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CLAUSES FOR FIXED-PRICE SUPPLY CONTRACTS

fracticable at all times and places including the period of manufacture, and in any event prior to acceptance.

(b) In case any supplies or lots of supplies are defective in material or workmanship or otherwise not in conformity with the requirements of this contract, the Government shall have the right either to reject them (with or without instructions as to their disposition) or to require their correction. Supplies cr lots of supplies which have been rejected or required to be corrected shall be removed or, if permitted or required by the Contracting Officer, corrected in place by and at the expense of the Contractor promptly after notice, and shall not thereafter be tendered for acceptance unless the former rejection or requirement of correction is disclosed. If the Contractor fails promptly to remove such supplies or lots of supplies which are required to be removed, or Fromptly to replace correct such

supplies or lots of supplies, the Government either (i) may by contract or otherwise replace or correct such supplies and charge to the Contractor the cost occasioned the Government thereby, or (ii) may terminate this contract for default as provided in the clause of this contract entitled "Default." Unless the Contractor corrects or replaces such supplies within the delivery schedule, the Contracting Cfficer may require the delivery of such supplies at a reduction in price which is equitable under the circumstances. Failure to agree to such reduction of price shall be a dispute concerning a question of fact within the reaning of the clause of this contract entitled "Disputes."

(Next page is 7-1:3)

NASA PROCUREMENT REGULATION

CLAUSES FOR FIXED-PRICE SUPPLY CONTRACTS

(c) If any inspection or test is made by the Government on the premises of the Contractor or a subcontractor, the Contractor without additional charge shall provide all reasonable facilities and assistance for the safety and convenience of the Government inspectors in the performance of their duties. If Government inspection or test is made at a point other than the premises of the Contractor or a subcontractor, it shall be at the expense of the Government except as otherwise provided in this contract, provided, that in case of rejection the Government shall not be liable for any reduction in value of samples used in connection with such inspection or test. All inspections and tests by the Government shall be performed in such a manner as not to unduly delay the work. The Government reserves the right to charge to the Contractor any additional cost of Government inspection and test when supplies are not ready at the time such inspection and test is requested by the Contractor or when reinspection or retest is necessitated by prior rejection. Acceptance or rejection of the supplies shall be made as promptly as practicable after delivery, except as otherwise provided in this contract; but failure to inspect and accept or reject supplies shall neither relieve the Contractor from responsibility for such supplies as are not in accordance with the contract requirements nor impose liability on the Government therefor.

(d) The inspection and test by the Government of any supplies or lots thereof does not relieve the Contractor from any responsibility regarding defects or other failures to meet the contract requirements which may be discovered prior to acceptance. Except as otherwise provided in this contract, acceptance shall be conclusive except as regards latent defects, fraud, or such gross mistakes as amount to fraud.

(e) The Contractor shall provide and maintain an inspection system acceptable to the Government covering the supplies hereunder. Records of all inspection work by the Contractor shall be kept complete and available to the Government during the performance of this contract and for such longer period as may be specified elsewhere in this contract.

7.103-6 Responsibility for Supplies.

RESPONSIBILITY FOR SUPPLIES (SEPTEMBER 1962)

Except as otherwise provided in this contract, (i) the Contractor shall be responsible for the supplies covered by this contract until they are delivered at the designated delivery point, regardless of the point of inspection; (ii) after delivery to the Government at the designated point and prior to acceptance by the Government or rejection and giving notice thereof by the Government, the Government shall be responsible for the loss or destruction of or damage to the supplies only if such loss, destruction, or damage results from the negligence of officers, agents, or employees of the Government acting within the scope of their employment; and (iii) the Contractor shall bear all risks as to rejected supplies after notice of rejection, except that the Government shall be responsible for the loss, or destruction of, or damage to the supplies only if such loss, destruction, or damage results from the gross negligence of officers, agents, or employees of the Government acting within the scope of their employment.

7.103-7 Payments. Insert the following clause except that in letter contracts insert clause 4 of NASA Form 551-3 set forth in 16.859-4(d).

PAYMENTS (SEPTEMBER 1962)

The Contractor shall be paid, upon the submission of proper invoices or vouchers, the prices stipulated herein for supplies delivered and accepted or services rendered and accepted, less deductions, if any, as herein provided. Unless otherwise specified, payment will be made on partial deliveries accepted by the Government when the amount due on such deliveries so warrants; or, when requested by the Contractor, payment for accepted partial deliveries shall be made whenever such payment would equal or exceed either $1,000 or 50 percent of the total amount of this contract.

NASA PROCUREMENT REGULATION

7.103-7

CONTRACT CLAUSES

In contracts for the furnishing of transportation and accessorial services, the words "properly certified" shall be substituted for the word "proper" above.

7.103-8 Assignment of Claims.

ASSIGNMENT OF CLAIMS (SEPTEMBER 1962)

(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 moneys 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 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. Unless otherwise provided in this contract, payments to an assignee of any moneys due or to become due under this contract shall not, to the extent provided in said Act, as amended, be subject to reduction or setoff. (The preceding sentence applies only if this contract is made in time of war or national emergency as defined in said Act and is with the Department of Defense, the General Services Administration, the Atomic Energy Commission, the National Aeronautics and Space Administration, the Federal Aviation Agency, or any other department or agency of the United States designated by the President pursuant to Clause 4 of the proviso of section 1 of the Assignment of Claims Act of 1940, as amended by the Act of May 15, 1951, 65 Stat. 41.)

(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.

In negotiated procurement, where a contractor is indebted to the Government as a result of dealings with NASA or other Government agencies, the last sentence before the sentence in parentheses of paragraph (a) of the "Assignment of Claims" clause, which is commonly referred to as the "no-set-off" provision, shall be omitted if such action is requested by other Government agencies or if it otherwise appears to be appropriate to protect the interests of the Government. In any event, the "no-set-off" provision shall be omitted from contracts for transportation services provided by common carriers who are subject to the Interstate Commerce Act, as amended, or the Civil Aeronautics Act of 1938. The assignee is required by the Assignment of Claims Act, as amended, to "File written notice of the assignment together with a true copy of the instrument of assignment with (i) the contracting officer or the head of his department or agency; (ii) the surety or sureties upon the bond or bonds, if any, in connection with such contract; and (iii) the disbursing officer, if any, designated in such contract to make payment."

When Standard Form 32 is used, the form need not be changed to delete the parenthetical sentence at the end of paragraph (a) of the clause.

7.103-9 Additional Bond Security.

7.103-8

CFR TITLE 41 CHAPTER 18

CLAUSES FOR FIXED-PRICE SUPPLY CONTRACTS

ADDITIONAL BOND SECURITY (SEPTEMBER 1962)

If any surety upon any bond furnished in connection with this contract becomes unacceptable to the Government, or if any such surety fails to furnish reports as to his financial condition from time to time as requested by the Government, the Contractor shall promptly furnish such additional security as may be required from time to time to protect the interests of the Government and of persons supplying labor or materials in the prosecution of the work contemplated by this contract.

7.103-10 Federal, State, and Local Taxes. Insert the appropriate clause set forth in 11.401-1 or 11.401-2.

7.103-11 Default. In accordance with the requirements of 8.707, insert the clause set forth therein.

7.103-12 Disputes.

DISPUTES (SEPTEMBER 1962)

(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 Contractor. The decision of the Contracting Officer shall be final and conclusive unless, within thirty (30) days from the date of receipt of such copy, the Contractor mails or otherwise furnishes to the Contracting Officer a written appeal addressed to the Administrator. The decision of the Administrator or his duly authorized representative for the determination of such appeals shall be final and conclusive unless determined by a court of competent jurisdiction to have been fraudulent or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence. In connection with any appeal proceeding under this clause, the Contractor shall be afforded an opportunity to be heard and to offer evidence in support of his appeal. Pending final decision of a dispute hereunder, the Contractor shall proceed diligently with the performance of the contract and in accordance with the decision of the Contracting Officer.

(b) This "Disputes" clause does not preclude consideration of law questions in connection with decisions provided for in paragraph (a) above, provided, that nothing in this contract shall be construed as making final the decision of any administrative official, representative, or board on a question of law.

7.103-13 Renegotiation.

RENEGOTIATION (SEPTEMBER 1962)

(a) 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.

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

7.103-14 Clean Air and Water. Insert the clause set forth in 1.2302-2. 7.103-15 [Reserved]

7.103-16 Contract Work Hours Standards Act-Overtime Compensation. Insert the clause set forth in 12.303-1. Note the prefatory language

NASA PROCUREMENT REGULATION

7.103-16

CONTRACT CLAUSES

required by 12.303-2 for use in contracts with a state or political subdivision thereof.

7.103-17 Walsh-Healy Public Contracts Act. Insert the Clause set forth in 12.605.

7.103-18 Equal Opportunity. In accordance with the provisions of 12.804, insert the appropriate clause set forth therein. 7.103-19 Officials Not To Benefit.

OFFICIALS NOT TO BENEFIT (SEPTEMBER 1962)

No member of or delegate to Congress, or resident commissioner, shall be admitted to any share or part of this contract, or to any benefit that may arise therefrom; but this provision shall not be construed to extend to this contract if made with a Corporation for its general benefit.

7.103-20 Covenant Against Contingent Fees. Insert the clause set forth in 1.503.

7.103-21 Termination for Convenience of the Government. Insert the appropriate clause set forth in 8.701.

7.103-22 Authorization and Consent. Insert the clause set forth in 9.102(a).

7.103-23 Notice and Assistance Regarding Patent and Copyright Infringement. Insert the clause set forth in 9.104.

7.103-53 Interest.

INTEREST (NOVEMBER 1974)

Notwithstanding any other provision of this contract, unless paid within thirty (30) days all amounts that become payable by the Contractor to the Government under this contract (net of any applicable tax credit under the Internal Revenue Code) shall bear interest from the date due until paid. The interest rate per annum shall be the interest rate in effect which has been established by the Secretary of the Treasury pursuant to Public Law 92-41, 85 Stat. 97, as of the date the amount becomes due as herein provided. Amounts shall be due upon the earliest one of (i) the date fixed pursuant to this contract; (ii) the date of the first written demand for payment, consistent with this contract, including demand consequent upon default termination; (iii) the date of transmittal by the Government to the Contractor of a proposed supplemental agreement to confirm completed negotiations fixing the amount, or (iv) if this contract provides for revision of prices, the date of written notice to the Contractor stating the amount of refund payable in connection with a pricing proposal or in connection with a negotiated pricing agreement not confirmed by contract supplement.

7.103-54 Pricing of Adjustments. Insert the following clause in all contracts which contain the "Changes" clause or provisions for adjustment of the contract price:

PRICING OF ADJUSTMENTS (AUGUST 1970)

When costs are a factor in any determination of a contract price adjustment pursuant to the "Changes" clause or any other provision of this contract, such costs shall be in accordance with Part 15 of the NASA Procurement Regulation as in effect on the date of this contract.

7.104 Clauses Required To Be Used When Applicable. 7.104-1 Clauses for Contracts Involving Construction Work.

7.103-17

CFR TITLE 41 CHAPTER 18

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