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. § 1-7.102-8 Assignment of claims. Insert the clause set forth in § 1-30.703 under the conditions contained therein. (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 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 Secretary. The decision of the Secretary 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 its appeal. Pending final decision of a dispute hereunder, the Contractor shall proceed diligently with the performance of the contract and in accordance with the Contracting Officer's decision. (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 Insert the clause set forth in § 112.803-2 under the conditions contained in § 1-12.803-1. § 1-7.102-17 Officials not to benefit. OFFICIALS NOT TO BENEFIT 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. § 1-7.102-18 Covenant against contingent fees. Insert the clause set forth in § 1-1.503 under the conditions contained in § 11.501. § 1-7.102-19 Termination for convenience of the Government. Insert the clause set forth in § 1-8.701 in fixed-price supply contracts in excess of $10,000 except as permitted by § 1-8.700-2(a) (2) for contracts not in excess of $100,000. [40 FR 44140, Sept. 25, 1975] § 1-7.102-20 Pricing of adjustments. The following clause shall be included in all formally advertised or negotiated contracts other than cost-type contracts: PRICING OF ADJUSTMENTS When costs are a factor in any determination of a contract price adjustment pursuant to the "Changes" cause or any other provision of this contract, such costs shall be in accordance with the contract cost principles and procedures in Part 1-15 of the Federal Procurement Regulations (41 CFR 1-18) or section XV of the Armed Services Procurement Regulation in effect on the date of this contract. Contract Work Hours and Safety Payrolls and Basic Records. Compliance with Copeland Regulations. Withholding of Funds. Contract Termination-Debarment. (b) Insert the clause set forth in 1-18.605 in fixed-price supply contracts under the conditions contained in Subpart 1-18.6. § 1-7.103-2 Additional bond security. If any surety upon any bond furnished in connection with this contract becomes unacceptable to the Government, or if any such surety falls to furnish reports as to his financial condition from time to time 8.5 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. § 1-7.103-3 Examination of records by Comptroller General. The following clause shall be included in fixed-price negotiated contracts and may be included in other than fixed-price negotiated contracts, as provided in § 1-3.814-2(c). When contracts involve the use of Standard Forms 2-A and 2-B the clause may be amended to provide for the use of the term "lessor" in lieu of the term "contractor." EXAMINATION OF RECORDS BY COMPTROLLER GENERAL (a) This clause is applicable if the amount of this contract exceeds $10,000 and was entered into by means of negotiation, including small business restricted advertising, but is not applicable if this contract was entered into by means of formal advertising. (b) The Contractor agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of 3 years after final payment under this contract or such lesser time specified in either Appendix M of the Armed Services Procurement Regulation or the Federal Procurement Regulations Part 1-20, as appropriate, have access to and the right to examine any directly pertinent books, documents, papers, and records of the Contractor involving transactions related to this contract. (c) The Contractor further agrees to include in all his subcontracts hereunder a provision to the effect that the subcontractor agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of 3 years after final payment under the subcontract or such lesser time specified in either Appendix M of the Armed Services Procurement Regulation or the Federal Procurement Regulations Part 1-20, as appropriate, 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 clause excludes (1) purchase orders not exceeding $2,500 and (2) subcontractors or purchase orders for public utility services at rates established for uniform applicability to the general public. (d) The periods of access and examination described in (b) and (c), above, for records which relate to (1) appeals under the "Disputes" clause of this contract. (2) litigation or the settlement of claims arising out of the performance of this contract, or (3) costs and expenses of this contract as to which exception has been taken by the Comptroller General or any of his duly authorized representatives, shall continue until such appeals, litigation, claims, or exceptions have been disposed of. [29 FR 10192, July 24, 1964, as amended at 40 FR 44140, Sept. 25, 1975] § 1-7.103-4 Notice and assistance regarding patent and copyright infringement. The following clause shall be included in all contracts which exceed $10,000: NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT (a) The Contractor shall report to the Contracting Officer, promptly and in reasonable written detail, each notice or claim of patent or copyright infringement based on the performance of this contract of which the Contractor has knowledge. (b) In the event of any claim or suit against the Government, on account of any alleged patent or copyright infringement arising out of the performance of this contract or out of the use of any supplies furnished or work or services performed hereunder, the Contractor shall furnish to the Government, when requested by the Contracting Officer, all evidence and information in possession of the Contractor pertaining to such suit or claim. Such evidence and information shall be furnished at the expense of the Government except where the Contractor has agreed to indemnify the Government. Insert the clause set forth in § 1-12.1102-2 under the conditions and in the manner prescribed therein. EDITORIAL NOTE: For a document relating to this section see 41 FR 33265 Aug. 9, 1976. § 1-7.103-17 Price reduction for defective cost or pricing data. Insert the appropriate clause set forth in § 1-3.814-1 under the conditions described therein. § 1-7.103-18 Audit and records. Insert the appropriate clause or clauses set forth in § 1-3.814-2 under the conditions described therein. § 1-7.103-19 Subcontractor cost and pricing data. Insert the appropriate clause set forth in § 1-3.814-3 under the conditions described therein. § 1-7.103-20 Advance payments. When advance payments are to be made in accordance with Subpart 1-30.4, insert the appropriate provisions as prescribed in § 1-30.414-2. § 1-7.103-21 Progress payments. When progress payments are to be made in accordance with Subpart 1-30.5, insert the appropriate clause as provided in § 1-30.510. § 1-7.103-22 Workmen's compensation insurance (Defense Base Act). Insert the clause set forth in § 1-10.402 under the conditions described therein. § 1-7.103-23 Late offers and modifications or withdrawals. (a) Insert the provision set forth in § 1-2.201(a) (31) in all formally advertised solicitations. (b) The provision set forth in § 1-3.802-1(b) shall be used in all negotiated solicitations except as provided by § 1-3.802-2(a). (c) The provision set forth in § 1-3.802-2(b) may be used in negotiated solicitations under the conditions prescribed in § 1-3.802-2(a). [38 FR 26916, Sept. 27, 1973] § 1-7.103-24 Contracts with the Small Business Administration, (a) Insert the clause set forth in § 1-1.713-3(d) (1) in contracts with the Small Business Administration awarded pursuant to section 8(a) of the Small Business Act (15 U.S.C. 637(a)). (b) Insert the clause set forth in § 1-1.713-3(e) in subcontracts which will be executed by the Small Business Administration and its subcontractors. § 1-7.103-25 Supplementary tax clauses. (a) Insert the supplementary clause set forth in § 1-11.401-3 (a) under the conditions contained therein. (b) Insert the clause set forth in § 1-11.401-3(b) under the conditions contained therein. § 1-7.103-26 Preference for U.S. flag air carriers. Insert the clause set forth in §1-1.323-2 under the conditions prescribed therein. [39 FR 34665, Sept. 27, 1974] § 1-7.103-27 Cost accounting standards. (a) Insert the three notices for solicitations set forth in § 1-3.1203 (a)(3), (h) (2), and (i) (2) in negotiated solicitations under the conditions contained in Subpart 1-3.12. (b) Insert the two clauses set forth in §§ 1-3.1204-1 and 1-3.1204-2 in negotiated contracts under the conditions contained in Subpart 1-3.12. [40 FR 60030, Dec. 31, 1975] § 1-7.103-28 Subcontracts. The following clause may be inserted in fixed-price supply contracts whenever it is likely that subsequent to award major modifications will be initiated pursuant to the Changes clause, or other contract provisions, and that such modifications will result in the placement of additional subcontracts. The pricing arrangements of such subcontracts have an impact upon the final price of the modification; therefore, it is essential that they be made available by the contractor for review by the contracting officer (see §§ 1-3.807-10(b) and 1-3.903). SUBCONTRACTS (The provisions of this clause do not apply to firm fixed-price and fixed price with escalation (economic price adjustment) contracts. The clause does apply to new subcontracts or modifications of existing subcontracts which are necessitated because of unpriced contract changes pursuant to the Changes clause or other provisions of this contract.) (a) As used in this clause, the term "subcontract" includes purchase orders. (b) The Contractor shall notify the Contracting Officer reasonably in advance of entering into any subcontract if the Contractor's procurement system has not been approved by the Contracting Officer and if the subcontract: (1) Is to be a cost-reimbursement, time and materials, or labor-hour contract which it is estimated will involve an amount in excess of ten thousand dollars ($10,000) including any fee; (11) Is proposed to exceed one hundred thousand dollars ($100,000); or (111) Is one of a number of subcontracts, under this contract, with a single subcontractor for the same or related supplies or services which, in the aggregate, are expected to exceed one hundred thousand dollars ($100,000). (c) The advance notification required by paragraph (b) above shall include: (1) A description of the supplies or services to be called for by the subcontract; (11) Identification of the proposed subcontractor and an explanation of why and how the proposed subcontractor was selected, including the competition obtained; (111) The proposed subcontract price, together with the Contractor's cost or price analysis thereof; (iv) The subcontractor's current, complete, and accurate cost or pricing data and Certificate of Current Cost of Pricing Data, when such data and certificates are required by other provisions of this contract to be obtained from the subcontractor; (v) Identification of the type of subcontract to be used; (vi) A memorandum of negotiation which sets forth the principal elements of the subcontract price negotiations. A copy of this memorandum shall be retained in the Contractor's file for use of Government reviewing authorities. The memorandum shall be in sufficient detail to reflect the most significant considerations controlling the establishment of initial or revised prices. The memorandum should include an explanation of why cost or pricing data was, or was not required, and, if it was not required in the case of any price negotiation in excess of $100,000, a statement of the basis for determining that the price resulted from or was based on adequate price competition, established catalog or market prices of commercial items sold in substantial quantities to the general public, or prices set by law or regulation. If cost or pricing data was submitted and a certificate of cost or pricing data was required, the memorandum shall reflect the extent to which reliance was not placed upon the factual cost or pricing data submitted and the extent to which this data was not used by the Contractor in determining the total price objective and in negotiating the final price. The memorandum shall also reflect the extent to which it was recognized in the negotiation that any cost or pricing data submitted by the subcontractor was not accurate, complete, or current; the action taken by the Contractor and the subcontractor as a result; and the effect, if any, of such defective data on the total price negotiated. Where the total price negotiated differs significantly from the Contractor's total price objective, the memorandum shall explain this difference; (vii) When incentives are used, the memorandum of negotiation shall contain an explanation of the incentive fee profit plan Identifying each critical performance element, management decisions used to quantify each incentive element, reasons for incentives on particular performance characteristics, and a brief summary of trade-off possibilities considered as to cost, performance, and time; and (viii) The Subcontractor's Disclosure Statement or Certificate relating to Cost Accounting Standards when such data are required by other provisions of this contract to be obtained from the subcontractor. (d) The Contractor shall not enter into any subcontract for which advance notification to the Contracting Officer is required by this clause, without the prior written consent of the Contracting Officer; Provided That the Contracting Officer in his discretion, may ratify in writing any subcontract. Such ratification shall constitute the consent of the Contracting Officer required by this paragraph. (e) Neither consent by the Contracting Officer to any subcontract or any provisions thereof nor approval of the Contractor's procurement system shall be construed to be a determination of the acceptability of any subcontract price or of any amount paid under any subcontract or to relieve the Contractor of any responsibility for performing this contract, unless such approval or consent specifically provides otherwise. (f) The Contractor agrees that no subcontract placed under this contract shall provide for payment on a cost-plus-a-percentage-of-cost basis. [40 FR 11580, Mar. 12, 1975; 40 FR 20818, May 13, 1975] § 1-7.103-29 Privacy Act. Insert the clause prescribed by § 11.327-5 under the conditions set forth therein. [40 FR 44504, Sept. 26, 1975] § 1-7.103-30 Clauses for solicitations and contracts for automatic data processing (ADP) equipment, software, maintenance services, and supplies. Insert the standard clauses set forth in § 1-4.1108 in solicitations and contracts for ADP under the conditions specified in § 1-4.1108. The clauses are: (a) Warranty Exclusion and Limitation of Damages. (b) Contractor Representation. (c) Fixed Price Options: Option to Extend the Term of the Contract, Option for Increased Quantity. [41 FR 43546, Oct. 1, 1976] § 1-7.103-31 Use of U.S. flag commercia! vessels. Insert the clause prescribed by |