(b) The action shall not obligate the Government in an amount in excess of $50,000.

(c) The action shall not release a contractor from performance of an obligation

(1) Priced in excess of $50,000; or (2) Where reprocurement is contemplated, unless the approving authority finds that the estimated actual or potential increase in cost to the Government will not exceed $50,000.

(d) The action shall not involve the disposal of Government surplus property.

(e) Mistakes shall not be corrected by action obligating the Government in an amount in excess of $500 unless notice of the mistake was given to the contracting officer before completion of the contractor's work or the effective date of contract termination.

(f) The correction of a contract because of a mistake in its making shall not result in increasing the original contract price above the next lowest responsive bid of a responsible bidder in the case of a formally advertised procurement, or the amount of the next lowest responsive proposal (at the time of award) of a responsible offeror considered in the case of a negotiated procurement.

§ 1-17.206

Contractual requirements.

Every contract entered into or amended or modified pursuant to this Part 1-17 shall contain:

(a) A citation of the Act and the Executive Order:

(b) A brief statement of the circumstances justifying the action;

(c) A recital of the finding that the action will facilitate the national defense;

(d) The contract clause entitled "Covenant Against Contingent Fees," as set forth in § 1-1.503;

(e) A contract clause in accordance with the examination of records requirements of section 3(b) of the Act (see § 1-3.814-2(e)), unless (1) the contract is for purchases authorized to be made outside the United States under the Foreign Assistance Act of 1961, and (2) pursuant to Executive Order No. 10784 of October 1, 1958 (3 CFR, 1954-1958 Comp., p. 422), as amended by Executive Order No. 10845 of October 12, 1959 (3 CFR, 1959-1963 Comp., p. 377), it is determined by the agency that inclusion of such

clause or compliance therewith (if included) would be impracticable;

(f) The Equal Opportunity clause prescribed in § 1-7.102-16;

(g) The Assignment of Claims clause prescribed in § 1-7.102-8;

(h) If otherwise applicable, the contract clause entitled Walsh-Healey Public Contracts Act as set forth in § 112.605; the contract clauses entitled Davis-Bacon Act and Compliance with Copeland Regulations as set forth in Standard Form 19-A (see § 1-16.901-19A); and the contract clause entitled Contract Work Hours and Safety Standards Act-Overtime Compensation as prescribed in § 1-7.102-15.

(i) Where an indemnification agreement is authorized under the Act, a contract clause providing that the Government's obligation under the agreement is expressly conditioned upon and subject to the availability of appropriated funds from which payment can be made; and

(j) Any other clauses which are appropriate to the particular procurement or required by law or regulation.

[29 FR 10348, July 24, 1964, as amended at 38 FR 6675, Mar. 12, 1973]

§ 1-17.207 Requests by contractors. § 1-17.207-1 Filing requests.

Any person seeking an adjustment under the standards set forth in § 1-17.204 (hereinafter referred to in this subpart as the "contractor") may file a request in duplicate with the cognizant contracting officer or his duly authorized representative. If such filing is impracticable, requests will be deemed to be properly filed if filed with the agency head.

§ 1-17.207-2 Form of requests.

The contractor's request shall normally consist of a letter to the contracting officer stating:

(a) The precise adjustment requested; (b) The essential facts summarized in chronological narrative form;

(c) The contractor's conclusions based on such facts and showing, in terms of the standards set forth in § 1-17.204, why the contractor considers himself entitled to the adjustment requested;

(d) Whether all obligations have been discharged under the contracts involved;

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action, although not creating any 11ability on its part, increases the cost of performance, considerations of fairness may make appropriate some adjustment of the contract.

§ 1-17.204-3 Mistakes.

(a) A defense contract may be amended or modified to correct or mitigate the effect of a mistake. The following are examples:

(1) A mistake or ambiguity which consists of the failure to express, or to express clearly, in a written contract the agreement as both parties understood it.

(2) A mistake on the part of the contractor which is so obvious that it was or should have been apparent to the contracting officer.

(3) A mutual mistake as to a material fact.

the

(b) Amending defense contracts to correct mistakes with the least possible delay normally will facilitate national defense by expediting the procurement program and by giving contractors proper assurance that such mistakes will be corrected expeditiously and fairly.

§ 1-17.204-4 Informal commitments.

Informal commitments may be formalized under certain circumstances to permit payment to persons who have taken action without a formal defense contract; for example, where any person, pursuant to written or oral instructions from an official of an agency and relying in good faith upon the apparent authority of the official to issue such instructions, has arranged to furnish or has furnished property or services to the agency or to a defense contractor or subcontractor without formal contractual coverage for such property or services. Formalization of commitments under such circumstances normally will facilitate the national defense by assuring such persons that they will be treated fairly and paid expeditiously. § 1-17.205 Limitations upon exercise of authority.

§ 1-17.205-1 General limitations.

(a) The Act is not authority for: (1) The use of the cost-plus-a-percentage-of-cost system of contracting;

(2) The making of any contract in violation of existing law relating to limitation of profit or fees;

(3) The negotiation of purchases of or contracts for property or services required by law to be procured by formal advertising and competitive bidding; or (4) The waiver of any bid, payment, performance or other bond required by law.

(b) No contracts, amendments, or modifications shall be entered into under authority of the Act:

(1) Unless a finding is made that the action will facilitate the national defense;

(2) Unless other legal authority within the agency concerned is deemed to be lacking or inadequate; and

(3) Except within the limits of the amounts appropriated and the statutory contract authorization.

(c) No contract shall be amended or modified:

(1) Unless the request therefor has been filed before all obligations (including final payment) under the contract have been discharged; and

(2) If the contract was negotiated under section 302(c) (14) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 252(c) (14)) or under 10 U.S.C. 2304(a) (15), to increase the contract price to an amount higher than the lowest rejected bid of any responsible bidder.

(d) No informal commitment shall be formalized:

(1) Unless a request for payment has been filed within six months after arranging to furnish or furnishing property or services in reliance upon the commitment; and

(2) Unless it is found that at the time the commitment was made it was impracticable to use normal procurement procedures.

At the time the contractor's requests is filed, a preliminary record thereof, as described in Subpart 1-17.4, shall be prepared.

§ 1-17.207-4 Facts and evidence.

(a) General. The contracting officer or an approving authority shall, where considered appropriate, request the contractor to furnish additional facts and evidence, as described in this paragraph (a), and, in addition, where applicable, as described in (b), (c), (d), or (e) of this 1-17.207-4. (In complying with such requests, the contractor may also submit other statements and evidence which he may consider helpful to the case.):

(1) If written contracts are involved, a brief description of the contracts, indicating the dates of execution and amendments thereto, the items being procured, the price or prices and delivery schedules and revisions thereof, and such other special contractual provisions as may be relevant to the request;

(2) A history of performance indicating when work under the contracts or commitments was begun, the progress made to the present, an exact statement of the contractor's remaining obligations, and the contractor's expectations regarding completion thereof;

(3) A statement of payments received, payments due, and payments yet to be received or to become due, including advance and progress payments, and amounts withheld by the Government, and information as to other obligations of the Government, if any, which are yet to be performed under the contract;

(4) A statement giving a detailed analysis of the monetary elements of

the request including precisely how the actual or estimated dollar amount of the request was arrived at, the effect of approval or denial on the contractor's profits before Federal income taxes, and whether the costs for which reimbursement is requested have been included as a part of his gross costs in statutory renegotiation proceedings, together with the contractor's renegotiation status for the relevant years;

(5) If a written contract is involved, a statement of the contractor's understanding of why the subject matter of the request cannot now, and could not at the time it arose, be disposed of under the terms of the contract itself;

(6) The best evidence available to the contractor in support of any facts alleged by the contractor, including contemporaneous memoranda, correspondence, affidavits, and any other material tending to establish matters of fact;

(7) Relevant financial statements, cost analyses, or other such data, preferably certified by a certified public accountant, including such additional financial data as are necessary to explain fully and to support the monetary elements of the request for adjustment;

(8) A list of persons (within the agency, in the employ of the contractor, or otherwise connected with the contract) who have some factual knowledge of the subject matter, including where possible the name, office or title, address, and telephone number of each such person;

(9) A statement and evidence of steps taken to mitigate loss and reduce claims to a minimum; and

(10) Such other statements or evidence as may be requested by the contracting officer.

(b) Amendments without consideration under § 1-17.204-2(a). In addition to the facts and evidence listed in § 117.207-4(a), where a request involves possible amendment without consideration and essentiality to the national defense is a factor, the contractor shall be asked to furnish such of the following as is deemed appropriate to the request:

(1) A statement and evidence of the contractor's original breakdown of estimated costs, including contingency allowances and profit;