No amount shall be withhold
under this paragraph when the nirthiun anuunt specified by this
paragr--2h is being, withheld under ether pr-visions of this contract.
The wil,bholding of any amount or subsequent payment thereof to the
C,Titraccor shall not be construed as a waiver of any right accruing to
the Gov-rnment under this contract.
RIGHTS IN DATA-UNLIMITED (SPR 9-203.1 AFPI 7-404,5)
(a) The term "Subject Data" as used heroin includes writings,
sound recordings, pictorial reproducti ns, drawings or other Graphical
representations, and works of any sinner nature (whether or not
copyrighted) which are specified to be delivered under this contract.
Cho term, loos not include financial reports, cost analyses and other
inform-tion incidental to contract adninistration,
(b) Subject to the proviso of (c) below, the Government nay
duplicate, use, and disclose in any manner and for any purpose
whatseever, and have others so do, all Subject Data delivered under
this contract,
(c) The Contractor agrees to and does hereby grant to the
;evernment, am' to its officers, agents, and employees acting within
the scope of their official duties, a royalty-free, nonexcolusive and
irrevocable license throughout the world, to publish, translate,
?oproduce, deliver, p(rf(rn dispose of and to authorize others so
to do, all Subject Data now or hereafter covered by copyright; PROViDEP
5hat with respect to such Subject Data not originated in the performance
)f this contract but which is incorporated in the work furnished under
this contract such license shall be only to the extent that the
;entract,r, its employees, or any individual cr concern specifically
.Jaployed or assigned by tho Contractor to originate and prepare such Data
Inder this contract, now has, or prior to complotion or final settlement
,f this contract nay acquire the right to grant such license without
2ccoming liable to pay compensation to others solely because of such
;rant.
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(d) The Contractor shall exert all reasonable effort to advise
the Contractinn Officer., at the tine of delivery of the Subject Data
furnished under this contract, of all invasi-ns of the right of
privacy contained therein and of allyertiens of such Data copied from
work rot composed or produced in the performanoe of this contract and
not licensed under this clause.
() The Contractor shall report to the Contracting Officer,
prouptJy and in reasonable written detail, each notice or claim of
copyright infringement received by the Contractor with respect to all
Subject Data delivered under this contract.
(f) Nothing contained in this clause shall imply a license to
the Government under any patent or be construed as affecting the scope
of any license or other richt otherwise granted to the Government under
any patent.
(c) The Contractor shall not affix any restrictive markings upon
any Subject Data, and if such markings are affixed, the Government shall
Now have the right at any tile to modify, remove, obliterate or ignore any
such larking.
Nrimere
MILITAY SECURITY REQUIREMENTS (ASPR 7-104.12, 7-204.12 AFPI 7-404.7)
(a) The'pr-visions of this clause shall apply to the extent that
this contract involves access to security information classified
"Confidential" including "Confidential - Modified Handling Authorized"
or higher.
(-0 The Government shall notify the Contractor of the security
classification of this contract and the elements thereof, and of any
subsequent revisi'ns in such security classification, by the use of a
Security Requirements Chock List (DD Form 254).
(c) To the extent the Government has indicated as of the date of
this contract, or thereafter indicated, security classification under
this contract as provided in paragraph (b) a-Lew), the Contractor shall
safeguard all classified olononts of this contract and shall provide and
maintain a system of security controls within its own organization in
accordance with the requirements of:
( i) the Security agreement (DD Porn 441), including the
Department of Defense Industrial Security Manual for Safeguarding
Classified Information as in effect on the date of this contract, and
modification to the Security Agreement for the purpose of adapting the
Manual to the C, -ntractor s business; and
(ii) any amendments to said Manual made after the date of
this contract, notice of which has been furnished to the Contractor by
the Security Office of the hilitary Department having security cognizance
over the facility.
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(d) Representatives of the Military Deprtment having security
cogniance over the facility and representatives of the contracting
iilitry Dcp ,rtment shall have the right to inspect at reasonable
inter-was the procedures, methods, and facilities utilized by the
Contract r in conplying with the security requiromentS Under this
contract,. Should the Government, through its authorized representative,
doterr'ne that the Contractor has not 0,-,p1ied with such requirements,
the Government shall inform the Cntracter in writing of the proper
actions to to taken in order to effect compliance with such requirements*
(n) If, subsequent to the date of the contract, the security
classifications or security requirements under this contract are
changed by the Government as provided in this clause, and if such
change causes an increase or decrease in the esti,latod cost of
performance of this contract, the estimated cost and fixed fee,
Shall, to the extent appropriate, bQ subject to an equialle adjustment
Any such equitable adjustment shall to accomplished in the manner sot
forth in the "Changes" clause at this contract.
(1) The Contractor agrees to insert, In all subc ntracts hereunder
which involve access to classified information, provisions which shall
conform substantially to the languate of this clause, including this
paragraph (f) but excluding paragraph (e) of this clause. The
Contractor nay insert in any such subcontract, and any such subcontract
entered into thereunder may contain, in lieu of paragraph (e) of this
clause, provisi ns which ooroait equitable adjustments to be made in the
subcontract price or in the estimated cost and fixed fee of the
subcontract (as appropriate to the type of subc-ntract involved) on
account of changes in security classificati-ns or requirements made under
the previsions of this clause subsequent to the date of the subcontract
involved..
(g) The Contractor also agrees that it shall determine that any
subcontractor proposed by it for the furnishing of supplies and services
which will involve access to classified information in the Contractor
custody ha o been -rranted an appr6priate-facility security el(aranco? which
is still in effect, prior to being accorded access to such classified
information.
WALSH-ETPLLEY PUBLIC CONTRACTS ACT (ASPR 12-604 .PFI 7-40448)
If this contract is for the manufacture or furnishing of materials,
supplies, articles or equipment in an amount which exceeds or may
exceed 10,00 and is otherwise subject to the Walsh-Healey Public
Contracts Act, as amended (41 U.S. Code 35-45), there are hereby
incorporated by reference all representations and, stipulations required
by said Act and regulations issued thereunder by the Secretary of Later,
such representations and stipulations being subject to all applicable
rulings and interpretations of the Secretary of Labor which aro now
or may hereafter be in affect.
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. GRATUITIES (ASPR 7-104.16 AFPI 7-404.9)
(a) The Government may, by written notice to the Contractor,
terminate the right of the Contractor to proceed under this contract
if it is found, after notice and hearing i by the Secretary or his
duly authorized representative, that gratuities (in the form of
entertainment, gifts, or otherwise) were offered or given by the
Contractor, or any agent or representative of the Contractor, to
a-y officer or employee of the Government with a view toward
securing a contract or securing favorable treatment with respect
to the awarding or amending, or the making of any determinations
with respect to the performing, of s'Uch contract; provided, that
the existence of the facts upon whieh the Secretary or his duly
authorized representative makes such findings shall be in issue
and may be reviewed in any competent court.
(b) In the event this contract is terminated as provided in
paragraph (a) hereof, the Government shall be entitled (i) to pursue
the same remedies against the Contractor as it could pursue in the
event of a breach of the contract by the Contractor, and (ii) as a
penalty in addition to any other damages to which it may be entitled
by law, to exemplary damages in an amount (as determined by the
Secretary or his duly authorized representative) which shall be not
lass than three nor more than ten times the costs incurred by the
Contractor in proviJing any such gratuities to any such officer or
eeloyee.
(c) The rights and remedies of the Government provided in
dlis clause shall net, be exclusive and are in addition to any
other rights and remedies provided by law or under this contract.
30. NEGOTIATED OVERHEAD RATES (ASPR 3-704.1 AFPI 7-404.12)
(a) Notwithstanding the provisions of the clause of this
contract entitled "Allowable Cost, Fixed Fee, and Payment," the
allowable indirect costs under this contract shall be obtained by
applying negotiated overhead rates to kbases agreed upon by the parties,
as specified below.
(b) The Contractor, as soon as possible but not later than
ninety (90) days after the expiration of each period specified in
the Schedule, shall submit to the Contracting Officer a proposed
final overhead rate or rates for that p,riod based on the Contractor's
actual cost experience during that period, together with supporting
cost data. Negotiation of final overhead rates by the Contractor
and the Contracting Officer shall be undertaken as promptly as
practicable after receipt of the Contractor's proposal.
(c) Allowability of costs and acceptability of cost
allocation methods shall be determined in accordance with ASPR,
Section XV, Part 2, as in effect on the date of this contract.
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(d) The results of each negotiation shall be set forth in an
amendment to this contract, which shall specify (i) the agreed
final rates, (ii) the bases to which the rates apply, (iii) the
periods for wlich the rates apply, and (iv) the specific items
treated as direct costs or any changes in the items previously
agreed to be direct costs.
(e) Pending establishment of final overhead rates for any
period, the Contractor shall be reimbursed either at negotiated
provisional rates as provided in the schedule or at billing rates
acceptable to the Schedule or at billing rates acceptable to the
Contracting Officer subject to appropriate adjustment when the
ff lal rates for that period are established. To prevent
substant'_al over or under payment, the provisional or billing
rates may, at the request of either party, be revised by mutual
agreement, either retroactively or prospectively. Any such
revision of negotiated provisional rates provided in the Schedule
sh-11 be set forth in an amendment to this contract.
(I) Any failure by the parties to agree on any final rate or
rates under this clto,use shall be considered a dispute concerning a
question of fact for decision by the Contracting Officer within the
meaning of the clause of this contract entitled "Disputes."
31. DELAY IN DELIVERY OF DATA (AFPI 7-4036)
(a) It is undeI9tood that the efficient use by the Government
of the supplies called for hereunder requires that the data called
for hereunder be dell7ored not later than the time or respective
timc.s herein specified. If such data is not deliver-.1 at said tine
or times, the Government may at its election so long as such data
re. ains undelivered, unless the delay in delivery thereof arises
out of causes beyond the control and without the fault or negligence
of the Contractor within the meaning of this clause hereof entitled
"Default," withhold payment to the Contractor for any of the amounts
then due, refuse a-Troval of the Contractor's vouchers and refuse to
accept further deliveries hereunder from the Contractor or take any
other action authorized by law or regulation now or hereafter in
effect including termination of the contract for default to the
extent and in the manner authorized by said clause, and may take
any or all of the foregoing actions separately or in combination.
(b) The provisions of this clause shall only be applicable to
technical data, such as handbooks, service manuals, or other
information necessary for the proper maintenance of servicing of the
end items called for herein.
32. SUPERSEDING SPECIFICATIONS (AFPI 7-404.14)
All references in any Government Specification incorporated
herein to other Government specifications shall be deemed to
include all specifications supplementary to or superseding the
specifications so referred to, to the extent that such supplementary
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7.3.1
or superseding specifications are in effect at the date of Contractor's
latest quotation if the Contractor was furnished or otherwise notified
of the existence of such supplementary or superseding specification
at the time of said quotation.
FLTATAT RISK (UPI 7-4022)
(a) As used in this clause the $erm "Operation" includes tests
of aircraft, tests of equipment and accessories installed therein,
and the operation of any power plant installed therein, whether or
not the aircraft is in motion during the making of any such test or
operation of any such power plant.
(b) Notwithstanding the provisions of paragraph (f) of the
clause of this contract captioned "Government Property," the
Contractor shall be liable for loss and destruction of and damage to
aircraft (including equipment and accessories installed therein),
to which the Government has title pursuant to the provisions of this
cee.cract or otherwise, occur"rgin the course of operations of such
ai.eraft conducted by the Ceetractor in the performance of this
coletract unless personnel conducting such operations are furnished
by the Government or are approved in writing by the Air Materiel
Area Commander having administrative responsibility for this
col,ract, or his representative to whom such authority has been
delegated. The provisions of this clause shall supersede any
provisions of apnlicale'le Air Force specifications insofar as such
s-e-cifications relate to Contractor's liability in connection with
such operations.
(c) If prior to final acceptance by the Government, any aircraft,
as referred to in paragraph (b), are lost, destroyed, or damaged
during such operation, and if the risk of such loss, damage, or
destruction is borne by the Government under paragraph (f) of
the clause hereof entitled "Government Property," the Government may
terminate this contract with respect to such aircraft, or in case
such aircraft is damaged, the Government nay require the Contractor
to restore such aircraft to the condition in which it was immediately
prior to such damage. If the Government terminates this contract
with respect to such aircraft, the Contractor shall deliver to the
Government at the place at or from which such ppm.ation is conducted
all or such parts of such aircraft as the Contracting Officer may
designate. If the Government requires the aircraft to be restored
as aforesaid, an equitable adjustment shall be made in the estimated
cost and fixed-fee, if any, and in the time required for its
performance, and this contract shall be modified in writing accordingly.
(d) Any dispute that may arise under the provisions of this
clause shall be determined as provided in the clause hereof entitled
"Disputes,"
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34. ALTERATIONS (ASPR 7-105.1 AFPI 7-404:10)
The following alterations have been made in the provisions of
this eontract.
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