timely notice may preclude later consideration of any request for an extension of contract time.

(Paragraphs (b) and (c) are applicable only when the contract requires fabrication or manufacture, and delivery time for the first production unit exceeds 120 days.)

(b) Within 30 days from the date of contract, the contractor shall furnish in duplicate to the contracting officer, a schedule showing the projected timing for accomplishment of each phase of the work required for each contract item. Each 30 days thereafter the contractor shall furnish, in duplicate, a progress report which shall clearly indicate the current status of each phase of the scheduled work. The schedule and reports required by this section shall be in chart form unless a different manner of presentation is approved by the contracting officer. Any report which indicates a failure to meet the contract schedule, shall be accompanied by a narrative statement of the reasons for delay and the action being taken by the contractor to improve his rate of progress.

(c) The contractor agrees to insert the substance of this clause, including this paragraph, in any subcontract entered into as a result of this contract.

§ 2-7.150-4 Change in place of delivery.

CHANGE IN PLACE OF DELIVERY

When the Government directs shipment to a destination other than stated in the contract, and does not furnish a Government Bill of Lading, shipping and delivery charges shall be prepaid by the contractor. The cost of such shipment shall be shown as a separate item on each invoice and be supported by a prepaid waybill, express receipt, or Post Office Certificate of Mailing, Form 3817 showing cost of such shipment. The Government will make an adjustment at the time of payment to account for any difference in transportation costs and contract time due to a change in destination. § 2-7.150-5 Evidence of delivery.

EVIDENCE OF DELIVERY

When the contract delivery point is "f.o.b. origin", evidence of delivery shall be submitted with invoices. In the case of freight or express shipments, this evidence shall be in the form of memorandum copies of Bills of Lading duly receipted by the carrier. In the case of parcel post shipments this evidence shall be by Post Office Certificate of Mailing Form 3817. If the invoice submitted for payment is not accompanied by evidence of delivery, discounts for prompt payment will be computed from date of receipt of such evidence of delivery or the receipt of the Contractor's invoice, whichever is later. When the contract delivery point is other than "f.o.b. origin", evidence of delivery will be obtained from the consignee.

§ 2-7.150-6 Patent indemnity.

Except as provided in paragraph (c) below, a patent indemnity clause shall be used in contracts exceeding $5,000, in accordance with the following instructions:

(a) An effort shall be made to determine in advance of issuing the Invitation whether the supplies (or such supplies with relatively minor modifications made thereto) normally are or have been sold to the public in the commercial open market. When this determination is affirmative, the following clause entitled "Patent Indemnity (Predetermined)" shall be used. When the contract calls only in part for supplies normally sold to the public in the commercial open market, the items which are excluded shall be listed with a statement that the clause does not apply to the listed items:

PATENT INDEMNITY (PREDETERMINED)

The Contractor agrees to indemnify the Government and its officers, agents and employees against liability, including costs, for infringements of any United States letters patent (except letters patent issued upon an application which is now or may hereafter be kept secret or otherwise withheld from issue by order of the Government) arising out of the performance of this contract, or out of the use of or disposal by or for the account of the Government, of supplies furnished hereunder. The foregoing indemnity shall not apply unless the Contractor shall have been informed as soon as practicable by the Government of the suit or action alleging such infringement, and shall have been given such opportunity as is afforded by applicable laws, rules, or regulations to participate in the defense thereof; and further, such indemnity shall not apply if: (1) The infringement results from compliance with specific written instructions of the Contracting Officer directing a change in the supplies to be delivered or in the materials or equipment to be used; or (ii) the infringement results from addition to, or change in, such supplies or components furnished which addition or change was made subsequent to delivery or performance by the Contractor; or (iii) the claimed infringement is settled without the consent of the Contractor, unless required by final decree of a court of competent jurisdiction.

(b) When it cannot be determined in advance of issuing the Invitation that the supplies (or such supplies with relatively minor modifications made thereto) normally are or have been sold to the public in the commercial open market, the above clause (revised as follows

and entitled "Patent Indemnity (Not Pre-determined)") shall be used. Revision shall consist of changing the period at the end of the first sentence to a comma, and adding the following: "which supplies or component parts either normally are or have been sold or offered for sale to the public in the commercial open market by any supplier on or before the date set for the opening of bids, or are such supplies or component parts thereof, with relatively minor modifications made thereto".

(c) When it is definitely established that the supplies (or such supplies with relatively minor modifications made thereto) are not sold to the public in the commercial open market, no patent indemnity clause shall be used.

§ 2-7.150-7 Authorization and Consent. AUTHORIZATION AND CONSENT

(This clause does not apply to contracts where both performance and delivery are to be outside the United States, its possessions, or Puerto Rico.)

The Government hereby gives its authorization and consent (without prejudice to any rights of indemnification) for all use and manufacture, in the performance of this contract or any part hereof or any amendment hereto or any subcontract hereunder (including any lower-tier subcontract), of any invention described in and covered by a patent of the United States (1) embodied in the structure or composition of any article the delivery of which is accepted by the Government under this contract, or (ii) utilized in the machinery, tools, or methods the use of which necessarily results from compliance by the Contractor or the using subcontractor with (a) specifications or written provisions now or hereafter forming a part of this contract, or (b) specific written instructions given by the Contracting Officer directing the manner of performance. The entire liability to the Government for infringement of a patent of the United States shall be determined solely by the provisions of the indemnity clauses, if any, included in this contract or any subcontract hereunder (including any lower-tier subcontract), and the Government assumes liability for all other infringement to the extent of the authorization and consent hereinabove granted.

§ 2-7.150-8 Suspension of work.

The following clause shall be included in contracts only when the Contracting Officer has determined that its use is appropriate, as in cases where a work stoppage may reasonably be anticipated for reasons such as advancements of the

state of the art, production or engineering breakthroughs, or realignment of programs.

SUSPENSION OF WORK

The Contracting Officer may order the contractor in writing, to suspend all or any part of the work for such period of time as he may determine to be appropriate in the interest of the Government. To the extent such period of time may be unreasonable, the Contracting Officer shall make an adjustment for any increase in the time or cost of performance of the contract (excluding profit) necessarily caused by the unreasonable period of such suspension, and the contract shall be modified in writing accordingly. No adjustment under this clause shall be made to the extent that performance by the contractor would have been delayed by other causes if the work had not been so suspended. No claim under this clause shall be allowed unless the claim, in an amount stated, is asserted in writing and made to the Contracting Officer within thirty (30) days after the termination of such suspension; Provided, That if the Contracting Officer decides the facts justify such action, he may receive and act upon any such claim asserted at any time prior to final payment under this contract. Failure to agree to any adjustment shall be a dispute concerning a question of fact within the meaning of the "Disputes" Clause of this contract.

§ 2-7.150-9 Priorities, allocations, and allotments.

PRIORITIES, ALLOCATIONS, AND ALLOTMENTS

The Contractor shall follow the provisions of DMS Reg. 1 and all other applicable regulations and orders of the Business and Defense Services Administration in obtaining controlled materials and other products and materials required for the performance of this contract.

§ 2-7.150-10 Definition of delivery

terms.

DEFINITION OF DELIVERY TERMS

The meaning of delivery terms used in this contract such as "f.o.b. origin", "f.o.b. destination", "f.a.s. vessel, port of shipment”, and other delivery terms shall be as those terms are defined in 41 CFR 1-19.3.

§ 2-7.150-11 Collection of information.

COLLECTION OF INFORMATION

In performance of this contract the Contractor shall not collect information upon identical items from 10 or more persons by use of written report forms, application forms, schedules, questionnaires, or other similar methods, unless authorized in writing to do so by the Contracting Officer.

When property will be furnished by the Government in the performance of the contract, the following clause shall be included in the contract:

GOVERNMENT-FURNISHED PROPERTY

(a) The Government shall deliver to the Contractor, for use in connection with and under the terms of this contract, the property described in the Schedule or Specifications, together with such related data and information as the Contractor may request and as may reasonably be required for the intended use of such property. The delivery or performance dates for the supplies or services to be furnished by the Contractor under this contract are based upon the expectation that Government-furnished property suitable for use will be delivered to the contractor at the times stated in the schedule, or, if not so stated, in sufficient time to enable the Contractor to meet such delivery or performance dates. If material is not on hand within five days prior to the date it is required, immediate notification shall be given in writing to the Contracting Officer. Failure to give such notice may preclude later consideration of any request for extension of contract time. If such timely notice has been given, and the Government-furnished property is not delivered to the Contractor in sufficient time to permit delivery or performance within the schedule established in the contract, the Contracting Officer shall, upon timely written request made by the Contractor, make a determination of the delay occasioned the Contractor thereby, and shall adjust the delivery or performance dates or the contract price, or both. 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, either (i) return such property at the Government's expense or otherwise dispose of the property, or (ii) effect repairs or modifications. 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. 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 the delivery of Government-furnished property or delivery of such property in a condition not suitable for its intended use.

(b) By notice in writing the Contracting Officer may decrease the property furnished or to be furnished by the Government under this contract. In any such case, the Contracting Officer upon written request of the Contractor shall equitably adjust the delivery or performance or the contract price, or both.

(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 agrees to promptly receipt for all Government-furnished property and to maintain a suitable inventory control system acceptable to the Contracting Officer.

(d) The Government-furnished property shall, unless otherwise provided herein, be used only for the performance of this contract. The Contractor shall maintain and administer, in accordance with sound industrial practices, a program for the maintenance, repair, protection and preservation of Government-furnished property.

(e) Unless otherwise provided in this contract, the Contractor upon delivery to it of any Government-furnished property, assumes the risk of, and shall be responsible for, any loss thereof or damage thereto except for reasonable wear and tear, and except to the extent that such property is consumed in the performance of the contract. The Contractor shall not be liable for loss or destruction of or damage to Governmentfurnished property if such loss, destruction or damage is due to causes beyond the control and without the fault or negligence of the Contractor.

(f) The Government shall at all times have access to the premises wherein any Government-furnished property is located.

(g) Upon the completion of this contract, or at such earlier date as may be fixed by the Contracting Officer, the Contractor shall submit, in a form acceptable to the Contracting Officer, inventory schedules covering all items of Government-furnished property not consumed in the performance of this contract (including any resulting scrap), or not theretofore delivered to the Government, and shall deliver or make such other disposal of such Government-furnished property as may be directed or authorized by the Contracting Officer. The net proceeds of any such disposal shall be credited to the contract price or shall be paid in such manner as the Contracting Officer may direct. § 2-7.150-13

Reproduction and use of

technical data.

When the contract will require manufacture or fabrication of equipment, the following clause shall be included in the contract:

REPRODUCTION AND USE OF TECHNICAL DATA

(a) The Contractor agrees to and does hereby grant to the Government, to the full extent of the Contractor's right to do so without payment of compensation to others, the right to reproduce, use, and disclose for

Governmental purposes, all or any part of the reports, drawings, blueprints, data, and technical information acquired under this contract.

(b) The Contractor shall advise the Contracting Officer at the time of acquisition under this contract as to all or any part of the reports, drawings, blueprints, data, and technical information which the Contractor does not have the right to grant to the Government the right set forth in paragraph (a) above without payment of compensation to others.

§ 2-7.150-14 Dissemination of contract information.

DISSEMINATION OF CONTRACT INFORMATION

The Contractor shall not publish, permit to be published, or distribute for public consumption, any information, oral or written, concerning the objectives or results or conclusions made pursuant to performance of this contract, without the prior written consent of the Contracting Officer. (Two copies of any material proposed to be published or distributed shall be submitted to the Contracting Officer.)

§ 2-7.150-15

Security requirements.

The following clause shall be included in all contracts which are classified as "Confidential", including "ConfidentialModified Handling Authorized”, or higher and in any other contracts the performance of which will require access to such classified information or material. The Contracting Officer shall notify the Security Division, Office of Compliance and Security, when a. contract has been executed which contains a security requirements clause.

SECURITY REQUIREMENTS

(a) The provisions of this clause shall apply to the extent that this contract involves access to information classified "Confidential" including "Confidential-Modified Handling Authorized” or higher.

(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), or other written notification.

(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 Contractor 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), includ

ing the Department of Defense Industrial Security Manual for Safeguarding Classified Information as in effect on date of this contract, and any modification to the Security Agreement for the purpose of adapting the Manual to the Contractor's business; and (ii) any amendments to said Manual made 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 Department having security cognizance over the facility and representatives of the Federal Aviation Agency shall have the right to inspect at reasonable intervals the procedures, methods, and facilities utilized by the Contractor in complying with the security requirements under this contract. Should the Government, through these representatives, determine that the Contractor is not complying with the security requirements of this contract, the Contractor shall be informed in writing by the Security Office of the cognizant Military Department of the proper action to be taken in order to effect compliance with such requirements.

(e) If subsequent to the date of this contract, the security classifications or security requirements under this contract are changed by the Government as provided in this clause and the security costs under this contract are thereby increased or decreased, the contract price shall be subject to an equitable adjustment by reason of such increased or decreased costs. Any equitable adjustment shall be accomplished in the same manner as if such changes were directed under the "Changes" clause in this contract.

(f) The Contractor agrees to insert, in all subcontracts hereunder which involve access to classified information, provisions which shall conform substantially to the language of this clause, including this paragraph (f) but excluding the last sentence of paragraph (e) 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 been granted an appropriate facility security clearance, which is still in effect, prior to being accorded access to such classified information.

§ 2-7.150-16 Termination for convenience of the Government.

(a) In contracts exceeding $2,500 but not in excess of $10,000, the short-form clause set forth in § 1-8.705-1 of this title shall be used.

(b) In contracts exceeding $10,000, the clause set forth in § 1-8.701 of this title shall be used.

To the extent required by law, this contract is subject to the Renegotiation Act of 1951 (50 U.S.C. App. 1211, et seq.), as amended, and to any subsequent act of Congress providing for the renegotiation of contracts. Nothing contained in this clause shall impose any renegotiation obligation with respect to this contract or any subcontract hereunder which is not imposed by an act of Congress heretofore or hereafter enacted. Subject to the foregoing, this contract shall be deemed to contain all the provisions required by Section 104 of the Renegotiation Act of 1951, and by any such other act, without subsequent contract amendment specifically incorporating such provisions.

The Contractor agrees to insert the provisions of this clause, including this paragraph, in all subcontracts, as that term is defined in Section 103g of the Renegotiation Act of 1951, as amended.

(b) The Renegotiation clause is not required in:

(1) Contracts with a State, territory, possession, foreign government, agency or subdivision thereof;

or

(2) Contracts or subcontracts for an agricultural commodity in its raw or natural state, or in its first form or state in which it is customarily sold;

(3) Contracts or subcontracts for the product of a mine, oil or gas well, or other mineral or natural deposit, or timber which has not been treated beyond its first form or state suitable for industrial use;

(4) Contracts or subcontracts with a common carrier for transportation or with a public utility for gas, electric energy, water, communications, or transportation if made at published rates regulated by a public body or at unregulated rates substantially as favorable to users as are regulated rates;

(5) Contracts or subcontracts with tax-exempt charitable, religious, and educational institutions, or for the prevention of cruelty to children or animals, providing the income from the contract or subcontract is not taxable as unrelated business net income;

(6) Contracts which the Renegotiation Board determines to have no direct and immediate connection with the national defense; examples - building

maintenance and repair, laundry and cleaning services, and removal of waste material;

(7) Subcontracts under exempt contracts and subcontracts.

(c) Renegotiation is a complex subject. It is not therefore practicable to set forth in detail the many varied mandatory and permissive exemptions from the Renegotiation Act (for example, certain contracts for "standard commercial articles" and "standard commerical services" may not be subject to the Act). In any case where there is any doubt as to whether the contract is exempt from renegotiation, the clause shall be inserted in the contract.

§ 2-7.150-18 Loss or damage to leased aircraft.

When the contract is for the lease of aircraft, the clause set forth in § 210.401(a) shall be used under the conditions described therein.

§ 2-7.150-19 Price redetermination (prospective).

When it is determined, in accordance with § 1-3.404-5 of this title and § 23.404-5 to use a fixed-price contract providing for prospective redetermination of price, the following clause shall be included in the contract.

PRICE REDETERMINATION

(a) General. The unit prices and the total price set forth in this contract shall be in periodically redetermined accordance

The with the provisions of this clause.* prices for supplies delivered and services performed prior to the first effective date of price redetermination shall remain fixed.

(b) Price Redetermination Periods. For the purpose of price redetermination the performance of this contract is divided into successive periods. The first period shall extend from the date of this contract to ** and the second and each succeeding period shall extend for (‒‒‒‒‒‒) months from the end of the last preceding

*Where a ceiling is applicable, the following proviso shall be added "provided that in no event shall the total amount paid under this contract exceed dollars

($------)”. Alternatively, the contract may provide ceiling amounts for each or any of the price redeterminations under the contract.

**This point may be expressed in terms of units delivered, or a calendar date, but in either case the period shall generally end on the last day of a month.