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Title 41-Public Contracts, Property Management
(b) Insert the two clauses set forth in signs, or specifications; (ii) method of ship$$ 1-3.1204–1 and 1-3.1204–2 in negoti
ment or packing; and (ili) place of inspecated contracts under the conditions con
tion, delivery, or acceptance. If any such
change causes an increase or decrease in the tained in Subpart 1-3.12.
cost of, or the time required for performance (40 FR 60030, Dec. 31, 1975)
of, this contract, or otherwise affects any 8 1-7.303–58 Labor surplus area sub
other provisions of this contract, whether
changed or not changed by any such order, contracting program.
an equitable adjustment shall be made (1) Insert the clause set forth in § 1-1.805– in the contract price or time of performance, 3(b) under the conditions and in the
or both, and (11) in such other provisions manner prescribed therein.
of the contract as may be so affected, and the
contract shall be modified in writing accord$1–7.303–59 Small business subcon ingly. Any claim by the Contractor for adtracting program.
justment under this clause must be asserted
within thirty (30) days from the date of Insert the clause set forth in § 1-1.710–
receipt by the Contractor of the notification 3(b) under the conditions and in the
of change; Provided, however, That the Conthe manner prescribed therein.
tracting Officer, if he decides that the facts
justify such action, may receive and act upon 88 1-7.303-60—1-7.303-62 [Reserved]
any such claim asserted at any time prior to § 1-7.303–63 Preference for U.S. flag
final payment under this contract. Failure air carriers.
to agree to any adjustment shall be a dispute
concerning a question of fact within the Insert the clause set forth in § 1-1.323– meaning of the clause of this contract en2 under the conditions prescribed titled “Disputes". However, nothing in this therein.
clause shall excuse the Contractor from pro
ceeding with the contract as changed. 8 1-7.303-64 Contracts with the Small Business Administration.
The period of “30 days" within which a
claim must be asserted may be varied in (a) Insert the clause set forth in
accordance with agency procedures. § 1-1.713-3(d) (1) in contracts with the Small Business Administration awarded
$ 1-7.304-2 Alterations in contract. pursuant to section 8(a) of the Small Insert the clause set forth in $ 1Business Act (15 U.S.C. 637(a)).
7.204-1. (b) Insert the clause set forth in
8 1-7.304–3 Approral of contract. § 1-1.713–3(e) in subcontracts which will be executed by the Small Business
Insert the clause set forth in $ 1
7.204-2. Administration and its subcontractors.
§ 1-7.304_4 [Reserved) § 1-7.303–65 Privacy Act.
1–7.304–5 Notice regarding late deInsert the clause prescribed by $ 1
livery. 1.327-5 under the conditions set forth therein.
Insert the clause set forth in § 1
7.204-4. (40 FR 44504, Sept. 26, 1975)
§ 1-7.304–6 Key personnel. § 1-7.303–66 Use of U.S. flag commercial vessels.
KEY PERSONNEL Insert the clause prescribed by
The personnel specified in an attachment § 1-19.108-2 under the conditions set
to this contract are considered to be essenforth therein.
tial to the work being performed hereunder.
Prior to diverting any of the specified indi(41 FR 52457, Nov. 30, 1976)
viduals to other programs, the Contractor § 1-7.304 Additional clauses.
shall notify the Contracting Officer reason
ably in advance and shall submit justificaThe following clauses may be inserted tion (including proposed substitutions) in in fixed-price research and development suficient detail to permit evaluation of the contracts when it is desired to cover the
impact on the program. No diversion shall be subject matter thereof.
made by the Contractor without the written
consent of the Contracting Officer: Provided, 8 1-7.304-1 Changes.
That the Contracting Officer may ratify in CHANGES
writing such diversion and such ratification
shall constitute the consent of the ContractThe Contracting Officer may at any time, Ing Officer required by this clause. The atby a written order, and without notice to the tachment to this contract may be amended suretles, if any, make changes, within the from time to time during the course of the general scope of this contract, in any one contract to either add or delete personnel, es or more of the following: (1) Drawings, de appropriate.
§ 1-7.304–7 Liquidated damages.
drawings in sufficient detall to comprehen
sively explain the results achieved under the Insert the provision set forth in § 1
contract. The final report shall be submitted 1.315–3 under the conditions and in the
in a reproducible copy plus the number of manner prescribed in § 1-1.315. Where coples specified in the Schedule. Standard Form 32 is not included in the contract, the provision set forth in § 1
Subpart 1-7.4-Cost-Reimbursement Type 1.315–3 shall be modified by replacing the
Research and Development Contracts first paragraph with appropriate refer SOURCE: 40 FR 17566, April 21, 1975, unless ences to the Default clause contained in
otherwise noted. the contract.
§ 1-7.400 Scope of subpart. § 1-7.304–8 Disposition of material.
This subpart sets forth contract clauses DISPOSITION OF MATERIAL
for use in cost-reimbursement type reUpon termination or completion of all
search and development contracts. work under this contract, the Contractor
$ 1-7.401 Applicability. shall prepare for shipment, deliver 1.0.b. destination, or dispose of all materials re As used throughout this subpart, the celved from the Government and all residual term "cost-reimbursement type research materials produced in connection with the
and development contract” means any performance of this contract as may be directed by the Contracting Officer, or as speci
contract (other than a letter contract, fied in other provisions of this contract. All
notice of award, or modification not efmaterials produced or required to be dellv
fecting new procurement) which is (a) ered under this contract become and remain entered into on a cost, cost-sharing, or the property of the Government.
cost-plus-a-fee basis, and (b) is for ex
perimental, developmental, or research $ 1-7.304–9 Reports of work.
work. Unless clearly inappropriate, these REPORTS OF WORK
clauses may also be used in other types of (a) The Contractor shall submit separato
nonpersonal services contracts; e.g., monthly progress reports of all work accom
studies, surveys, and demonstrations in plished during each month of contract per
socio-economic areas, except for (a) conformance. Reports shall be in narrative form, struction, (b) architect-engineer services, and brief and informal in content. Monthly and (c) those subject to the Service Conreports shall include:
tract Act of 1965, as amended. (1) A quantitative description of overall progress;
§ 1-7.402 Required clauses. (11) An indication of any current problems which may impede performance, and pro
The clauses set forth in this § 1-7.402 posed corrective action; and
shall be inserted, as required, in all cost(10) A discussion of the work to be per
reimbursement type research and develformed during the next monthly reporting opment contracts. period.
8 1-7.402-1 Definitions. Monthly reports shall be submitted in a reproducible copy plus the number of copies
Insert the clause set forth in § 1-7.102– specified in the Schedule.
1. Additional definitions may be included (b) The Contractor shall submit separate provided they are not inconsistent with quarterly reports of all work accomplished the clause or the provisions of these during each 3 month period of contract per regulations. formance. In addition to factual data, these reports shall include a separate analysis sec
§ 1-7.402–2 Limitation of cost or funds. tion which interprets the results obtained,
(a) Insert the clause set forth in recommends further action, and relates occurrences to the ultimate objectives of the
$ 1-7.202-3(a) in all fully funded costcontract work, Sufficient diagrams, sketches,
reimbursement type research and decurves, photographs, and drawings shall be velopment contracts which do not proIncluded to convey the intended meaning. vide for cost sharing. The clause is Quarterly reports shall be submitted in a re equally applicable to contracts not proproducible copy plus the number of coples viding for the payment of a fee, and, if specified in the schedule.
desired, may be altered to delete the (c) The Contractor shall submit a final report which documents and summarizes the
words "exclusive of fee” wherever they results of the entire contract work, including
appear. recommendations and conclusions based on
(b) Insert the following clause in fully the experience and results obtained. The funded cost-reimbursement type refinal report shall include tables, graphs, dla search and development contracts which grams, curves, sketches, photographs, and provide for cost sharing. The contract
total amount then allotted to the contract. walacting Officer to be allowable in accordtracting Officer shall affect the amount alted for in the Schedule.
mounts approved by the Contracting Omroer.
The Contractor may submit to an authorized lotted to the contract, whether those excess costs were incurred during the course of the presentative of the Contracting Oficer, to statements of cor
nach form and reasonable detal es sich berettore made contract or as a result of termination. When
representative may require, en invoice or tion for amount and to the extent that the amount allotted to the contract has been increased, any costs publle voucher supported by statement of tice or round
Dess, Iot the performance of this contract a Contracting Ofert incurred by the Contractor in excess of the amount previously allotted shall be allowable calmed to constitute allowable cost. For de uit, not to to the same extent as if such costs had been purpose, except as provided herrin with a permet may be incurred after such increase in the amount pect to pension contributions, we to pressed for
"posts" shell include only one zenet
of contract perlormance in fide any ons testing Changes clause of this contract shall not be considered an authorization to the Contrac
tourse of business) Costa nel brut satsions of (1) tor to exceed the amount allotted in the
necessarily peid, for materiais vaistas papay part Schedule in the absence of a statement in the blic Contracts, Property Management Cople -Federal Procurement Regulations of the period specified in the Schedule the dag onder
, or other contract modification, been issued from the contri Contractor will advise the Contracting on besedag the amount allotted.
ventory and placed in the pr cer in writing as to the estimated amount of 1) Nothing in this clause shall affect the for use on the contract, for additional funds, If any, that will be required
the Government to terminate this direct travel, for other dire for the timely performance of the work under most In the event this contract is ter and for properly allocables the contract or for such further period as
, the Government and the Contractor direct costs, as is shown may be specified in the Schedule or otherwise del segotiate an equitable distribution of tained by the Contractor f agreed to by the parties. If, after such notif d property produced or purchased under the taining reimbursement u cation, additional funds are not allotted by matract based upon the share of costs in contracts plus the amoun the end of the period set forth in the Sched
azred by each.
ments which have been ule or an agreed date substituted therefor, g) In the event that sufficlent funds are tractor's subcontractors the Contracting Officer will, upon written re
Halotted to this contract to allow com standards. In addition, wh quest by the Contractor, terminate this con d the work contemplated by this butions are paid by the tract pursuant to the provisions of the Ter meact, the Contractor shall be entitled to retirement fund less mination clause on such date. If the con percentage of the lee set forth in the quarterly, accrued costs t' tractor, in the exercise of his reasonable sede equivalent to the percentage of cluded from indirect cost judgment, estimates that the funds available spletion of the work contemplated by this poses until such costs a will allow him to continue to discharge his
contributions are paid on obligations hereunder for a period extend
e) In the foregoing clauses set forth
frequent basis, accruals ing beyond such date, he shall specify the
cluded in indirect costs 1
paragraphs (a) and (b) of this $ 1-7.later date in his request and the Contracting
provided that they are Officer, in his discretion, may terminate this (24
, the period of "60 days” and the
within 30 days after the contract on that later date.
pauentage of "75 percent" may be varied covered. If payments a (d) Except as required by other provisions a 30 days to 90 days and 75 percent fund within such 30-day of this contract specifically citing and stated 16 percent.
tribution costs shall b to be an exception from this clause, the Gov
direct cost for payment ernment shall not be obligated to reimburse 1-12024Allowable cost, fee, and
ident has been made. T the Contractor for costs incurred in excess
ment more frequently t of the total amount from time to time al.
requirement of prior
Insert the following clause in all costlotted to the contract, and the Contractar ambursement type supply contracts all not apply when të
services purchased dir ance under the contract (including actions Sat provide for the payment of a
business concern. under the Termination clause) or other
(c) Promptly after wise to incur costs in excess of the amount
LLOWAELE COST, FIXED-FEL, AND PAYMENT
or voucher and states allotted to the contract, unless and until the
ernment sball, except Contracting Officer has notified the Con.
() For the performance of this contract,
in this contract subje tractor in writing that such allotted amount Comernment shall pay to the
(d), below, make pe has been increased and has specified in such The cost thereof (hereinafter referred
proved by the Contr notice an increased amount constituting the "allowable cost") determined by the
of the fixed-fee, 11 &r
Contractor as specific To the extent the amount allotted ex
vided, however, Tha ceeds the estimated cost set forth in the
O Subpart 1-15,2 of the Federal Procurefeat Regulations (41 CFR 1-15.2), ss in
percent of the fixe Schedule, such estimated cost shall be
lect on the date of this contract; and
Schedule, the Contra correspondingly increased. No notice, com
bold further payme
(U) The terms of this contract, and munication, or representation in any other
stal have been set
2 Such fixed-fee, sny, as may be proform or from any person other than the con
be considers necess (b) Payments shall be made to the co
ests of the Gover lotted to this contract.
sball not exceed 15 specified notice, the Government shall not be
hat not more trequently than bi-wekiy, to
See, or $100,000, wh obligated to reimburse the Contractor for any
(@) At any time costs in excess of the total amount then al
ment under this
be allotted to this contract up to the full tor's corresponding share exceeds the estiestimated cost to the Government set forth in mated cost set forth in the Schedule, such the Schedule, exclusive of any fixed fee. The estimated cost shall be correspondingly inContractor agrees to periorm or have per creased. Any increase in such estimated cost formed work on this contract up to the point shall be allocated in accordance with the forat which the total amount paid and payable mula set forth in the Schedule governing by the Government pursuant to the terms of such increases. No notice, communication, this contract approximates but does not ex or representation in any other form or from ceed the total amount actually allotted by any person other than the Contracting ofthe Government to the contract.
ficer shall affect the amount allotted by the (C) If at any time the Contractor has Government to this contract. In the absence reason to believe that the costs which he of the specified notice, the Government shall expects to Incur in the performance of this not be obligated to reimburse the Contractor contract in the next succeeding 60 days, for any costs in excess of the total amount when added to all costs previously incurred,
then allotted by the Government to the conwill exceed 75 percent of the total of the tract, whether those excess costs were inamount then allotted to the contract by the curred during the course of the contract or as Government plus the Contractor's corre a result of termination. When and to the exsponding share, the Contractor shall notify
tent that the amount allotted by the Govthe Contracting Officer in writing to that ef
ernment to the contract has been increased, fect. The notice shall state the estimated any costs incurred by the Contractor in examount of additional funds required to con
cess of the total of the amount previously tinue performance for the period set forth in allotted by the Government plus the Conthe Schedule. Sixty days prior to the end of
tractor's corresponding share shall be allowthe period specified in the schedule the Con
able to the same extent and in the same per-' tractor will advise the Contracting Officer in centage as if such costs had been incurred writing as to the estimated amount of addi after such increase in the amount allotted; tional funds, if any, that will be required
unless the Contracting Officer issues a termifor the timely performance of the work under nation or other notice and directs that the the contract or for such further period as
increase is solely for the purpose of covering may be specified in the Schedule or otherwise termination or other specified expenses. agreed to by the parties. If, after such notif (e) Chango orders issued pursuant to the cation, additional funds are not allotted by Changes clause of this contract shall not be the end of the period set forth in the Sched considered an authorization to the Contracule or an agreed date substituted therefor, tor to exceed the amount allotted by the the Contracting Officer will, upon written Government in the Schedule in the absence request by the Contractor, terminate this of a statement in the change order, or other contract pursuant to the provisions of the contract modification, increasing the amount Termination clause on such date. If the Con allotted. tractor, in the exercise of his reasonable Judg
(f) Nothing in this clause shall affect the ment, estimates that the funds available will
right of the Government to terminate this allow him to continue to discharge his obli contract. In the event this contract is tergations hereunder for a period extending be minated, the Government and the Conyond such date, he shall specify the later tractor shall negotiate an equitable distribudate in his request, and the Contracting Of
tion of all property produced or purchased ficer, in his discretion, may terminate on under the contract based upon the share of that later date.
costs incurred by each. (d) Except as required by other provisions
(g) In the event that sufficient funds are. of this contract specifically citing and stated
not allotted to this contract by the Governto be an exception from this clause, the
ment to allow completion of the work conGovernment shall not be obligated to reim
templated by this contract, the Contractor burse the Contractor for costs incurred in
shall be entitled to that percentage of the excess of the amount from time to time al
fee set forth in the Schedule equivalent to lotted by the Government to the contract,
the percentage of completion of the work and the Contractor shall not be obligated to
contemplated by this contract. continue performance under the contract (including actions under the Termination (e) In accordance with agency proceclause) or otherwise to incur costs in excess
dures the percentages and time periods of the total of the amount then allotted to
stated in the foregoing clauses may be the contract by the Government plus the Contractor's corresponding share, unless and
varied respectively between 75 percent until the Contracting Officer has notified the
and 85 percent and 30 to 90 days. Contractor in writing that the amount al § 1-7.402–3 Allowable cost, fee, and lotted by the Government has been increased
payment. and has specified in such notice an increased amount constituting the total amount then
(a) Insert the clause set forth in allotted by the Government to the contract.
§ 1-7.202–4 in all cost-reimbursement To the extent the total of the amount al type contracts which provide for paylotted by the Government plus the Contrac ment of a fixed fee.
Government inspectors in the performance d the Contractor's directors or officers, sistance for the safety and convenience of the willful misconduct on the part of the Government shall be performed in such dents, or other equivalent representaExcept as otherwise provided in this con. Le substantially all of the Contractor's tract, acceptance of any supplies or lots of them, or (2) all or substantially all of the supplies shall be made as promptly as prac- creator's operations at any one plant or deemed to have been made no later than 80 e performed, or (3) & separate and com
14 major industrial operation in connecceptance has not been made earlier within th the performance of this contract.
Genernment may at any time also rethis contract, but not later than 6 months (of war, without cost to the Government, of
oxtection or replacement by the ConSchedule) after acceptance of the supplies of the defects or fallures are caused by
sur mere individual employees selected or lots of supplies last delivered in accordance
thed by the Contractor after any such
Comicted supplies or replaced supplies of delivery thereof are defective in material
and the same manner and to the same
es sa supplles originally delivered under how the proposed subco Except as otherwise provided in paragraph (c) hereof, the cost of any such replacement or correction shall be included in allowable
respection work available to the Gov
hat during the performance of this concost determined as provided in the clause of
this contract entitled "Allowable Cost, Fixed
In ud Payment," but no additional fee
tract and for such long provisions of this clause shall be included in
tal de payable with respect thereto. Such specified in this contract determining the amount payable under this
pls or lots of supplies shall not be (1) Except as provide contract, notwithstanding any provision ndered thereafter for acceptance unless as may be provided in contained in the specifications or other docu
de former requirement of correction is dis Contractor shall have n ments incorporated in this contract by
dhed. I the Contractor falls to proceed with bility to correct or repla reference, designating services to be per
sixesble promptness to replace or correct supplies which at the formed or materials to be furnished by the
sah supplies or lots of supplies, the Govern defective in material Contractor at his expense or without cost to
23 (1) may by contract or otherwise re otherwise not in conform the Government.
per er correct such supplies and charge to ments of this contract. [29 FR 10192, July 24, 1964 as amended at de Contractor any increased cost occasioned (g) Except as otherw 40 FR 14913, Apr. 3, 1975; 40 FR 18996, May 1 u Government thereby, or may reduce any Schedule, the Contracto 1975)
sal lee payable under this contract (or re-rect or replace Governm § 1-7.202–5 Inspection of supplies and an in such amount as may be equitable
ens repayment of any fixed fee theretofore erty (which is property 11
acquired directly by th correction of defects.
ther the circumstances, or (2) In the case delivered or otherwise m INSPECTION OF SUPPLIES AND CORRECTION OF Amplies not delivered, may require the Contractor) shall be go DEFECTS
Litery of such supplies, and shall have the visions of the clause of t
* to reduce any fixed fee theretofore "Government Property." (a) All supplies (which term throughout al ln such amount as may be equitable this clause Includes without limitation Tax
ther the circumstances, or (3) may termi
$ 1-7.202-6 Assignm materials, components, intermediate as
2 tbls contract for default as provided semblies, and end products) shall be subject to cause of this contract entitled
Insert the clause set to inspection and test by the Government
, Tradination for Default or Convenience of under the conditions to the extent practicable at all times and
1 Comernment." Fallure to agree to the places including the period of manufacture
$ 1-7.202-7 Examin and in any event prior to acceptance. The Weed to the Contractor or to such reduc
Comptroller Gene Contractor shall provide and maintain an
ng or repayment of, the fixed fee shall Inspection system acceptable to the Governo ispute concerning a question of fact
Insert the clause ment covering the supplies, fabricating the meaning of the clause of this 7.103-3. methods, and special tooling hereunder. The rest entitled "Disputes." Government, through any authorized represeNotwithstanding the provisions of para
$ 1-7.202-8 Subcont sentative, may Inspect the plant or plants and (b) hereof
, the Government may at of the Contractor or any of his subcon the require the correction or replace
Insert the following tractors engaged in the performance of this set by the Contractor, without cost to the
reimbursement type su by the Government on the premises of the dae defective in material or workman
SUBCONT Contractor or a subcontractor, the Contractor scolherwise not in conformity with the
(a) The Contractor s shall provide and shall require subcontracteresent of this contract, I such defectes tracting Officer reasonal and as
or labor-hour, or (2) is of their duties. All inspections and tests by
exceeds in dollar amount
of the total estimated a manner as will not unduly delay the work
or (3) provides for the 1 rental, Installation, or special test equipment i
cess of $1,000 or of any after delivery thereof
(b) In the case of a days after the date of such delivery, 1f ac
which (1) is cost-relmi such period.
and materials, or labor
volve an estimated ar btime
$10,000, including any i such other period as may be provided in the
to exceed $100,000, or ( of subcontracts under
single subcontractor for with the requirements of this contract, the
supplies or services wh Government may require the Contractor to
are expected to exceed remedy by correction or replacement, as di
notification required 1
include: rected by the Contracting Officer, any supplies or lots of supplies which at the time
(1) A description of t
to be called for by the or workmanship or otherwise not in conform
(2) Identification of ity with the requirements of this contract
contractor and an exp Including the degree of
(3) The proposed si gether with the Conti