(Insert the clause in 9-409.1(f).) Article 5. Payment. The Contractor shall be paid the sum of Dollars ($----------) in full compensation for the rights herein granted and agreed to be granted. (For a license on a running royalty basis, insert the clause in 9-409.4 (c) in accordance with the instructions therein, and also the clause as specified in 9-409.2 (b) and 9-409.4 (d) and (e).) Article 6. Officials Not to Benefit. (Insert the clause in 7-103.19.) Article 7. Covenant Against Contingent Fees. (Insert the clause in 7-103.20.) Article 8. Assignment of Claims. (Insert the clause in 7-103.8.) Article 9. Gratuities. (Insert the clause in 7-104.16.) Article 10. Disputes. (Insert the clause in 7-103.12.) Waiver of performance and payment bonds. 10.103-4 10.103-5 Furnishing information to subcontractors and suppliers. Requirements and indefinite quantity contracts. Performance and payment bonds for contracts other than construction contracts. General. Performance bonds. Payment bonds. Other types of bonds. Advance payment bonds. Fidelity and forgery bonds. Substitution of surety bonds. Additional bond and increase of penalty. Additional bond. By Date By Date -- (Signature and title of contractor) § 9.413 Recordation. Executive Order No. 9424 of February 18, 1944, requires all executive Departments and agencies of the Government to forward through appropriate channels to the Commissioner of Patents for recording, all Government interests in patents or applications for patents. PART 10-BONDS, INSURANCE, AND INDEMNIFICATION' Subpart A-Bonds Definitions. 10.200 10.201 Additional bond-new surety. Execution and administration of bonds and consents of surety. Subpart B-Sureties General. Requirements of sureties. 10.201-1 Corporate sureties and cosureties. Sec. 10.101 10.300 Certified or cashier's checks, bank drafts, money orders, or currency. Subpart C-Insurance; General Scope of subpart. General. Notice of cancellation or change. Insurance against loss of or damage to Government property. Procedures to be followed in the event of loss of or damage to Government property. § 10.101-1 Advance payment bond. "Advance payment bond" means bond which secures the performance and the fulfillment of a contractual provision for the making of advance payments. [29 F.R. 6933, May 27, 1964] § 10.101-2 Annual bid bond. "Annual bid bond" means a single bond (in lieu of separate bid bonds), without limitation as to penal amount, which secures all bids (on other than construction contracts) requiring bonds submitted by a contractor during a specific fiscal year of the Government in response to formal advertising. [29 F.R. 6933, May 27, 1964] § 10.101-3 Annual performance bond. This term means a single bond (in lieu of separate performance bonds for each contract) which secures the performance of contracts (other than construction contracts) which require bonds and are entered into by a contractor during a specific fiscal year of the Government. Such bonds may be in different forms, including the following three: The first providing for penal sums separately applicable to each covered contract, regardless of the total amount of covered contracts; the second providing a gross penal sum cumulatively applicable to the total amount of all covered contracts but without a separate limit applicable to each contract; and the third providing both, separate contract and cumulative limits. [34 F.R. 13844, Aug. 29, 1969] § 10.101-4 Bid guarantee. "Bid guarantee" means a form of security accompanying a bid or proposal as assurance that the bidder (a) will not withdraw his bid within the period specified therein for acceptance, and (b) will execute a written contract and furnish such bonds as may be required within the period specified in the bid (unless a longer period is allowed) after receipt of the specified forms. [29 F.R. 6933, May 27, 1964] "Fidelity bond" means a bond which secures an employer up to an amount stated in the bond for losses caused by dishonesty on the part of an employee. A blanket fidelity bond covers all employees, except those except expressly excluded by written endorsement on the bond. [30 F.R. 12005, Sept. 21, 1965] § 10.101-8 Forgery bond or policy. "Forgery bond or policy" (depositors form) means a bond or policy which secures the person or persons named therein up to the amount stated for losses caused by the forging or altering of a check, draft, or similar instrument issued by or purporting to have been issued by any of the insureds, and for losses resulting from a check or draft having been obtained from the insureds through impersonation. [30 F.R. 12005, Sept. 21, 1965] § 10.101-10 Payment bond. "Payment bond" means a bond which is executed in connection with a contract and which secures the payment of all persons supplying labor and material in the prosecution of the work provided for in the contract. [30 F.R. 12005, Sept. 21, 1965] § 10.101-11 Penal sum or amount. "Penal sum or amount" means the dollar amount shown in a bond and represents the maximum payment for which the surety is obligated. [30 F.R. 12005, Sept. 21, 1965] ance and fulfillment of all the undertakings, covenants, terms, conditions, and agreements contained in the contract. [30 F.F. 12005, Sept. 21, 1965] Sections 10.102-10.102-5 apply to both negotiated and formally advertised procurements. Where appropriate, the term "bid" includes "proposal". [29 F.R. 6933, May 27, 1964] § 10.102-2 Limitations. Bid guarantees shall not be required unless the solicitation specifies that the contract must be supported by a performance bond or performance and payment bonds. In connection with supply and services contracts, the bidder may furnish either an individual bid bond (Standard Form 24) or an annual bid bond (Standard Form 34). A bid guarantee will not be requested unless the bid exceeds $2,000 (see § 10.102-4(a) (1)). In connection with construction contracts, only the individual bid bond will be accepted. [30 F.R. 12005, Sept. 21, 1965] (a) Whenever a bid guarantee is deemed necessary, the contracting officer shall determine the percentage (or amount) which in his best judgment, when applied to the bid price, will produce a bid guarantee amount adequate to protect the Government from loss should the successful bidder fail to execute such further contractual documents and bonds as may be required. The percentage determined shall be not less than 20 percent of the bid price except that the maximum amount required shall be $3,000,000. (b) The penal sum of a bid bond may be expressed as a specified percentage of the bid price. In this fashion, the bid bond may be written by the surety before the bidder's final determination of his bid price. [29 F.R. 6934, May 27, 1964] § 10.102-4 Solicitation provisions. (a) Where a bid guarantee is determined to be necessary, the solicitation shall contain (1) a statement requiring that a bid guarantee be submitted with any bid in excess of $2,000 and containing such details as are necessary to enable bidders to determine the proper amount of bid guarantee to be submitted; and (2) the following provision: BID GUARANTEE (JUNE 1964) Where a bid guarantee is required by the invitation for bids, failure to furnish a bid guarantee in the proper form and amount, by the time set for opening of bids, may be cause for rejection of the bid. A bid guarantee shall be in the form of a firm commitment, such as a bid bond, postal money order, certified check, cashier's check, irrevocable letter of credit or, in accordance with Treasury Department regulations, certain bonds or notes of the United States. Bid guarantees, other than bid bonds, will be returned (a) to unsuccessful bidders as soon as practicable after the opening of bids, and (b) to the successful bidder upon execution of such further contractual documents and bonds as may be required by the bid as accepted. If the successful bidder, upon acceptance of his bid by the Government within the period specified therein for acceptance (sixty days if no period is specified) fails to execute such further contractual documents, if any, and gives such bond(s) as may be required by the terms of the bid as accepted within the time specified (ten days if no period is specified) after receipt of the forms by him, his contract may be terminated for default. In such event he shall be liable for any cost of procuring the work which exceeds the amount of his bid, and the bid guarantee shall be available toward offsetting such difference. (b) The requirement for the provision in paragraph (a) (2) of this section is met where Standard Form 22 (Instructions to Bidders (Construction Contracts)) is used in accordance with §§ 16.401-1(e) and 16.401-2(a). (c) The provision required by paragraph (a) (2) of this section may be appropriately modified in negotiated contracts. [30 F.R. 12005, Sept. 21, 1965] nishing of the bid guarantee before award); (b) Where the amount of the bid guarantee submitted, though less than the amount required by the invitation for bids, is equal to or greater than the difference between the price stated in the bid and the price stated in the next higher acceptable bid; (c) Where the amount of the bid guarantee submitted, though less than the amount required by the invitation for bids in relation to the bid price for the maximum quantity bid upon, is sufficient in relation to the bid price for a quantity for which the bidder is otherwise eligible for award (and in that event any award to him shall be limited to the quantity covered by the bid guarantee); (d) Where the bid guarantee is received late and the late receipt may be waived under the rules established in § 2.303 for consideration of late bids; (e) Where an otherwise adequate bid guarantee becomes inadequate as a result of the correction of a mistake in bid under § 2.406, if the bidder will increase the amount of the bid guarantee in proportion to the authorized bid correction; and (f) Where a telegraphic modification of the bid is received without a corresponding modification of the bid guarantee, provided the bid modification expressly refers to the bid previously submitted in response to the invitation for bids and the bid guarantee satisfies the above criteria. [31 F.R. 9857, July 21, 1966] § 10.103 Performance and payment bonds for construction contracts. [29 F.R. 6934, May 27, 1964] § 10.103-1 Performance bonds. (a) Pursuant to the Miller Act, as amended (40 U.S.C. 270a-270e), in connection with any construction contract exceeding $2,000 in amount except as provided in § 10.103-3, a performance bond shall be required in a penal amount deemed adequate by the Contracting Officer for the protection of the Government. Generally, the penal amount of each performance bond shall be 100 percent of the contract price at the time of award. But where the Contracting Officer finds that to require a 100 percent performance bond would be disadvantageous to the Government, he may prescribe a lesser penal amount, which should normally be not less than 50 percent of the original contract price, and in all cases no less than the amount of the payment bond. The performance bond shall specifically provide coverage for taxes imposed by the United States which are collected, deducted, or withheld from wages paid by the contractor in carrying out the contract with respect to which such bond is furnished. (b) Additional performance bond protection shall be required in connection with any modification effecting an increase in price under any contract for which a bond is required pursuant to paragraph (a) of this section if— (1) The modification is for new or additional work which is beyond the scope of the existing contract; or (2) The modification is pursuant to an existing provision of the contract and is expected to increase the contract price by $50,000 or 25 percent of the basic contract price, whichever is less. The penal amount of the bond protection should generally be increased so that the total performance bond protection is 100 percent of the contract price as revised by the modification requiring such additional protection, and the aggregate of any previous modifications: Provided, That lesser penal amounts may be authorized by the contracting officer as indicated in paragraph (a) of this section. The increased penal amount may be secured either by increasing the bond protection provided by the existing surety or sureties (the format set forth in § 10.111-1 may be used when an additional bond is obtained from the original surety), or by obtaining an additional performance bond from a new surety, but see § 10.111-2 with respect to requiring consent of surety. (c) In making allowance for bond premium in equitable adjustments or other price modifications affecting contracts, the allowance shall not be more than that calculated at the rate paid for the bonds furnished under the original contract. [29 F.R. 6934, May 27, 1964, as amended at 30 F.R. 12006, Sept. 21, 1965; 33 F.R. 7400, May 18, 1968] § 10.103-2 Payment bonds. (a) Pursuant to the Miller Act, as amended (40 U.S.C. 270a-270e), in connection with any construction contract exceeding $2,000 in amount, except as 66-071-72 provided in § 10.103-3, a payment bond shall be required in a penal amount as follows: (1) When the contract price is not more than $1,000,000, the penal sum shall be 50 percent of the contract price; (2) When the contract price is more than $1,000,000 but not more than $5,000,000, the penal sum shall be 40 percent of the contract price; and (3) When the contract price is more than $5,000,000, the penal sum shall be $2,500,000. (b) Additional payment bond protection shall be required in connection with any modification effecting an increase in price under any contract for which a bond is required pursuant to paragraph (a) of this section if (1) The modification is for new or additional work which is beyond the scope of the existing contract; or (2) The modification is pursuant to an existing provision of the contract and is expected to increase the contract price by $50,000 or 25 percent of the basic contract price, whichever is less. The penal amount of the additional bond protection should generally be such that the total payment bond protection is 50 percent of the contract price as revised by the modification requiring such additional protection, and the aggregate of any previous modifications: Provided, That when the contract price as so revised is more than $1,000,000 but not more than $5,000,000, the total payment bond protection shall be in a penal amount of 40 percent of the revised contract price: Provided further, That when the contract price as so revised is more than $5,000,000, the total payment bond protection shall be in the penal amount of $2,500,000. The additional protection may be secured either by increasing the bond protection provided by the existing surety or sureties or by obtaining an additional payment bond from a new surety; but see § 10.111-2 with respect to requiring consent of surety. (c) In making allowance for bond premium in equitable adjustments or other price modifications affecting any contract, the allowance shall not be more than that calculated at the rate paid for the bonds furnished under the original contract. [29 F.R. 6934, May 27, 1964, as amended at 30 F.R. 12006, Sept. 21, 1965] |