14H-70.615 14H-70.616

14H-70 617 14H-70.618 14H-70.619

14B-70.620

14H-70.621

14H-70.622

14H-70.623

14E-70.624

143-70.625

143-70.625 14H-70.827 14H-70.628

14H-70.629 14H-70.630

14H-70.631

14-70.639

Required clauses.

Definitions.

Effect on existing rights.
Retrocession.

Examination of records.
Penalties.

Indian employment preference.
Equal opportunity.

Use of Indian business conCCTTS.

Indemnity and insurance.

Advance payment.

Contract funding and renegotiation.

Government furnished property.

Annual reporting.

Reassumption of programs.
Fair and uniform services.
Disputes.

Officials not to benefit.
Changes.

Bid guarantee and bonds.
Certificate of nonsegregated

facilities.

Convict labor.

Limitation of costs.

Allowable cost and payment.
Negotiated overhead rates.
Assignment of claims.

Payment of interest on con-
tractor's claims.
Audit and records.

Contract Work Hours and Safety Standards Act-Overtime Compensation. Price reduction for defective east or pricing data.

for

General.

Reimbursement.

Automatic advances.

account.

Standard Form 37, Report on Procurement by Civilian Executive Agencies. AUTHORITY: Sec. 205 (c), 63 Stat. 390; 40 U.S.C. 486 (c); Pub. L. 93-638, 88 Stat. 2203.

§ 14H-70.000 Scope of part.

This part sets forth policies and procedures concerning the Bureau of Indian Affairs Procurement Regulation System insofar as the system pertains to contracts entered into under the authority of the Indian Self-Determination and Education Assistance Act (Pub. L. 93 683, 88 Stat. 2203).

Subpart 14H-70.0-Regulation System § 14H-70.001 Scope of subpart.

This Subpart establishes a system for Subcontractor cost and pricing the codification and publication of prodate.

curement policy and procedural regulations of the Bureau of Indian Affairs which implement the Indian Self-Determination and Education Assistance Act (Pub. L. 93-638, 88 Stat. 2203).

§ 14E-70.002 General.

The Act provides that, contracts with tribal organizations pursuant to Section 102 of the Act shall be in accordance with all contracting laws and regulations except that, in the discretion of the Secretary, contracts may be negotiated without advertising and need not conform with the provisions of the Act of August 24, 1935 (49 Stat. 793), as amended. The Secretary may waive any provision of such contracting laws or regulations

Federal and Interior procurement regulations.

To the extent that the Federal Procurement Regulations and Interior Procurement Regulations, 41 CFR Chapter 1, Chapter 14, and Chapter 14H (except 41 CFR Part 14H-1) respectively are not made specifically applicable to contracts entered into pursuant to the Act by reference in this Part 14H-70 they are hereby waived. If this part conflicts with any of the provisions of either the Federal Procurement Regulations or Interior Procurement Regulations the provisions of this Part 14H-70 shall govern. When either the Federal Procurement Regulations or Interior Procurement Regulations are referenced in this Part, the reference shall be similar to the following:

(a) "1-1.000 of this title", when referring to a section of the Federal Procurement Regulations.

(b) "14-1.000 of this title", when referring to a section of the Interior Procurement Regulations.

§ 14H-70.004 Area Office implementation of Federal or Interior procurement regulation issuances.

Any regulations issued through the Federal Procurement Regulation or Interior Procurement Regulation System shall not be implemented by contracting officers insofar as contracts entered into pursuant to the Act are concerned unless such regulations are implemented in this Part 14H-70.

The provisions of this Part 14H-70 apply only to those contracts between the Bureau and Indian organizations entered into pursuant to the Act. They do not apply to contracts with individuals, partnerships, corporations or other Indian organizations that do not fall under the purview of the Act.

§ 14H-70.006 Changes of regulations.

(a) To the extent that a change of the regulations issued under this Part 14H70 may

(1) Impose additional requirements on the contractor:

(2) Have an adverse effect on the contractor's operations; or,

(3) Delay or impede the contracting process, such changes shall be made only after consultation, to the maximum extent practicable, with Indian tribes and national and regional Indian organizations. Further those changes shall be presented to the Committees on Interior and Insular Affairs of the United States Senate and House of Representatives before publication in the FEDERAL REGISTER for comments.

(b) To the extent that changes of the regulations issued under this Part 14H70 affect only the internal operation of the Bureau's contracting offices, the changes may be made without consultation.

f

vehicles.

Tribal organizations performing services under cost reimbursement contracts pursuant to the Act are entitled to use General Services Administration interagency motor pool vehicles in accordance with Subpart 1-5.5 of this title.

§ 14H-70.503 Purchase of passenger carrying vehicles.

Purchase of passenger carrying vehicles is prohibited. If allowed under the contract, purchase of other vehicles shall be through Federal buying channels unless a waiver by the General Services Administration is obtained.

Subpart 14H-70.6-Contract Clauses § 14H-70.601 Scope of subpart.

This subpart sets forth the clauses to be included in the contracts entered into with tribal organizations pursuant to the Act.

§ 14H-70.602 Required clauses.

The clauses set forth in this subpart shall be included in all contracts entered into pursuant to the Act unless otherwise indicated. §14H-70.603

Definitions. DEFINITIONS

The following terms shall have the meanings set forth below throughout this

contract:

(a) The term "head of the agency" or "Secretary" as used herein means the Secretary, the Under Secretary, and Assistant Secretary, or any other head or assistant head of the Department of the Interior; and the term his duly authorized representative" means any person or persons or board (other than the contracting officer) authorized to act for the head of the agency or the Secretary.

(b) The term "contracting officer" means the person executing this contract on behalf of the Government, and any other officer or civilian employee who is properly designated as a contracting officer; and the term includes, except as otherwise provided in this contract, the authorized representative of a contracting officer acting within the limits of his authority.

§ 14H-70.604 Effect on existing rights. EFFECT ON EXISTING RIGHTS

(a) Nothing in this contract shall be construed as

(1) Affecting, modifying, diminishing, or otherwise impairing the sovereign immunity from suit enjoyed by an Indian tribe; or,

(2) Authorizing or requiring the termination of any existing trust responsibility of the United States with respect to the Indian people.

tractor. The retrocession will become effective no later than 120 days after the contracting officer receives the tribe's request unless the tribal governing body, the tribal organization and the contracting officer

mutually agree on a later date.

(c) Immediately after receipt of the request for retrocession and where applicable notifying the contractor, the contracting offcer will meet the contractor and, where applicable, the tribal governing body and mutually agree to the following:

(1) A plan for the orderly transfer of responsibilities;

(2) A plan for inventorying materials and supplies on hand;

(3) An accounting for funds, including but not limited to current and anticipated obligations:

(4) The cost of operation until retrocession: and,

(5) The Identification of all records relating to the contract and the contracted function.

§ 14H-70.606

Examination of records.

(a) The following clause shall be included in all negotiated contracts which do not exceed $10,000:

EXAMINATION OF RECORDS

(a) (1) The contractor agrees to maintain books, records, documents and other evidence pertaining to the costs and expense of this contract (hereinafter collectively called records) to the extent and in such detall as will properly reflect all net costs, direct and indirect, of labor, materials, equipment, supplies and services, and other costs of whatever nature for which reimbursement is claimed under the provisions of this contract.

(2) The contractor agrees to make available at the office of the contractor at all reasonable times during a period of three years, after final payment under this contract all records specified in paragraph (1) above for examination and audit by designated representative of the Comptroller General, the Secretary of Interior or the contracting officer.

(3) The contractor further agrees that records which relate to claims, litigation, or to any costs or expenses of this contract to which exception has been taken by the Comptroller General, the Secretary of Interior or the contracting officer or any of their duly authorized representatives shall be retained by the contractor until such appeals, litigation or exceptions have been disposed of.

(4) The provisions of this clause shall be applicable to and included in any negotiated subcontract.

(b) The following clause shall be included in all negotiated contracts which exceed $10,000:

EXAMINATION OF RECORDS

(B) (1) The contractor agrees to maintain books, records, documents, and other evidence pertaining to the costs and expenses of this

contract (hereinafter collectively called "records") to the extent and in such detail as will properly reflect all net costs, direct and indirect, of labor, materials, equipment, supplies and services, and other costs and expenses of whatever nature for which reimbursement is claimed under the provisions of this contract.

(2) The contractor agrees to make available at the office of the contractor at all reasonable times during the period set forth in subparagraph (4) below any of the records for inspection, audit or reproduction by any authorized representative of the Comptroller General, Secretary of the Interior, and the contracting officer.

(3) If the Comptroller General or any of his duly authorized representatives determine that his audit of the amounts reimbursed under this contract as transportation charges will be made at a place other than the office of the contractor, the contractor agrees to deliver, with the reimbursement voucher covering such charges or as may be otherwise specified within 2 years after reimbursement of charges covered by any such voucher, to such representative as may be designated for that purpose through the contracting officer, such documentary evidence in support of transportation costs as may be required by the Comptroller General or any of his duly authorized representatives.

(4) Except for documentary evidence delivered to the Government pursuant to subparagraph (3) above, the contractor shall preserve and make available his records:

(1) Until expiration of 3 years after final payment under this contract or of the time periods for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20), whichever expires earlier, and

(11) For such longer period, if any, as is required by applicable statutes, by any other clause of this contract, or by (A) or (B) below:

(A) If this contract is completely or partially terminated, the records relating to the work terminated shall be preserved and made available for a period of 3 years from the date of any resulting settlement.

(B) Records which relate to:

(1) Appeals under the disputes clause of this contract;

(11) Litigation or the settlement of claims arising out of the performance of this contract; or,

(1) Costs and expenses of this contract to which exception has been taken by the Comptroller General, Secretary of the Interior or the contracting officer, or any of their duly authorized representatives, shall be retained by the contractor until such appeals, litigation, claims or exceptions have been disposed

of.

(5) Except for documentary evidence delivered pursuant to subparagraph (3) above, and the records described in subparagraph (4) (11) (B) above, the contractor may in fulfillment of his obligation to retain his records as required by this clause substitute photographs, microphotographs, or other authentic reproductions of such records, after the expiration of 2 years following the last days of the month of reimbursement to the contractor of the invoice or voucher to which such records relate, unless a shorter period is authorized by the contracting officer with the concurrence of the Comptroller General or his duly authorized representative.

(6) The provisions of this paragraph (a). including this subparagraph (6), shall be applicable to and included in each subcontract hereunder which is on a cost, cost-plusa-fixed-fee, time-and-material or labor-hour basis.

(b) The contractor further agrees to include in each of his subcontracts hereunder, other than those set forth in paragraph (a) (6) above, a provision to the effect that the subcontractor agrees that the Comptroller General, the Secretary of the Interior, and the contracting officer, or any of their duly authorized representatives, shall, until the expiration of 3 years after final payment under the subcontract, or of the time periods for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20), whichever expires earller, have access to and the right to examine any directly pertinent books, documents, papers, and records of such subcontractor, involving transactions related to the subcontract. The term "subcontract", as used in this paragraph (b) only, excludes:

(1) Purchase orders not exceeding $10,000, and

(11) Subcontracts or purchase orders for public utility services at rates established for uniform applicability to the general public. § 14H-70.607 Penalties.

PENALTIES

(a) Any officer, director, agent, employee or such other person connected in any capacity with this contract or any subcontract thereunder that embezzles, willfully misapplies, steals or obtains by fraud any of the money, funds, assets or property provided through the contract shall be fined not more than $10,000 or imprisoned for not more than two years, or both; Provided, that if the amount embezzled, misapplied, stolen, or obtained by fraud does not exceed $100, such person shall be fined not more than $1,000 or imprisoned not more than one year, or both.

PROPOSED RULES

off or termination; rates of pay or other forms of compensation; and selection for training. including apprenticeship.

(b) The contractor will, in all solicitations or advertisements for employees placed by or on behalf of the contractor, state that all qualified applicants will receive consideration for employment without regard to race, age, religion or sex.

(c) The contractor will include the provisions of paragraphs (a) through (b) in every subcontract or purchase order, so that such provisions will be binding upon each subcontractor or vendor. The contractor will take such action which respect to any subcontract or purchase order as the Bureau of Indian Affairs may direct as a means of enforcing such provisions, including sanctions for noncompliance. However, if the contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the Bureau of Indian Affairs, the contractor may request the United States to enter into such litigation to protect the interest of the United States. § 14H-70.610

concerns.

Use of Indian business

USE OF INDIAN BUSINESS CONCERNS (a) As used in this clause, the term "Indian business concern" means Indian organizations or an Indian-owned economic enterprise as defined in 25 CFR 401.2.

(b) The contractor agrees to give preference to qualified Indian business concerns in the awarding of any subcontracts entered into under the contract consistent with the efficient performance of the contract.

are

§ 14H-70.608

crence.

INDIAN EMPLOYMENT PREFERENCE

(a) The contractor shall give preference in employment for all work performed under the contract, including subcontracts thereunder, to qualified Indians regardless of age, religion or sex and, to the extent feasible consistent with the efficient performance of the contract, provide employment and training opportunities to Indians, regardless of age, religion or sex that are not fully qualifled to perform under the contract.

(b) If the contractor or any of its subcontractors is unable to fill its employment openings after giving full consideration to Indians as required in paragraph (a) above, these employment openings may then be filled by other than Indians under the conditions set forth in the Equal Opportunity clause of this contract.

(c) The contractor agrees to include this clause or one similar thereto in all subcontracts issued under the contract.

§ 14H-70.609 Equal opportunity.

EQUAL OPPORTUNITY

During the performance of this contract and after complying with the Indian Emp.oyment Preference clause of this contract, the contractor agrees as follows:

(a) The contractor will not discriminate against any employee or applicant for employment because of race, age, religion, or sex. The contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, age, religion, or sex. Such action shall include, but not be limited to, the following: Employment, up-grading, demotion, or transfer; recruitment or recruitment advertising: pay

surplus area concerns or minority business enterprises, the definitions for which are contained in Subparts 1-1.7, 1-1.8, and 1-1.13 of the Federal Procurement Regulations. The contractor is not, however, required to establish a small business, labor surplus, or minority business subcontracting program as described in § 1-1.710-3(b), 1-1.805-3(b) and 1-1.1310-2(b) respectively of the Federal Procurement Regulations (41 CPR 1). § 14H-70.611

Indemnity and insurance. INDEMNITY AND INSURANCE

(a) The contractor shall indemnify and save and keep harmless the Government against any or all loss, cost, damage, claim. expense or liability whatsoever, because of accident or injury to persons or property or others occurring in connection with any program included as a part of this contract, and provide where applicable, the insurance described below.

(b) The contractor shall secure, pay the premium for, and keep in force until the expiration of this contract or any renewal period thereof, insurance as provided below. Such insurance policies shall specifically include a provision stating the liability assumed by the contractor under this contract. (1) Workman's compensation insurance as required by laws of the State.

(2) Owner's, landlord's and tenant's bodily injury liability insurance with limits of not less than $50,000 for each person and $500,000 for each accident.

(3) Property damage liability insurance with limits of not less than $25,000 for each accident.

(4) Automobile bodily Injury liability insurance with limits of not less than 850,000 for each person and 8500,000 for each accident and property damage liability insurance

41029

with a limit of not less than $5,000 for each accident.

(5) Food products liability insurance with limits of not less than $50,000 for each person and $500,000 for each accident.

(6) Other insurance not specifically mentioned when required.

(c) Each policy of insurance shall contain an endorsement providing that cancellation by the insurance company shall not be effective unless a copy of the cancellation is mailed (registered) to the contracting officer at least 30 days before the effective date of cancellation.

(d) A certificate of each policy of insurance, and any changes therein, shall be furnished to the contracting officer immediately upon receipt from the insurance company.

(e) Insurance companies of the contractor shall be satisfactory to the contracting offcer. When in his opinion an insurance company is not satisfactory for reasons that will be stated, the contractor shall provide insurance through companies that are satisfactory to the contracting officer.

(f) Each policy of insurance shall contain a provision that the insurance carrier waives any rights it may have to raise as a defense the tribe's sovereign immunity from suit, but such waiver shall extend only to claims the amount and nature of which are within the coverage and limits of the policy of Insurance. The policy shall contain no provision. either express or implied, that will serve to authorize or empower the insurance carrier to waive or otherwise limit the tribe's sovereign immunity outside or beyond the coverage and limits of the policy of insurance. § 14H-70.612 Advance payment.

(a) The following clause will be inserted in all contracts in which deposit of the advance in a special bank account is not required.

ADVANCE PAYMENT

(a) Amount of advance. At the request of the contractor, and subject to the conditions set forth herein, the Government shall make Each advance payments to the contractor payment shall be limited to the amount determined necessary for the contractor's op eration under the contract for the period of time covered by the advance, which shall not be less than two weeks, except that the Anal payment under the contract may be a period less than two weeks.

(b) Payment will be made by check payable to the contractor.

(c) Funds advanced under this contract may not be used for any purpose except for making payments for materials, labor, administrative and overhead expenses allowable

under this contract.

(d) The contractor shall keep separate accounts in his accounting system which will reflect all receipts, expenditures, fund balances and obligations under this contract. (e) Return of funds. The contractor may at any time repay any or all of the funds advanced hereunder when it is determined that such funds will not be required for operations under the contract; or, when requested, in writing, by the contracting officer, as a result of retrocession, recision or ter mination for cause of this contract, the contractor shall return such amount as may be determined by the contracting officer is not required for settlement of outstanding obligations.

(1) Liquidation. Advance payments may be liquidated by expenditure for purposes allowable under the contract. When the sum of all the advance payments made under this contract equals 85 per cent of the contract amount, no further advance payments shall be made until a review or audit of accounts has been made and any non-allowable

41030

charges against the contract have been identined. Such amounts shall be subtracted from remaining funds due under the contract.

(g) No interest will be charged on advance payments.

(b) The following clause will be used in all contracts under which deposit of advance payments in a special bank account will be required.

ADVANCE PAYMENTS

(a) Amount of advance. At the request of the contractor and subject to conditions set forth herein, the Government shall make advance payments to the contractor in amounts and at such times as agreed to between the e-ntractor and the contracting officer and which are specified in of this contract.

Bu

(b) Special bank account. Until the advance payment(s) made hereunder is liquidated and the contracting officer approves in writing the release of any funds due and payable to the contractor, the advance payment(s) and all other payments (progress, partial, and final) made under the contract shall be made by check payable to the contractor but mailed to the bank, where the special bank account is maintained as stated in the Agreement for Special Bank Account. The check must be marked for "Deposit in Special Bank Account Number reau of Indian Affairs." The Agreement for Special Bank Account shall designate the account number. No part of the funds deposited in the Special Bank Account shall be mingled with other funds of the contractor prior to withdrawal thereof from the Special Bank Account as hereinafter provided. Except as hereinafter provided, each withdrawal shall be only by check of the contractor, unless countersigning on behalf of the Government by the contracting omcer or such other person as he may designate in writing is determined to be in the best interest of the Government and the contracting omcer notifies the contractor and bank in writing that countersigning will be required.

(e) Use of funds. The funds in the Special Bank Account may be withdrawn by the contractor solely for the purposes of making payments for materials, labor, administrative and overhead expenses, and other purposes required for this contract, or for the purposes of reimbursing the contractor for such payments, and or such other purposes as the contracting officer may approve in writing. If this is a cost reimbursement contract, the funds in the Special Bank Account may be withdrawn by the contractor solely for the purpose of making payments for items of allowable costs as provided in the clause titled "Allowable Cost and Payment" of this contract. Any interpretation required as to the proper use of funds shall be made in writing by the Contracting Office.

(d) Return of funds. The contractor may at any time repay all or any part of the funds advanced hereunder. Whenever so requested in writing by the contracting officer, the contractor shall repay to the Government such part of the uniiquidated balance of the advance payment as shall in the opinion of the contracting officer be in excess of the contractor's current requirements or, when added to total advances previously made and liquidated, are in excess of the amount specified in paragraph (n) (1) hereof or are no longer to be made available to the contractor because of default, or abuse of their use, or for such other reasons as the contracting officer may specify. If the contractor falls to repay such part of the unliquidated balance of the advance payment when so requested by the Contracting Officer, all or any part thereof may be withdrawn from the Special Bank Account by check(s) made payable to the Bureau of Indian Affairs signed

PROPOSED RULES

by the contracting officer or by an official of the Bureau of Indian Affairs authorized in writing by the contracting officer to take such action. Such withdrawals shall be applied in reduction of the advance payment(s) then outstanding hereunder. The contracting officer shall notify the contractor and the bank of the action taken.

(e) Liquidation. If not otherwise liquidated, the advance payment(s) made hereunder shall be liquidated as herein provided. When the sum of all the estimated payments remaining due on the contract approximate the unliquidated amount of the advance payment(s), the contracting officer shall thereafter withhold further payments due on the contract, represented by proper invoiced amounts submitted by the contractor, and apply the amount(s) withheld against the liquidation of the advance payment until the advance payment has been fully liquidated. If, upon completion or termination of the contract, or for other reasons, the entire advance payment(s) is not fully liquidated, by the process indicated above, and the contractor does not repay the balance due upon request, then the balance thereof shall be offset against any sums otherwise due or which may become due to the contractor from the Government on any other contracts or from any

source.

(f) Interest charge. No interest will be charged on the amount of the advance payment(s), but any interest earned on the advance payment(s) including sub-advances or contract earnings deposited in the Special Bank Account shall be used in the performance of the contract and to liquidate the advance payment(s) made.

(g) Bank agreement. Before an advance payment(s) is made hereunder, the contractor shall submit to the contracting officer in the form prescribed, an Agreement for Special Bank Account, in triplicate, signed by the contractor and an official of the bank in which the Special Bank Account is established as the depository for the advance payment(s) and other payments. The agreement shall clearly set forth the character of the Special Bank Account and the responsibilities of the contractor, the bank and contracting officer, thereunder. Wherever possible. such bank shall be a member of the Federal Reserve System, or an "insured" bank within the meaning of the Act creating the Federal Deposit Insurance Corporation (Act of August 23, 1935, 49 Stat. 684, as amended; 12 U.S.C. 264).

(h) Lien on special bank account. The Government shall have a lien upon any balance in the Special Bank Account paramount to all other liens, which llen shall secure the repayment of any advance payment(s) made hereunder.

(1) Lien on property under contract. Any advance payment(s) made under this contract shall be secured, when made, by a llen in favor of the Government, paramount to all other liens, upon the supplies or other things covered by this contract. The Government's lien shall apply to all material and other property acquired for or allocated to the of this contract, except to the extent that the Government by virtue of any other provision of this contract, or otherwise, shall have valid title to such supplies, materials, or other property as against other creditors of the contractor. The contractor shall identify, by marking or segregation, all property which is subject to a lien in favor of the Government by virtue of any provisions of this contract in such a way as to indicate that it is subject to such lien and that it has been acquired for or allocated to the performance of this contract. If for any reason such supplies, materials, or other property are not identified by marking or segregation, the Government shall be deemed to

have a lien to the extent of the Government's interest under this contract on any mass of property with which such supplies, materials, or other property are commingled. The contractor shall maintain adequate accounting control over such property on his books and records. If at any time during the progress of the work on the contract it becomes necessary to deliver any item or items and materials upon which the Government has a lien as aforesaid to a third person, the contractor shall notify such third person of the lien herein provided and shall obtain from such third person a receipt, in duplicate, acknowledging, interalia, the existence of such lien. A copy of each receipt shall be delivered by the contractor to the contracting officer. If this contract is cancelled in whole or in part and the contractor is authorized to sell or retain cancellation inventory acquired for or allocated to this contract, such sale or retention shall be made only if approved by the contracting officer which approval shall constitute a release of the Government's lien hereunder to the extent that such cancellation inventory is sold or retained, and to the extent that the proceeds of the sale, or the credit allowed for such retention of the contractor's termination claim, is applied in reduction of advance payment(s) then outstanding hereunder.

(1) Insurance. The contractor represents and warrants that he is now maintaining with responsible insurance carriers:

(1) Insurance upon his own plant and equipment against fire and other hazards to the extent that like properties are usually insured by others operating plants and properties of similar character in the same general locality:

(2) Adequate insurance against liability on account of damage to persons or property; and,

(3) Adequate insurance under all applicable workmen compensation laws. The contractor agrees that, until work under this contract has been completed and the advance payment(s) made hereunder has been liquidated, he will:

(1) Maintain such insurance;

(11) Maintain adequate insurance upon any materials, parts, assemblies, sub-assemblies, supplies, equipment, and other property acquired for or allocable to this contract and subject to the Government llen hereunder; and,

(111) Furnish such certificate with respect to his insurance as the contracting officer may require from:

(k) Default provisions. Upon the happening of any of the following events of default: (1) Cancellation of this contract by reason of fault of the contractor;

(2) A finding by the contracting officer that the contractor:

(1) Has failed to observe any covenants, conditions, or warranties of these provisions or has failed to comply with any material provision of this contract; or,

(11) Has so falled to make progress or is in such unsatisfactory financial conditions as to endanger performance of this contract; or,

(111) Has allocated inventory to this contract substantially exceeding reasonable requirements; or,

(iv) Is delinquent in payment of taxes, or of the costs of performance of this contract in the ordinary course of business.

(3) Appointment of a trustee, receiver or liquidator for all or a substantial part of the contractor's property or institution of bankruptcy, reorganization, arrangement, or liquidation proceedings by or against the contractor;

(4) Service of any writ of attachment, levy of execution, or commencement of garnishment proceedings with respect to the Special, Bank Account; or,