CONTRACT CLAUSES AND SOLICITATION PROVISIONS (c) Upon completion of the related procurement contract, or at any time during the life of the related procurement contract when the facilities are no longer required, it is the responsibility of the Contractor to notify the Contracting Officer in order that appropriate disposal may be made. (End of clause) 7-706.16 Period of This Contract. Insert the clause in 7-702.25. 7-706.17 Disposition of the Facilities. Insert the clause in 7-702.26. 7-706.18 Disputes. Insert the clause in 7-103.12. 7-706.19 Officials Not To Benefit. Insert the clause in 7-103.19. 7-706.20 Gratuities. In accordance with 7-104.16 insert the clause therein. 7-706.21 Covenant Against Contingent Fees. Insert the clause in 7-103.20. 7-706.22 Convict Labor. In accordance with 12-202 and 12-203, insert the clause in 7-104.17. 7-706.23 Equal Opportunity. In accordance with 12-807.1, insert the applicable clause in 7-103.18. 7-706.24 Contract Work Hours and Safety Standards Act-Overtime Compensation. In accordance with 12-301, 12-302 and 12-306, insert the appropriate clause(s) in 7-103.16. 7-706.25 Supersedure. SUPERSEDURE (1968 SEP) (a) Facilities heretofore provided to the Contractor pursuant to the contracts specified in the Schedule shall become subject to the terms of this contract upon its effective date. The terms of the contract by which such Facilities may have been provided to the Contractor are hereby superseded with respect to such Facilities, except for rights and obligations which may have accrued under such other contract prior to the effective date hereof. (b) Each item of Facilities hereafter provided to the Contractor under any related procurement contract shall become subject to the terms of this contract upon the completion of its construction, acquisition, and installation, or upon its availability for use, whichever first occurs, except as otherwise provided in the contract or other document by which such Facilities are provided to the Contractor. (End of clause) 7-706.26 Affirmative Action for Disabled Veterans and Veterans of the Viet- | nam Era. Insert the clause in 7-103.27. 7-706.27 Affirmative Action for Handicapped Workers. Insert the clause in 7-103.28. 7-706.28 Clean Air and Water. In accordance with 1-2302.2, insert the clause in 7-103.29. 7-706.29 Privacy Act. In accordance with 1-327.1, insert the clause in 7-104.96. 7-706.30 Preference for Domestic Specialty Metals. In accordance with 7-104.93, insert the applicable clause therein. 7-706.31 Notice of Intent to Disallow or Not Recognize Costs. Insert the clause in 7-203.35. 7-706.31 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS Part 8-Letter Contracts 7-801 Applicability. This Part sets forth uniform contract clauses for use in letter contracts as defined in 3–408(a). 7-802 Required Clauses. The following clauses shall be inserted in all letter contracts. 7-802.1 General. Letter contracts shall include all clauses which statute, executive order, or this Regulation require to be included in the type of definitive contract contemplated by the letter contract. The letter contract also shall include such additional clauses as are known to be appropriate for the definitive contract which is contemplated. 7-802.2 Execution, Commencement of Work, and Priority Rating. (This clause may be omitted when Standard Form 26 is used to award the letter contract.) EXECUTION, COMMENCEMENT OF WORK, AND PRIORITY RATING (1964 MAR) The Contractor's acceptance of this order will be indicated by affixing its signature to three copies thereof and returning the executed copies to the Contracting Officer not later than Upon acceptance by both parties, the Contractor shall proceed with performance of the work described herein, including procurement of necessary materials. An appropriate priority rating, in accordance with the Department of Defense Priorities and Allocation Manual, will be assigned to this letter contract. (End of clause) 7-802.3 Limitation of Government Liability. LIMITATION OF GOVERNMENT LIABILITY (1967 OCT) (a) The Contractor is not authorized to make expenditures or to incur obligations, in performance of this contract, which exceed dollars ($............. (b) The maximum amount for which the Government shall be liable if this contract is terminated is dollars ($.. ...). (End of clause) 7-802.4 Payments Clauses for Letter Contracts. (a) Cost Type. Insert the following clause in all letter contracts contemplating a cost-type contract except letter contracts for conversion, alteration or repair of ships. PAYMENTS OF ALLOWABLE COSTS PRIOR TO DEFINITIZATION OF CONTRACT (1972 MAY) (a) Pending the placing of the definitive contract referred to herein, the Government shall currently reimburse the Contractor for all allowable expenditures made hereunder at the following rates: (i) One hundred percent (100%) of approved costs representing progress payments to (iii) eighty-five percent (85%) of all other approved costs subject to the definition of 7-802.4 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS (b) For the purpose of determining the amounts payable to the Contractor hereunder, allowable items of cost shall be determined by the Contracting Officer in accordance with the statement of cost principles set forth in Part of Section XV of the Armed Services Procurement Regulation. In no event shall the total reimbursement made under this paragraph exceed eightyfive percent (85%) of the maximum amount of the Government's liability otherwise set forth in this letter contract. (c) Payments shall be made to the Contractor when requested as work progresses, but not more frequently than bi-weekly, in amounts approved by the Contracting Officer. The Contractor may submit to an authorized representative of the Contracting Officer, in such form and reasonable detail as such representative may require, an invoice or public voucher supported by a statement of cost incurred by the Contractor in the performance of this contract and claimed to constitute allowable cost. Costs shall include only those recorded costs which result, at the time of the request for reimbursement, from payment by cash, check, or other form of actual payment for items or services purchased directly for the contract, together with (when the Contractor is not delinquent in payment of costs of contract performance in the ordinary course of business) costs incurred, but not necessarily paid for materials which have been issued from the Contractor's stores inventory and placed in the production process for use on the contract, for direct labor, for direct travel, for other direct inhouse costs, and for properly allocated and allowable indirect costs, as is shown by records maintained by the Contractor for purposes of obtaining reimbursement under Government contracts plus the amount of progress payments which have been paid to Contractor's subcontractors under similar cost standards. The requirement of prior payment for items or services purchased directly for the contract shall not apply where the Contractor is a small business concern. (d) 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 (e) below, make payment thereon as approved by the Contracting Officer. (e) At any time or times prior to final payment under this contract, the Contracting Officer may have the invoices 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 underpayments, on preceding invoices or vouchers. (End of clause) (b) Fixed Price Type. When, in accordance with Appendix E, Part 5 (see E-503 and E-505), payments are to be made under letter contracts contemplating a fixed-price-type contract, insert the clause set forth in 7-104.35(a) (see E-515 and E-510) unless the contract is for construction. The clause may be supplemented as provided in E-511.6 and E-516. In construction contracts, insert the clause set forth in (a) above, supplemented by appropriate title, risk of loss and other provisions. 7-802.5 Definitization. (a) When it is known at the time of entering into the letter contract that the price of the definitive contract will be based on adequate price competition or will otherwise meet the criteria of 3–807.3, paragraph (a) of the following clause may be appropriately modified to eliminate the requirement for cost or pricing data. The definitization schedule in paragraph (b) shall include (i) dates for submission of a make-or-buy plan, contractor's price and other proposals; (ii) a date for commencement of negotiation of price and other terms and conditions; and (iii) a target date for definitization. The target date shall be the earliest practicable date for definitization. 7-802.5 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS DEFINITIZATION (1969 DEC) ............ (a) A type definitive contract is contemplated. To accomplish this result, the Contractor agrees to enter into negotiation promptly with the Contracting Officer over the terms of a definitive contract, which will include all clauses required by the Armed Services Procurement Regulation on the date of the execution of the letter contract, all clauses required by law on the date of the execution of the definitive contract and such other clauses, terms and conditions as may be mutually agreeable. The Contractor agrees to submit a fixed-price proposal [cost and fee proposal], and cost or pricing data supporting that quotation. (b) The schedule for definitization of this contract is set forth below: Target Date for Definitization: (c) If agreement on a definitive contract to supersede this letter contract is not reached by the target date set forth in (b) above or any extension thereof by the Contracting Officer, the Contracting Officer may, with the approval of the Head of the Procuring Activity, determine a reasonable price or fee in accordance with ASPR Section III, Part 8, and Section XV, subject to appeal by the Contractor as provided in the "Disputes" clause of this contract. In any event, the Contractor shall proceed with completion of the contract, subject only to the "Limitation of Government Liability” clause. After the date of the Contracting Officer's determination of price or fee, the contract shall be governed by: (i) all clauses required by the Armed Services Procurement Regulation on the date of execution of this letter contract for either a fixed price type contract or a cost reimbursement type contract as determined by the Contracting Officer under this paragraph (c); (ii) all clauses required by law as of the date of the Contracting Officer's determination; and (iii) such other clauses, terms and conditions as may be mutually agreed upon. To the extent consistent with the foregoing, all clauses, terms and conditions included in this letter contract except which by their nature are applicable only to a letter contract shall continue to be effective. (End of clause) (b) When the award of the letter contract is based on price competition, the following paragraph (d) shall be added to the clause in (a) above. In the blank therein, insert the contractor's proposed price on which the award was made. (d) The definitive contract resulting from this letter contract will include a negotiated [price ceiling] [firm fixed-price] in no event to exceed $..... 7-802.6 Management Systems Requirements. In accordance with 16-827.1, insert the clause in 7-104.50. 7-802.7 Audit by Department of Defense. Insert the clause in 7–104.41(a). 7-802.7 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS Part 9-Time and Material and Labor Hour Contracts 7-900 Scope of Part. This Part sets forth uniform contract clauses for use in time and material and labor hour types of contracts as described in 3-406.1 and 3-406.2. 7-901 Required Clauses. The following clauses shall be inserted in all time and material contracts and labor hour contracts. In labor hour contracts, the provisions governing the reimbursement of material costs may be deleted. 7-901.1 Definitions. Insert the contract clause set forth in 7-103.1. Additional definitions may be included in such clause provided they are not inconsistent with such clause or the provisions of this Regulation. 7-901.2 Changes. CHANGES (1964 MAR) The Contracting Officer may at any time, by a 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; (iii) place of delivery; and (iv) the amount of Government-furnished property. If any such change requires an increase or decrease in any hourly rate or in the ceiling price provided for in this contract, or in the time required for the performance of any part of the work under this contract, whether changed or not changed by any such order, or otherwise affects any other provision of this contract, an equitable adjustment shall be made in the (i) ceiling price, (ii) hourly rates, (iii) delivery schedule, and (iv) 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 facts 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 "Disputes" clause of this contract. However, nothing in this clause shall excuse the Contractor from proceeding with the contract as changed. (End of clause) Instructions in 7-203.2 are applicable to this clause. 7-901.3 Excusable Delays. Insert the clause in 7-203.11. 7-901.4 Termination. TERMINATION (1974 OCT) (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 per- formance), and shall fail to cure such default within a period of ten (10) days (or such longer periods as the Contracting Officer may allow) after receipt from the Contracting Officer of a notice specifying 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 the Contractor was not in 7-901.4 ARMED SERVICES PROCUREMENT REGULATION |