forth in paragraph (a) of this section may be varied to take into account the contractor's established billing procedures.

(c) In the case of cost-sharing contracts or, where determined by the Contracting Officer to be appropriate, of cost-reimbursement-type contracts without fee

(1) Insert the following paragraph in lieu of paragraph (c) of the clause set forth above in paragraph (a) of this section, except that if the contract does not provide for cost sharing, delete the parenthetical references to the Government's share

(c) Promptly after receipt of each invoice or voucher, the Agency shall review the document to the extent deemed necessary and appropriate, and authorize payment to be made of the approved amount. After payment of an amount equal to eighty percent (80%) of (the Government's share of) the total estimated cost of performance of this contract set forth in the clause entitled "Limitation of Cost", further payment on account of allowable cost shall be withheld until a reserve of five (5%) percent of (the Government's share of) such total estimated cost shall have been set aside.

(2) Delete paragraph (a)(2) and the words "fixed fee" from paragraphs (a) or (e) of the clause set forth in paragraph (a) of this section. Amend paragraph (a)(1)(i) of the clause to reflect Subpart 1-15.3 when the contractor is an educational institution.

(3) In contracts which provide for cost sharing, change paragraph (a) of the clause set forth in paragraph (a) of this section as follows:

(a) For the performance of this contract, the Government shall pay to the Contractor:

(1) The cost thereof (hereinafter referred to as "allowable costs") determined by the Agency to be allowable in accordance with

(i) Subpart 1-15.2 of the Federal Procurement Regulations in effect on the date of this contract; Provided, however, That unallowable costs shall include but not be limited to the following items:

Overtime or shift premiums not reasonably or properly allocable to the contract work unless it will result in lower overall cost to the Government;

Equipment purchased as direct costs to the contract without prior approval of the Contracting Officer;

And provided further, That cost for air transportation will normally be allowed at less than first-class rates only; and (ii) the terms of this contract.

(d) In the clause paragraph (c) set forth in paragraph (c)(1), of this section, the percentage to be held in reserve may be varied as appropriate but in no case may it be less than five (5%) percent or more than ten (10%) percent.

(e)(1) The title of the clause set forth in paragraph (a) of this section shall be changed to "Allowable Cost and Payment," where appropriate.

(2) Other modifications to the clause set forth in paragraph (a) of this section may be made as appropriate to reflect the proper fee arrangement (such as incentive fee) concluded between the Government and the Contractor.

§ 23-7.5002-5 Subcontracts.

SUBCONTRACTS

(a) The Contractor shall not enter into any contractual undertaking with a third party, including individuals utilized by the Contractor as consultants (but excluding individuals serving or to serve as regular employees of the Contractor and agreements for the acquisition of office supplies that are expended in the performance of the contract) for the performance in whole or in part of any of the work under this contract without the prior consent of the Contracting Officer, which consent shall not be unreasonably withheld.

(b) The Contracting Officer may, in his discretion, ratify in writing any such subcontract; such action shall constitute the consent of the Contracting Officer required by this paragraph.

(c) The Contracting Officer may, in his discretion, specifically approve in writing any of the provisions of a subcontract. However, such approval or the consent of the Contracting Officer obtained as required by this clause shall not be construed to constitute a determination of the allowability of any cost under this contract, unless such approval specifically provides that it constitutes a determination of the allowability of such cost.

(d) Except as otherwise authorized in writing by the Contracting Officer, the Contractor shall insert provisions similar to those contained in this clause in all subcontracts under this contract.

§ 23-7.5002-6 Litigation and claims. (a) Clause:

LITIGATION AND CLAIMS

The Contractor shall give the Contracting Officer immediate notice in writing of any action filed against the Contractor arising out of the performance of this contract and of any claim (excluding billings by subcontractors or consultants for duly contracted services rendered in the performance of this contract) against the Contractor the cost and expense of which is allowable under the clause entitled "Allowable Cost, Fixed Fee and Payment". Except as otherwise directed by the Contracting Officer in writing, the Contractor shall furnish immediately to the Contracting Officer copies of all pertinent papers received by the Contractor with respect to such action or claim. To the extent not in conflict with any applicable policy of insurance, the Contractor may, with the Contracting Officer's approval, settle any such action or claim, shall effect at the Contracting Officer's request an assignment and subrogation in favor of the Government of all the Contractor's right and claims (except those against the Government) arising out of any such action or claim against the Contractor, and, if required by the Contracting Officer, shall authorize representatives of the Government to settle or defend any such action or claim and to represent the Contractor in, or take charge of, any action. If the settlement or defense of an action or claim against the Contractor is undertaken by the Government, the Contractor shall furnish all reasonable assistance in effecting a settlement or asserting a defense. Where an action against the Contractor is not covered by a policy of insurance the Contractor shall, with the approval of the Contracting Officer, proceed with the defense of the action in good faith, and in such event the defense of the action shall be at the expense of the Government: Provided, however, That the Government shall not be liable for such expense to the extent that it would have been compensated for by insurance which was required by law or by the written direction of the Contracting Officer, but which the Contractor failed to secure through its own fault or negligence for reasons other than the refusal of an insurer to issue a policy which was required by Contracting Officer's direction.

(b) In the clause set forth in paragraph (a) of this section, the title of the clause "Allowable Cost, Fixed Fee and Payment" may be amended as appropriate.

§ 23-7.5002-7 Publication and release of information.

Insert the clause set forth in § 237.154 where the use of the clause is appropriate.

§ 23-50.103 Limitations.

(a) The authority of the Agency to make grants is limited to U.S. public or private institutions or persons. Accordingly, any application from an institution or person other than a U.S. public or private institution or person will not be considered. Private persons will not ordinarily be awarded grants except under the sponsorship of an educational institution of higher learning or of some other established nonprofit organization. Normally, organizations for profit will not be awarded grants. Exceptionally, grants may be made to such organizations if the results of its activities cannot otherwise be obtained and if one or more of the following criteria are met:

(1) The research, development, or study to be undertaken is of special concern or interest and shows promise of making an outstanding contribution to the acquisition of theoretical or practical knowledge in the field of arms control and disarmament;

(2) Unique resources are available for the work.

(b) The Act restricts the Agency's authority to make grants with respect to research, development and studies

related to arms control and disarmament to the following:

(1) The detection, identification, inspection, monitoring, limitation, reduction, control, and elimination of armed forces and armaments, including thermonuclear, nuclear, missile, conventional, bacteriological, chemical, and radiological weapons;

(2) The techniques and systems of detecting, identifying, inspecting, and monitoring of tests of nuclear, thermonuclear, and other weapons;

(3) The analysis of national budgets, levels of industrial production, and economic indicators to determine the amounts spent by various countries for armaments;

(4) The control, reduction, and elimination of armed forces and armaments in space, in areas on and beneath the earth's surface, and in underwater regions;

(5) The structure and operation of international control and other organizations useful for arms control and disarmament;

(6) The training of scientists, technicians, and other personnel for manning the control systems which may be created by international arms control and disarmament agreements;

(7) The reduction and elimination of the danger of war resulting from accident, miscalculation, or possible surprise attack, including (but not limited to) improvements in the methods of communications between nations;

(8) The economic and political consequences of arms control and disarmament, including the problems of readjustment arising in industry and the reallocation of national resources;

(9) The arms control and disarmament implications of foreign and national security policies of the United States with a view to a better understanding of the significance of such policies for the achievement of arms control and disarmament;

(10) The national security and foreign policy implications of arms control and disarmament proposals with a view to a better understanding of the effect of such proposals upon national security and foreign policy;

(11) Methods for the maintenance of peace and security during different

stages of arms control and disarmament;

(12) The scientific, economic, political, legal, social, psychological, military, and technological factors related to the prevention of war with a view to a better understanding of how the basic structure of a lasting peace may be established;

(13) Such related problems as the Director may determine to be in need of research, development, or study in order to carry out the provisions of the Act.

Subpart 23-50.2-Submission of Applications

§ 23-50.201 Who may apply for a grant.

Application for grants normally shall be submitted by a nonprofit organization, or by an educational institution. Such applications must be signed by an official duly authorized to execute such instruments.

§ 23-50.202 Where to submit applications.

Applications for grants shall be submitted to the Office of the Executive Director, U.S. Arms Control and Disarmament Agency, 320 21st Street NW., Washington, D.C. 20451.

§ 23-50.203 What to submit.

The Agency does not prescribe any particular format to govern the preparation of applications for grants. The Agency must be supplied, however, with essential information on which to base a determination to award a grant. The applications shall cover the points given below insofar as these may be applicable.

(a) Name and address of institution. The name, address, and telephone number of the prospective grantee shall be given. Where the official designation of the organization differs from the designation commonly used, the official designation shall be given, followed by the popular name enclosed in parentheses.

(b) Title of proposed research. The title of the proposed research should be brief but adequately descriptive.

(c) Desired starting date of the research. Proposed alternate starting dates may be specified, taking into ac

count the time required by the Agency's personnel for review and evaluation.

(d) Time period for which support is requested. The length of time for which support is being requested, ordinarily up to a year, must be consistent with the nature and complexity of the proposed research. The Agency will consider and process each request for subsequent support as an application for a new research grant, except in those cases of pilot or feasibility studies which contemplate additional funding upon satisfactory conclusion of the preliminary study.

(e) Description of proposed research. Applications must include a brief abstract describing the proposed research. In addition, the applicant shall provide a more detailed description of the work to be undertaken, its objectives, and its relation to the present state of knowledge on the subject and to comparable work in progress elsewhere, together with pertinent bibliographic citations. The general plan of the work to be undertaken must be included. The Agency will be influenced by the adequacy of information in its appraisal of the merits of the proposed research.

(f) Facilities and equipment. (1) Prospective grantees should own or control the capital facilities and equipment necessary to the research. The application for grant must identify the facilities available, as well as those items of equipment specially adapted or suited to the proposed research. As a general policy, Agency grants do not provide for the acquisition, refurbishment, or renovation of facilities and equipment. Therefore, requests for such acquisition, refurbishment or renovation of equipment with grant funds for use in performance of the research requires prior Agency approval. Except as stated below, title to such equipment shall pass to the Government upon acquisition.

(2) Under the authority of 42 U.S.C. 1891 and 1892, grants may be made to nonprofit institutions of higher learning (or to nonprofit organizations whose primary purpose is the conduct of scientific research) for basic or applied scientific research. Such grants may permit title to specialized equip

ment for research purchased with grant funds to vest in such institutions or organizations without further obligation to the Government or on such other terms and conditions as the Agency deems appropriate.

(g) Personnel. (1) The principal investigator shall be responsible for direct supervision of the work and in most instances will participate in the conduct of the research regardless of whether or not he is to receive any compensation from the grant funds. The proposal shall list the names and titles of professional personnel to be associated directly with the research, including the level of effort each is expected to devote to the undertaking.

(2) A short biographical sketch of the principal investigator and a list of his principal publications must be included along with similar biological information on other senior professional personnel who will be directly associated with the project. If applicable, the number of student or other assistants, together with information as to their level of academic attainment, shall be listed. The names and titles of other scientific and technical personnel who are expected to be associated with the project in an advisory or consulting capacity must be shown.

(h) Financial information. Each applicant must submit an estimate of the total cost of the project, with a breakdown of estimated costs per year in the categories listed below. Parts 115.1 through 1-15.3 of this title set forth principles for determining what costs are reasonable and allowable. ACDA will use these principles in determining the extent to which it will support a research grant proposal. Applicants will list in similar categories, contributions that other sources will make to the research.

(1) Salaries. (i) List the names of personnel who will perform the work; the percentage of time each will devote to the research; and the present salary, rate of pay, or stipend of each individual who is to be compensated under the grant; and, the total amount of salary per year that each will be paid from the grant.

(ii) Request funds to defray a portion, or all, of the salaries of personnel who will work on the research. Sti