NEGOTIATED CONTRACT CONTRACT NO. CW-6744 (Sanitized)(657)-16775

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP72B00464R000400070028-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 36
• Document Creation Date: December 14, 2016
• Document Release Date: October 21, 2002
• Sequence Number: 28
• Publication Date: July 21, 1966
• Content Type: CONT

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NEGOTIATED CONTRACT
Contract No.CW-6744
AF33(657)-16775
251A
Contract For: See Schedule
Amount: See Schedule
Mail Invoice To:
Performance Period: See
Schedule
Administrative Data: This is a CPZF Type Contract
251A
251A
This contract is entered into by and between the United States
of America, hereinafter called the Government, represented by
the Contracting Officer executing this contract, and the above
named Contractor which is a Corporation, incorporated in the
State of Delaware, hereinafter called the Contractor.
The parties hereto agree that the Contractor shall furnish the
facilities and deliver all supplies and furnish all the services
set forth in the attached Schedule issued hereunder, for the
consideration stated herein.
The rights and obligations of the parties to this contract shall
be subject to and governed by the attached Schedule and the
General Provisions. In the event of any inconsistency between
the Schedule and the General Provisions, the Schedule shall
control.
IN WITNESS WHEREOF: the parties hereto have executed this con-
tract as of 2 7 JUN 1966
THE UNITED STATES OF AMERICA
BY_I
TITLE Contracting Officer
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CERTIFICATE
Assistant Secretary
as Contractor herein; that
Contract No. CW-6744
AF33(657)-16775
certify that I am
of the Corporation named
who
Contractor was then
said
signed this contract on behalf of the
President of said Corporation; that
Contract was duly signed for and in behalf of said Corpor-
ation by authority of its governing body, and is within
the scope of its Corporate Powers.
251A
(Corporate Seal)
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251A
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INDEX TO SCHEDULE
PART I
- MATERIAL AND SERVICES TO BE FURNISHED.
. .
Page
4
PART II
- PERIOD OF PERFORMANCE . . ? 0 **
6
PART III
- ESTIMATED COST AND FEE . ? ? ? **
6
PART IV
- PAYMENTS ....... 0 ? ? ? ? .??
.
. .
7
PART V
- AIR TRAVEL . . . . . . . ... . . ?
. .
8
PART VI
- DELIVERY SCHEDULE
8
PART VII
_ INSPECTION AND ACCEPTANCE. ? . . ? ? ?
. .
8
PART VIII -
GOVERNMENT FURNISHED PROPERTY
8
PART IX -
GOVERNMENT FURNISHED FACILITIES
8
PART X -
SPECIAL PRODUCTION TOOLING AND TEST
EQUIPMENT. . OOOOOOOOO . ? 0
? .
9
PART XI -
SPECIAL SECURITY RESTRICTIONS. . . ? .
. .
9
PART XII
WAIVER OF REQUIREMENTS OF GENERAL
PROVISIONS
9
PART XIII -
ALTERATIONS IN SCHEDULE
9
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SCHEDULE
PART I - MATERIAL AND SERVICES TO BE FURNISHED
The Contractor shall furnish the necessary services,
facilities, material and supplies to accomplish the work
set forth below. The work called for herein shall be
accomplished in accordance with Exhibits ASZB-66-70, ASZB-66-82,
ASZB-66-83, and Appendices A thru J. Said Exhibits and Appen-
dices were furnished as attachments to the Government's RFP
as amended and are incorporated herein by reference and made
a part hereof.
251A
251A
Item I Follow-On Spare Parts:
A_ Provide spare parts for the
25X1A
B. Provide spare parts for the AGE associated
with the
Administration of Item I will be generally in accordance
with the procedures set forth in Appendix A.
Item II Flight Test Support
Provide approximately eighty-five (85) man months
of technical assistance in support of items provided by the
Contractor generally in accordance with the requirements
and procedures set forth in Appendix B. This effort will
be utilized in the Cat.I, Cat.II, and continuing development
testing program, as appropriate, at Edwards AFB, California.
Item III Field Service Representatives
Provide approximately fifty-four (54) man months
in support of theI
to advise, assist and instruct the opera-
tional Command's personnel on matters of use, support, and
solution of technical difficulties in connection with Con-
tractor's equipment and associated AGE. Performance will
be accomplished in accordance with the requirements and
procedures set forth in Appendix C.
of effort
Item IV In-Plant (sustaining) Engineering and Administra-
tive Services
Provide engineering and technical services in
support of all Items in PART I except Item X. As applicable,
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the Contractor shall comply with the procedures and in-
structions set forth in Exhibits ASZB-66-70, ASZB-66-82,
ASZB-66-83 and Appendix D. Performance under Item IV will
be authorized and accomplished in accordance with the pro-
cedures set forth in Appendix I.
Item V Engineering Change Kits
Provide the necessary materials and labor to fur-
nish Engineering Change Kits for incorporation into equip-
ment previously furnished by the Contractor. Performance
under this item will be accomplished in accordance with the
procedures and instructions set forth in Exhibits ASZB-66-70,
ASZB-66-82, ASZB-66-83 and Appendix D.
Item VI Specialized Repair Activity
Provide material and services necessary for in-
spection, test, repair, overhaul and/or modification of
all items of GFP and GFAE of the types and kinds furnished
or utilized by the Contractor under previous system con-
tracts. Performance under this item will be accomplished
in accordance with the requirements and procedures set
forth in Appendix D.
Item VII Follow-On Age
Provide replenishment and/or new or additional
items of AGE, as necessary, generally in accordance with
the procedures set forth in Appendix E.
Item VIII Technical Data
Provide materials and services necessary to
furnish revisions to, maintenance of, and updating of
technical,maintenance, and operating manuals, data and
publications relating to Contractor furnished equipment.
Performance under this item will be accomplished generally
in accordance with the procedures set forth in Appendix F.
Item IX Reports
Provide a monthly financial status report and
Management Report to the PSO, SPO and the Contracting
Officer using the format set forth in Appendix G (G-1
and G-2 respectively). The report shall be prepared and
forwarded so that it will be received not later than the
15th day of the month following the month being reported.
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25.1 A amount of for performance hereunder.
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E. Notwithstanding Paragraph D above, the Government's
obligation hereunder is contingent upon the availability of
FISCAL YEAR 1967 appropriated funds.
PART IV - PAYMENTS
A. In accordance with the provisions of Clause 3 of the
General Provisions of this contract entitled, "Allowable Cost,
Fixed Fee, and Payment," the Government shall pay the Contractor,
as full compensation for the performance of this contract, the
fee as specified in PART III above and the allowable cost in-
curred by the Contractor in the performance of this contract,
and accepted by the Contracting Officer as chargeable in ac-
cordance with "Contract Cost Principles," such determination
being subject to the provisions of this contract entitled
"Disputes." It being understood and agreed, without limiting
the generality of the foregoing, that the following shall be
considered as allowable items of costs incurred hereunder
when incurred or paid by the Contractor, and when necessary and
required and used for the performance of work hereunder:
1. Costs of travel within the continental limits of
the United States, when such travel is performed in
accordance with Contractor's established travel policy
and PART V hereof. Travel costs to overseas points or
to symposiums shall not be allowed unless authorized by
the Contracting Officer.
2. Costs of shipping charges of material provided
hereunder from Contractor's plant to final destination
shall be an allowable cost hereunder.
3. Such other costs as may be approved by the Con-
tracting Officer.
B. For purposes of determining the costs for the billing
invoice, the Contractor will include labor, material and other
direct costs, overhead and general and administrative expense.
Overhead and general and administrative expense will be estab-
lished by applying billing rates, as agreed upon between the
parties, to the labor hours included in the invoice subject to
appropriate adjustment when the final rates are established.
Billing rates may be adjusted, as required, to keep provisional
payments on a current basis.
C. The Contractor shall be paid the fee stated in PART III
herein in monthly installments based on allowable costs in-
curred by the Contractor and approved by the Contracting Officer
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computed at the same ratio that the total fee stated herein
is to the total estimated cost stated herein, subject, however,
to the withholding provisions of paragraph (c) of Clause 3 of
the General Provisions.
PART V - AIR TRAVEL
The Contractor agrees, in the performance of necessary air
travel allocable to this contract, to use air coach, tourist
class or similar accomodations to the extent consistent with
the successful and economical accomplishment of the mission for
which the travel is being made.
PART VI - DELIVERY SCHEDULE
The Items set forth under PART I above shall be delivered
in accordance with the provisions contained in the appropriate
Exhibit and/or Appendix referenced in PART I.
PART VII - INSPECTION AND ACCEPTANCE
All services, supplies, and workmanship called for under
PART I above shall be subject to the inspection and acceptance
procedures set forth in the Exhibits and Appendices, referenced
in PART I, as appropriate. In addition the Contractor shall
allow, at all reasonable times, inspectors and other Government
personnel free access to the plant and operations and shall
furnish such facilities, supplies, and services as may be re-
quired for this work.
PART VIII - GOVERNMENT FURNISHED PROPERTY
For the performance of this contract, the Government will
supply the Contractor with such property as shall be agreed
upon by the Technical Representative of the Contracting Officer
and the Contractor. Such property will be subject to the pro-
visions of Appendix H and the clause of the General Provisions
entitled "Government Property."
PART IX - GOVERNMENT FURNISHED FACILITIES
In the performance of this contract the Contractor is
authorized to use, on a no-charge-for-use basis, the Govern-
ment owned facilities presently furnished under Contracts
AF33(657)-7796 and NOW-6168-U, as amended, provided such use
does not interfere with the work for which such facilities
were originally furnished or are to be furnished.
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PART X - SPECIAL PRODUCTION TOOLING AND TEST EQUIPMENT
In the performance of this contract the Contractor is
authorized to use on a non-interference basis the special
production tooling and test equipment acquired under Contracts
AF33(657)-10810 and AF33(657)-12839.
PART XI - SPECIAL SECURITY RESTRICTIONS
The Contractor shall not reveal (i) the specific nature
or any details of the work being performed hereunder or (ii)
any information whatsoever with respect to the Government;
the department sponsoring this contract and the work thereunder
except as the Contractor is directed or permitted in writing to
reveal such information by the Contracting Officer or by his
authorized representative for security matters, and notwith-
standing any clause or section of this contract to the contrary,
the Contractor shall not interpret any clause or section of
this contract as requiring or permitting divulgence of such
information to any person, public or private, or to any officer
or department of the Government without the express consent of
the Contracting Officer or his duly authorized representative
for security matters.
PART XII - WAIVER OF REQUIREMENTS OF GENERAL PROVISIONS
Notwithstanding the requirements of any of the General
Provisions of this contract to the contrary, whensoever the
Contractor, in the performance of the work under this contract,
shall find that the requirements of any of the clauses of the
General Provisions are in conflict with security instructions
issued to the Contractor by the Contracting Officer or by his
duly authorized representative for security matters, the Con-
tractor shall call the attention of the Contracting Officer to
such conflict and the Contracting Officer or his duly authorized
representative for security matters shall (i) modify or rescind
such security requirements or (ii) the Contracting Officer shall
issue to the Contractor a waiver of compliance with the require-
ments of the General Provisions conflicting with such security
requirements. Any waiver of compliance with the General Pro-
visions of this contract issued by the Contracting Officer shall
be in writing except that the approval by the Contracting Officer
of any subcontract issued hereunder by the Contractor shall be
deemed to constitute approval of waiver of any clause of the
General Provisions in conflict with the stipulations of such
subcontract.
PART XIII - ALTERATIONS IN SCHEDULE
The following alterations were made in this Schedule prior
to execution of this contract:
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COST-REIMBURSEMENT RESEARCH AND
DEVELOPMENT CONTRACT
(With Fixed Fee)
1. DEFINITIONS (Feb. 1962) As used throughout this contract, the following terms shall have the meanings,
set forth below:
(a) The term "head of the agency" or "Secretary" means the Secretary, the Under Secretary, any Assistant
Secretary, or any other head or assistant head of the executive or military department or other Federal agency;
and the term "his duly authorized representative" means any person or persons or board (other than the Contract-
ing Officer) authorized to act for the head of the agency or the Secretary.
(b) 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; and the term includes,
except as otherwise provided in this 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" includes purchase orders under this
contract.
(d) The term "contract work" means all work to be performed under this contract including without limita-
tion any studies covering fundamental, theoretical, or experimental investigations; any extension of the investi-
gative findings and theories of a scientific or technical nature into practical application; any tangible items, herein-
after referred to as "supplies," furnished to the Government; and any reports, data, computations, plans, drawings,
and specifications with respect to any of the foregoing. (Oct. 1957)
2. LIMITATION OF COST. (Feb. 1959) (a) It is estimated that the total cost to the Government, exclusive
of any fixed fee, for the performance of this contract will not exceed the estimated cost set forth in the Schedule,
and the Contractor agrees to use his 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 believe that the costs
which he expects to incur in the performance of this contract in the next succeeding sixty (63) days, when added
to all costs previously incurred, will exceed seventy-five per cent (75%) of the estimated cost then set forth in the
Schedule, or if at any time, the Contractor has reason to believe that the total cost to the Government, exclusive of
any fixed fee, for the performance of this contract will be substantially greater or less than the then estimated cost
thereof, the Contractor shall notify the Contracting Officer in writing to that effect, giving the revised estimate of
such total cost for the performance 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 be obligated to continue performance under
the contract or to incur costs in excess of the estimated cost set forth in the Schedule, unless and until the Con-
tracting 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 shall thereupon constitute the estimated cost of per-
formance of this contract. When and to the extent that the estimated cost set forth in the Schedule has been in-
creased, any costs incurred by the Contractor in excess of such estimated cost prior to the increase in estimated
cost shall be allowable to the same extent as if such costs had been incurred after such increase in estimated cost.
S. ALLOWABLE COST, FIXED FEE, AND PAYMENT. (Sep. 1962) (a) For the performance of this con-
tract, the Government shall pay to the Contractor ?
(i) the coat thereof (hereinafter referred to as "allowable cost") determined by the Contracting Officer
to be allowable in accordance with?
(A) Part 2 of Section XV of the Armed Services Procurement Regulation as in effect on the date of this
contract; and
(B) the terms of this contract; and
(ii) such fixed fee, if any, as may be provided for in the Schedule.
(b) Once each month (or at more frequent intervals, 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 Contrac-
tor in the performance of this contract and claimed to constitute allowable cost.
(c) Promptly after receipt of each invoice or voucher and statement of cost, the Government shall, except
as otherwise provided in this contract, subject to the provisions of (d) below, make payment thereon as approved
by the Contracting Officer. Payment of the fixed fee, if any, shall be made to the Contractor as specified in the
Schedule; provided, however, ?that after payment of eighty-five percent (85%) of the fixed fee set forth in the
Schedule, further payment on account of the fixed fee shall be withheld until a reserve of either fifteen percent
(15%) of the total fixed fee, or one hundred thousand dollars ($100,000), whichever is less, shall have been set
aside.
(d) At any time or times prior to final payment under this contract, the Contracting Officer may have the in-
voices or vouchers and statements of cost audited. Each payment theretofore made shall be subject to reduction
for amounts included in the related invoice or voucher which are found by the Contracting Officer, on the basis of
such audit, not to constitute allowable cost. Any payment may be reduced for overpayments, or increased for un-
derpayments, on preceding invoices or vouchers.
(e) On receipt and approval of the invoice or voucher designated by the Contractor as the "completion in-
voice" or "completion voucher" and upon compliance by the Contractor with all the provisions of this contract
(including, without limitation, the provisions relating to patents and the provisions of (f) below), the Government
shall promptly pay to the Contractor any balance of allowable cost, and any part of the fixed fee, which has been
withheld pursuant to (c) above or otherwise not paid to the Contractor. The completion invoice or voucher shall
be submitted by the Contractor promptly following completion of the work under this contract but in no event
later than one (1) year (or such longer period as the Contracting Officer may in his discretion approve in writing)
from the date of such completion.
AFPI 71-8, June 65
CPFF R&D ?
(Supersedes AFPI 71-8, Sep 64, and alterations thereto dated Nov 64)
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(f) The Contractor agrees that any refunds, rebates, credits, or other amounts (including any interest there-
on) accruing to or received by the Contractor or any assignee under this contract shall be paid by the Contractor
to the Government, to the extent that they are properly allocable to costs for which the Contractor has been re-
imbursed by the Government under this contract. Reasonable expenses incurred by the Contractor for the purpose
of securing such refunds, rebates, credits, or other amounts shall be allowable costs hereunder when approved by
the Contracting Officer. Prior to final payment under this contract, the Contractor and each assignee under this
contract whose assignment is in effect at the time of final payment under this contract shall execute and deliver--
(i) an assignment to the Government, in form and substance satisfactory to the Contracting Officer, of
refunds, rebates, credits, or other amounts (including any interest thereon) properly allocable to costs for which
the Contractor has been reimbursed by the Government under this contract; and
(ii) a release discharging the Government, its officers, agents, and employees from all liabilities, oblige-
tions, and claims arising out of or under this contract, subject only to the following exceptions?
(A) specified claims in stated amounts or in estimated amounts where the amounts are not susceptible
of exact statement by the Contractor;
(B) claims, together with reasonable expenses incidental thereto, based upon liabilities of the Contractor
to third parties arising out of the performance of this contract; provided, that such claims are not known to the
Contractor on the date of the execution of the release; and provided further that the Contractor gives notice of
such claims 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, whichever is earlier;
and
(C) claims for reimbursement of costs (other than expenses of the Contractor by reason of his indemni-
fication of the Government against patent liability), including reasonable expenses incidental thereto, incurred by
the Contractor under the provisions of this contract relating to patents.
(g) Any cost incurred by the Contractor under the terms of this contract which would constitute allowable
cost under the provisions of this clause shall be included in determining the amount payable under this contract,
notwithstanding any provisions contained in the specifications or other documents incorporated in this contract by
reference, designating services to be performed or materials to be furnished by the Contractor at his expense or
without cost to the Government.
4. STANDARDS OF WORK. (Feb. 1959) The Contractor agre.-.) that the performance of work and services,
pursuant to the requirements of this contract, shall conform to hibh professional standards.
5. INSPECTION AND CORRECTION OF DEFECTS. (May 1960) (a) All work, under this contract shall be
subject to inspection and test by the Government (to the extent practicable) at all times (including the period of
performance) and places, and in any event prior to acceptance. The Contractor shall provide and maintain an in-
spection system acceptable to the Government covering the work, hereunder. The Government, through any author-
ized representative, may inspect the plant or plants of the Contractor or of any of his subcontractors engaged in the
performance of this contract. If any inspection or test is made by the Government on the premises of the Con-
tractor or a subcontractor the Contractor shall provide and shall require subcontractors 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. Except as otherwise provided in this contract, final inspection, and acceptance shall be made at the place
of delivery as promptly as practicable after delivery and shall be deemed to have been made no later than ninety
(90) days after the date of such delivery, if acceptance has not been made earlier within such period.
(b) At any time during performance of this contract, but not later than six (6) months (or such other time
as may be provided in the Schedule) after acceptance of all of the end items (other than designs, drawings, or
reports) to be delivered under this contract, 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 the require-
ments of this contract. Any time devoted to such correction or replacement shall not be included in the computa-
tion of the period of time specified in the preceding sentence, except as provided in (d) below. Except as otherwise
provided in paragraph (c) below, the allowability of the cost of any such replacement or correction shall be de-
termined as provided in the clause of this contract entitled "Allowable Cost, Fixed Fee, and Payment," but no ad-
ditional fee shall be payable with respect thereto. Corrected articles shall not be tendered again for acceptance un-
less the former tender and the requirement of correction is disclosed. If the Contractor fails to proceed with reason-
able promptness to perform such replacement or correction, t h e Government (i) may by contract or otherwise
perform such replacement or correction and charge to the Contractor any increased cost occasioned the Govern-
ment thereby, or may reduce any fixed fee payable under the contract (or require repayment of any fixed fee
theretofore paid) in such amount as may be equitable under the circumstances, or (ii) in the case of articles not
delivered, may require the delivery of such articles, and shall have the right to reduce any fixed fee payable under
this contract (or to require repayment of any fixed fee theretofore paid) in such amount as m a y be equitable
under the circumstances, or (iii) may terminate this contract for default. Failure to agree to the amount of any
such increased cost to be charged to the Contractor or to such reduction in, or repayment of, the Axed fee shall
be deemed to be a dispute concerning a question of fact within the meaning of the clause of this contract entitled
"Disputes."
(c) Notwithstanding the provisions of paragraph (b) above, t h e Government may at any time require the
Contractor to remedy by correction or replacement, without cost to the Government, any failure by the Contractor
to comply with the requirements of this contract 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 his managers, super-
intendents, or other equivalent representatives, who has supervision or direction of (i) all or substantially all
of the Contractor's business, or (ii) all or substantially all of t he Contractor's operaticns at any one plant or
separate location in which this contract is being performed, or (iii) a separate and complete major industrial oper-
ation in connection with the performance of this contract. The Government may at any time also require the Con-
tractor to remedy by correction or replacement, without cost to the Government, any such failure caused by one or
more individual employees selected or retained by the Contractor after any such supervisory personnel has reason-
able grounds to believe that any such employee is habitually careless or otherwise unqualified.
(d) The provisions of paragraph (b) above shall apply to any corrected or replacement end item or component
until six months after its acceptance.
(e) The Contractor shall make his records of all inspection work available to the Government during the
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cent as provided in this clause and as .may be provided in the Schedule, the Contractor shall have no
obligation or liability to correct or replace articles which at the time of delivery are defective in material or work-
manship or otherwise not in conformity with the requirements of this contract.
(g) Except as otherwise provided in the Schedule, the Contractor's obligation to 'correct or replace Govern-
ment-furnished Property (which is property in the possession of or acquired directly by the Government and de-
livered or otherwise made aVailable to the Contractor) shall be governed by the provisiens of the clause of this
contract entitled "Government Property."
6. ASSIGNMENT OF CLAIMS. (Feb. 1962) (a) Pursuant to the provisions of the Assignment of Claims Act
of 1940, as amended (31 U.S.C. 203, 41 U.S.C. 15), if this contract provides for payments aggrdgating $1,000 or more,
claims for monies due or to become due the Contractor from the Government under this, contract may be assigned
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 reassignment shall cover all
amounts payable under this contract and not already paid, and shall not be made to more than one party, except
that any such assignment or reassignment may be made to one party as agent or trustee for two or more parties
participating in such financing. Unless otherwise provided in this contract, payments to an assignee of any monies
due or to become due under this contract shall not, to the extent provided 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, specifications, or other similar documents
relating to work under this contract, if marked "Top Secret,' "Secret," or "Confidential," be furnished to any as-
signee of any claim arising under this contract or to any other person not entitled to receive the same. However,
a copy of any part or all of this contract so marked may be furnished, or any information contained therein may
be disclosed, to such assignee upon the prior written authorization of the Contracting Officer.
7. EXAMINATION OF RECORDS (Nov. 1962) (a) (1) The Contractor agrees to maintain books, records,
documents, and other evidence pertaining to the costs and expenses of this contract (hereinafter collectively called
the "records") to the extent and in such detail as will properly reflect all net costs, direct and indirect, of labor,
materials, equipment, supplies and services, and other costs and expenses of whatever nature for which reim-
bursement is claimed under the provisions of this contract.
(2) The Contractor agrees to make available at the office of the Contractor at all reasonable times during
the period set forth in subparagraph (4) below any of the records for inspection, audit or reproduction by any
authorized representative of the Comptroller General.
(3) In the event the Comptroller General or any of his duly 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 reimbursement voucher covering such
charges or as may be otherwise specified within two years after reimbursement of charges covered by any such
voucher, to such representative as may be designated for that purpose through the Contracting Officer, such
documentary evidence in support of transportation costs as may be required by the Comptroller General or any
of his duly authorized representatives.
(4) Except for documentary evidence delivered to the Government pursuant to subparagraph (3) above,
the Contractor shall preserve and make available his records (i) for a period of three years from the date of
final payment under this contract, and (ii) for such longer period, if any, as is required by applicable statute,
by any other clause of this contract, or by (A) or (B) below.
(A) If this contract is completely or partially terminated, the records relating to the work terminated
shall be preserved and made available for a period of three years from the date of any resulting final settlement.
(B) Records which relate to (i) appeals under the Disputes clause of this contract, (ii) litigation or
the settlement of claims arising out of the performance of this contract, or (iii) cost and expenses of this con-
tract as to which exception has been taken by the Comptroller General or any of his duly authorized repre-
sentatives, shall be retained by the Contractor until such appeals, litigation, claims, or exceptions have been
disposed of.
(5) Except for documentary evidence delivered pursuant to subparagraph (3) above, and the records
described in subparagraph (4) (B) above, the Contractor may in fulfillment of his obligation to retain his records
as required by this clause substitute photographs, microphotographs, or other authentic reproductions of such
records, after the expiration of two years following the last day of the month of reimbursement to the Con-
tractor of the invoice or voucher to which such records relate, unless a shorter period is authorized by the Con-
tracting Officer with the concurrence of the Comptroller General or his duly authorized representative.
(6) The provisions of this paragraph (a), including this subparagraph (6), shall be applicable to and
included in each subcontract hereunder which is on a cost, cost-plus-a-fixed-fee, time-and-material or labor-hour
basis.
(b) The Contractor further agrees to include in each of his subcontracts hereunder, other than those set
forth in subparagraph (a)(6) above, a provision to the effect that the subcontractor agrees that the Comptroller
General or any of his duly authorized representatives, shall, until the expiration of three years after final pay-
ment under the subcontract, have access to and the right to examine any directly pertinent books, documents,
papers, and records of such subtontractor, involving transactions related to the subcontract. The term "sub-
contract," as used in this paragraph (b) only, excludes (i) purchase orders not exceeding $2,500 and (ii) sub-
contracts or purchase orders for public utility services at rates established for uniform applicability to the general
public.
8. SUBCONTRACTS (Apr. 1964) (a) The Contractor shall give advance notification to the Contracting Officer
of any proposed subcontract hereunder which (i) is cost-reimbursement type, time and materials, or labor-hour, or
(ii) is fixed-price type and exceeds in dollar amount either $25,000 or five percent (5%) of the total estimated cost
of this contract.
(b) In the case of a proposed subcontract which (i) is cost-reimbursement type, time and materials, or labor-
hour and which would involve an estimated amount in excess of $10,000, including any fee, or (ii) is proposed to
exceed $100,000; or (iii) is one of a number of subcontracts under this contract with a single subcontractor for the
same or related supplies or services which, in the aggregate are expected to exceed $100,000; the advance notification
required by (a) above shall include:
(1) a description of the supplies or services to be called for by the subcontract;
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(2) identification of the proposed subcontractor and an explanation of why and how the proposed subcon-
tractor was selected, including the degree of competition obtained;
(3) the proposed subcontract price, together with the Contractor's cost or price arolysis thereof;
(4) the subcontractor's current, complete, and accurate cost or pricing data and Certificate of Current Cost
or Pricing Data when such data and certificate are required, by other provisions of this fontract, to be obtained
from the subcontractor; and ,
(5) identification of the type of contract to be used.
(c) The Contractor shall not, without the prior written consent of the Contracting Officey, tlace any subcontract
which (i) is cost-reimbursement type, time and materials, or labor-hour, or (ii) is fixed-price type and exceeds In
dollar amount either $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 $1,000, or (iv) has experimental, developmental, or research work as one of its
purposes. The Contracting Officer may, in his discretion, ratify in writing any such subcontract; such action shall
constitute the consent of the Contracting Officer as required by this paragraph (c).
(d) The Contractor agrees that no subcontract placed under this contract shall proVide for payment on a
cost-plus-a-percentage-of-cost basis.
(e) The Contracting Officer may, 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 determination of the allowability of any cost under this contract,
unless such approval specifically provides that it constitutes a determination of the allowability of such cost.
(f) The Contractor shall give the Contracting Officer immediate 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, may result in litigation, related in any way to this contract, with respect to which
the Contractor may be entitled to reimbursement from the Government.
(g) Notwithstanding (c) above the Contractor may enter into subcontracts within (ii), or, if the subcontract
Is for special tooling, within (iii), of (c) above, without the prior written consent of the Contracting Officer if
the Contracting Officer has in writing approved the Contractor's purchasing system and the subcontract is within
the limitations of such approval.
(If this is a cost sharing contract where the Contractor's share is 25% or more, or is a cost-plus-incentive-fee
contract in which the contract incentive provides for both (i) a swing from target fee of at least 3% and (II) a
Contractor's overall cost share of at least 10%, consent is not required for subcontracts, except subcontracts for
research and development, coming under any part of the Contractor's purchasing system that has been approved,
paragraph (g) above shall be deemed deleted and the following paragraph (g) substituted in lieu thereof:)
(g) Notwithstanding (c) above, the Contractor may enter into subcontracts within (i), (ii), or (iii) of (c)
above without the prior written consent of the Contracting Officer, if the Contracting Officer has in writing approved
the Contractor's purchasing system and the subcontract is within the limitations of such approval. (Apr. 1964)
(h) The Contractor shall (i) insert in each price redetermination or incentive price revision subcontract here.
under the substance of the "Limitation on Payments" paragraph set forth in the appropriate clause prescribed by
paragraph 7-108 of the Armed Services Procurement Regulation, including subparagraph (4) thereof, modified to
omit mention of the Government and reflect the position of the Contractor as purchaser and of the subcontractor as
vendor, and to omit that portion of subparagraph (3) thereof relating to tax credits, and (ii) include in each cost-
reimbursement type subcontract hereunder a requirement that each price redetermination and incentive price re-
vision subcontract thereunder will contain the substance of the "Limitation on Payments" provision, including sub-
paragraph (4) thereof, modified as outlined in (i) above.
(i) To facilitate small business participation in subcontracting under this contract, the Contractor agrees to
provide progress payments on the fixed-price types of subcontracts of those subcontractors which are small business
concerns, in conformity with the standards for customary progress payments stated in paragraphs 503 and 514 of
Appendix E of the Armed Services Procurement Regulation, as in effect on the date of this contract. The Contractor
further agrees that the need for such progress payments will not be considered as a handicap or adverse factor in the
award of subcontracts.
9. UTILIZATION OF SMALL BUSINESS CONCERNS. (Jan. 1958) (a) It is the policy of the Government
as declared by the Congress that a fair proportion of the purchases and contracts for supplies and services for the
Government be placed with small business concerns.
(b) The Contractor agrees to accomplish the maximum amount of subcontracting to small business con-
cerns that the Contractor finds to be consistent with the efficient performance of this contract.
10. TERMINATION. (Jul. 1962) (a) The performance of work under the contract may be terminated by the
Government in accordance with this clause in whole, or from time to time in part:
(i) 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 ten days (or such
longer periods as the Contracting Officer may allow) after receipt from the Contracting Officer of a notice specify-
ing the default; or
(ii) whenever 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 (I) above' it is determined for any reason that ,144.1.4
the Contractor was not in default pursuant to (i), or 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 pursu-
ant to the provisions of the clause of this contract relating to excusable delays, the Notice of Termination shallbe deemedto hgaovveelzli YL:golk t8186VS,2662111)/1641!scitA4W31P711311oatkikeoeurttiyotheett2
shall:
of a Notice of Termination and except as otherwise directed by the Contracting Orneer,
tha, Sbontraltte orr
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(1) stop work under the contract on the date and to the extent specified in the Notice of Termination;
(ii) place no further orders or subcontracts for materials, services, or facilities, wept as may be necessary
for completion of such portion of the work under the contract as is not terminated; -
(iii) terminate all ordprs and subcontracts to the extent that they relate to the performance of work ter-
minated by the Notice of Termination;
(iv) 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 ternv1nated, in 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;
?
(v) 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 clause, 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 accordance with the provisions of this contract;
(vi) 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 (A) the fabricated or un-
fabricated parts, work in process, completed work, supplies, and other material produced as a part of, or acquired
in respect of the performance of, the work terminated by the Notice of Termination, (B) the completed or partially
completed plans, drawings, information, and other property which, if the contract had been completed, would be
required to be furnished to the Government, and (C) the jigs, dies, and fixtures, and other special tools and tooling
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;
(vii) use his best efforts to sell in the manner, at the times, to the extent, and at the price or prices di-
rected or authorized by the Contracting Officer, any property of the types referred to in (vi) above; provided,
however, that the Contractor (A) shall not be required to extend credit to any purchaser, and (B) 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 Contractor under this contract or shall otherwise be credited to
the price or cost of the work covered by this contract or paid in such other manner as the Contracting Officer may
direct;
(viii) complete performance of such part of the work as shall not have been terminated by the Notice of
Termination; and
(ix) 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 Contractor in which the Govern-
ment 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 fee, or any item of reimbursable cost, under this clause. At any
time after expiration of the plant clearance period, as defined in Section VIII, Armed Services Procurement Regu-
lation, as it may be amended from time to time, the Contractor may submit to the Contracting Officer a list, certi-
fied 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 directed or authorized 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 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 his termi-
nation claim in the form and with the certification prescribed by the Contracting Officer. Such claim shall be sub-
mitted promptly but in no event later than one year 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 one 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 one
year period or any extension thereof. Upon failure of the Contractor to submit his termination claim within the
time allowed, the Contracting Officer may, subject to any Settlement Review Board approvals required by Section
VIII of the Armed Services Procurement Regulation in effect as of the date of execution of this contract, 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), and subject to any Settlement Review Board approvals re-
quired by Section VIII of the Armed Services Procurement Regulation in effect as of the date of execution of this
contract, 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 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.
(e) In the eveni, of the failure of the Contractor and the Contracting Officer to agree in whole or in part, as
provided in paragraph (d), as to the amounts with respect to costs and fee, or as to the amount of the fee, to be
paid to the Contractor in connection with the termination of work pursuant to this clause, the Contracting Officer
shall, subject to any Settlement Review Board approvals required by Section VIII of the Armed Services Procure-
ment Regulation in effect as of the date of execution Of. this contract, determine, on the basis of information avail-
able to him, the amount, if any, due to the Contractor by reason of the termination and shall pay to the Contractor
the amount determined as follows:
(i) if the settlement includes cost and fee?
(A) there shall be included therein all costs and expenses reimbursable in accordance with this contract,
not previously paid to the Contractor for the performance of this contract prior to the effective date of the Notice
of Termination, and such of these costs as may continue for a reasonable time thereafter with the approval of
or as directed by the Contracting Officer; provided, however, that the Contractor shall proceed as rapidly as
practicable to discontinue such costs;
(B) there shall be included therein so far as not included under (A) above, the cost of settling and
paying claims arising out of the termination of work under subcontracts or orders, as provided in paragraph (b) (v)
above, which are properly chargeable to the terminated portion of the contract;
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(C) there shall be included therein the reasonable costs of settlement, including accounting, legal, clerical,
and other expenses reasonably necessary for the preparation of settlement claims and supporting data with respect
to the terminated portion of ;the contract and for the termination and settlement of sulkontracts, thereunder, to-
gether with reasonable storage, transportation, and other costs incurred in connection with the protection or
disposition of termination imientory; 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 settlemtpit proposal; and
(D) there shall be Included therein a portion of the fee payable under the contr4t determined as follows?.
(I) in the event of the termination of this contract for the convenience of th? Government and not for
the default of the Contractor, there shall be paid a percentage of the fee equivalent to the percentage of the com-
pletion of work contemplated by the contract, less fee payments previously made hereunder; or
(II) in the event of the termination of this contract for the default of the Contractor, the total fee
payable shall be such proportionate part of the fee (or, if this contract calls for articles of different types, of such
part of the fee as is reasonably allocable to the type of article 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
contract:
if the amount determined under this subparagraph (i) is less than the total payment theretofore made to the Con-
tractor, the Contractor shall repay to the Government the excess amount; or
(ii) if the settlement includes only the fee, the amount thereof will be determined in accordance with sub-
paragraph (i)(D) above.
(f) The Contractor shall have the right of appeal, under the clause of this contract entitled "Disputes," from
any determination made by the Contracting Officer under paragraphs (c) or (e) above, except that if the Con-
tractor has failed to submit his claim within the time provided in paragraph (a) above and has failed to request
extension of such time, he shall have no such right of appeal. In any case where the Contracting Officer has made
a determination of the amount due under paragraph (c) or (e) above, the Government shall pay to the Contractor
the following: (i) if there is no right of appeal hereunder or if 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.
(g) In arriving at the amount due the Contractor under this clause there shall be deducted (i) all unliquidated
advance or other payments theretofore made to the Contractor, applicable to the terminated portion of this con-
tract, (ii) any claim which the Government may have against the Contractor in connection with this contract, and
(iii) the agreed price for, or the proceeds of sale of, any materials, supplies, or other things acquired by the Con-
tractor or sold pursuant to the provisions of this clause and not otherwise recovered by or credited to the Government.
(h) In the event of a partial termination, the portion of the fee which is payable with respect to the work
under the continued portion of the contract shall be equitably adjusted by agreement between the Contractor and
the Contracting Officer, and such adjustment shall 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 termi-
nated portion of the contract whenever in the opinion of the 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 Government upon demand, together with interest computed at the rate of 6 percent per annum, for the
period from the date such excess payment is received by the Contractor to the date on which such excess is repaid
to the Government; provided, however, that no interest shall be charged with respect to any such excess payment
attributable to a reduction in the Contractor's claim by reason of retention or other disposition of termination in-
ventory until 10 days after the date of such retention or disposition, or such later date as determined by the Con-
tracting Officer by reason of the circumstances.
(j) The provisions of this clause relating to the fee shall be inapplicable if this contract does not provide
for payment of a fee.
11. DISPUTES. (Jan. 1958) (a) Except as otherwise provided in this contract, any dispute concerning a
question of fact arising under this contract which is not disposed of by agreement shall be decided by the Contract-
ing Officer, who shall reduce his decision to writing and mail or otherwise furnish a copy thereof to the 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 mails or otherwise furnishes to the Contracting Officer a written appeal addressed to
the Secretary. The decision of the Secretary or his duly authorized representative for the determination of such ap-
peals shall be final and conclusive unless determined by a court of competent jurisdiction to have been fraudulent,
or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial
evidence. In connection with any appeal proceeding under this clause, the Contractor shall be afforded an oppor.
tunity to be heard and to offer evidence in support of his appeal. 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 questions in connection with decisions pro-
vided for in paragraph (a) above; provided, that nothing in this contract shall be construed as making final the
decision of any administrative official, representative, or board on a question of law.
12. RENEGOTIATION. (Oct. 1959) (a) To the extent required by law, this contract is subject to the Rene-
gotiation Act of 1951 (50 U.S.C. App. 1211, et seq.), as amended, and to any subsequent act of Congress providing
for the renegotiation of contracts. Nothing contained in this clause shall impose any renegotiation obligation with
respect to this contract or any rnbcontract hereunder which is not imposed by an act of Congress heretofore or here-
after enacted. Subject to the foreg,, this contract shall be deemed to contain all the provisions required by Sec-
tion 104 of the Renegotiation Act of i, and by any such other act, without subsequent contract amendment
specifically incorporating such provision
(b) The CentractoAdowtptiki Per Releasev2062//110i2.5 contracts, as as that tem" ff He n sectio,: 503g of the Renegotiation Act of 1951, as amended.
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13. BUY AMERICAN ACT. (May 1964) (a) In acquiring end products, the Buy American Act (41 U.S.C.
10a?d) provides thet the Government give preference to domestic source end products. For the purpose of this
clause:
(i) "componpnts" means those articles, materials, and supplies, which pre directly incorporated in the end
products;
MI "end products" means those articles, materials, and supplies, whicli'Are to be acquired under this con-
tract for public use and
(iii) a "domestic source end product" means (A) an unmanufactured end product 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 com-
ponents thereof which are mined, produced, or manufactured in the United States or Canada exceeds 50 percent of
the cost of all its components. For the purposes of this (a) (iii) (B), components of foreign origin of the same
type or kind as the products referred 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 contract only domestic source end products,
except 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 commercial quantities and of a satisfactory quality;
(iii) as to which the Secretary determines the domestic preference to be inconsistent with the public
interest; or
(iv) as to which the Secretary determines the cost to the Government to be unreasonable.
(The foregoing requirements are administered in accordance with Executive Order No. 10582, dated
December 17, 1954. So as to alleviate the impact of Department of Defense expenditures on the United States
balance of international payments, bids offering domestic source end products normally will be evaluated against bids
offering other end products by adding a factor of fifty percent (50%) to the latter, exclusive of import duties. Details
of the evaluation procedure are set forth in Section VI of the Armed Services Procurement Regulation.)
14. CONVICT LABOR. (Mar. 1949) In connection with the performance of work under this contract, the Con-
tractor agrees not to employ any person undergoing sentence of imprisonment at hard labor.
15. W ALSH-HEALEY PUBLIC CONTRACTS ACT. (Jan. 1958) If this contract is for the manufacture or
furnishing of materials, supplies, articles, or equipment in an amount which exceeds or may exceed $10,000 and is
otherwise subject to the Walsh-Healey Public Contracts Act, as amended (41 U.S.C. 35-45), there are hereby incor-
porated by reference all representations and stipulations required by said Act and regulations issued there-
under by the Secretary of Labor, such representations and stipulations being subject to all applicable rulings and
interpretations of the Secretary of Labor which are now or may hereafter be in effect.
16. CONTRACT WORK HOURS STANDARDS ACT ? OVERTIME COMPENSATION. (June 1964) This con-
tract, to the extent that it is of a character specified in the Contract Work Hours Standards Act (40 U.S.C. 327-
330), is subject to the following provisions and to all other applicable provisions and exceptions of such Act and
the regulations of the Secretary of Labor thereunder.
(a) Overtime Requirements. No Contractor or subcontractor contracting for any part of the contract work
which may require or involve the employment of laborers or mechanics shall require or permit any laborer or
mechanic in any workweek in which he is employed on such work to work in excess of eight hours in any calendar
day or in excess of forty hours in such workweek on work subject to the provisions of the Contract Work Hours
Standards Act unless such laborer or mechanic receives compensation at a rate not less than one and one-half times
his basic rate of pay for all such hours worked in excess of eight hours in any calendar day or in excess of forty
hours in such workweek, whichever is the greater number of overtime hours.
(b) Violation; Liability for Unpaid Wages; Liquidated Damages. In the event of any violation of the provisions
of paragraph (a), the Contractor and any subcontractor responsible therefor shall be liable to any affected employee
for his unpaid wages. In addition, such Contractor and subcontractor shall be liable to the United States for
liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic
employed in violation of the provisions of paragraph (a) in the sum of $10 for each calendar day on which such
employee was required or permitted to be employed on such work in excess of eight hours or in excess of his
standard workweek of forty hours without payment of the overtime wages required by paragraph (a).
(c) Withholding for Unpaid Wages and Liquidated Damages. The Contracting Officer may withhold from the
Government Prime Contractor, from any moneys payable on account of work performed by the Contractor or
subcontractor, such sums as may administratively be determined to be necessary to satisfy any liabilities of such
Contractor or subcontractor for unpaid wages and liquidated damages as provided in the provisions of paragraph (b).
(d) Subcontracts. The Contractor shall insert paragraphs (a) through OD of this clause in all subcontracts,
and shall require their inclusion in all subcontracts of any tier.
(e) Records. The Contractor shall maintain payroll records containing ,he information specified in 29 CFR
516.2(a). Such records shall be preserved for three years from the completion of the contract.
17. EQUAL OPPORTUNITY (Apr. 1964) (The following clause is applicable unless this contract is exempt
under the rules and regulations of the President's Committee on Equal Employment Opportunity (41 C.F.R. Chapter
60). Exemptions include contracts and subcontracts (i) not exceeding $10,000, (ii) not exceeding $100,000 for stand-
ard commercial supplies or raw materials, and (iii) under which work is performed outside the United States and
no recruitment of workers within the United States is involved.)
During the performance of this contract, the Contractor agrees as follows:
(a) The Contractor will not discriminate against any employee or applicant for employment because of race,
creed, color, or national origin. The Contractor will take affirmative action to ensure that applicants are employed,
? and that employees are treated during employment, without regard to their race, creed, color, or national origin.
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Such action shall include but not be limited to, the following: employment, upgrading, demotion, or transfer;
recruitment or recruitment advertising; lay-off or termination; rates of pay or other fp ins of compensation; and
selection for training, incitiding apprenticeship. The Contractor agrees to post in cons tious places, available to
employees and applicants for,employment, notices to be provided by the Contracting Ofipr setting forth the pro-
visions of this nondiscrinthrtion clause. (.
(b) The Contractor wi I, in all solicitations or advertisements for employees placed by or on behalf of the
Contractor, state that all qualified applicants will receive consideration for employment without regard to race,
creed, color, or national origin.
(c) The Contractor will' send to each labor union or representative of workers with which he has a collective
bargaining agreement or other contract or understanding, a notice, to be provided by the Agency Contracting Officer,
advising the said labor union or workers' representative of the Contractor's commitments under this nondiscrimina-
tion clause, and shall post copies of the notice in conspicuous places available to enployees and applicants for
employment.
(d) The Contractor will comply with all provisions of Executive Order No. 40925 of March 6, 1961, as
amended, and of the rules, regulations, and relevant orders of the President's Committee on Equal Employment
Opportunity created thereby.
(e) The Contractor will furnish all information and reports required by Executive Order No. 10925 of March
6, 1961, as amended, and by the rules, regulations, and orders of the said Committee, or pursuant thereto, and will
permit access to his books, records, and accounts by the contracting agency and the Committee for purposes of
investigation to ascertain compliance with such rules, regulations, and orders.
(f) In the event of the Contractor's noncompliance with the nondiscrimination clause of this contract or
with any of the said rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in
whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance
with procedures authorized in Executive Order No. 10925 of March 6, 1901, as amended, and such other sanction.
may be imposed and remedies invoked as provided in the said Executive Order or by rule, regulation, or order of
the President's Committee on Equal Employment Opportunity, or as otherwise provided by law.
(g) The Contractor will include the provisions of paragraphs (a) through (g) in every subcontract or pur-
chase order unless exempted by rules, regulations, or orders of the President's Committee on Equal Employment
Opportunity issued pursuant to Section 303 of Executive Order No. 10925 of March 6, 1961, as amended, so that
such provisions will be binding upon each subcontractor or vendor.* The Contractor will take such action with
respect to any subcontract or purchase order as the contracting agency may direct as a means of enforcing such
provisions, including sanctions for noncompliance: Provided, however, that in the event the Contractor becomes
involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by
the contracting agency, the Contractor may request the United States to enter into such litigation to protect the
interests of the United States.
*Unless otherwise provided, the "Equal Opportunity" clause is not required to be inserted in subcontracts below the
second tier, except for subcontracts involving the performance of "construction work" at the "site of construction" (an
those terms are defined in the Committee's rules and regulations) in which case the clause must be inserted in all
such subcontracts. Subcontracts may incorporate by reference the "Equal Opportunity" clause.
18. OFFICIALS NOT TO BENEFIT. (Jul. 1949) No member of or delegate to Congress, or resident commis-
sioner, 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.
19. COVENANT AGAINST CONTINGENT FEES. (Jan. 1958) The Contractor warrants that no person or
selling agency has been employed or retained to solicit or secure this contract upon an agreement or understanding
for a commission, percentage, brokerage, 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 breach or
violation of this warranty the Government shall have the right to annul this contract without liability or in its dis-
cretion, to deduct from the contract price or consideration, or otherwise recover, the full amount of such commission,
percentage, brokerage or contingent fee.
20. AUTHORIZATION AND CONSENT. (Jan. 1961) ? The Government hereby gives its authorization and
consent for all use and manufacture of any invention described in and covered by a patent of the United States
in the performance of this contract or any part hereof or any amendment hereto or any subcontract hereunder
(including any lower-tier subcontract).
21. NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT. (Jan. 1965)
----The provisions of this clause shall be applicable only if the amount of this contract exceeds $10,000.
(a) The Contractor shall report to the Contracting Officer, promptly and in reasonable written detail, each
notice or claim of patent or copyright infringement based on the performance of this contract of which the Con-
tractor has knowledge.
(b) In the event of any claim or suit against the Government on account of any alleged patent or copyright
infringement arising out of the performance of this contract or out of the tiae of any supplies furnished or work
or services performed hereunder, the Contractor shall furnish to the Government, when requested by the Contract-
Officer, all evidence and information in possession of the Contractor pertaining to such suit or claim. Such
evidence and information shall be furnished at the expense of the Government except where the Contractor has
agreed to indemnify the Government.
(c) This clause shall be included in all subcontracts.
22. PATENT RIGHTS (:LICENSE) (May, 1964)
(a) Definitions Used in This Clause.
reduced to practice in
(1) Subject Invention means any invention or discovery whether or taat7p e le- trgalgYa
ovectfRruRtePoite oam ado teeplAs s';$ 'P
to, any art, machine, in Limn, design or composition of matter, or any new and useful improvement thereof, or
any vAfrbi-d0/01143010FielettStitOOLV10/25t4MAYetfoiRe2a0d3646/M011400.111daa4s of America or any
foreign liblintry.
(2) Governmental' purpose means the right of the Government of the United States (includling any agency
thereof, state or domestic municipal government) to practice and have practiced (make or have made, use or have
used, sell or have sold) any Subject Invention throughout the world by or on behalf of the Government of the United
States.
(3) Contract means i any contract, agreement, grant, or other arrangement, or subcontract entered into with
or for the benefit of the Government where a purpose of the contract is the conduct of e*perimental, developmental,
or research work.
(4) Subcontract and subcontractor mean any subcontract or subcontractor of the Contractor, any lower-tier
subcontract or subcontractor under this contract.
(6) To bring to the point of practical application means to manufacture in the case of a composition or
product, to practice in the case of a process, or to operate in the case of a machine or system and, in each case,
under such conditions as to establish that the Invention is being worked and that its benefits are reasonably accessible
to the public.
(b) Rights Granted to the Government.
(1) The Contractor agrees to and does hereby grant to the Government an irrevocable, nonexclusive, and
royalty-free license to practice and have practiced each Subject Invention (made by the Contractor) throughout the
world for Governmental purposes. In addition, the Government shall have the right to grant licenses to any foreign
government or international organization specifically for use in programs established by International Agreements
for research, development, or production of weapons or equipment for mutual defense and shall include the practice
of such Subject Invention in the manufacture, use, and disposition of any article or material, in the use of any
method, or in the performance of any service acquired by or for the Government or with funds derived through
the Military Assistance Program of the Government or otherwise through the Government.
(b) Rights Granted to the Government.
(1) (This paragraph applies if this contract has as one of its purposes the performance of research and
development work under a space program, project or task and paragraph (b)(1) above is made inapplicable.) The
Contractor agrees to and does hereby grant to the Government an irrevocable, nonexclusive and royalty-free license
to practice and have practiced each Subject Invention (made by the Contractor) throughout the world for Gevern-
mental purposes. In addition, the Government shall have (a) the right to grant licenses to any foreign government
or international organization specifically for use in programs established by International Agreements for research,
development or production of weapons or equipment for mutual defense and (b) the right to grant licenses to others,
under such terms and conditions as may be prescribed, for the practice of such Subject Invention throughout the
world in the design, development, manufacture, operation, maintenance and testing of communications satellite
systems, and of equipment, components, and ground tracking, transmitting and receiving facilities therefor, and shall
include the practice of such Subject Invention in the manufacture, use, and disposition of any article or material, in
the use of any method or in the performance of any service acquired by or for the Government or with funds
derived through the Military Assistance Program of the Government or otherwise through the Government.
(2) The Contractor further agrees to grant, upon the request of the Government, a license under any Subject
Invention (made by the Contractor) to:
(i) any applicant on a nonexclusive, royalty-free basis, unless the Contractor, his licensee, or his assignee
demonstrates to the Government, at its request, that effective steps have been taken within three years after a
patent issues on such Invention to bring the Invention to the point of practical application or that the Invention has
been made available for licensing royalty-free or on terms that are reasonable in the circumstances, or can show
cause why the principal or exclusive rights should be retained for a further period of time;
(ii) any applicant royalty-free or on terms that are reasonable in the circumstances to the extent that
the Invention is required for public use by governmental regulations or as may be necessary to fulfill health needs,
or for other public purposes stipulated in the Schedule of this contract.
Nothing contained in this Patent Rights clause shall be deemed to grant any rights with respect to any invention
other than a Subject Invention.
(c) Invention Disclosures and Reports. With respect to Subject Inventions (made by the Contractor), the
Contractor shall furnish to the Contracting Officer:
(i) a written disclosure of each such Invention within four (4) months after conception or first actual
reduction to practice, whichever occurs first under this contract, sufficiently complete as to technical detail to convey
to one skilled in the art to which the Invention pertains a clear understanding of the nature, purpose, operation
and, as the case may be, physical, ch,-mical or electrical characteristics of the Invention, together with a written
statement making an election as to whether a United States patent application claiming the Invention will be filed
by or on behalf of the Contractor;
'(ii) interim reports at least every twelve (12) months, the initial period of which shall commence with
the date of this contract, each report listing- all such Inventions conceived or first actually reduced to practice more
than three (3) months prior to the date of the report and not listed on a prior interim report, or certifying that
there are no such unreported Inventions;
(iii) prior to final settlement of this contract, a final report listing all such Inventions including all those
previously listed in interim reports, or certifying that there are no such unreported Inventions; and
(iv) written reports at reasonable intervals, prior to and after final settlement, when requested by the
Government, as to:
(A) the commercial use that is being made or is intended to be made of such Invention;
(B) the steps taken by the Contractor to bring the Invention to the point of practical application,
or to make the Invention available for licensing.
(d) Domestic Filing. In connection with each Subject Invention referred to in (c) (i) above:
(i) if the Contractor has elected to file a United States patent application claiming such Invention, the
Contractor shall, within six (6) months after the election, file or cause to be filed such application in due form and
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? 10 ?
shall so notify the Contracting Officer at the time of such filing; if the Contractor does not file or cause to be filed
such application, he shall notify the Contracting Officer within the six (6) month period;
(ii) if the Contractor has elected not to file or to cause to be filed a United Statetpatent application claim-
ing such Invention, or has made the contrary election but has not filed or caused to be fil ti such application within
six (6) months after the election, the Contractor shall: ..1.
(A) inform the Contracting Officer in writing, as soon as practicable, of, the date and identity of
any public use, sale, or publication of such Invention made by or known to the Contractor or of any contemplated
publication by the Contractor;
?
(B) upon written request, convey to the Government the Contractor's entitle right, title and interest
in such Invention by delivering to the Contracting Officer such duly executed instruments (prepared by the Govern-
ment) of assignment and application, and such other papers as are deemed necessary to Vest in the Government the
entire right, title, and interest aforesaid, and the right to apply for and prosecute patent applications covering such
Invention throughout the world, subject to the reservation of a nonexclusive and royalty-free license to the Con-
tractor (and to his existing and future associated and affiliated companies, if any, within the corporate 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 Invention 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;
.(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 Contrac-
tor, the Contractor shall so notify the Contracting Officer not less than sixty (60) days before the expiration of,
the response period and, upon written request, deliver to the Contracting Officer such duly executed instruments (pre-
pared by the Government) as are deemed necessary to vest in the Government the entire right, title, and interest
in such Invention and the application, subject to the reservation as specified in paragraph (d)(ii)(B) of this clause;
and
(v) the Contractor shall deliver to the Contracting Officer duly executed instruments fully confirmatory of
all rights herein agreed to be granted or reserved to the Government.
(e) 'Foreign Filing. The Contractor, or those other than the Government deriving rights from the Contractor,
shall as between the parties hereto, have the exclusive right, subject to the rights of the Government under para-
graph (b) of this clause, to file applications on Subject Inventions (made by the Contractor) in each foreign country
within:
(i) nine (9) months from the date a corresponding United States application is filed, or nine (D) months
from the date the Contractor discloses a Subject Invention under paragraph (c) (i) above with an election not to file
a United States application;
(ii) six (6) months from the date permission is granted to file foreign applications 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 notify the Contracting Officer of each foreign application filed and, upon written request of
the Contracting Officer, convey to the Government the entire right, title, and interest in each such Subject Invention
in each foreign country in which an application has not been filed within the time above specified, subject to the
reservation as specified in paragraph (d)(ii)(B) of this clause.
,(f) Withholding of Payment. 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 (e)(4) '
above shown to be due in accordance with any interim report delivered under (c)(ii) or otherwise known to the Gov-
ernment 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 ten thousand
dollars ($10,000), 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 the amount of this
contract, or ten thousand dollars ($10,000) whichever is less, shall have been set aside, such reserve or balance ?
thereof to be retained until the Contractor shall have furnished to the Contracting Officer:
(i) the final report required by (c) (iii) of this clause;
(ii) written disclosures for all Inventions required by (c)(i) above which are shown to be due in accordance
with interim reports delivered under (c)(ii) above, or in accordance with such final reports, or are otherwise known
to the Government to be unreported; and
'(iii) the information as to any subcontractor required by (g) below.
No amount shall be withheld under this paragraph when the amount specified by this paragraph is being withheld
under other provisions of this contract. The withholding of any amount or subsequent payment thereof to the Con-
tractor shall not be construed as a waiver of any rights accruing to the Government under this contract. This para-
graph shall not be construed as requiring the Contractor to withhold any amounts from a subcontractor to enforce
compliance with the patent provision of a subcontract. In cost-type contracts, "amount of this contract" shall mean
"estimated cost of this contract."
(g) Subcontracts.
(1) The Contractor shall, unless otherwise authorized or directed by the Contracting Officer, include a patent
rights clause containing all of the provisions of this Patent Rights clause except provision (f) in any subcontract
hereunder where a purpose of the subcontract is the conduct of experimental, developmental, or research work. In
the event of refusal by a subcontractor to accept this Patent Rights clause, or if in the opinion of the Contractor
this Patent Rights clause is inconsistent with the policy set forth in ASPR 9-107.2 and 9-107.2, the Contractor:
1(1) shall promptly submit a written report to the Contracting Officer setting forth ?the subcontractor's
reason for such refusal or the reasons the Contractor is of the opinion that the inclusion of this clause would be so
Inconsistent, and other pertinent information which may expedite disposition of the matter; and
(ii) shall not proceed with the mtbcontract
q.215invt?YeAn_FlitlisofMatP4e41t66041MOSt1T026-c5r.
The Contractor shill notIFERyVagoPtcsiar b9q4 u a subcontract as consideration therefor, acquire any
rights 'to Subject Inventions for his own use (as distinguished from such rights as may be required solely to fulfill
his ContraAlfitraYi%Ftc9rtliNTRARAMilklMeifgaitU/FORIMMA539CitiMant9tilents, and other
information required to be furnished by a subcontractor to the Contracting Officer under the provisions of such a
patent rights clause in a subcontract hereunder may, upon mutual consent of the Contractor and the subcontractor
(or by direction of the Contracting Officer) be furnished to the Contractor for transmission4to the Contracting Officer.
'(2) The Contractor, at the earliest practicable date, shall also notify the Contraging Officer in writing of
any subcontract containing a patent rights clause, furnish him a copy of such clause, and notify him when such
subcontract is completed.. It is understood that the Government is a third party beneficiarm Of any subcontract clause
granting rights to the Government in Subject Inventions, and the Contractor hereby aesigns to the Government
all the rights that he would have to enforce the subcontractor's obligations for the benefil of the Government with
respect to Subject Inventions. If there are no subcontracts containing patent rights clauhes, -a negative report is
required. The Contractor shall not be obligated to enforce the agreements of any subcontractor hereunder relating
to the obligations of the subcontractor to the Government in regard to Subject Inventions.
(h) Licenses Granted by Contractor to Others Subject to Government's Rights. ThePtontractor recognizes that
the Government, or a foreign government with funds derived through the Military Assistance Program or otherwise
through the United States Government, may contract for property or services with respect to which the vendor
may be liable to the Contractor for royalties for the use of a Subject Invention on account of such a contract. The
Contractor further recognizes that it is the policy of the Government not to pay in connection with its contracts, or
to allow to be paid in connection with contracts made with funds derived through the Military Assistance Program
or otherwise through the United States Government, charges for use of patents in which the Government holds a
royalty-free license. In recognition of this policy, the Contractor agrees to participate in and make appropriate
arrangements for the exclusion of such charges from such contracts or for the refund of amounts received by the
Contractor with respect to any such charges not so excluded.
(I) Rights to Disclose Subject Inventions. The Government may duplicate and disclose reports and disclosures
of Subject Inventions required to be furnished by the Contractor or a subcontractor pursuant to this Patent Rights
clause.
* 23. RIGHTS IN TECHNICAL DATA. (Feb. 1965)
(a) Definitions.
(1) Technical Data, as used in this clause, means technical writings, sound recordings, pictorial reproductions,
drawings, or other graphic representations and works of a technical nature, whether or not copyrighted, which are
specified to be delivered pursuant to this contract. The term does not include financial reports, cost analyses, and
other information incidental to contract administration.
(2) Limited Rights means rights to use, duplicate, and disclose technical data in whole or in part, by or
for the Government, with the express limitation that such data may not be released outside the Government, used,
duplicated, or disclosed in whole or in part, for manufacture or procurement, except for: '
(i) emergency repair or overhaul work by or for the Government where the item or process concerned is
not otherwise reasonably available to enable timely performance of the work; and
(ii) release to a foreign government as the interests of the United States may require;
provided, in either case, that the release of such data shall be subject to the limitations of this paragraph (2).
(3) Unlimited Rights means rights to use, duplicate or disclose technical data, in whole or in part, in any
manner and for any purpose whatsoever, and to have or permit others to do so.
(b) Government Rights.
(1) The Government shall have unlimited rights in:
(i) technical data resulting directly from performance of experimental, developmental or research work
which was specified as an element of performance in this or any other Government contract or subcontract;
(ii) technical data necessary to enable manufacture of end-items, components and modifications, or to
enable the performance of processes, when the end-items, components, modifications or processes have been, or are
being, developed under this or any other Government contract or subcontract in which experimental, developmental
or research work is, or was specified as an element of contract performance, except technical data pertaining to
items, components or processes developed at private expense (but see (2) (ii) below);
(iii) technical data constituting corrections or changes to Government-furnished data;
(iv) technical data pertaining to end-items, components or processes which was prepared for the purpose
of identifying sources, size, configuration, mating and attachment characteristics, functional characteristics and per-
formance requirements ("form, fit and function" data, e.g., specification control drawings, catalog sheets, envelope
drawings, etc.);
(v) manuals or instructional materials prepared for installation, operation, maintenance or training pur-
poses;
(vi) other technical data which has been, or is normally furnished without restriction by the Contractor or
subcontractor; and
(vii) technical data listed or described in an agreement incorporated into the Schedule of this contract, which
the parties have predetermined, on the basis of subparagraphs (i) thru (v1) above, and agreed will be furnished
with unlimited rights.
(2) The Government shall have limited rights in:
(i) technical data, listed or described in an agreement incorporated into the Schedule of this contract,
whaft-tbe parties have agreed will be furnished with limited rights; and
'Op_ technical data pertaining to items, components or processes developed at private expense, other
than such data as may be included in the data referred to in (b) (1) (i), (iii), (iv), (v), and (vi);
provided tint each piece of data to which limited rights are to be asserted pursuant to (2)(i) and (ii) above is
marked with the following legend in which is inserted the number of the prime contract under which the technical
data is to :43 delivered and the name of the Contractor or subcontractor by whom the technical data was generated:
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"Furnishednnom wViletded,ma e " .25 ?:C.I A RDP72800,4 W*ul0n004 b0e0 et4 t e0 2r e -(*5s'
ea outside
the Government, omused,..duplicated,,or disclosed in whole or in part for manufacture or procurement,' without
the written permission oU,except for (i) emergencY repair or overin4,worle '14' Or for, the
Government, where -the item er process 'concerned is not otherwise reasonably available to enable timely per-
formance of the work; or (ii) release to,p foreign government, as the interests of the United States may require;
provided that in either case "the release, use,. duplication or disclosure hereof shall be subject to the foregoing
limitations. This legend shall be marked on any reproduction hereof in whole or in part."
-
No legend shall be marked on, nor shall any limitation on rights of use be aSserted as to, any data which the'Con.
tractor has previously delivered to the Government without restriction. The limited rights provided for by this
paragraph (b) (2) shall not ittipair the right of the Government to use similar or identical data acquired from other
sources.
(c) Material Covered by Copyright.
(1) Notwithstanding the provisions of (b) above, the Contractor agrees to and does hereby grant to the
Government, and to its officers, agents, and employees acting within the scope of their official duties, a royalty-free,
nonexclusive and irrevocable license throughout the world for Government purposes to publish, translate, reproduce,
deliver, perforni, dispose of, and te authorize others so to do, all technical data now or hereafter covered by .copy-
right.
(2) No such copyrighted matter shall be ineluded in technical data furnished hereunder without the written
permission of the copyright owner for the Government to use such copyrighted matter in the manner described
above.
(3) The Contractor shall report to the Government (or higher-tier Contractor) promptly and in reasonable
written detail each notice or claim of copyright infringement received by the Contractor with respect to any technical
data delivered hereunder.
(d) Removal of Unauthorized Markings. Notwithstanding any provisions of this contract concerning inspection
and acceptance, the Government may modify, remove, obliterate, or ignore any marking not authorized by the terms
of this contract on any technical data furnished hereunder, if ?
(i) the Contractor fails to respond within sixty (60) days td a written inquiry by the Government concern-
ing the propriety of the We of the marking, or
(ii) the Contractor's response fails to substantiate his contention that the use of the marking is authorized,
In which case the Government shall give written notice to the Contractor.
(e) Relation to Patents. 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 right otherwise granted to the Government
under any patent.
'(f) Limitation on Charges for Data. The Contractor recognizes that the Government, or a foreign government
with funds derived through the Military Assistance Program or otherwise through the United States Government,
may contract for property or services with respect to which the vendor may be liable to the Contractor for charges
for the use of technical data on account of such a contract. The Contractor further recognizes that it is the policy
of the Government not to pay in connection with its contracts, or to allow to be paid in connection with contracts
made with funds derived through thq Military Assistance Program or otherwise through the United States Govern-
ment, charges for data which the Government has a right to use and disclose to others, which is in the public domain,
or which the Government has been given without restrictions upon its use and disclosure to others. This policy does
not apply to reasonable reproduction, handling, mailing, and similar administrative costs incident to the furnishing
of such data. In recognition of this policy, the Contractor agrees to participate in and make appropriate arrange-
ments for the exclusion of such charges from such contracts, or for the refund of amounts received by the Contractor
with respect to any such charges? not so excluded.
(g) Acquisition of Data from Subcontractors.
(1,) Whenever any technical data is to be obtained from a subcontractor under this contract, the Contractor
shall use this same clause in the subcontract, without alteration, and no other clause shall be used to enlarge or
diminish the Government's or the Contractor's rights in that subcontractor data which is required for the Government.
(2) Technical data required to be delivered by a subcontractor shall normally be delivered to the next higher-
tier Contractor. However, when there is a requirement in the prime contract, or in the deferred order, for data
which may be supplied with limited rights pursuant to (b) (2) above, a subcontractor may fulfill such requirement
by submitting such data directly to the Government rather than through the prime Contractor.
(3) The Contractor and higher-tier 'subcontractors will not use their power to award subcontracts as economic
leverage to acquire rights in data from their subcontractors for themselves.
24. MILITARY SECURITY REQUIREMENTS. (Jun. 1958) (a) The provisions of this clause shall apply to
the extent that this contract involves access to information classified "Confidential" including "Confidential?Modi-
fied Handling Authorized" or higher.
(b) The Government shall notify the Contractor of the security classifications of this contract and the elements
thereof, and of any subsequent revisions in such security classification, by the use of a Security Requirements
Check List (DD Form 254), or other written notification.
(c) To the extent the Oovernment has indicated as of the date of this contract or thereafter indicates security
classification under this contract as provided in paragraph (b) above, the Contractor shall safeguard all classified
elements of this contract and shall provide and maintain a system of security controls within his own organization
in accordance with the requirements of?
(i) the Security Agkement (DD Form 441), including the Department of Defenfila Industrial Security Manual `
for Safeguarding Classifiet Information as in effect on the date of this contract, and any modification to the Security
Agreement for the purpoil: of adapting the Manual to the Contractor's business; and
(ii) any amendments Ito said Manual made after the date of this contract, notice of which has been fur-
nished to the Contractor by the Security Office of the Military Department having security cognizance over the
facility.
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.(d) ARCPrmitikfsosfliNEtwagP9411144ii caMPIRIAPQWARCIPAPWAROAnd representatives
of the contracting Military Department shall have the right to inspect at reasonable intervals the procedures,
methods, and facilities utilized by the Contractor in complying with the security requirements under this contract.
Should the Government, through these representatives, determine that the Contractor' is not complying with the
security requirements of this contract the Contractor shall be informed in writing by the Security Office of the
cognizant Military Department of the proper action to be taken in order to effect compliance with such require-
ments.
(e) If, subsequent to the flate of this 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 estimated cost of performance of this contract, the estimated cost and fled See shall, to the extent
appropriate, be subject to an equitable adjustment. Any such equitable adjustment 610111 be accomplished in the
manner set forth in the "Changes" clause in this contract.
(f) The Contractor agrees to insert, in all subcontracts hereunder which involve arcess to classified informa-
tion, provisions which shall conform substantially to the language of this clause, iticluding this paragraph (f)
but excluding paragraph (e) of this clause. The Contractor may insert in any such, subcontract, and any such
subcontract entered into thereunder may contain, in lieu of paragraph (e) of this clause, provisions which per-
mit equitable adjustments to be made in the subcontract price or in the estimated cost and fixed fee of the sub-
contract (as appropriate to the type of subcontract involved) on account of changes in security classifications or
requirements made under the provisions of this clause subsequent to the date of the subcontract involved. (Oct 1953)
(g) The Contractor also agrees that he shall determine that any subcontractor proposed by him for the furnish-
ing of supplies and services which will involve access to classified information in the Contractor's custody has been
granted an appropriate facility security clearance, which is still in effect, prior .to being accorded access to such
classified information.
25. GOVERNMENT PROPERTY (COST-REIMBURSEMENT) (June 1965) (a) Government-Furnished Property.
The Government shall deliver to the Contractor, for use in connection with and under the terms of this contract, the
property described as Government-furnished property in the Schedule or specifications, together with such related
data and information 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 Gov-
ernment-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 time 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, if any, occa-
sioned the Contractor and shall equitably adjust the estimated cost, fixed fee, or delivery or performance dates, or all
of them, and any other contractual provisions affected by any such delay, in accordance with the procedures provided
for in the clause of this contract entitled "Changes." In the event that Government-furnished property is received by
the Contractor in a condition not suitable for the intended use, the Contractor shall, upon receipt thereof notify the
Contracting Officer of such fact and, as directed by the Contracting Officer, either (i) return such property at the
Government's expense or otherwise dispose of the property or (ii) effect repairs or modifications. Upon completion
of (i) or (ii) above, the Contracting Officer upon written request of the Contractor shall equitably adjust the esti-
mated cost, fixed fee, or delivery or performance dates, or all of them, and any other contractual provision affected
by the return or disposition, or the repair or modification in accordance with the procedures provided for in the clause
of this contract entitled "Changes." The foregoing provisions for adjustment are exclusive and the Government shall
not be liable to suit for breach of contract by reason of any delay in delivery of Government-furnished property or
delivery of such property in a condition not suitable for its intended use.
(b) Changes in Government-Furnished Property.
(1) By notice in writing, the Contracting Officer may (i) decrease the property furnished or to be furnished
by the Government under this contract, or (ii) substitute other Government-owned property for property to be fur-
nished by the Government, or to be acquired by the Contractor for the Government, under this contract. The Con-
tractor shall promptly take such action as the Contracting Officer may direct with respect to the removal and
shipping of property covered by such notice.
(2) In the event of any decrease in or substitution of property pursuant to paragraph (1) above, or any with-
drawal of authority to use property provided under any other contract or lease, which property the Government
had agreed in the Schedule to make available for the performance of this contract, the Contracting Officer, upon the
written request of the Contractor (or, if the substitution of property causes a decrease in the cost of performance,
on his own initiative), shall equitably adjust such contractual provisions as may be affected by the decrease, sub-
stitution or withdrawal, in accordance with the procedures provided for in the "Changes" clause of this contract.
(e) Title. Title to all property furnished by the Government shall remain in the Government. Title to all prop-
erty purchased by the Contractor, for the cost of which the Contractor is entitled to be reimbursed as a direct item
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 the contract, shall pass to and
vest in the Government upon (i) issuance for use of such property in the performance of this contract, or (ii) com-
mencement of processing or use of such property in the performance of this contract, or (iii) reimbursement of
the cost thereof by the Government in whole or in part, whichever first occurs. All Government-furnished prop-
erty, together with all property acquired by the Contractor title to which vests in the Government under this para-
graph, are subject to the provisions of this clause and are hereinafter collectively referred to as "Government prop-
erty." Title to the Government property shall not be 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 become a
fixture or lose its identity as personalty by reason of affixation to any realty.
(d) Property Administration. The Contractor shall comply with the provisions of the "Manual 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 incorporated by reference and made a part of this con-
tract. Material to be furnished by the Government shall be ordered or returned by the Contractor, when required,
In accordance with the "Manual for Military Standard Requisitioning and Issue Procedure (MILSTRIP) for Defense
Contractors" (Appendix II, Armed Services Procurement Regulation) as in effect on the date of this contract, which
Manual is hereby incorporated by reference and made a part of this contract.
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(e) Use of Government trOnerty: The Government property shall, unless otherwise provided herein or approved
by the Contracting Officer, be used only for the performance of this contract
(f) Maintenance of Government Property The Contractor shall maintain and adminiater in accordance with
sound industrial practice, a program for the maintenance, repair, protection and preservation of Government property
so as to assure its full availability and upefulness for the performance of this contract. The Contractor shall take
all reasonable steps to comply with all appropriate directions or instructions which the Contracting Officer may ?
prescribe as reasenably necessary for the ,protection of Crovernment property.
(g) Risk of Loos.
(1) The Contractor shall not be liable for any lois of or damage to the Government property, or for ex-
penses incidental to such loss or damage, except that the Contractor shall be responsible for any such loss or dam-
age (including expenses incidental thereto);?
i(i) which results from willful misconduct or lack of good faith on the part of any one of the Contractor's
directors or officers, or on the part of any of his managers, superintendents, or other equivalent representatives,
who has supervision or-direction of?
(A) all or substantially all of the Contractor's business; or
(B) all or substantially all of the Contractor's operations at any one plant or separate location, in which
this contract is being performed; or
(C) a separate and complete major industrial operation in connection with the performance of this
contract;
(ii) which results from a failure on the part of the Contractor, due to the willful misconduct or lack of
good faith en the part of any of his directors, officers, or other representatives mentioned in subparagraph (i)
above?
(A) to maintain and administer, in accordance with sound industrial practice, the program for mainte-
nance, repair, protection and preservation of Government property as required by paragraph (f) hereof, or
(B) to take all.reasonable steps to comply with any appropriate written directions of the Contracting
Officer under paragraph (f) hereof;
(iii) for which the Contractor is otherwise resPOnsible under the express terms of the clause or clauses
designated in the Schedule;
(iv) which results from a risk expressly required to be insured under this contract, but only to the extent
of the insurance so required to be procured and maintained, or to t h e extent of insurance actually procured and
maintained, whichever is greater; or
(v)- which results from a risk which is in fact covered by insurance or for which the Contractor is other-
wise reimbursed, but only to the extent of such insurance or reimbursement;
provided that, if more than one of the above exceptions shall be applicable in any case, the Contractor's liability
under any one exception shall not be limited by any other exception. If the Contractor transfers Government prop-
erty to the possession and control of a subcontractor, the transfer shall not affect the liability of the Contractor
for loss or destruction of or damage to the property as set forth above. However, the Contractor shall require the
subcontractor to assume the risk of, and be responsible for, any loss or destruction of or damage to the property
while in the latter's possession or control, except to the extent that the subcontract, with the prior approval of
the Contracting Officer, provides for the relief of the subcontractor from such liability. In the absence of such ap-
proval, the subcontract sliall contain appropriate provisions requiring the return of all Government property in as
good condition as when received, except for reasonable wear and tear or for the utilization of the property in ac-
cordance with the provisions of the prime contract.
? (2) The Contractor shall not be reimbursed for, and shall not include as an item of overhead, the cost of
insurance, or any provision for a reserve, covering the risk of loss of or damage to the Government property, ex-
cept to the extent that the Government may have required the Contractor to carry such insurance under any other
provisions of this centred. ,
(3) Upon the happening of loss or destruction of or damage to the Government property, the Contractor
shall notify the Contracting Officer thereof, and shall communicate with the Loss and Salvage Organization, if any,
now or hereafter designated by the Contracting Officer, and with the assistance of the Loss and Salvage Organiza-
tion so designated (unless the Contracting Officer has designated that no such organization be employed), shall take
all reasonable steps to protect. the Government property from further damage, separate the damaged and undam-
aged Government property, put all the Government property in the best possible order, and furnish to the Contract-
ing Officer a statement of?
(I) the lost, destroyed and damaged Government property;
(ii) the time and origin' of the loss, destruction or damage;
(iii) all known interests in commingled property of which the Government property is a part; and
(iv) the insurance, if any,. Covering any part of or interest in such commingled property.
? ?
The Contractor shall mIake repairs and renovations of the damaged Government property or take such other action,
as the Contracting Offieer-directa.
?
(4) In the-eveth the Contractor-is indemnified, reimbursed, or otherwise compensated for any loss or de-
struction of or damage to the Government property, he 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 contracti
or shall otherwise reiniburse the Government, as directed by the Contracting Officer. The Contractor shall do noth.
ing to prejudice the Gbvernment's right to recover against third parties for any such loss, destruction, or damage
. and, upon the request itif 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 assign-
ment in favor of the Government) in obtaining recovery. In addition, where the subcontractor has not been relieved
from liability for any less 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
o& the Government. Approved For Release 2002/10/25 : CIA-RDP72B00464R000400070028-5
(5) 61iPirsocv0Rfitactl; 0 qtRAINW12155riika-Actraiig9,94;64gggaiPAPZPUMui of aircraft,
' or otherwise involves the furnishing of aircraft by the Government, the clause of this contract entitled "Flight Risks"
shall control, to the extent it is applicable, in the case of loss or destruction of, or damage to, aircraft.
(h) Access. The Government, and any persons designated by it, shall at all reasonable times have access to
the premises where any of the Government property is located, for the purpose of inapecting the Government
property.
(i) Final Accounting and Disposition of Government Property. 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 Proierty, not consumed in the
performance of this contract, or not theretofore delivered to the Government, and shall deliver or make such other
4 disposal of such Government property as may be directed or authorized by the Contracting Officer. The net proceeds
of any such disposal shall be credited ?to the cost of the work covered by the contract lor shall be paid in such
manner as the Contracting Officer may direct. The foregoing provisions shall apply to scrap from Government prop-
perty; provided, however, that the Contracting Officer may authorize or direct the Contractor to omit from such In-
ventory schedules any scrap consisting of faulty castings or forgings,. or 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 Contractor's normal practice and account therefor as a part of general overhead or
other reimbursable cost in accordance with the Contractor's established accounting procedures.
(j) Restoration of Contractor's Premises. Unles1 -therwise provided herein, the Government:
(i) may abandon any Government property in place, and thereupon all obligations of the Government re-
garding such abandoned property shall cease; and
(ii) shall not be under any duty or obligation to restore or rehabilitate, or to pay the costs of the restor-
ation or rehabilitation of, the Contractor's plant or any portion thereof which is affected by the abandonment or
removal of any Governmeht property.
(k) Communications. All communications issued pursuant to this clause shall be in writing or in accordance
with the "Manual for Military Standard Requisitioning and Issue Procedure (MILSTRIP) for Defense Contractors"
(Appendix H, Armed Services Procurement Regulation).
26. INSURANCE?LIABILITY TO THIRD PERSONS. (Jan. 1960) (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 contract, 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 may with the approval of the Contracting Officer
maintain a self-insurance program, and provided further, that with respect to workmen's compensation the Con-
tractor is qualified pursuant to statutory authority. All insurance required pursuant to the provisions of this
paragraph shall be in such form, in such amounts, and for such pieriods of time, as the Contracting Officer may
from time to time require or approve, and with insurers approved by the Contracting Officer.
(b) The Contractor agrees, to the extent and in the manner required by the Contracting Officer, to sub-
mit for the approval of the Contracting Officer any other insurance maintained by the Contractor in connection
with the performance of this contract and for which the Contractor seeks reimbursement hereunder.
(c) The Contractor shall be reimbursed: (i) for the portion allocable to this contract of the reasonable
cost of insurance as required or approved pursuant to the provisions of this clause, and (ii) for liabilities to
third persons for loss of or damage to property (other than property (A) owned, occupied or used by the
Contractor or rented to the Contractor, or (B) in the care, custody, or control of the Contractor), or for death
or bodily injury, not compensated by insurance or otherwise, arising out of the performance of this contract.,
whether or not caused by the negligence of the Contractor, his agents, servants or employees, provided such
liabilities are re presented by final judgments or settlements approved in writing by the Government. and ex-
penses incidental to such liabilities, except liabilities (I) for which the Contractor is otherwise responsible un-
der 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 t h e 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 his managers, superintendents, or other equivalent representa-
tives, who has supervision or direction of (1) all or substantially all of the Contractor's business, or (2) all
or substantially all of the Contractor's operations at any one plant or separate location in which this contract
is being performed, or (3) a separate and complete major industrial operation in connection with the per-
formance 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 performance of this contract, other
than insurance required to be submitted for approval or required to be procured and maintained pursuant to
the provisions of this clause, provided such cost would constitute Allowable Cost under the clause of this con-
tract entitled "fkllowable Cost, Fixed Fee and Payment."
(d) 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 con-
tract, the cost and expense of which may be reimbursable to the Contractor under the provisions of this con-
tract 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 Con-
tractor. If the amount, of the liability 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, the 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 his own expense, be associated with the representatives of the Government in the settlement or defense of any
such claim or litigation.
27. irriLizATIoN OP CONCERNS IN LABOR 'SURPLUS AREAS. (Pelt. 1962) (The provisions of this clime
;shall be applicable if this contract is in excess of $5,000.00). It is the policy of the Government to place contracts
.with concerns which Will perform such contracts substantially in areas of persistent ol? substantial labor surplus
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?10?
where this can be done, consistent with the efficient performance of the contract, at prices no higher than are
obtainable elsewhere. The Contractor agrees to use his best efforts to place his subcontracts in accordance with
this policy. In complying with the foregoing and with paragraph (b) of the clause of this contract entitled
"Utilization of Small Business Concerns," the Contractor in placing his subcontracts shall observe the following
order of preference: (i) persistent labor surplus area concerns which are also small budsiess concerns; (ii) other
persistent labor surplus area concerns; (iii) substantial labor surplus area concerns which are also small business
concerns; ?(iv) other substantial labor surplus area concerns; and (v) small business concerns which are not labor
surplus area concerns.
t ?
28. PAYMENT FOR OVERTIME PREMIUMS (Apr. 1964) '(This clause is -applicable if this contract is in
excess of $100,000 unless it is a cost-plus-incentive-fee cOntract having a cost incentive which provides for a swing
from target fee of at least ? 3% and the Contractor's share of cost of at least 10%.) (a) Allowable cost shall
not include any amount on account of overtime premiums except to the extent that they either (i) are approved
In writing on behalf of the Government or (ii) are paid for work ?
(A) necessary to cope with emergencies such as those resulting from accident, natural disasters, break-
downs of production equipment, or occasional production bottlenecks of a sporadic nature;
(B) by indirect labor employees such as those performing duties in connection with administration, pro-
tection, transportation, maintenance, standby plant protection, operation of utilities, or accounting;
(C) in the performance of tests, industrial processes, laboratory procedures, loading or unloading of trans-
portation media, and operations in -flight or afloat, which are continuous in nature and cannot reason-
ably be interrupted or otherwise completed; or
(D) which will result in lower overall cost to the Government.
(b) The cost of overtime premiums otherwise allowable under (a) above shall be allowed only to the extent
the amount thereof is reasonable and properly allocable to the work under this contract.
29. COMPETITION IN SUBCONTRACTING (Apr. 1982)?The Contractor shall select subcontractors (including
suppliers) on a competitive basis to the maximum practical extent consistent with the objectives and requirements
of the contract.
30. FILING OF PATENT APPLICATIONS. (Jan. 1955) (a) Before filing or causing to be filed a patent
application disclosing any subject matter of this contract, which subject matter is classified "Secret" or higher,
the Contractor shall, citing the thirty (30) day provision below, transmit the proposed application to the Contrac-
ting Officer for determination whether, for reasons of national security, such application should be placed under
an order of secrecy or sealed in accordance with the provisions of 35 U.S. Code 181-188 or the issuance of a patent
should be otherwise delayed under pertinent statutes or regulations; and the Contractor shall observe any in-
structions of the Contracting Officer with respect 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 file such patent application. If
the Contracting Officer shall not have given any such instructions within thirty (30) days from the date of mail-
ing or other transmittal of the proposed application, the Contractor may file the application.
(b) The Contractor shall furnish to the Contracting Officer, at the time of or prior to the time when the
Contractor files or causes to be filed a patent application disclosing any subject matter of this contract, which
subject matter is classified "Confidential," a copy of such application for determination whether, for reasons of
national security, such application should be placed under an order of secrecy or the issuance of 'a patent should
be otherwise delayed under pertinent statutes or regulations.
(c) In filing any patent application coming within the scope of this clause, the Contractor shall observe all
applicable security regulations covering the transmission of classified subject matter.
31. EXCUSABLE DELAYS. (Jul. 1958) Except with respect to defaults of subcontractors, the Contractor
shall not be in default by reason of any failure in performance of this contract in accordance with its terms (includ-
ing 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 Con-
tractor. Such causes may include, but are not restricted to: acts of God or of the public enemy.' acts of the
Government in either its sovereign or contractual capacity; fires; floods; epidemics; quarantine restrictions; strikes;
freight embargoes; and unusually severe weather; but in every case the failure to perform must be beyond the
control and without the fault or negligence of the Contractor. If the failure to* perform is caused by the failure
of a subcontractor to perform or make progress, and if such failure arises out of causes beyond the control of both
the Contractor and??subcontractor, and without the fault or negligence of either of them, the Contractor shall not
be deemed to be in default, unless (i) the supplies or services to be furnished by the subcontractor were obtainable
from other sources, (ii) the Contracting Officer shall have ordered the Contractor in writing to procure such supplies
or services from such other sources, and (iii) the Contractor shall have failed to comply reasonably with such
order. Upon request of the Contractor, the Contracting Officer shall ascertain the facts and extent of such failure
and, if he shall determine that any failure to perform was occasioned by any one or more of the said causes, the
delivery schedule shall be revised accordingly, subject to the rights of the Government under the clause hereof
entitled "Termination."
32. PRIORITIES, ALLOCATIONS, AND ?ALLOTMENTS. (Jan. 1981)?The Contractor shall follow the pro-
visions of DMS Regulation 1 and all other applicable regulations and orders of the Business and Defense Services
Administration in obtaining controlled materials and other products and materials needed to fill this order.
33. NOTICE TO THE GOVERNMENt OF LABOR DISPUTES. (Sep. 1958) (a) Whenever the Contractor
has knowledge that any actual or potential labor dispute is delaying or threatens to delay the timely performance
of this contract, the Contractor shall immediately give notice thereof, including all relevant information with re-
spect thereto, to the Contracting Officer. , ? -
(b) The Contractor agrees to, insert the substance of this clause includin t I 71,41) any
subcontract hereunder arta relifraHenglo-epdisinto gteostiroi25e: tedAyRtang A tuthat
each such subcontract WO profiSi that In the- event its timely performance ill delayed or threatened by delay by
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any actual or potential labor dispute, the subcontractor shall immediately notify his next higher tier subcontractor,
or the prime contractor, as the case may be, of all relevant information with respect to such dispute.
34. GRATUITIES. (Mar., 1952) (a) The Government may, by written notice to the Contractor, terminate the
right of the Contractor to proeeed under this contract if it is found, after notice and hering, 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 anyApfficer 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 suCiP contract; provided, that
the existence of the facts upon which the Secretary or his duly authorized representative makes such findings shall
be in iesue 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 less than three nor more than ten times the costs incurred by the Contractor in providing any
such gratuities to any such officer or employee.
(c) The rights and remedies of the Government provided in this clause shall not be exclusive and are in ad-
dition to any other rights and remedies provided by law or under this contract.
35. LIMITATION ON WITHHOLDING OF PAYMENTS. (Feb. 1959) If more than ofte clause or Schedult
provision of this contract authorized the temporary withholding of amounts otherwise payable to the Contractor
for work performed under this contract, the total of the amounts so withheld at any one time shall not exceed
the greatest amount which may be withheld under any one such clause or Schedule provision at that time; provided
that this limitation shall not apply to:
(i) withholdings pursuant to any clause relating to wages or hours of employees;
(ii) withholdings not specifically provided for by this contract; and
(iii) the recovery of overpayments.
'0 36. CHANGES. (Nov. 1964) The Contracting Officer may at any time, by written order, and without notice to
the sureties, if any, make changes, within the general scope of this contract, in any one or more of the following:
(i) drawings, designs, or specifications, (ii) method of shipment or packing; and (iii) place of inspection, delivery,
or acceptance. If any such change causes an increase or decrease in the estimated cost of, or the time required for
performance of this contract, or otherwise affects any other provisions of this contract, whether changed or not
changed by any such order, an equitable adjustment shall be made (i) in the estimated cost or delivery schedule,
or both, (ii) in the amount of any fee to be paid to the Contractor, and (iii) in such other provisions of the
contract as may be so affected, and the contract shall be modified in writing accordingly. Any claim by the
Contractor for adjustment under this clause must be asserted within thirty (30) days from the date of receipt by
the Contractor of the notification of change; provided, however, that the Contracting Officer, if he decides that the
fedi justify such action, may receive and act upon any such claim asserted at any time prior to final payment-
under this contract. Failure to agree to any adjustment shall be a dispute concerning a question of fact within the
meaning of the clause of this contract entitled "Disputes." However, nothing in this clause shall excuse the Con-
tractor from proceeding with the contract as changed.
37. STOP WORK ORDER. (M. 1960)
(a) The Contracting Officer may, at any time, by written order to the Contractor, require the Contractor
to stop all, or any part, of the work called for by this contract for a period of ninety (90) days after the order
is delivered to the Contractor, and for any further period to which the parties may agree. Any such order shall
be specifically identified as a Stop Work Order issued pursuant to this clause. Upon receipt of such an order, the
Contractor shall forthwith comply with its terms and take all reasonable steps to minimize the incurrence of
costs allocable to the work covered by the order during the period of work stoppage. Within a period of ninety
(90) days after a stop work order is delivered to the Contractor, or within any extension of that period to which
the parties shall have agreed, the Contracting Officer shall either?
(i) cancel the stop work order, or
(H) terminate the work covered by such order as provided in the "Termination" clause of this contract.
(b) If a stop work order issued under this clause is canceled or the period of the order or any extension
theteof expires, the Contractor shall resume work. An equitable adjustment shall be made in the delivery sched-
ule, the estimated cost, the fee, or a combination thereof, and in any other provisions of the contract that may
be affected, and the contraot shall be modified in writing accordingly, if?
(1) the stop work order results in an increase in the time required for, or in the Contractor's cost properly
allocable to, the performance of any part of this contract, and
(ii) the Contractor asserts a claim for such adjustment within thirty (30) days after the end of the period
of work stoppage; provided that, if the Contracting Officer decides the foots justify such action, he may
receive and act upon any such claim asserted at any time prior to final payment under this contract.
Failure to agree to any adjustment shall be a dispute concerning a question of fact within the meaning of the
"Disputes" clause of this contract. ,
(C) If a stop work order is not canceled and the work covered by such order is terminated for the con-
venience of the Government, the reasonable costs resulting from the stop work order shall be allowed in arriving
at the termination settlement.
. ie. REPORTS OP 'WORK. (Jul. 1960) (a) The Contractor shall submit reports making full disclosure of all
?
work done and the results thereof, in the manner, at the times, and to the extent set forth in the Schedule; provided
, that, unless otherwise s ified in the Schedule, the_ 9oRtradajhalLinbmit Auch_reuorts_In..triolicate from time
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to time as requested and upon completion (or earlier termination) of the work. Except as may be otherwise speci-
fied in the Schedule, or unless the Contractor is otherwise instructed, the Contractor shall, ? upon completion (or
earlier termination) of the work, deliver any working drawings and specifications of artV prototypes as may have
been developed.
(b) If the Contractor becomes unable to complete the contract work and to deliver at the time specified in
the Schedule because of technical difficulties, notwithstanding the exercise of good faith and diligent efforts in
performance of the work, he shall give the Contracting .Officer written notice of the anticipated delays with reasons
therefor not less than forty-fiye (45) days before the completion date specified in the Schedule or within such time
as the Contracting Officer deems sufficient. When notice is so required, the Contracting Officer may, in his dis-
cretion, extend the time specified in the Schedule for such period as he deems advisable.
.q
39. DATA?WITHHOLDING OF PAYMENT. (Apr. 1965) If "Technical Data"? (as defined in the clause of this
contract entitled "Rights in Technical Data"), or any part thereof, is not delivered within the time specified by
this contract or is deficient upon delivery (including having restrictive markings not specifically authorized by the
contract), the Contracting Officer may, until such data is delivered or deficiencies are corrected, withold payment
due the Contractor on account of allowable costs and fixed fee, of ten percent (10%) of the contract price, unless
a lesser withholding is specified in the schedule. Payments shall not be withheld nor any other action taken pursu-
ant to this clause where the Contractor's failure to make timely delivery or to deliver data without deficiencies
arises out of causes beyond the control and withhout the fault or negligence of the Contractor within the mean-
ing of the clause hereof entitled "Excusable Delays." The withholding of any amount or subsequent payment there-
of to the Contractor shall not be construed as a waiver of any rights accruing to the Government under this
contract.
40. SUPERSEDING SPECIFICATIONS. (Jul. 1948) All references in any Government specification incorpo-
rated 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 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 specifications at the time of said qudtation.
41. FINANCIAL MANAGEMENT REPORT. (Sept. 1964) (a) On or before the thirtieth day of the month follow-
ing the end of each calendar quarter until such time as the uninvoiced dollar amount of this contract is less than
$100,000, the Contractor shall submit to the Contracting Officer, on DD Form 1097, dated 1 November 1959, or other
authorized form calling for substantially the same information, furnished by the Contracting Officer, a report of the
financial status of the contract, as of the end of such quarter. The Contracting Officer may extend the time f o t-
illing said report for a period not to exceed ten working days.
(b) Notwithstanding the provisions of paragraph (a) hereof, if the Contractor has reason to believe that the
actual costs of performance of this contract may exceed the estimated costs contained herein, the Contractor shall
submit items one (1) through fourteen (14) of the report set forth in paragraph (a) above once each month, with-
in ten (10) days following the close of the month being reported. The Contractor shall furnish in such form as may
be requested by the Contracting Officer additional information and documentation as may be reasonably required
to verify the extent and causes under which the actual costs may exceed the estimated cost of performing the
contract.
42. SHIPMENTS. (Oct. 11957) (a) Unless otherwise provided in this contract or unless the Contracting Officer
acting under the "Changes" clause hereof directs in writing. otherwise, all supplies to be furnished under this contract
shall be delivered f.o.b. carrier's equipment at the plant or plants at which such supplies are to be finally in-
spected and accepted, or if the facilities for shipment by carrier's equipment are not available at the Contractor's
plant, f.o.b. the point or points, nearest thereto that carrier service is available. When the carrier's equipment is
rail, any shipment occupying suffiCient space in a railroad car to constitute a carload shipment subject to
carload freight rates shall be properly and adequately loaded in freight cars by the Contractor, and any shipment
subject to less-than-carload freight rates shall be delivered by the Contractor into the carrier's possession at the
Contractor's plant, or at the point or points nearest thereto at which delivery can be effected.
(b) Whenever it is provided in this contract that supplies shall be delivered f.o.b. specified destinations,
such supplies shall be shipped direct by the Contractor to the specified destinations on commercial bills of lading,
at the expense of the Contractor. Provided, however, that nothing contained herein shall preclude reimbursement
of the Contractor by the Government of any such transportation expenses if this is a cost-reimbursement type
contract. -
(c) Notwithstanding other pro-Visions of this contract, shipments made under cost reimbursement contracts
which do not exceed (i) 1000 pounds if shipped by rail, truck, or freight forwarder, or (ii) 100 pounds if shipped
by railway express, or (iii) 50 pounds if shipped by commercial air, shall be made by commercial bills of lading,
charges to destination(s) paid by the Contractor.
(d) If the Contracting Officer directs in writing that any of the supplies to be furnished hereunder be de-
livered to a carrier for shipment from a point other than specified in this contract, equitable adjustment shall be
made in the contract price in the manner provided in the general provisions of this contract entitled "Changes."
(e) Shipping Instructions. If not otherwise provided herein, names of consignees of all supplies to be
delivered by the Contractor hereunder will be furnished in writing by the Contracting Officer at a later date.
Request therefor shall be made to such address as the Contracting Officer may direct, not later than thirty
(30) days prior to the date on which any of . the articles are ready for shipment.
(f) Routing Instructions. If not Otherwise provided herein and deliveries are other than f.o.b. specified
destinations, Government routing instructions - Will he fui nished to the Contractor in writing by the Contracting
Officer at a later date. If the Government routing instru, tions have not been received by the Contractor thirty
(30) days prior to date on which any of the 'articles are anticipated to be ready for 4hipment, request therefor
shall immediately be made to the cognizant transportation activity specified herein.
(g) Notice of Shipments. (Jul. 1949) At the tinoRg
VEY. I At or
transportation, the ContrikpipfiactilltiFOilrglitilleaSlic.041Viligtret tcatartglgtrtlAnt&ri ,itilloMiesuPtitgrter
persons or installations designated by the Contracting Officer, in accordance with Instructinns cit the Contracting
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Officer. If such instructions have not been received by the Contractor at least 24 hours prior to such delivery to
a carrier, the Contractor shall request instructions from the Contracting Officer concerning the notice of ship-
ment to be giiven.
(h) Computation of Delivery Time. For the purpose of determining the fulfillment of this contract so far
as delivery dates are concerned, in the event the delivery point or points are not thooame as the point or points
.of destination, the time of delivery of the supplies shall be the date of delivery to the terrier ready for shipment
to destination.
(i) Shipments by the 'Government. Unless this is a cost-reimbursement type Se.ntract, any articles, supplies
or other items to be delivered by the Government to the Contractor shall, unless otherwise provided herein, be
delivered to the Contractor f.o.b. carrier's equipment at the plant or plants of the Contractor designated, or if
facilities for shipment by carrier's equipment are not available at the Contractor's plint or plants, f.o.b. the point
or points nearest thereto that carrier's equipment is available.
(j) Where the contract provides that inspection and acceptance shall be accomplished at a subcontractor's
plant (whether in whole or in part) the foregoing provisions, except paragraphs (0) and (f), shall be equally
, applicable to such subcontractors as provided in said subcontract. Subcontractors' shipping instructions and rout-
ing instructions, if not previously furnished, shall be requested from the Prime Contractor.
43. GOVERNMENT BILL OF LADING. (Jul. 1961) When it is provided in this contract that the supplies shall
be delivered other than f.o.b. specified destinations, shipment(s) will be made on a Government Bill of Lading. The
required number of such Government Bills of Lading will be furnished to the Contractor by the cognizant trans-
portation activity. The Contractor shall acknowledge receipt of these Government Bills of Lading in the manner
prescribed. As shipments are made, the Contractor shall prepare and distribute the applicable Government
Bills of Lading in accordance with AFLC Form 232, Instructions for Processing U.S. Government Bill of Lading.
,:. The Contractor also agrees that Government Bills of Lading in excess of the requirements of this contract will
be returned to the cognizant transportation activity within a reasonable time after final shipment. The use of
U. S. Government mailing indicia is authorized in lieu of U. S. Government Bills of Lading when commodity, weight,
and cube permit movement within the U. S. Postal Service.
44. SUBMISSION OF VOUCHERS (Jun. 1959)
Pursuant to the Allowable Cost, Fixed Fee, and Payment (or Allowable Cost and Payment) General Provision
of this contract, the Contractor shall submit vouchers to the Contracting Officer, with the supporting statement of
costs describing the amounts claimed for: direct salaries and wages, labor burden or overhead, materials, and
other direct and indirect costs.
45. ACKNOWLEDGMENT OF SPONSORSHIP
? ?
(a) The Contractor agrees that in the release of information relating to this contract such release shall /
include a statement to the effect that the project or effort depicted was or is sponsored by the agency set forth in
the Schedule of this contract.
(b) For the purpose of this clause, "information" includes but is not limited to, news releases, articles,
manuscript, brochures, advertisements, still and motion pictures, speeches, trade association meetings, symposia,
etc.
(c) Nothing in the foregoing shall affect compliance with the requirements of the clause of this contract
entitled "Military Security Requirements."
(d) The Contractor further agrees to include this provision in any subcontract awarded as a result of this
contract.
46. INTEREST (May 1963) Notwithstanding any other provision of this contract, unless paid within 30 days
all amounts that become payable by the Contractor to the Government under this contract (net of any applicable
tax credit under the Internal Revenue Code) shall bear interest at the rate of six percent per annum from the
date due until paid and shall be subject to adjustments as provided by Part 6 of Appendix E of the Armed Services
Procurement Regulation, as in effect on the date of this contract. Amounts shall be due upon the earliest one of
(i) the date fixed pursuant to this contract, (ii) the date of the first written demand for payment, consistent with
this contract, (iii) the date of transmittal by the Government to the Contractor of a proposed supplemental agree-
ment to confirm completed negotiations fixing the amount, or (iv) if this contract provides for revision of prices,
the date of written notice to the Contractor stating the amount of refund payable in connection with a pricing
proposal or in connection with a negotiated pricing agreement not confirmed by contract supplement.
47. GENERAL SERVICES ADMINISTRATION SUPPLY SOURCES (Jan. 1965) The Contracting Officer may
issue the Contractor an authorization to utilize General Services Administration supply sources for property to be
used in the performance of this .contract. Title to all property acquired under such an authorization shall be in
the Government. All property acquired under such an authorization shall be subject to the provisions of the clause
of this contract entitled "Government Property," except paragraphs (a) and (b) thereof.
48. AUDIT A N D RECORDS (Sep. 1964) (ci) The Contractor shall maintain books, records, documents,
and other evidence and accounting procedures and practices, sufficient to reflect properly all direct and indirect
costs of whatever nature claimed to have been incurred and anticipated to be incurred for the performance of this
contract. The foregoing constitute "records" for the purposes of this clause.
?
(b) The Contractor's plants, or such part thereof as may be engaged in the performance of this contract,
and his records shall be subject at all reasonable times to inspection and audit by the Contracting Officer. or
his authorized representative.
?
(c) The Contractor shall preserve and malce available his records (i) until the expiration of three years
from the data of final Payment under this contract, and (ii) for such longer period, if any, as is required by
applicable statute, or by other Manses of this contract, or by (A) or (B) below
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(A) If this contract is completely or partially terminated, the records relating to the work terminated
shall be preserved and made available for a period of three years from the date of any resulting final settlement.
(B) Records which relate to (i) appeals under the "Disputes" clause of this contract or (ii) litigation or
the settlement of claims arising out of the performance of this contract, shall be retained until such appeals,
litigation, or claims have beep disposed of.
(d) (1) The Contractor' ,shall insert the substance of this clause, including the whole a this paragraph (d),
In each subcontract hereunder \that is not on a firm fixed-price basis.
(2) The Contractor shall insert the substance of the following clause in each lrm fixed-price subcontract
hereunder in excess of $100,000, except those subcontracts covered by subparagraph (3) below.
A UDIT ?
(a) For purposes of verifying that coat or pricing data submitted in conjunction with the negotiation
of this contract or any contract change or other molification involving an amount in excess of $100,000 are
accurate, complete, and current, the Contracting Officer, or his authorized representatives, shall?until the
expiration of three years from the date of final payment under this contract?have the right to examine
those books, records, documents, and other supporting data which will permit adequate evaluation of the cost
or pricing data submitted, along with the computations and projections used therein, which were available
to the Contractor as of the date of execution of the Contractor's Certificate of Current Cost or Pricing Data.
(b) The Contractor agrees to insert the substance of this clause including this paragraph (b) in all
subcontracts hereunder in excess of $100,000 unless the price is based on adequate price competition, established
catalog or market prices of commercial items sold in substantial quantities to the general public, or prices
set by law or regulation.
(3) The Contractor shall insert the substance of the following clause in each firm fixed-price subcontract
hereunder in excess of $100,000 where the price is based on adequate price competition, established catalog or
market prices of commercial items sold in substantial quantities to the general public, or prices set by law or
regulation.
AUDIT?PRICE ADJUSTMENTS
(a) This clause shall become operative only with respect to any change or other modification made
pursuant to one or more provisions of this contract which involves a price adjustment in excess of $100,000
unless the price adjustment is based on adequate price competition, established catalog or market prices of
commercial items sold in substantial quantities to the general public, or prices set by law or regulation and
further provided that such change or other modification to this contract must result from a change or other
modification to the Government prime contract.
(b) For purposes of verifying that any cost or pricing data submitted in conjunction with a contract
change or other mochfication involving an amount in excess of $100,000 are accurate, complete, and current,
the Contracting Officer, or his authorized representatives, shall?until the expiration of three years from the
date of final payment under this contract?have the right to examine those books, records, documents and
other supporting data which will permit adequate evaluation of the cost or pricing data submitted, along
with the computations and projections used therein, which were available to the Contractor as of the date
of execution of the Contractor's Certificate of Current Cost or Pricing Data.
(c) The Contractor agrees to insert the substance of this clause including this paragraph (c) in all
subcontracts hereunder in excess of $100,000, so as to apply until three years after final payment of the sub-
contract.
49. PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA (Sep. 1964) (a) If the Contract-
ing Officer determines that any price, including profit or fee, negotiated in connection with this contract was
increased by any significant sums because the Contractor, or any subcontractor in connection with a subcontract
covered by (c) below, furnished incomplete or inaccurate cost or pricing data or data not current as certified
in the Contractor's Certificate of Current Cost or Pricing Data, then such price shall be reduced accordingly and
the contract shall be modified in writing to reflect such adjustment.
(b) Failure to agree on a reduction shall be a dispute concerning a question of fact within the meaning
of the "Disputes" clause of this contract.
(c) The Contractor agrees to insert the substance of paragraphs (a) and (c) of this clause in each of his
cost-reimbursement type, price redeterminable, or incentive subcontracts hereunder, and in any other subcontract
hereunder in excess of $100,000 unless the price is based on adequate price competition, established catalog or
'market prices of commercial items sold in substantial quantities to the general public, or price,:. set by law or
regulation. In each such excepted subcontract hereunder which exceeds $100,000, the Contraci.or shall insert
the substance of the following clause.
PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA?PRICE ADJUSTMENTS
(a) This clause shall become operative only with respect to any change or other modification made
pursuant to one or more provisions of this contract which involves a price adjustment in excess of $100,000,
except where the price is based on ?adequate price competition, established catalog or market prices of com-
mercial items sold in substantial quantities to the general public, or prices set by law or regulation. The right
to price reduction under this clause shall be limited to such price adjustments.
(b) If the Contractor determines that any price, including profit or fee, negotiated in connection with
any price adjustment within the purview of paragraph (a) above was increased by any significant sum be-
cause the subcontractor or any of his subcontractors in connection with a subcontract covered by paragraph
(c) below, furnished incomplete or inaccurate cost or pricing data, or data not current as of the date of
execution of the subcontractor's certificate of current cost or pricing data,, then such price shall be reduced
accordingly and the subeohtract ShaJ be modigied_in writin te
(c) The subil6PRERMAC lineteSr? UeU2stibl g.
atlec; iiiricePis151:12113se In each fTb4ccTfcr hereunder
which exceeds $100,000.
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50. SUBCONTRACTOR COST AND PRICING DATA (Sep. 1964) (a) The Contractor shall require sub-
contractors hereunder to submit cost or pricing data under the following circumstances,: (i) prior to award of
any cost-reimbursement type, incentive, or price redeterminable subcontract; (ii) prior to the award of any sub-
contract the price of which is expected to exceed $100,000; (iii) prior to the pricing of any subcontract change
or other modification for which the price adjustment is expected to exceed $100,000; except in the case of (ii)
or (iii) where the price is based on adequate price competition, established catalog or raerket prices of commer-
cial items sold in substantial cipantities to the general public, or prices set by law or regulation.
(b) The Contractor shall require subcontractors to certify, in substantially the snipe form as that used in
. the certificate by the Prime Centractor to the Government, that to the best of their Iglowledge and belief, the
P cost and pricing data submitted under (a) above is accurate, complete, and current as ,of the date of execution,
which date shall be as close as kpossible to the date of agreement on the negotiated price of the subcontract.
(c) The Contractor shall insert the substance of this clause including this paragraph (c) in each of his cost-
reimbursement type, price redeterminable, or incentive subcontract hereunder, and in any other subcontract hereunder
which exceeds $ L00,000 except where the price thereof is based on adequate price competition, established catalog
or market prices of commercial items sold in substantial quantities to the general public, or prices set by law or
regulation. In each such excepted subcontract hereunder in excess of $100,000, the Contractor shall insert the sub-
stahce of the following clause:
SUBCONTRACTOR COST AND PRICING DATA?PRICE ADJUSTMENTS
(a) Paragraphs (b) and (c) of this clause shall become operative only with respect to any change or
other modification made pursuant to one or more provisions of this contract which involves a price adjust-
ment in excess of $100,000. The requirements of this clause shall be limited to such price adjustments.
(b) The Contractor shall require subcontractors hereunder to submit cost or pricing data under the
following circumstances: (i) prior to award of any cost-reimbursement type, incentive or price redeter-
minable subcontract; (ii) prior to award of any subcontract, the price of which is expected to exceed $100,000;
(iii) prior to the pricing of any subcontract change or other modification for which the price adjustment is
expected to exceed $100,000; except, in the case of (ii) or (iii), where the price is based on adequate price
competition, established catalog or market prices of commercial items sold in substantial quantities to the
general public, or prices set by law or regulation.
(c) The Contractor shall require subcontractors to certify, in substantially the same form as that used
in the certificate by the Prime Contractor to the Government, that to the best of their knowledge and belief
the cost and pricing data submitted under (b) above is accurate, complete, and current as of the date of
execution, which date shall be as close as possible to the date of agreement on the negotiated price of the contract
modification.
(d) The Contractor shall insert the substance of this clause including this paragraph (d) in each sub-
contract hereunder which exceeds $100,000.
51. DEFERRED ORDERING OF TECHNICAL DATA (May 1964)
The Government shall have the right to order, at any time during the performance of this contract, or within
two (2) years from either acceptance of all items (other than data) to be delivered under this contract or termina-
tion of this contract, whichever is later, any data called for in the Schedule of this contract, and the Contractor
shall promptly prepare and deliver such data as is ordered. However, the Contractor shall be relieved of the obli-
gation to furnish data pertaining to an item obtained from a subcontractor upon the expiration of two (2) years
from the date he accepts the item. When the data is delivered, payments shall be made, by equitable adjustment
or otherwise, for converting the data into the prescribed form, reproducing it, and preparing it for delivery. Such
payment shall not be included in the application of any incentive pricing formula.
4t 52. RESTRICTIONS ON PRINTING (June 1963)
Reproduction of reports, data or other written material, if required, is authorized provided that the material
produced does not exceed 5,000 production units* of any page and that items consisting of multiple pages do not
exceed 25,000 production units in the aggregate. These production unit limitations do not apply to jobs of 225 copies
or less. Printing of materials in excess of quantities cited above must be in accordance with paragraph 6, APR 6-1.
These restrictions do not preclude the writing, editing, preparation of manuscript or reproducible copy or related
illustrative materials if required as a part of this contract. It does not apply to the printing or duplicating re-
quired by Contractors for their own use in responding to the terms of this contract.
? DEFINITION Or PRODUCTION UNIT. One sheet size, 8 x 101,4? printed one side, one color wily..
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53. NEGoTIAThipemfigA5o0gitanA0p2MT:CIA-RDP72B00464R000400070028-5
(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 bases
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 with a copy to the cognizant audit activity a proposed
final overhead rate or rates for that period based on the Contractor's actual
cost experience during that period, together with supporting cost data. Neg-
otiation 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 Part 2 of Section XV of the Armed Services
Procurement Regulation as in effect on the date of this contract.
(d) The resuLts of each negotiation shall be set forth in a modification
to this contract, which shall specify (i) the agreed final rates, (ii) the bases
to which the rates apply, and (iii) the periods for which the rates apply.
(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 Contracting
Officer, subject to appropriate adjustment when the final rates for that
period are established. To prevent substantial 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 shall be set forth in
a modification to this contract.
(f) Any failure by the parties to agree on any final rate or rates under
this clause shall be considered a dispute concerning a question of fact for
decision by the Contracting Officer within the meaning of the "Disputes"
clause of this contract.
54. FLIGHT RISKS (Oct. 1965)
(a) Notwithstanding any other provision of this contract, and particularly
subparagraph (g) (1) of the Government Property clause and paragraph (c) of the
Insurance - Liability to Third Persons clause, the Contractor shall not (i) be
relieved of liability for, damage to, or loss or destruction of, aircraft sus-
tained during flight, or (ii) be reimbursed for liabilities to third persons
for loss of or damage to property, or for death or bodily injury, which are
caused by aircraft during flight, unless the flight crew members have pre-
viously been approved in writing by the Contracting Officer.
(b) For the purpose of this clause:
(i) Unless otherwise specifically provided in the Schedule, the term
"aircraft" means any aircraft, whether furnished by the Contractor
under this contract (either before or after acceptance by the
Government) or furnished by the Government to the Contractor
under this contract, including all Government Property placed or
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such aircraft and property are not covered by a separate bail-
ment agreement.
(a) The term "flight" means any flight demonstration, flight test,
taxi test, or other flight, made in the performance of this
contract, or for the purpose of safeguarding the aircraft, or
previously approved in writing by the Contracting Officer. As
to land based aircraft, "flight" shall commence with the taxi
roll from a flight line and continue until the aircraft has
completed the taxi roll to a flight line; as to sea planes,
"flight" shall commence with the launching from a ramp and
continue until the aircraft has completed its landing run
and is beached at a ramp; as to helicopters, "flight" shall
commence upon engagement of the rotors for the purpose of
take-off and continue until the aircraft has returned to the
ground and rotors are disengaged; and for vertical take-off
aircraft, "flight" shall commence upon disengagement from any
launching platform or device and continue until the aircraft
has been re-engaged to any launching platform or device.
(iii) The term "flight crew members" means the pilot, the co-pilot
and unless otherwise specifically provided in the Schedule,
the flight engineer, navigator, bombardier-navigator, and
defense systems operator, when required, or assigned to their
respective crew positions, to conduct any flight on behalf of
the Contractor.
(c) If any aircraft is damaged, lost, or destroyed during flight, and if
the amount of such damage, loss, or destruction exceeds one hundred thousand
dollars ($100,000) or twenty percent (20%) of the estimated cost (exclusive of
any fee) of this contract, whichever is less, and if the Contractor is not
liable for the damage, loss or destruction pursuant to the "Government Property"
clause of this contract together with paragraph (a) above, then an equitable
adjustment for any resulting repair, restoration, or replacement that is
required under this contract shall be made (i) in the estimated cost, delivery
schedule, or both, and (ii) in the amount of any fee to be paid to the Contractor
and the contract shall be modified in writing accordingly; provided, in determining
the amount of adjustment in the fee that is equitable, any fault of the Contractor,
his employees, or any subcontractor, which materially contributed to the damage,
loss, or destruction shall be taken into consideration. Failure to agree on any
adjustment shall be a dispute concerning a question of fact within the meaning
of the "Disputes" clause of this contract.
55. ALTERATIONS IN CONTRACT
The following alterations have been made in the provisions of this contract:
(a) Under Clause 7 "Examination of Record" the words "Comptroller General
or any of his duly authorized representative(s)" are deleted and the following
words substituted therefor: "Appropriate Audit Representative of the Government."
(b) Clause 12 "Renegotiation"; Clause 41 "Financial Management Report";
Clause 43 'Government Bill of Lading"; Clause 45 "Acknowledgement of Sponsorship";
Clause 47 "General Services Administration Supply Sources" and Clause 52
"Restriction on Printing" are deleted in their entirety.
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(c) Clause 24 "Military Security Requirements" and in particular
paragraph (c) and (d) thereunder shall be applicable only to the extent as
authorized by the security representatives of the Contracting Officer.
(d) Paragraph (k) under Clause 25 "Government Property" is deleted
in its entirety.
(e) Clause 42 "Shipments" is deleted in its entirety. Shipments shall
be made as provided in the Schedule of this contract or as otherwise indicated
by the Contracting Officer or his authorized representative.
(1). Ciause b6 "LIMITATION OF GOVERNMENT S OBLIGATION" is
attached hereto and made a part hereof.
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1VERNKAT'S OBL1'4?1iu4
1) IL ts estimated that the total cost to the Goverethent,
t-iclusive of any fixed fee, for he performance of this coneract
elle Dot exceed the estimated case ane fixed fee set forth in the
echedufe, and the Contractor agrees eo use its best efforts to
7eerform the work specified in the schedule and all obligations
onder this contract within such estimated cost? The fixed fee
foe complete perfoxmance or this contract es specified in the.
echedule
.2) The sum presently available for payment and allotted to
centract, and the period of performance which it is estimated
:he alAotted amount will cover, are specified in the schedule. It
-s eneicipated that from time to time additional funds will be
illetced to this contract up co the Lull estimated cost, including
fixed fee, When additional funds are allotted from time to time
or continued performance of the work, the parties shall agree as to
Ale applicable estimated period of contract performance which shall
tle eovered by such funds and the contract schedule amended accord-
ngly The Contractor agrees to perform or have performed work on
thie contract up to the point at which, in the event of terminatior
ef this contract for the convenience of the Government pursuent to
theeieluse of this eontract entitled "Termination," the total amourt
and payable by the Government pursuant to any settlement
lesciuding cost and fixed fee under Paragraph (e) of such clause
ocuW, in the exercise of reasonable judgement by the Contractor,
eppeoximate the total amount at the cime allotted to this contract
:?ese eontractot shall noc be obligated co continue performance of
,he wock beyoad such point.
,) The Government shale not be obligated to reimburse the Con-
ere,eer for costs incurred (including amounts payable in respect to
es):oetea(ts and ination settlement costs) and to pay any fixed
-tee te which the Contractor may be entitled, in excess of the total
AMOqo from time to elme allottec to this contrace0 however, when
and to the extent that the total amount allotced to this contract
is been increased, any costs incurreo.by the Contractor and any
Axed fee to which the Contractor may be entitled, prior to the
,neeeese and tis excess ot the amount previously allotted, shall be
ellewable to the same extent as if such costs had been ineereed and
e. earned alcer soch increase in amount aliottede