cretion approve in writing) from the date of such completion.

(f) Documentation for mission. When submitting Voucher Form SF-1034 to the Paying Office listed on the Cover Page of this contract, the Contractor shall at the same time airmail to the Mission Controller one copy of vendor's invoices for all items of commodities, equipment and supplies (except magazines, pamphlets and newspapers) procured and shipped overseas and for which the cost is reimbursable under this contract. (For items shipped from Contractor's stocks where vendor's invoices are not available, a copy of the documents used for posting to Contractor's account shall be furnished.)

(g) The Contractor agrees that all approvals of the Mission Director and the Contracting Officer which are required by the provisions of this contract shall be preserved and made available as part of the Contractor's records which are required to be preserved and made available by the Clauses of this contract entitled "Examination of Records by Comptroller General" and "Audit and Records".

(h) The Contractor agrees that any refunds, rebates, credits, or other amounts (including any interest thereon) accruing to or received by the Contractor or any assignee under this contract shall be paid by the Contractor to the Government to the extent that they are properly allocable to costs for which the Contractor has been reimbursed by the Government under this contract. Reasonable expenses incurred by the Contractor for the purpose of securing such refunds, rebates, credits, or other amounts shall be allowable costs hereunder when approved by the Contracting Officer. Prior to final payment under this contract, the Contractor and each assignee under this contract whose assignment is in effect at the time of final payment under this contract shall execute and deliver an assignment and a release using A.I.D. Forms 1420-40 or 1420-44, as appropriate, as required in AIDPR 7-16.851.

(1) An assignment to the Government, in form and substance satisfactory to the Contracting Officer, of refunds, rebates, credits, or other amounts (including any interest thereon) properly allocable to costs for which the Contractor has been reimbursed by the Government under this contract; and

(2) A release discharging the Government, its officers, agents, and employees from all liabilities, obligations, and claims arising out of or under this contract, subject only to the following exceptions:

(1) Specified claims in stated amounts or in estimated amounts where the amounts are not susceptible of exact statement by the Contractor;

(ii) Claims, together with reasonable expenses incidental thereto, based upon liabilities of the Contractor to third parties arising out of the performance of this contract; provided that such claims are not

known to the Contractor on the date of the execution of the release; and provided further that the Contractor gives notice of such claims in writing to the Contracting Officer not more than six (6) years after the date of the release or the date of any notice to the Contractor that the Government is prepared to make final payment, whichever is earlier; and

(iii) Claims for reimbursement of costs (other than expenses of the Contractor by reason of his indemnification of the Government against patent liability), including reasonable expenses incidental thereto, incurred by the Contractor under the provisions of this contract relating to patents.

(i) Any dollar cost incurred by the Contractor under the terms of this contract which would constitute allowable cost under the provisions of this clause shall be included in determining the amount payable under this contract, notwithstanding any provisions contained in the specifications or other documents incorporated in this contract by reference, designating services to be performed or materials to be furnished by the Contractor at his expense or without cost to the Government.

[37 FR 3804, Feb. 23, 1972, as amended at 38 FR 28672, Oct. 16, 1973; 39 FR 21129, June 19, 1974]

§ 7-7.5001-10 Negotiated

rates.

overhead

NEGOTIATED OVERHEAD RATES (Nov. 1973)

(a) Notwithstanding the provisions of the clause of this Contract entitled "Allowable Cost, Fixed Fee, and Payment", the allowable indirect costs under this Contract shall be obtained by applying negotiated overhead rates to bases agreed upon by the parties, as specified below.

(b) The Contractor, as soon as possible but not later than ninety (90) days after the close of each of his fiscal years during the term of this Contract, shall submit to the Contracting Officer with copies to the cognizant audit activity, the A.I.D. Auditor General, and the A.I.D. Overhead and Special Cost Branch, a proposed final overhead rate or rates for that period based on the Contractor's actual cost experience during that period, together with supporting cost data. Negotiation of final overhead rates by the Contractor and the Contracting Officer shall be undertaken as promptly as practicable after receipt of the Contractor's proposal.

(c) Allowability of costs and acceptability of cost allocation methods shall be determined in accordance with Subpart 1-15.2 (Principles and Procedures for Use in Cost-Reimbursement Type Sup

ply and Research Contracts with Commercial Organizations) of the Federal Procurement Regulations as in effect on the date of this Contract.

(d) The Results of each negotiation shall be set forth in a written overhead rate agreement, executed by both parties. Such agreement is automatically incorporated in this Contract upon execution and shall specify (1) the agreed final rates, (2) the bases to which the rates apply, (3) the periods for which the rates apply, and (4) the items treated as direct costs. The overhead rate agreement shall not change any monetary ceiling, contract obligation, or specific cost allowance or disallowance provided for in this Contract.

(e) Pending establishment of final overhead rates for any period, the Contractor shall be reimbursed either at negotiated provisional rates as provided in the Contract or at billing rates acceptable to the Contracting Officer, subject to appropriate adjustment when the final rates for that period are established. To prevent substantial over or under payment, and to apply either retroactively or prospectively, (1) provisional rates may, at the request of either party be revised by mutual agreement, and (2) billing rates may be adjusted at any time by the Contracting Officer. Any such revisions of negotiated provisional rates specified in the Contract shall be set forth in a modification to this Contract.

(f) Any failure by the parties to agree on any final rate or rates under this clause shall be considered a dispute within the meaning of the "Disputes" clause of this contract and shall be disposed of in accordance therewith. [38 FR 28672, Oct. 16, 1973]

§ 7-7.5001-11

Assignment of claims.

ASSIGNMENT OF CLAIMS (DECEMBER 1970) (a) Pursuant to the provisions of the Assignment of Claims Act of 1940, as amended (31 U.S.C. 203, 41 U.S.C. 15), if this contract provides for payments aggregating $1,000 or more, claims for monies due or to become due the Contractor from the Government under this contract may be assigned to a bank, trust company, or other financing institution, including any Federal lending agency, and may thereafter be further assigned and reassigned to any such institution. Any such assignment or reassignment shall cover all dollar amounts payable under this contract and not already paid, and shall not be made to more than one party, except that any such assignment or reassignment

may be made to one party as agent or trustee for two or more parties participating in such financing.

(b) In no event shall copies of this contract or of any plans, specifications, or other similar documents relating to work under this contract, if marked "Top Secret," "Secret," or "Confidential" be furnished to any assignee of any claim arising under this contract or to any other person not entitled to receive the same. However, a copy of any part or all of this contract so marked may be furnished, or any information contained therein may be disclosed, to such assignee upon the prior written authorization of the Contracting Officer.

the

(a) Unless otherwise provided in Schedule of this contract, the Contractor shall prepare and submit to the Contracting Officer three (3) copies of a semi-annual report which shall include the following:

(1) A substantive report covering the status of the work under the Contract, indicating progress made with respect thereto, setting forth plans for the ensuing period, including recommendations covering the current needs in the fields of activity covered under the terms of this contract.

(2) An administrative report covering expenditures and personnel employed under the contract.

(b) Contractor shall prepare and submit to the Contracting Officer such other report as may be specified in the Schedule.

(c) Unless otherwise provided in the schedule of this contract, at the conclusion of the work hereunder, the Contractor shall prepare and submit to the Contracting Officer three (3) copies of a final report which summarizes the accomplishments of the assignment, methods of work used and recommendations regarding unfinished work and/or

program continuation. The final report shall be submitted within 45 days after completion of the work hereunder unless this period is extended in writing by the Contracting Officer.

(d) Contractor shall submit two copies of each report dealing with technical matters (e.g., progress and final reports) prepared pursuant to this clause, or a clause of the Schedule of this contract to the AID Reference Center, Agency for International Development, Washington, D.C. 20523. The title page of all reports forwarded to the A.I.D. Reference Center pursuant to this paragraph (d) shall include the contract number, project number and project title as set forth in the schedule of this contract.

(e) In preparing reports the Contractor shall refrain from using elaborate art work, multicolor printing and expensive paper and binding, unless it is specifically authorized in the Schedule. Wherever possible, pages should be printed on both sides using single spaced type.

[37 FR 3804, Feb. 23, 1972, as amended at 38 FR 28673, Oct. 16, 1973]

§ 7-7.5001-17 Source requirements of procurement of equipment, vehicles, materials, and supplies.

SOURCE REQUIREMENTS OF PROCUREMENT OF EQUIPMENT, VEHICLES, MATERIALS, SUPPLIES, AND SERVICES (SEPTEMBER 1974)

(a) Except as may be specifically approved or directed in advance by the Contracting Officer or as exempted in paragraph (d) below, the source of any procurement financed under this contract shall be the United States and it shall have been mined, grown, or through manufacturing, processing, or assembly, produced in the United States. The term "source" means the country from which a commodity is shipped to the Cooperating Country, or the Cooperating Country if the commodity is located therein at the time of purchase. If, however, a commodity is shipped from a free port or bonded warehouse in the form in which it is received therein, "source" means the country from which the commodity was shipped to the free port or bonded warehouse. In addition to the foregoing rule, a produced commodity will not be eligible for financing under this contract if:

(1) It contains any component from countries other than free world countries as described in A.I.D. Geographic Code 935; or

(2) It contains components which were imported into the country of production from such free world countries other than authorized source countries; and

(1) Such components were acquired by the producer in the form in which they were imported; and

(11) The total cost of such components (delivered at the point of production) amounts to more than 50 percent, or such other percentage as A.I.D. may prescribe, of

the lowest price (excluding the cost of ocean transportation and marine insurance) at which the supplier makes the commodity available for export sale (whether or not financed by A.I.D.).

(b) If (1) the effective use of printed or audio-visual teaching materials depends upon their being in the local language, and (ii) such materials are intended for technical assistance projects or activities financed by A.I.D. in whole or in part, and (iii) other funds, including U.S.-owned or U.S.-controlled local currencies, are not readily available to finance the procurement of such materials, local language versions may be procured from the following sources, in order of preference:

Countries selected from Geographic Code (See AIDPR 7-6.5201-1):

(1) 000 United States, including the AID Regional Technical AID Centers.

(2)

Cooperating Country, identified, when applicable, by specific reference to the name and corresponding AID geographic code.

(3) 901 Limited Free World. (4) 899 Free World.

(c) The contractor shall purchase all English language books from the current AID Contractor providing purchasing services of such materiai at discount prices: Provided, however, That the Contractor may purchase books from other sources if the terms, price, delivery, and other factors considered, are as good as, or better than, those offered by the current AID contractor. The procedure to be followed, the name and address of the contractor, and pertinent provisions of the contract are set forth in AID Manual Order 1425.3.

(d) Procurements in the Cooperating Country which are less than $2.500.00, and are for materials (regularly available and normally sold on the local market) which are to be consumed or expended in the performance of this contract, are exempt from the conditions set forth above other than (a) (1). Such materials include but are not limited to, raw and processed materials, parts, components, assemblies, small tools and supplies. [37 FR 3804, Feb. 23, 1972, as amended at 39 FR 21129, June 19, 1974] § 7-7.5001-18

Subcontracts and pur

chase orders. SUBCONTRACTS AND PURCHASE ORDERS (DECEMBER 1971)

(a) Subcontractors and/or vendors shall be selected on a competitive basis to the maximum practicable extent consistent with the obligations and requirements of this contract. In no event shall any such subcontract or purchase order be on a cost-plus-apercentage-of-cost basis.

(b) Unless authorized by the schedule of this contract, written approval by the Contracting Officer is required prior to the placement of any subcontract or purchase order which:

(1) Is for the purchase and/or lease of vehicles.

(2) Is for the purchase of any equipment, material or supplies in excess of $2,500.00. (3) Is written on a cost-reimbursement, time and material or labor hour basis.

(4) Is for the furnishing of any of the work or services required by this contract. For the purpose of this subparagraph (4); purchase of materials, supplies, equipment and vehicles is not considered to be work or services required by this contract (reference subparagraphs (1) and (2) for approval requirements on vehicles, materials, equipment and supplies).

(c) The data to be furnished when submitting subcontracts or purchase orders for approval shall include as a minimum:

(1) A description of supplies or services being purchased.

(2) Identification of subcontractor or vendor and an explanation of how the proposed subcontractor was selected including the extent of competition obtained.

(3) Statement as to why the type of Contract (if other than firm fixed price) and the price/estimated cost are considered to be reasonable and in the best interest of the project.

(4) Subcontractor representations and certifications (1.e., Certificate of Cost or Pricing Data, etc.) as required by other provisions of this contract.

(d) Contracting Officer approval 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.

[37 FR 3804, Feb. 23, 1972, as amended at 38 FR 28673, Oct. 16, 1973]

§ 7-7.5001-19 Title to and care of property.

Insert the clause as required by AIDPR 7-13.703.

of

Small

§ 7-7.5001-20 Utilization Business Concerns. Insert the clause set forth in FPR 1-1.710-3(a) and the following paragraph (c).

(c) Small Business Provision. To permit A.I.D. in accordance with the Small Business Provisions of the Foreign Assistance Act, to give United States Small Business firms an opportunity to participate in supplying equipment supplies and services financed under this contract, the Contractor, shall to the maximum extent possible, provide the following information to the Small Business Office, A.I.D., Washington, D.C. 20523, at least 45 days prior to placing any order in excess of Five Thousand Dollars ($5,000), except where a shorter time is requested of, and granted by the Small Business Office:

(1) Brief general description and quantity of commodities or services;

(2) Closing date for receiving quotations or bids; and

(3) Address where invitations or specifications may be obtained.

[37 FR 3804, Feb. 23, 1972, as amended at 38 FR 28673, Oct. 16, 1973]

§ 7-7.5001-21

Utilization of concerns in labor surplus areas.

Insert the clause set forth in FPR 1-1.805-3(a).

§ 7-7.5001-22 Insurance liability to third persons.

INSURANCE LIABILITY TO THIRD PERSONS
(DECEMBER 1970)

(a) The Contractor shall procure and thereafter maintain workmen's compensation, employer's liability, comprehensive general liability (bodily injury) and comprehensive automobile liability (bodily injury and property damage) insurance, with respect to performance under this contract, and such other insurance as the Contracting Officer may from time to time require with respect to performance under this contract; provided, that the Contractor may, with the approval of the Contracting Officer, maintain a self-insurance program, and provided further, that with respect to Workmen's Compensation the Contractor is qualified pursuant to statutory authority. All insurance required pursuant to the provisions of this paragraph shall be in such form, in such amounts, and for such periods of time, as the Contracting Officer may from time to time require or approve, and with insurers approved by the Contracting Officer.

(b) The Contractor agrees, to the extent and in the manner required by the Contracting Officer, to submit for the approval of the Contracting Officer any other insurance maintained by the Contractor in connection with the performance of this contract and for which the Contractor seeks reimbursement hereunder.

(c) The Contractor shall be reimbursed: (1) For the portion allocable to this contract of the reasonable cost of insurance as required or approved pursuant to the provisions of this clause; and

(2) For liabilities to third persons for loss of or damage to property (other than property:

(1) Owned, occupied or used by the Contractor or rented to the Contractor; or

(11) In the care, custody, or control of the Contractor), or for death or bodily injury, not compensated by insurance or otherwise, arising out of the performance of this contract, whether or not caused by the negligence of the Contractor, his agents, servants or employees, provided such liabilities are represented by final judgments or settlements approved in writing by the Government, and expenses incidental to such liabilities, except liabilities (I) for which the

Contractor is otherwise responsible under the express terms of the clause or clauses, if any, specified in the Schedule, or (II) with respect to which the Contractor has failed to insure as required or maintain insurance as approved by the Contracting Officer, or (III) which results from willful misconduct or lack of good faith 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 (A) all or substantially all of the Contractor's business, or (B) all or substantially all of the Contractor's operations at any one plant or separate location in which this contract is being performed, or (C) a separate and complete major industrial operation in connection with the performance of this contract. The foregoing shall not restrict the right of the Contractor to be reimbursed for the cost of insurance maintained by the Contractor in connection with the performance of this contract, other than insurance required to be submitted for approval or required to be procured and maintained pursuant to the provisions of this clause, provided such cost would constitute Allowable Cost under the clause of this contract entitled "Allowable Cost, Fixed Fee and Payment".

(d) The Contractor shall give the Government or its representatives immediate notice of any suit or action filed, or prompt notice of any claim made, against the Contractor arising out of the performance of this contract, the cost and expense of which may be reimbursable to the Contractor under the provisions of this contract and the risk of which is then uninsured or in which the amount claimed exceeds the amount of coverage. The Contractor shall furnish immediately to the Government copies of all pertinent papers received by the Contractor. If the amount of the liability claimed exceeds the amount of coverage, the Contractor shall authorize representatives of the Government to collaborate with counsel for the insurance carrier, if any, in settling or defending such claim. If the liability is not insured or covered by bond, the Contractor shall, if required by the Government, authorize representatives of the Government to settle or defend any such claim and to represent the Contractor in or take charge of any litigation in connection therewith; provided, however, that the Contractor may, at his own expense, be associated with the representatives of the Government in the settlement or defense of any such claim or litigation. § 7-7.5001-23 Termination for default or for convenience of the Government.

Insert the clause set forth in FPR 18.702.

§ 7-7.5001-24 Excusable delays.

Insert the clause set forth in FPR 18.708.

STOP WORK ORDER (DECEMBER 1970) (a) The Contracting Officer may, at any time, by written order to the Contractor, require the Contractor to stop all, or any part, of the work called for by the contract for a period of ninety (90) days after the order is delivered to the Contractor, and for any further period to which the parties may agree. Any such order shall be specifically identified as a Stop Work Order issued pursuant to this clause. Upon receipt of such an order, the Contractor shall forthwith comply with its terms and take all reasonable steps to minimize the incurrence of costs allocable to the work covered by the order during the period of work stoppage. Within a period of ninety (90) days after a stop work order is delivered to the Contractor, or within any extension of that period to which the parties shall have agreed, the Contracting Officer shall either(i) Cancel the stop work order; or

(ii) Terminate the work covered by such order as provided in the clause of this contract entitled "Termination for Default or for Convenience of the Government".

(b) If a stop work order issued under this clause is canceled or the period of the order or any extension thereof expires, the Contractor shall resume work. An equitable adjustment shall be made in the delivery schedule, the estimated cost, the fee, or a combination thereof, and in any other provisions of the contract that may be affected, and the contract shall be modified in writing accordingly, if:

(1) The stop work order results in an increase in the time required for, or in the Contractor's cost properly allocable to, the performance of any part of this contract;

and

(11) The Contractor asserts a claim for such adjustment within thirty (30) days after the end of the period of work stoppage; 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.

(c) If a stop work order is not canceled and the work covered by such order is terminated for the convenience of the Government, the reasonable costs resulting from the stop work order shall be allowed in arriving at the termination settlement. § 7-7.5001-26 Disputes.

DISPUTES (DECEMBER 1970)

(a) Except as otherwise provided in this contract, any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be decided by the Contracting Officer, who shall reduce his decision to writing and mail or otherwise furnish a copy thereof to the Con