GENERAL PROVISIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81B00879R000100060175-5
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 20, 2016
• Document Release Date: February 9, 1999
• Sequence Number: 175
• Publication Date: April 29, 1998
• Content Type: REPORT

Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
INDEX OF GENERAL PROVISIONS
1. DEFINITIONS ! a b , ! W a . o . ? . o
2. CHAi%E S .~ ? ! . . ? ! ! ! ? r e . , ? 1
3/ . INSSPECTION. . ? ! ! ? , . ? D . ? . 2
4? P AYJYENTS ? Ay ? ~ r ~? b f ! ! , 6 4 ! ! , i W ? ? ? ? ? i /2,
5. ?"SS1GNWM O~ry~. ~L~+~-+1S'1 . . ? . . . . W 4
W ? 8 f P , b O ? ? ? i
6. EXCUSABLE DELAYS. . . . . ? ! . ? ? f 4
7. DISPUTES. ? . a + + ? ? ? r . b ! . . , o r ? ? . ? ? 5
8. NOTICE AND ASSISTANCE REGARDING PATENT INFRINGEMENT . ? . f 5
9? BUY AI'EERIOAid ACT''. , , 4 r i , a . , . . . a ? , . . . ? . . , 6
10. CONVICT LABOR ? !,. . p tr ! ? . ? . b . ? . ! ! 6
11, EIGHT-HOUR LAW OF 912. ..? ? . . ? ? b ! ! . 6
12. WkLSH-HEA1EY PUBLIC CONTRACTS ACT ? . ? ? ? 7
13, iNONDISCRININATIOid 11; EMPLGYi'.ENT . . . . . . 7
14, OFFICIALS NOT TO BEi2FIT, b . f . b . . . ? ? . b ? ? ? . , 8
15, COVENANT AGAINST, COi~'TL GENT FEES. . . . . . ? . . ? . . ? . ? 8
REPORTING OF ROYALTIES. . , . . . ! , . . ? , ? , , . . ? . 8
17. TE ,Iv iwION FOR CONVENIENCE OF THE GOVERNIENT ? . ? ! D . ? 10
18, SUBCONTRACTS .. . b . . . . . . ? . . ? ? . ? ? . ? ? 15
19 ? RECORDS a ? . . . ? ? . . . tr ! ! ? ! ! . 15
20. GRATUITIES. ? ',! ? ! . ! . ? . ? . ? ? ? . ! ? 17
21. GOVERNMENT FURNISHED PROPERTY b 3 0 ! ? ! ? . . ! ? ! 17
22. Ei LOYhxENT OF ALIENS? . . . . , . . . . . . ? ? ? . . . . . . 22
23. b1ILITARY SECURIT C REQUIREN]ENTS. d . . . . . D , . . . . . 22
24. QOPYRIGHT , b 0 . * ? b ? tl ? ! . ? . . ? . . O 4 ? . ? . . 23
25. FILING OF PATENT'APPLICATIONS . , ? d ! . . . ? . . . . . . 24
26. NOTICE TO THE GOZIERNNENT OF LABOR DISPUTES. . , . . .. . . . . 24
27, AUTHORIZATION AND CONSENT . . . . . . . .. . ? . . . . . . . 25
28 D ALTERATIONS I14 CONTRACT . . . . . . . . . . . . . ?. . . ? 25
T&d'I 8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 GENERAL PROVISIONS
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
the limits of his aut)4ax Iy..
1. DEFINITIONS
As used throughout this contract, the following terms shall
have the meanings set forth below:
(a) The term "Secretary" means the Secretary, the Under
Secretary, or any Assistant Secretary of the Department and the head
or any assistant head of the executive agency; and the term "his duly
authorized representative" means any person or persons or board
(other than the Contracting Officer) authorized to act for the Secretary;
and the term "Department" means that component of the Government having
cognizance of this contract and represented by the Contracting Officer
executing this contract.
(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: :s otherwise provided in this contract,
the authorized represp:t r * of a Contracting Officer acting within
(c) Except as otherwise provided in this contract, the term
"subcontracts" includes purchase orders under this contract.
(d) The term "contra Gt.wo?k" means all work to be performed
under this contract irlcludi_ng any studies covering fundamental, theo-
retical, or experimental investigations; any extension of the inves-
tigative findings and theories of a scientific and technical nature
into practical application; any tangible terms, hereinafter referred
to as supplies, if called for herein, furnished to the Government;
Lr and any reports, data, computations, plans, drawings, and specifica-
tions with respect to the foregoing.
(e) The term "direct labor," as used in the Payments clause,
shall be defined in the schedule.
2, CHANGES
The Contracting Officer may at any time, by a written order, within
the general scope of this contract, and without notice to any sureties,
make changes in (i) drawings, desi ns, or specifications, (ii) am1 ft441n o work ar , (iii) make changes in method of
shipping or packing, and (iv) make changes in place of delivery. If
such changes require a change in the time of performance of the work
called for hereunder, the contract shall be modified in writine,
accordingly. The hourly rate set forth in the schedule small not be
adjusted by reason of any change ordered under this clause.
T&M 8/22/56 -- 1 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
(a) All material and workmanship shall be subject to inspection
and test by representatives of the Government. For this purpose, the
Contractor shall allow) at all reasonable times, i z"-
era a nt.-personnel. ;.free access-to the-plant an erst ?rr~a and i~a31 D~
{ ' - ' ' n ' n ' oh A l l as pay, be required.-for the work. The Contractcr
shall inform the inspector when the work is ready for inspection, The
Government representative shall have the right to (i) require the
replacement of parts which are not in accordance with applicable speci-
fications, and (ii) require the correction of defects.
(b) The Contractor shall provide and maintain an inspection
system acceptable to the Government covering the inspection of the
supplies and services furnished under this contract. Records of all
inspection work by the Contractor shall be kept complete and available
to the Government during the performance of the contract.
(c) The Contractor4grees that it will employ only qualified
and competent employees in the performance of this contract and that
the services performed will conform to the highest professional
standards for the work iivplv'ed,
(d) Prior to final acceptance by the Government, any correction
of defects in supplies or services, or replacement of materials to
make the item conform to contract requirements, which correction or
replacement is made necesspxy by inferior workmanship or materials,
shall be at no cost to the Government.
(e) Final acceptance by the Government shall be conclusive
except as regards latent defects, fraud, or such gross mistakes as
amount to fraud. The Contractor shall, before or after final ac-
ceptance, remedy defects or failures due to au c4 causes at no cost
to the Government.
The Contractor shall be paid as follows upon the submission of
properly certified invoices or vouchers approved by the Contracting
Officer :
1_ Ruth: -
The amounts computed by applying the appropriate time rate /
timecards, preferably signed by the workers performing the servers
tents--ell-normally-be made -at---Contracter1a payro --intervals;ss1
mini.strative expense and profit. ' nal parts of an hour shall
be payable on a prorated basis. The Contrac ' 1 substantiate
vouchers by evidence of actual payment and by indivi u job
or rates set Tort the schedule to the number of direct labor hours~ y
_ J
performed, which rates s elude wages, overhead, general and ad-
T&M: 8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
Noe
?be z'or.. --by_..the Contracting Officer if conditions so warrant.
(ii) Not wi e rovisions of subparagraph (i) hereof?
the Contracting Officer, as provided edule, shall withhold
payment of certain amounts due under this contract. its shall
- ccom payable upon completion of
(iii) Unless provisions of the schedule hereof otherwise
specify, the hourly rate or rates set forth in the schedule shall
not be varied by virtue of the Contractor having performed work on an
overtime basis. If the schedule provides rates for overtime, the
premium portion of those rates will not be reimbursable unless the over-
time is approved in writing by the Contracting Officer,
(b) Materials (Including Subcontracts).
(i) Allowable costs of direct materials shall be determined
by the Contracting Officer in accordance with Part 2, Section XV, of
the Armed Services Procurement Regulations The Contractor shall
support all material costs c~med by submitting paid invoices or
storeroom requisitions,,.:pjrbct materials as referenced by this clause
are defined as those r'at ~ ;als which enter directly into the end
product, or which are usec tly
orconsumed direc in connection with
(ii) The colt of subcontracts which are authorized pursuant
to the clause hereof entitled. A~Subcontracts" shall be reimbursable
costs hereunder.
(iii) The Contractor shall, to the extent of its ability,
procure materials at the most advantageous prices available, with
due regard to securing prompt delivery of satisfactory materials,
take all cash and trade discounts, rebates, allowances, credits,
salvage, commissions, and bonifications,, and when unable to take
advantage of such benefits it shall promptly notify the Contracting
Officer to that effect and the reason therefor. Credit shall be
given to the Government for cash and trade discounts, rebates,
allowances, credits, salvage, the value of resulting scrap, when
the amount of such scrap is appreciable, commissions and boni-
fications which have accrued to the benefit of the Contractor or
would have so accrued except for the fault or neglect of the Con-
tractor. Such benefits lost through no fault or neglect on the
part of the Contractor or lost through fault of the Government,
shall not be deducted from gross costs.
(c) As of the date of execution of this contract, there has
been allotted for it the total sum set forth in the schedule. This
sum may be increased from time to time by the Government solely at
its discretion, and the contract shall be amended accordingly. Not-
withstanding any other provisions of this contract, the Contractor shall
not be obligated to perform any services, pursuant hereto, the
T&M 8/22/56
- 3
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
WHEI
aggregate price of which when added to the aggregate price of aJ-1
services theretofore furnished pursuant hereto would exceed said
sum. If at any time the Contractor considers it likely that the
aggregate amount set forth in'the schedule may be exceeded within
45 days, the Contractor w, .l so notify the Contracting Officer and
the parties may thereupon enter into negotiations for an amendment
to or modification of this contract, as nay be appropriate. Anything
in this contract to the.contrary-notwithstanding, the Government shall
not be obligated to pay to the Contractor any amount in excess of the
sum allotted for this contract.
5, ASSIGNMENT OF CLAIMS
(a) Pursuant to the provisions of the Assignment of Claims
Act of 1940 as amended (31 U. S. Code 203, 41 U. S. Code 15), if
this contract provides for payments aggregating :1,000 or more,
claims for moneys due or to become due to 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 re-
assigned to any such institution. Any such assignment or re-
as~ignraent 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
t1mde to one party or agont or trustee for two or more parties
participating in such financing. Notwithstanding any other
provision of this contract, payment to an assignee of any moneys
due or to become due under this contract shall not, to the extent
provided in said Act as aarmiended, 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," 11SECRET," "CONFIDENTIAL,"
be furnished to any assignee of any claim arising under this con-
tract or to any other person not entitled to receive the same;
PROVIDED, That a copy or 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 author-
ization of the Contracting Officer.
(c) The Contractor shall obtain the written authorization of
the Contracting Officer prior to the assignment of any rights under
this contract.
6. EXCUSABLE DELAYS
The Contractor shall not be in default by reason of any failure
in performance of this contract in accordance with its terms (including
any failure by the Contractor to make progress in the prosecution of
the work hereunder which endangers such performance) if such failure
T&M 8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
:.1f SECRET
au .. fps out of causes beyond the control and without the fault or
negligence of the Contractor. Such causes include, but are not
restricted to; acts of God or of the public enarq; acts of the
Government; fires; floods; epidemics; quarantine restrictions;
strikes; freight embargoes; unusually severe weather; and failure of
subcontractors to perform or make progress duo to such causes,
unless the Contracting Officer shall have determined that the
supplies or services to be furnished under the subcontract were ob-
tainable from other sources and shall have ordered the Contractor
in writing to procure such services or supplies from such other
sources, and the Contractor shall have failed reasonably to comply
with such order. Upon request of the Contractor, the Contracting
Officer shall ascertain the facts and extent of such failure and,
if he shall determine that such failure 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 "Teri-dnation. rr
Except as otherwise prpvided in this contract, any dispute
concerning a question of fast arising under this contract which is
not disposed of by agreement shall be decided by the Contracting
Officer, who shall reduoo.h s decision to writing and sail or
otherwise furnish a o py thereof to the Contractor. Within thirty
(30) days from the dato of receipt of such copy, the Contractor may
appeal by nailing or otherwise, Furnishing to the Contracting Officer
a written appeal addrossedio the Secretary, and the decision of the
Secretary or his duly authorized representative for the hearing of
such appeals shall, unless determined by a court of competent juris-
diction to have been fraudulent or capricious or arbitrary or so
grossly erroneous as necessarily to imply bad faith, or not supported
by substantial evidence, be final and conclusive; PROVIDED, That, if
no such appeal is taken, the decision of the Contracting Officer shall
be final and conclusive. In connection with any appeal proceeding
under this clause, the Contractor shall be afforded an opportunity
to be heard and to offer evidence in support of its appeal. Pend-
ing final decision of a dispute hereunder,, the Contractor shall pro-
ceed diligently with the performance of the contract and in accord-
ance with the Contracting Officerzs decision.
8. NOTICE AND ASSISTANCE REGARDING PATENT INFRINGE, NENT
The provisions of this clause shall be applicable only if the
amount of this contract is in excess of 45,000.
(a) The Contractor shall report to the Contracting Officer,
promptly and in reasonable written detail, each notice or claim of
patent infringement based on the performance of this contract of which
the Contractor has knowledge.
T&M 8/22/56 - 5 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
W SECRET
(b) In the event of litigation against the Government on
account of any claim of patent infringement arising out of the per-
formance of this contract or out of the use of any supplies furnished
or work or services performed hereunder, the Contractor shall furnish
to the Government, upon request, all evidence and information in
possession of the Contractor pertaining to such litigation. Such
evidence and information shall be furnished at the expense of the
Government except in those cases in which the Contractor has agreed
to indemnify the Government against the claim being asserted.
The Contractor agrees that there will be delivered under this
contract only such unnanufactured articles, materials and supplies
(which term "articles, materials and supplies" is hereinafter re-
ferred to in this clause as "supplies") as have been mined or pro-
duced in the United States, apd only such manufactured supplies as
have been manufactured in the United States substantially all from
supplies mined, produced or manufactured, as the case may be, in
the United States. Pursuant to the Buy Al:nerical Act (/1 U. S.
Code 10a-d), the foregoing provision shall not apply (i) with
respect to supplies excepted b the Secretary from the applica-
tion of that Act, (ii) with ro'spect to supplies for use outside
the United States, or (iii) with respect to the supplies to be
delivered under this contracthich are of a class or kind do-
terrii.ned by the Secretary or his duly authorized representative
not to be mined, produced, or manufactured, as the case may be,
in the United States in sufficient and reasonably available
commercial quantities and of a satisfactory quality, or (iv)
with respect to such supplies from which the supplies to be
delivered under this Contract are manufactured, as are of a
class or kind, determined by the Secretary or his duly author-
ized representative not to be i-.Anod, produced, or manufactured,
as the case may be, in the United States in sufficient and rea-
sonably available commercial quantities and of a satisfactory
quality: PROVIDED, That this exception (iv) shall not permit
delivery of supplies manufactured outside the United States if
such supplies are manufactured in the United States in suffi-
cent and reasonably available commercial quantities and of a
satisfactory quality.
10. CONVICT LABOR
In connection with the performance of work under this contract,
the Contractor agrees not to employ any person undergoing sentence
of imprisonment at hard labor.
11. EIGHT-HOUR LEVI OF 1912
This contract, to the extent that it is of a character specified
T&M 8/22/56 - 6 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
Nw~
in ne Eight1Hoiir Law of 1912 as amended (40,U. S1 Code 324--326) and
is not covered by the Walsh-Healey Public Contracts Act (41 U. S.
Code 35-45) is,subject to the following provisions and exceptions
of said EightHour Lpwiof 1912 as amended, and to all other provi-
sions and exceptions of hid Law:
No laborer or mechanic doing any part of the work contemplated
by this contract, In the employ of the Contractor shall be required
or permitted to work more than eight hours in any one calendar day
upon such work, except upon the condition that compensation is paid
to such laborer or mechanic in accordance with the provisions of
this clause. The wages of every such laborer and mechanic employed
by the Contractor shall be computed on a basic day rate of eight
hours per day; and work in excess of eight hours per day is per
rli.tted only upon the condition that every $uoh laborer and mechanic
shall be compensated for all hours worked in excess of eight hours
per day at not less than one and one-half times the basic rate of
pay. For each violation of the requirements of this clause a
penalty of five dollars shall be imposed upon the Contractor for
each such laborer or mechanic for every calendar day in which such
employee is required or permitted to labor more than eight hours
upon said work without receiving compensation computed in accord-
ance with this clause; and all, penalties thus imposed shall be
withheld for the use ??d benefit of the Government.
12, IdALSH-.HENLEY PUBLIC QQNTRACTS ACT
If this contract ~.s for the manufacture or furnishing of
materials, suppl op articles or equipment in an amount which
exceeds or may exceed a0,000 and is otherwise subject to the
Walsh-Healey Public Contracts Act as amended (41 U. S. Code
35-45), there are hereby ,incorporated by reference all repro-
sentations and. *t ip ,at:ons required by said Act and regulations
tow, l'
issued thereunder by the Secretary of Labor, such representations
and stipulations being subject to all applicable rulings and inter-
pretations of the Secretary of Labor which are now or may hereafter
be in effect, except that the Contractor shall not be required to in-
clude this clause in subcontracts issued hereunder when the inclusion
of this clause in a subcontract would jeopardize or conflict with
the security considerations established in connection with this
contract.
13. NONDISCRIMINATION IN EMPLOYMENT
(a) In connection with the performance of work under this con-
tract, the Contractor agrees not to discriminate against any employee
or applicant for employment because of race, religion, color, or
national origin. The aforesaid provision shall include, but not
be limited to, the following: employment, upgrading, demotion, or
transfer; recruitment or recruitment advertising; layoff or termina-
4L alit
T&M 8/22/56 - 7 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
tion; rates of pay or other forms of compensation; and selection for
training,, including apprenticeship. The Contractor agrees-to post
hereafter in conspicuous places, available for employees and appli-
cants for employment, notices to be provided by the Contracting
Officer setting forth the provisions of the nondiscrimination clause.
(b) The Contractor further agrees to insert the foregoing
provision in subcontracts issued hereunder, except subcontracts for
standard commercial supplies or raw materials, and except as in-
sertion of the foregoing provision in a subcontract would jeopardize
or conflict with the security considerations established in connec-
tion with this contract.
14. OFFICIALS NOT TO BENEFIT
No member of or delegato::to Congress, or resident cor:missioner,
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,
15. COVENANT AGAINST CONTINGENT FEES
The dontractor warrants that no person or selling agency has
been employed or retained ? solicit or secure this contract upon
an agreement or understanding for a commission, percentage, broker-
age, or contingent fee, excepting bona fide employees or bona fide
established connorcial 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 discretion to deduct
from the contract price or consideration the full amount of such
commission, percentage, brokerage or contingent fee,
16. REPORTING OF ROYALTIES
The provisions of this clause shall be applicable only if
the amount of the contract is in excess of :d.O,0O0.
(a) The Contractor shall report in writing (in quadruplicate)
to the Contracting Officer as soon as practicable after execution
of this contract whether or not any royalties in excess of X250
hnnvo been paid. or are to be paid'by"the Contractor directly. to any
person or firm in connection with the performance of this contract.
If royalties in excess of X250 have been paid or are to be paid to
any person or firm, the report shall include the following items of
information with respect to such royalties (including the initial
25O):
(1) The name and address of each licensor to whom royalties
T&M 8/22/56 - 8.
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
OLU1\1.L_
In excess of X250 have boon paid or are to be paid,
(2) The patent numbers patent application serial numbers
(with filing dates), or other identification of the
basis for such royalties,
(3) The manner of computing the royalties consisting of
(i) a brief identification of each royalty-bearing unit
or process, (ii) the total amount of royalties, and (iii)
the percentage rate or dollars and cents amount of royal-
ties on each such unit or process; PROVIDED that if the
royalties cannot be computed in terms of units or dollars
and cents value, then other data showing the manner in
which the Contractor computes the royalties.
(b) In lieu of furnishing a report under paragraph (a), the
Contractor may furnish a single, consolidated report for each
accounting period of the Contractor during which the Contractor
has contracts with the Govornrient, provided the Contractor has
requested and obtained the prior written approval of the Contracting
Officer. Such consolidated report shall be furnished, when the
furnishing thereof hap been -'approved, in the number of copies as
approved, as soon cs pr ,cticablo after the close of the accounting
period covered by th.4'V'port. Such consolidated report shall be
made in accordance wi G'oritractorfs established accounting practice
and shall include; CC the accounting period, the total amount of
royalties accruing to each licensor at a rate in excess of l,00O
per annum on the.Cont da A6r s over-all business together with (i)
the name and address' of each such licensor, (ii) the patent numbers,
patent application serial numbers (with filing dates), or other
identification of the basis for such royalties, (iii) a brief
description of the subject natter of the license under which
royalties are charged, (iv) the percentage rate or unit amount,
or if the royalties do not accrue by rate or unit amount, such
other data showing the manner by which the royalties accrue to
licensor, and (v) an estimate or approximation (without detailed
accounting) of the portion of such royalties that may be attrib-
utable to Government contracts, The Contractor shall, if requested
by the Government, furnish at Government expense a more detailed
allocation of such royalty payments attributable to Government
contracts.
(c) In the event that the Contractor requests written approval
to furnish consolidated reports under paragraph (b) above, the Con-
tracting Officer shall promptly consider the request and furnish to
the Contractor a letter stating whether or not the request is approved
and, notwithstanding any such approval, the Contracting Officer shall
have the right to question any such subsequently furnished report as
to accuracy or completeness of data and to ask for additional in-
formation. The Contractor shall furnish a copy of such letter of
approval to the Contracting Ofyf~icer adz:itnistering this contract.
T 0
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
(d) After payment of eighty percent (80%) of the amount of
this contract, as from time to time amended, further payment shall
be withheld until a reserve of either (i) ton percent (10%) of
such amount or (ii) 4p5,000, whichever is less, shall have been
set aside, such reserve or the balance thereof to be retained
until the Contractor shall have furnished to the Contracting
Officer the report called for. by paragraph (a) hereof or the
copy of the letter approving the Contractorrs request to furnish
the report under paragraph (b); PROVIDED that no ai,iount shall
continue to be withheld from payrlent for the causes specified in
this paragraph (d) if the Contracting Officer shall find that the
Contractor has not boon furnished a letter as required by paragraph
(c) within a reasonable time ~Itor making written request to submit
a single, consolidated report under the provisions of paragraph (b)
of this clause; and PROVIDED FURTHER that the Contracting Officer
unay, in his discretion, order payment to be withheld in the amount
and manner above provided if the report called for by paragraph (a)
is unsatisfactory or if the report called for by paragraph (b) is
due but has not been received, or if received, is found to be unsat-
isfactory. No amount shall be;withheld under this paragraph when
the minimum 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 Contractor shall `not
be construed as a waiver of azay right accruing to the Government
under this contract.
(b) The Contractor agrees that it will exert all reasonable
effort to advise the Contracting Officer, at the tine of
delivering any copyrightablo or copyrighted work furnished
under this contract, of any adversely held copyrighted or
copyrightable material incorporated in any such work and of
any invasion of the right of privacy therein contained.
(c) The Contractor agrees to report to the Contracting Officer,
promptly and in reasonable written detail, any notice or claim
of copyright infringement received by the Contractor with re-
spect to any material delivered under this contract.
17. TERMINATION FOR CONVENIENCE OF THE GOVERNMENT
(a) The performance of work under this contract may be
terminated by the Government in accordance with this clause in
whole, or from time to time in part, (1) whenever the Contractor
shall default in performa4nce of this contract in accordance with
its terms (including in the term default any such failure by the
Contractor to make progress in the rosecution of the work here-
under as endangers such performance), and shall fail to cure such
default within a period of 10 days (or such longer period as the
Contracting Officer may allow) after receipt from the Contracting
Officer of a notice specifying the default, or (2) whenever for
any reason the Contracting Officer shall determine that such
T&M 8/22/56 - 10 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
Yale
SECRET
te-,Uc nation is in the best interests of the Goverment. Any such
te-z.:iination shall be effected by delivery to the Contractor of a
Notice of Termination specifying whether termination is for the
default of the Contractor or for the convenience of the Government,
the extent to which performance of work under the contract is
terminated, and the date upon which such termination becomes
effective. If, after Notice of Termination of this contract for
default under (1) above, it is determined that the`Contractor's
failure to perform or to make progress in performance is due to
causes beyond the control and without the fault or negligence of
the Contractor pursuant to the provisions of the clause of this
contract entitled "Excusable Delays," the Notice of Termination
shall be deemed to have been issued under (2) above, and the rights
and obligations of the parties hereto shall in such event be governed
accordingly,
(b) After receipt of a totice of Termination and except as
otherwise directed by the Co}tracting Officer, the Contractor shall
(1) stop work under the contract on the date and to extent specified
in the Notice of Termination'$ (2) place no further orders or sub-
contracts for materials, services, or facilities except as nay be
necessary for completion of such portion of the work under the contract
as is not terminated;.( `,texumminate all orders and subcontracts to
the extent that they red ate to the performance of work terminated
by the Notice of Torninata.on, '(4) assign to the Govermaent, in the
a:monnor 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 terminatod- ( )-=with the approval or ratification of
the Contracting Off :Gor which approval or ratification shall be final
and conclusive for all the purposes of this clause, settle all out-
standing lihbilitios 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;
(6) transfer title (to the extent that title has not already boon
transferred) and, in the runner, to the extent, and at the tines
directed by the Contracting Officer, deliver to the Govermont (i)
the fabricated or unfabricated 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; (ii) the completed or partially completed plans, drawings,
information, and other property which, if the contract had been com-
pleted, would be required to be furnished to the Government; and (iii)
the jigs, dies, fixtures, and other special tools and tooling acquired
or r:ianufactured for the performance of this contract for the cost of
which the Contractor has been or will be reimbursed under this con-
tract; (7) use its best efforts to sell in the manner., at the tines,
to the extent, and at the price or prices directed or authorized
by the Contracting Officer, any property of the types referred to in
provision (6) of this paragraph: PROVIDED, HMVER, That the
Contractor (1) shall not be required to extend credit to any purchaser,
T&M 8/22/56 .11
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECRET
and (ii) may acquire any such property under the conditions prescribed
by and at a price or prices approved by the Contracting Officer: AND
PROVIDED FURTHER, That the proceeds of any such transfer or disposition
shall be applied in reduction of any payments to be ,.lade by the
Government to the Contractor Under this contract or shall otherwise
be credited to the price or cost of work covered by this contract or
paid in such manner as the Contracting Officer may direct; (8) complete
performance of such part of the work as shall not have been terminated
by the Notice of Teri.dnation; and (9) take such action as may be
necessary., or as the Contracting Officer may direct, for the protection
and preservation of the property related to this contract which is in
the possession of the Contractor and in which the Government has or
may acquire an interest. The'Contractor shall proceed immediately with
the performance of the above obligations notwithstanding any delay in
determining or adjusting any mount reimbursable under the provisions
of this clause. At any tine after expiration of the plant clearance
period, as defined in Section VIII, Armed Services Procurement Regulation
as it may be amended from time to time, the Contractor may submit to the
Contracting Officer a list, certified as to quantity and quality, of
any or all items of termination inventory not previously disposed of,
exclusive of items the disposition of which has been directed or
authorized by the Contracting Officer, arrl may request the Government
to remove such items or enter into a storage agreement covering them.
Not later than fifteen (3,5) days thereafter, the Government will accept
title to such items and i6 vq them or enter into a storage agreement
cove ing the same, provided that the list subr.-dtted 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 sub..-Lit to the Contracting Officer its termination claim, in
the form and with the certification proscribed by the Contracting
Officer. Such claim shall be submitted promptly but in no event
later than 2 years from the effective date of ter~Anation, unless one
or more extensions in writing are granted by the Contracting Officer
upon request of the Contractor made in writing within such 2-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 2-year
period or any extension thereof. Upon failure of the Contractor to
submit its termination claim within the time allowed, the Contracting
Officer may determine on the basis of information available to him, the
amount if any due to the Contractor by reason of the termination and
shall thereupon pay to the Contractor the amount so determined.
(d) Subject to the provisions of paragraph (c), the Contractor
and the Contracting Officer may agree upon the whole or any part of
the amount or amounts to be paid to the Contractor by reason of the
T&M 8/22./56
- 12
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
to - or partial te::uination of work pursuant to this clause which
ar.;:ount or amounts may include a roasonablo allowance for profit on
work done. The contract shall be amended accordingly, and the Con-
tractor shall be paid the agreed amount.
(o) In the event of the failure of the Contractor and the Con-
tracting Officer to agree in whole or in part, as provided in paragraph
(d) above, as to the amounts to be paid to the Contractor in connection
with the termination of work pursuant to this clause, the Contracting
Officer shall determine on the basis of information available 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:
(1) If the termination of the contract is for the convenience of
the Government:
(i) There shall be included for direct labor hours (as defined
in the Schedule of the contract),an amount which shall be determined
by multiplying the nur.:bor q U..'oct labor hours expended prior and up
to the effective date:off`-erica, e.tion by the hourly rate or rates set
forth in the Schedule less any hiourly rate payments theretofore made
to the Contractor.
(ii) There ,94al . be included therein all costs of material
reimbursable in accordance with this contract not previously paid to
the Contractor for the perform ice of this contract prior to the effecive
date of the Notice of Termination.
(iii) There Sh'a1 be included therein the reasonable costs of
settlement, including accounting, legal, clerical, and other expenses
reasonably necessary for the preparation of settliaent claims and
supporting data with respect to the terminated portion of the contract
and for the termination and settlement of subcontracts thereunder,
together with reasonable storage, transportation, and other costs
incurred in connection with the protection or disposition of termination
inventory.
(2) If the termination of the contract is for the default of the
Contractor:
(i) There shall be included for all direct labor hours (as
defined in the Schedule of the contract) an amount which shall be
determined by riultiplyind the number of direct labor hours expended
prior and up to the effective date of termination by the hourly rate
or rates set forth in the Schedule less the profit factor contained
therein as indicated in the Schedule and less any hourly rate pay-
rients theretofore made.
(ii) There shall be included therein such costs as are set
forth in subparagraphs (l)(ii) and (iii) of this paragraph (c):
T&N 8/22/56 - 13 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECRET. W
PROVIDED, HOIEVER, That there shall not be included any amounts for the
preparation of the Contractorls Settlement Proposal.
(3) If the amount determinod under subparagraphs (1) and (2),
above, is less than the total payments theretofore made to the Con-
tractor, the Contractor shall repay the excess amount to the Government.
(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 Contractor has failed to submit its claim within
the time provided in paragraph (c) above, and has failed to request
extension of such time, it shall have no such right of appeal. In
any case where the Contractin- Officer has made a determination of the
amount due under paragraph (c~ or (o) above, the Govermient 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 de-
terri.ned by tho Contracting Officer, or (ii) if an appeal has been
taken, the amount finally determined on such appeal
(g) In arriving, at tIe amount due to the Contractor under this
clause there shall be deducted (1) all unliquidated advance or other
unliquidated payments theretofore made to the Contractor, (2) any
claim which the Government may have against the Contractor in connection
with this contract, and ) the agreed price for, or the proceeds of
sale of any r.iaterials, stipgplies, 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
contract relating to hourly rates which are 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 tine to time, under such terms and
conditions as it may prescribe, make partial pay~.lents and payments on
account against costs incurred by the Contractor in connection with the
terminated portion of the contract whenever in the opinion of the
Contracting Officer the aggregate of such payments sha11 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 Con-
tractor to the Government upon demand, together with interest com-
puted at the rate of 6 percent per annum, for the period from the
date such excess is repaid to the Government; PROVIDED, HO VER, That
no interest shall be charged with respect to any such excess payment
attributable to a reduction in the Contractoris claim by reason of
retention or other disposition of termination inventory until 10 days
after the date of such retention or disposition,
T&M 8/22/56
-14-
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECRET
(j) U:nleas otherwise provided for in this contract, or by
applicable statute, the Contractor from the effective date of
termination and for a period of 6 years after final settlement under
this contract shall preserve and make available to the Government
at all reasonable tines at the office of the Contractor, but without
direct charge to the Government, all its books, records, documents,
and other evidence bearing on the cost and expenses of the Contractor
under this contract and relating to the work terminated hereunder, or,
to the extent approved by the Contracting Officer, photographs,
i:iicrophoto,raphs, or other authentic reproductions thereof.
18. SUBCONTRACTS
(a) No contracts shall be made by the Contractor for the
furnishing of any of the work herein contracted for without the
w t-trem approval of the Contracting Officer. For the purposes of
this clause, purchase of raw material or commercial stock items shall
not b -
e c
d
onsi
ered work.
(b) The Contractor agrees that no subcontract (laced under this
contract shall provide fqr payrient on a cast-plus-percentage-of-cost
basis.
RECORDS
Cnnt;;...,) z'a~lxL ain booksy - records,----_
documents and other evidence pnrtainin + 4.11
this contract (herea nester co] g o e costs and expenses of
lectivel called th if It
e Mt and in such detail as will properly reflect t1- re allcnetscosts ,the
direr d indirnnt.- of l n'k
15uies and
services d other costs and' expenses of whatevernat
uree1for which
reiubursomon ' s clajuod under the provisions of this contract. The
Contractorls ace -'tin, procedures and practices shall be subject to
the approval of the retracting Officer;. PROVIDED, however, that no
material change will be equired to be made in the Contractorts
aceeilnt.inn v+ ---
accepted accounting practices
if the costs properly applicable to
this contract are readily ascorta~ able therefrom.
(2) The Contractor agrees to r. e available at the office
of the Contractor at all reasonable times du ' g the period set
forth in subparagraph (4) below any of the reco for inspection,
audit or reproduction by the Comptroller of the Con cting
Government agenc
or hi
th
y
s au
orized reprosentatives.
(3) In the event the C
t
ll
`
omp
ro
er of the Contrac
Government agency 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
t.hnn thn nffi
~.- Contxactory --the Contractor agrees t c 3iver9
y
T&M 8/22/56 15
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SEki
Mk~--~the-re aureeraent veuclie cover ng suoh ahe~r ,es- er as r: otherwise specified within two years after reimbursement of charges
overed by any such voucher, to such representative as may be
d ignated for that purpose through the Contracting Officer such
Ntar, evidence in support of transportation costs as may be
Zen
doe
req ed by the Comptroller of the Contracting Government agency
of his duly authorized roprosontaives,
or any
(4) Except for documentary evidence delivered to the
Government ursuant to subparagraph (3) above, the Contractor shall
preserve and .Zake available its records for a period of six years
(unless a lone r period of time is provided by applicable statute)
from the date o the voucher or invoice submitted by the Contractor
after the eor.ZpletIon of the work under the contract and designated
by the Contractor the "completion voucher" or "completion invoice"
or, in the event thi contract has been completely terminated, from
the date of the teriaz. -ti on settlement agreement, PROVIDED, however,
that records which rela to (A) appeals under the clause of this
contract entitled ''Dispu, S," (B) litigation or the settlement of
claims arising out of the 'rforr.Zance of this contract, or (C) costs
or expenses of the contract s to which exception has been taken by
the Comptroller of the Coitra ine, Government agency or any of his
duly authorized representatives shall be retained by the Contractor
until such appeals, litigation, aims, or exceptions have been dis-
posed of, but in no event for less than the six-year period mentioned
above.
(5) Except for documentary o ' dance delivered pursuant to
subparagraph (3) above, and the records r scribed in the proviso of
subparagraph (4) above, the Contractor racy 'n fulfillment of its
obligation to retain its records as require by this clause, sub-
stitute photographs, micro-photographs or oth authentic reproduc-
tions of such records, after the expiration of wo years following
the last day of the month of reir.Zburseront to th Contractor of the
invoice or voucher to which such records relate, ass a shorter
period is authorized by the Contracting Officer witl the concurrence
of the Comptroller of the Contracting Government agen or his duly
authorized representative.
(6) The provisions of this paragraph (a), incl 'ng this
subparagraph (6), shall be applicable to and included in ea sub-
contract hereunder which is on a cost, cost-plus-a--fixed-fee, tii.le-
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 of the Contracting Government agency or an;
of his duly authorized representatives, shall, until the expiration
-----of -three--wee -eAter---final--payiient--under-the--aubeontraot3---h3uve ? aaaees-~~-
T&M ?/'22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECRET
tc~ ~.,c~tha ri ft _tc~ : ex~a ne e ~3 r er nent .boo s; 3e tints
pot' ,mad cords of such subcontractor involving transactions
related to the su co a he terr.i "subcontractas used in this
Para raph (b) only, excludes (i pur s not exceeding;P1,000
and; ii) subcontracts or purchase orders for public rvices
atablished for un on applicability-to--??the Sen
20. GRATUITIES
(a) The Government may, by written notice to the Contractor,
terminate the right of the Contractor to proceed under this
contract if it is found, after notice and hearing, by the
Secretary or his duly authorized representative, that grat-
uities (in the form of entertainment, gifts, or otherwise)
were offered or given by the Contractor, or any agent or
representative of the Contractor, to any officer or employee
of the Government with a view toward securing; a contract or
securing favorable treatment with respect to the awardingg or
amending, or the making of any determinations with respect to
the performance of such contract; PROVIDED, That the oxistance
of the facts upon which the Secretary of his duly authorized
representative makes such f .nding,s shall be in issue and may
be reviewed in any cQppotent 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 6.6ainst the Contractor as it could
pursue in the event of a breach of the contract by the Con-
tractor, and (ii). as a p.n ;.lty in addition to any other damages
to which it nay be entitled by law, to exemplary damages in an
ar_lottnt (as determined by the Secretary or his duly authorized
representative) which shall be not less than three nor more
than ten tines the costs incurred by the Contractor in provid-
ing any such gratuities to any such officer of employee.
(c) The rights and remedies of the Government provided in this
clause shall not be exclusive and are in addition to any other
rights and remedies provided by law or under this contract,
21~ GOVERNIvENT-FURNISHED PROPERTY
(a) The Government shall deliver to the Contractor, for use
in connection with and under the torus of this contract, the
property described in the Schedule or specifications, together
with such related data and inforl:lation as the Contractor nay re-
quest and as nay 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 tiro expectation that Gove ,:lent-furnished Property
T&M 8/22/56 __ ^ 17 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
EG~tET
suitable for use will be delivered to the Contractor at the tines
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 tine or times, the Contracting Officer shall,
upon timely written ronuest made by the Contractor, make a determination
of the delay occasioned the Contractor thereby, and shall equitably
adjust the delivery or perfornance dates or the contract price, or
both, and any other contractual provision affected by such delay, in
accordance with the procedures provided for in the clause of this
contract entitled "Changes." In the event the 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, ether (i) return such property at the Govern-
ment2s expense or otherwise dispose of the property, or (ii) effect
repairs or iaodjfications, Upon the completion of (i) or (ii) above,
the Contracting Officer upon written request of the Contractor shall
equitably adjust the delivery or performance dates or the contract
price, or both, and any other contractual provision affected by the
rejection or disposition or the repair or modification, in accordance
with the procedures provided for in the clause of this contract c titled
"Chan?es." 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 dol. vory of Government--furnished Property or
delivery of such property in a condition not suitable for its intended
use, 1.. - ?, 1
(b) By notice in w riting the Contracting; Officer rimy decrease
the property furnished or to be furnished by the Government under
this contract. In any such case, the Contracting Officer upon the
written request of the Contractor shall equitably adjust the delivery
or performance dates or the contract price, or both, and any other
contractual provisions affected by the decrease, in accordance with the
procedures provided for in the clause of this contract entitled 'tChanges.
(c) Title to the Government-furnished property shall remain in the
Government. Title to Government-furnished property shall not be
affected by the incorporation or attachment thereof to any property
not owned by the Government, nor shall such Government-furnished
property, or any part thereof, be or become a fixture or lose its
identity as personalty by reason of affixation to any realty. The
Contractor shall maintain adequate property control records of
Government-furnished property in accordance with the provisions of the
"Manual for the Control of Government Property in the Possession of
Contractors" (Appendix B, Armed Services Procurement Regulation) as
in effect on the date of the contract, which Manual is hereby incor-
porated by reference and made a part of this contract.
(d) The Govern:-met-furnished property shall, unless otherwise
T&M .8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
NW
pr Lded herein, be used only for the performance of this contract.
(o) The Contractor shall maintain and administer, in accordance
with sound industrial practice, a program for the maintenance, repair,
protection and preservation of Goverment-furnished property, until
disposed of by the Contractor in accordance with this clause. In the
event that any damage occurs to Government-furnished Property the
risk of which has been assumed by the Government under this contract,
the Government shall replace such items or the Contractor shall mike
such repair of the property as the Government directs; provided,
however, that if the Contractor cannot effect such repair within the
time required, the Contractor shall disposo of such property in the
l--fanner directed by the Contracting Officer. The contract price
includes no compensation to the Contractor for the performance of
a;ny repair or replacement for which the Government is responsible,
and an equitable adjustment will be made in the contract price for
any such repair or replacement of Government-furnished property made
at the direction of the Government. Any repair or replacement. for
which the Contractor is rooporsible under the provisions of this
contract shall be c csgilplishod by the Contractor at its own expense,
(f) (i) Except for loss, destruction or da.taa6e resulting from
a failure of the Contractot, due to willful misconduct or lack of
good faith of any of the Contractorts managerial personnel as defined
herein, to mainta,rr 4 id ad:4nister the program for the mrLintenance,
repair, protection arld preservation of the Government-furnished
property as required by paragraph (e) hereof, and except as specifically
provided in clause (s) of this contract or in the clause or
clausos of this con,rtot'dosignatod in the Schedule, the Contractor
shall not be liable for loss or destruction of or damage to the Govern-
zmlent-furnished property (A) caused by any peril while the property is
in transit off the Contractorts premises, or (B) caused by any of the
following perils while the property is on the Contractorts or sub-
contractorts premises, or on any other pron.-rises where such property
may properly be located, or by removal therefrom because of any of the
following perils:
(I) Fire; lightning; windstorm, cyclone, tornado, hail;
explosion; riot, riot attending a strike, civil commotion; vandalism
and malicious mischief; sabotage; aircraft or objects falling therefrom;
vehicles running on land or tracks, (: xcluding vehicles owned or
operated by the Contractor or any agent or employee of the Contractor;
smoke; sprinkler leakage; earthquake or volcanic eruption; flood, meaning
thereby rising of a body of water; hostile or warlike action, including
action in hindering, combating, or defending against an actual, i~:ipend-
ing or expected attack by any government or sovereign power (do jure
or do fa4to), or by any authority using military, naval, or air forces,
or by an agent of any such government, power, authority, or forces; or
(II) Other peril, of a type not listed above, if such other
peril is customarily covered by insurance (or by a reserve for self-
T& 8/22/56 - 19
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECRET. v
insurance) in accordance with the normal practice of the Contractor,
or the provailint practice in the industry in which the Contractor is
engaged with respect to s .r.Liler property in the sar.ie general locale.
The perils as set .forth in (A) and (B) above are hereinafter
called "excepted peri~.~.: , rr
This clause shall not be construed as relieving a subcontractor
froi.i liability or loti.> or destruction of or damage to the Government-
Furnished property whii'l.a in its possession or control, except to the
extent that the subcontract, with the prior approval of the Contracting
Officer, nay provide for the relief of the subcontractor froi.l such
liability. In the absence of such approval, the subcontract shall
contain appropriate provisions requiring the return of all Government-
Furnished property in as good condition as when received, except for
reasonable wear and 1oE:ac or for the utilization of the property in
accordance with the provisions of the prime contract.
The term 'tContractor R p i:aaaiagcrial personnel" as used herein means
the Contractorls directo's, officers and any of its managers, superinten
dents, or other equivalent representatives who have supervision or
direction of (I) all or substantially all of the Contractor's business;
(II) all. or substantially "all of the Contractor's operation at any one
plant or separate locat4,oi at which the contract is being performed;
(III) a separate and complete major industrial operation in connection
with the performance of this contract.
(ii) The Contractor represents that it is not including in the
price hereunder, and agrees that it will not hereafter include in any
price to the Government, anycharLe or reserve for insurance (including
self-insurance funds or reserves) covering loss or destruction of or
damage to the Government-furnished property caused by any excepted peril.
(III) Upon the happening,, of loss or destruction of or damage to
luny Government-furnished property caused by an excepted peril, the
Contractor shall notify the Contracting Officer thereof, and shall
communicate with the L?ss and Salvage Organization,. if any, now or
hereafter designated by the Contracting Officer, and with the assistance
of the Loss and Salvage Organization so designated (unless the Con-
tracting Officer has directed that no such organization be employed),
shall take all reasonable steps to protect the Governi.iont-furnished
property from further dai.:ag;e, separate the damaged and undamaged Govern-
ment-furnished property, put all the Goverruaent-furnished property
in the best possible order, and furnish to the Contracting Officer a
statement of ; (A) the lost, destroyed and dat:na0,ed Government-furnished
property (B) the tine and origin of the loss, destruction or dar:iage,
(C) all known interests in commingled property of which the Government-
furnished property is a part, and (D) the insurance, if any,, covering;
any part of or interest in such commingled property. The Contractor
shall be reimbursed for the expenditures made by it in performing
T&M 8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
i-t obligations under this subparagraph (iii) (including charges ;.lade
to the Contractor by the Loss and Salvage Organization, except any of
such charges the payment of which the Government has, at its option,
assumed directly), to the extent approved by the Contracting Officer
and set forth in a Supplemental Agreement.
(iv) With the approval of the Contracting Officer after loss or
destruction of or damage to Government-furnished property, and subject
to such conditions and limitations as may be imposed by the Contracting;
Officer, the Contractor may, in order to minimize the loss to the Gov-
ernr:ient or in order to permit resumption of business or the like, sell
for the account of the Government any item of Government-furnished
property which has been damaged beyond practicable repair} or which
is so commingled or QoLj'b no with property of others, including the
Contractor, that sep:atiozu is impracticable.
(v) Except to the extent of any loss or destruction of or
damage to Government-furi~.shed property for which the Contractor is
relieved of liability under'' the foregoing provisions of this clause,
and except for reasonable wear and teas or depreciation, or the utitizat_o
of the Government-furnished property in accordance with the provisions
of this contract, the Qov'ernT.ier t-furnished property (other than properly
permitted to be sold) shall be returned to the Government in as rood
condition as when received,,by the Contractor in connection with this
contract, or as repaired,urdor paragraph (o) above.
(vi) In the event.tl}e;Coritractor is reimbursed or compensated
for any loss or destruction of or damage to the Governi.ient-furnished
property, caused by an excepted peril, it shall equitably reimburse
the Government. The Contractor shall do nothing to prejudice the
Goverrinentts rights to recover against third parties for any such
loss, destruction or damage and, upon the request of the Contracting
Officer, shall at the Government's expense, furnish to the Government
all reasonable assistance and cooperation (including the prosecution
of suit and the execution of instruments of assignment in favor of the
Government) in obtaining recovery. In addition, where a subcontractor
has not been relieved from liability for any loss or destruction of or
damage to the Government-Furnished property, the Contractor shall enforce
the liability of the subcontractor for such loss or destruction of or
damage to the Government-Furnished property for the benefit of the
Government.
(vii) (Where applicable). In the event any aircraft are to be
furnished under this contract, any loss or destruction of, or damage
to, such aircraft or other Government-furnished property occurring in
connection with operations of said aircraft will be governed by the
clause of this contract captioned "Flight Risks", to the extent such
clause is, by its terms, applicable.
The Government shall at-all-reasonable tines have access to
T&M 8/22/56 - 21
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
SECT `'
:rru:e
(h) Upon the completion of this contract, or at such earlier
0"P, 2.6
date as may to fixed by the Contracting Officer, the Contractor
shall submit, in a form acceptable to the Contracting Officer,
inventory schedules c ~- ri.ng all iteus of Government-furnished property
not consumed in the pe-r `'or::lance of this contract (including any result-
ing scrap), or not thcae :ofc).re delivered to the Government, and shall
deliver or is ke such c `her ?_tU.spc?sal of such GovernLient-furni shed
property, as may be d?. -ct c:. or authorized by the Contracting Officer.
Recoverable scrap from ''xover-n:_ient--furnished property shall to reported
in accordance with a pl ocei::ro and in such form as the Contracting Offi-
cer may direct. The net proceeds of any such disposal shall be credited
to the contract price or shall be paid in such other manner as the Con-
tract_ .ng; Offica r may (:1-rect.
(:~.) i.re'.t: ons the Contracton:,, Officer and coi:n.iunications of
the Contra--tor ona?.l be in writing.
If this contract cc.;lls for furnishing or constructing aircraft,
aircraft parts, or aeronautical accessories, no aliens employed by
the Contractor shall be permitted to have access to the plans or
specifications, or the work under construction, or to participate
in the contract trials, without the written consent beforehand of
the Secretary or his duly authorized representative.
23. MILITARY SECURITY REQUIREI?NTS
(a) The provisions of this clause shall apply to the extent
that this contract involves access to security information classified
"Confidential" including "Confidential---Modified Handling Authorized"
or hiti r
(b) The Government shall notify the Contractor of the security
classification 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 and 254-1).
(c) To the extent the Government has indicated as of the date
of this contract, or thereafter indicates, security classification
under this contract as provided in paragraph (b) above, the Con-
tractor shall safeguard all classified elements of this contract and
shall provide and maintain a system of security controls within its
own organization in accordance with the requirements of-.,
(i) the Security Agreement (DD Form 441), including the
Department of Defense Industrial Security Manual for Safeguarding
Classified Information as in effect on date of this contract, and
T&M 8/22/56
22 J-J
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 JI\VVV I VVVVV I I J-J
SEA
modification to the Security Agreom.ient for the purpose of
aaaptinc-, the Manual to the Contractor's business; and
(ii) any amendments to said Manual iiado after the date of
this contract, notice of which has been furnished to the Contractor
by the Security Office of the Military Department having; security
cognizance over the facility.
(d) Representatives of. the Military Departi;ient having
security cognizance over the facility and 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. Shquld,tie Government, through its authorized repre-
sentative, deterAlj e tIat the Contractor has not complied with such
requirements, the Goyernuzent shall inform the Contractor in writing
of the proper actions tob taken in order to effect compliance with
such requirements.
(e) If, subsequent to the date of this contract, the security
classifications or requirements under this contract are changed by
the Government as pravtdq.d in this clause and the security costs
under this contract ar.' theveby increased or decreased, the con-
tract price shall be subject to an equitable adjustment by reason
of such increased or decreased costs. Any equitable adjustment
shall be accomplished ; n the sine manner as if such changes were
directed under the " h1t -" clause in this contract.
(f) The Contractor agrees to insert, in all subcontracts here-
under which involve access to classified security information, pro-
visions which shall conform substantially to the lan`,uage of tiiis
clause, including this paragraph (f) but excluding, the last sentence
of paragraph ((-,') of this clause.
(g) The Contractor also agrees that it shall determine that
any subcontractor proposed by it for the furnishing of supplies
and services which will involve access to classified information
in the Contractor's custody has boon granted an appropriate facility
security clearance, which is still in effect, prior to being accorded
access to such classified security information.
24, COPYRIGHT
(a) The Contractor agrees to and does hereby grant to the Govern-
i:ient, and to its officers, agents and employees actin; within the
scope of thier official duties, (i) a royalty free, nonexclusive
and irrevocable license to reproduce, translate, publish, use,
and dispose of, and to authorize others so to do, all copyright-
able Material first produced or composed and delivered to the
Government under this contract by the Contractor, its employees
T&M 8/22/56 -- 23 -
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
OW-10 *Wo~
or any individual or concern specifically euployed or assigned to
on ,inate and prepare such material; and (ii) a license as afore-
said under any and all copyrighted or copyriglitable work not first
produced or composed by the Contractor in the performance of this
contract but which is incorporated in the material furnished under
this contract, provided that such license shall be only to the
extent the Contractor now has, or prior to completion or final
settlement of the contract may acquire, the right to grant such
license without becorzinb liable to pay compensation to others
solely because of such Brant,
25, FILING OF PATENT APPLICATIONS
(a) Before filint; or causing; to be filed a patent application
disclosinb any subject mattor of this contract, which subject
matter is classified "Secret',' or higher, the Contractor shall,
citinb the thirty (30) day provision below, transmit the pro-
posed application to the Contracting Officer for deterLdnation
whether, for reasons of national security, such application
should be placed wader an order of secrecy or sealed in accord-
ance 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 instructions
of the ContractinL,, Officer with respect to the imnner of delivery
of the patent application tb 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
iven any such instructions within thirty,.30)days from the date
of i.aailin, or other transmittal of the proposed application, the
Contractor may file the application.
(b) The Contractor shall furnish to the Contractin Officer, at
the tIme of or prior to the tine 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 com:zint, within the scope of
this clause, the Contractor shall observe all applicable security
re. ulations covering, the transmission of classified subject matter.
26. NOTICE TO THE GOVERNI;NT OF LABOR DISPUTES
Whenever the Contractor has knowledge that any actual or potential
labor dispute is delayint; or threatens to delay the tii.iely performance
of this contract, the Contractor shall immediately give notice thereof,
including, all relevant information with respect thereto, to the Con-
tractinb Officer.
T&l 8/22/56 - 24
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
27, AU":!_ i IZ. T')I .^,`~.D CG"..`TSE 17.'
SHOW
The Govorm.ient hereby gives its authorization and consent
(without prejudice to its riLlzts of indei.;nification, if such riLhts
are provided for in this contract) for all use and iaanufacture, in
the porfor..imace of this contract or any part hereof or any ai.iend-
i.ient hereto or any subcontract hereunder (includin- any lower-tier
subcontract), of any patented invention (i) ei:i:;o; ied in the struc-
ture or coi:lposition of any article the delivery of which is accepted
uy the Government under this contract, or (ii) utilized in the
machinery, tools, or r.iethods the use of which necessarily results
frorl co::ipliance Iy the Contractor or the usin" subcontractor with
(a) specifications or written provisions now or hereafter foruinh
a part of this contract, or (h) specific written instructions
Liven by the Contractin.. Officer directinL the i.ianner of perfor-
i.lance, The Contractor) s entire liability to the Govern;;_ient for
'patent infrinLeiaent shall be deteri.iined solely by the provisions
of the indei.mity clause, if any, included in the contract and the
Governi.ient assu.ies liali.li,ty for all other infrin`,ei.ient to the
extent of the authoriz ,t .orn? ' zd consent hereinabove`ranted.
ALTERaTTONS IN CONTRACT
The followin. alterati.onp were ..lade in this contract prior to
siLnaturo thereof by the partiep to this contract:
T & M 8/22/56
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
 Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5
on 18, 11CO>`i , larch (a), the
eted frn the first sentence, and the fol1ot , new
the 'Written recuest for approval
tractor.
e R $ Is deleted in I
substituted therefor:
to asaiatain butt,
e peertaini to the costs and expanses of this con-
er collectively called the rtrecorda ) to the a eat
as will properly reflect all net costes, diretct and
r, esterials, equipment, su .ies and services,, and
asees of to atever nature for which reeUburs want is
ovisia2s at this contract. The Contractor agrees
Jag Officer or any of his duly authorised raymsents.-
the expiration of six yawn sitter final pqyment under
v's nooses to and the right to ewe any duly pertinent
duets, pa rs and records of the Contractor iuvo1viag trans-
iag to this tract, including subcontracts he .."
In ar m. Prevision 21, 3'? rmwsm P '' !1, P& sgre ,>h ()
g
is deleted and the following paragraph is substituted therefor
titer, Officer or his duly prized representative
ale tines have access to the Vvedmei
furnished property is la ted.
Provision 1t P # ra sh
*Direct siterts1s as
I ss those material Mich eater
or Leh are used or consumed directly in con-
aing of such product and such maw costs
26
Approved For Release 2007/07/25: CIA-RDP81 B00879R000100060175-5