DAC #76-18 12 MAR. 1979 CONTRACT CLAUSES AND SOLICITATION PROVISIONS 7-901.17 Examination of Records by Comptroller General. In accordance with 7-104.15, insert the clause therein. 7-901.18 Gratuities. Insert the clause in 7-104.16, except in contracts and purchase orders with foreign governments obligating solely funds other than those contained in Department of Defense appropriation acts. 7-901.19 Notice and Assistance Regarding Patent Infringement. In accordance with 9-104, insert the clause in 7-103.23. 7-901.20 Authorization and Consent. In accordance with 9-102, insert the clause in 7-103.22. 7-901.21 Inspection and Correction of Defects. INSPECTION AND CORRECTION OF DEFECTS (1974 OCT) (a) All materials, which term includes technical data when the contract does not include the clause entitled Warranty of Technical Data, furnished and services performed by the Contractor under this contract shall be subject to inspection and test by the Government to the extent prac 7-901.21 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS ticable at all times (including the period of performance) and places, and in any event prior to acceptance. The Government, through any authorized 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 Contractor 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, acceptance of services performed and materials furnished under this contract 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 sixty (60) 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 period as may be provided in the schedule) after acceptance of the services or materials last delivered in accordance with the requirements of this contract, the Government may require the Contractor to remedy by correction or replacement, as directed by the Contracting Officer, any services or materials which at the time of delivery thereof failed to comply with the requirement of this contract. Except as otherwise provided in paragraph (c) hereof, below, the allowability of the cost of any such replacement or correction shall be determined as provided in the "Payments" clause of this contract, but the "hourly rate" for labor hours incurred in such replacement or correction shall be reduced so as to exclude the portion of such rate attributable to profit. Corrected or replacement materials and services shall not be tendered again for acceptance unless the former tender and the requirement of correction or replacement is disclosed. If the Contractor fails to proceed with reasonable promptness to perform such replacement or correction, and if such replacement or correction may be performed within the ceiling price, or the ceiling price as increased by the Government, the Government (i) may by contract or otherwise perform such replacement or correction and charge to the Contractor any increased cost occasioned the Government thereby, and may deduct such increased cost from any amounts due the Contractor under this contract (or require repayment of any payments theretofore made), or (ii) may terminate this contract for default as provided in the “Termination" clause of this contract. 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, any amount due under this contract, shall be a dispute concerning a question of fact within the meaning of the "Disputes" clause of this contract. (c) Notwithstanding the provisions of paragraph (b) above, the 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 misconduct 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 representatives, who has supervision or direction of (i) all or substantially all of the Contractor's business; (ii) all or substantially all of the Contractor's operations at any one plant or separate location in which this contract is being performed; (iii) a separate and complete major industrial operation in connection with the performance of this contract; or (iv) all or substantially all of the Contractor's operations under this contract. The Government may at any time also require the Contractor 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 person has reasonable grounds to believe that any such employee is habitually careless or otherwise unqualified. als. (d) The provisions of this clause shall apply to any corrected or replacement services or materi (e) The Contractor shall provide and maintain an inspection system acceptable to the Government covering the material, fabricating methods, and the work and services hereunder. Records of all inspection work by the Contractor shall be complete and available to the Government at all reasonable times during performance of this contract and for such longer period as may be specified in this contract. (f) Except 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 materials furnished and services performed under this contract which at the time of delivery are defective in material or workmanship or otherwise not in conformity with the requirements of this contract. 7-901.21 ARMED SERVICES PROCUREMENT REGULATION 7:388 CONTRACT CLAUSES AND SOLICITATION PROVISIONS (g) Except as otherwise provided in the Schedule, the Contractor's obligation to correct or replace Government-furnished property (which is property in the possession of or acquired directly by the Government and delivered or otherwise made available to the Contractor) shall be governed by the provisions of the “Government Property" clause of this contract. (End of clause) In cases where inspection and acceptance are desired at the contractor's plant, the following may be inserted in place of the last sentence of paragraph (a): Acceptance by the Government of all the items (other than aircraft to be flown away, if any) to be furnished under this contract shall be at the plant or plants of the Contractor specified in the Schedule, or any other plant or plants approved for such purpose in writing by the Contracting Officer. The Contractor shall inform the inspector or Contracting Officer when the work is ready for inspection. The Government reserves the right to charge to the Contractor any additional cost of Government inspection and test when items are not ready at the time such inspection and test are requested by the Contractor. 7-901.22 New Material. In accordance with 1-1208, insert the clause in 7-104.48. 7-901.23 Pricing of Adjustments. Insert the clause in 7-103.26. 7-901.24 Renegotiation. In accordance with the requirements of 7-103.13, insert the appropriate contract clause therein. 7-901.25 Inspection System. When it is desired to require contractors to maintain an inspection system in accordance with Military Specification MIL1-45208 (see 14–303), insert the following clause. INSPECTION SYSTEM (1967 AUG) The inspection system which the Contractor is required to maintain, as provided in paragraph (e) of the "Inspection" clause of this contract, shall be in accordance with the edition of Military Specification MIL-I-45208 in effect on the date of this contract. (End of clause) 7-901.26 Quality Program. In accordance with 14-304, insert the clause in 7-104.28. 7-901.27 Equal Opportunity Pre-Award Clearance of Subcontracts. In accordance with 23-201.4, insert the clause in 7-104.22. 7-901.28 Minority Business Enterprises. In accordance with 1-332, insert the appropriate clause or clauses in 7-104.36. 7-901.29 Affirmative Action for Disabled Veterans and Veterans of the Vietnam Era. Insert the clause in 7-103.27. 7-901.30 Affirmative Action for Handicapped Workers. Insert the clause in 7-103.28. 7-901.31 Clean Air and Water. In accordance with 1-2302.2, insert the clause in 7-103.29. 7-902 Clauses To Be Used When Applicable. 7-902.1 Utilization of Small Business Concerns. In accordance with 1-707.3, insert the clause in 7-104.14. 7-902.2 Utilization of Labor Surplus Area Concerns. In accordance with 1-805, insert the clause in 7-104.20, as appropriate. 7-902.3 Military Security Requirements. In accordance with 7-104.12, insert the clause therein, deleting paragraph (c) and substituting the following: 7-902.3 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS (c) If, subsequent to the date of this contract, the security classification or security requirements under this contract are changed by the Government as provided in this clause and 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 (1) ceiling price, (2) hourly rates, (3) delivery schedule, and (4) in such other provisions of the contract as may be so affected, and the contract shall be modified in writing accordingly. Any equitable adjustment shall be accomplished in the same manner as if such changes were directed under the "Changes" clause of this contract. 7-902.4 Priorities, Allocations and Allotments. In accordance with 1-307.2, insert the clause in 7-104.18. 7-902.5 Buy American Act. In accordance with 7-104.3, insert the clause therein. 7-902.6 Notice to the Government of Labor Disputes. In accordance with 7-104.4, insert the clause therein. 7-902.7 Filing of Patent Applications. In accordance with 9-106, insert the clause in 7-104.6. 7-902.8 Patent Rights. In accordance with 9-107, insert the appropriate clause in 7-302.23. 7-902.9 Rights in Data. In accordance with 7-104.9, insert the appropriate clause, or clauses, therein. 7-902.10 Alterations in Contract. When required, insert the clause in 7-105.1(a). 7-902.11 Limitation on Withholding of Payments. In accordance with 7-104.21, insert the clause therein. 7-902.12 Communist Areas. In accordance with 6-403. insert the clause in 7-103.15. 7-902.13 Flight Risks. In accordance with 10-504, if the contract is for development, production, modification, maintenance, or overhaul of aircraft, or if it otherwise involves furnishing of aircraft to the contractor by the Government, include the clause from 7-204.21, but substitute the paragraph (c) below for paragraph (c) of the clause in 7-204.21. (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 ceiling price 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 in the ceiling price, hourly rate, delivery or performance date, or all of them and the contract shall be modified in writing accordingly; provided, in determining the amount of adjustment in the hourly rate that is equitable, any faults 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. 7-902.13 ARMED SERVICES PROCUREMENT REGULATION CONTRACT CLAUSES AND SOLICITATION PROVISIONS 7-902.14 Workmen's Compensation and War Hazard Insurance Overseas. In accordance with 10-403, insert the clauses in 7-104.2(a) and/or 7-104.2(b), depending on whether all contract employees are subject to the Defense Base Act or whether the Act has been waived as to all or part of the contract employees. Also insert the clause Reimbursement for War Hazard Losses in 7-104.2(c) and the language at 10-502(b) and (c) according to the instructions stated in those paragraphs. 7-902.15 Royalty Information. In accordance with 9-110(d), insert the clause in 7-104.8(a). 7-902.16 Reserved. 7-902.17 Interest. In accordance with E-620 and E-621, insert the clause in 7-104.39. 7-902.18 Price Reduction for Defective Cost or Pricing Data. Insert the clause in 7-104.29(a). 7-902.19 Limitation of Liability. In accordance with 1-330(b), insert the appropriate clause in 7-104.45. 7-902.20 Subcontractor Cost and Pricing Data. Insert the clause in 7-104.42(a). 7-902.21 Order of Precedence. In accordance with 3-501(b)Sec.C(xxxi), insert the clause in 7-2003.41. 7-902.22 Duty-Free Entry. In accordance with 6-603.2, insert the clause in 7-104.31. 7-902.23 United States Products and Services (Balance of Payments Program). In accordance with Section VI, Part 8, insert the clause in 7-2003.53. 7-902.24 Identification of Expenditures in the United States. In accordance with Section VI, Part 8, insert the clause in 7-104.58. 7-902.25 Material Inspection and Receiving Report. Insert the clause in 7-104.62 except in negotiated subsistence procurements and contracts for tanker/barge shipments of bulk petroleum products. 7-902.26 Insurance. In accordance with 10-405, insert the clause in 7-104.65. 7-902.27 Use of Excess and Near-Excess Currency. In accordance with 6-1110, insert the clause in 7-104.66. 7-902.28 Bills of Lading Covering Shipments To or From Contractor's Plant. In accordance with the requirements of 19-217.1(b), insert the clause in 7-203.14. 7-902.29 Safety Precautions for Ammunition and Explosives. In accordance with 7-104.79, insert the clause therein. 7-902.30 Notice of Radioactive Materials. In accordance with 7-104.80, insert the clause therein. 7-902.31 Procurement of Miniature and Instrument Ball Bearings. In accordance with 1-2207.3, insert the clause in 7-104.38. 7-902.32 Management Systems Requirements. In accordance with 16–827.1, insert the clause in 7-104.50. 7-902.33 Aircraft, Missile, and Space Vehicle Accident Reporting and Investigation. In accordance with 7-104.81, insert the clause therein. 7-902.34 Payment of Interest on Contractors' Claims. In accordance with 1-333, insert the clause in 7-104.82. 7-902.34 ARMED SERVICES PROCUREMENT REGULATION |