INDEX OF GENERAL PROVISIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP65-00523R000100110065-9
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 21, 2016
• Document Release Date: December 22, 2008
• Sequence Number: 65
• Publication Date: August 22, 1956
• Content Type: REPORT

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INDEX OF GENERAL PROVISIONS
1.
2.
3.
4.
5.
6.
7.
8.
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10,
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13.
4.
154
16.
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18,
19,
20.
21.
22,
23.
24a
_25.
26,
27,
28.
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_ v ? . ? O O O O . O ? . V ? ? O O ? ? ? ? . ? y
CHAiVGES < ? . < < . ? ? . ? . < 1
IN
e
SPECTION, ? ?
PAYh,ENTS_
EXCUSABLE, DELAYS - - - - - ? ? ? ? ? ? ? o a -T
DISPUTES. . . . . . . . . ? . ? . 5
NOTICE AND ASSISTANCE REGARDING PATENT INF'RIiNGEI,TVT . ? , 5
BUY AJ ERICAN ACT. 6
C0i'VICT LABOR . :91, . , i : ? a : . . ? 6.
EI;:=HT-HOUR LAiJ OF 12 < . , : 6
'~d.~- Si I ;ATEY PUBLIC COivTRyCTS ACT a ? i r, < a <
7
N
0NDISCRII?IIInATIOid IN El.FLCYNENT* , ? l 7
QF'FIcIALS NOT TO BEIEFIT. e e a < . ? . 8
COVENANT AGAINST CO::TIi~GEN'JT FEES e ? . ? . ? . . . ? . . 8
REPORT,.dG OF ROYALTIES. . . . . . ? . . . . 8
TERIII -- --
ivATION FOR CONVENIEN
SUBCONTRACTS, < ?
RECOE.DS -
? ? ? ? ? ? a ? ? ? 15
-
? , e F - - - _ - ? . ? ? ? 0 a 0 . ? -L-)
GRATUITIES,
? t,- ? . ? ? . . . . ?. . ? . . . . 17
GOVERNI?NT FMR ISHED PROPERTY . . . . . . . . . . . . . . . . 17
EILOYME
NT OF ALIENS.
MILITARY SECURITY REQUIRENJENTS.
COPYRIGHT p , . . , . , , , ~ ,
FILIvG OF PATENT APPLICATIONS
NOTICE TO THE GOVERNMENT OF LABOR
AUTHORIZATION AND CONSENT . ? . ,
ALTERATIONS IN CONTRACT . p ,
. . ? e a . a ? 22
? ? ? a ? .. . . 23
DISPUTES.
?
e 24
0 . a 0 a . ? ? a 24
O 0. O O p . . .. e , O . . . 25
o ? e o o a e o p o O .. ? 0 25
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1. DEFINITIONS
As used throughout this contract, the following terms shall
have the meanings set forth below:
(a) The term "Secretary" means the Secretary, the Under
Secretary, or any Assistant Secretary of the Department and the head
or any assistant head of the executive agency; and the term "h..s duly
authorized representative" means any person or persons or board
(other than the Contracting Officex*) authorized to act for the Secretary;
and the term "Department" means that component of the Government having
cognizance of this contract and represented by the Contracting Officer
executing this contract.
(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 a properly designated 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.
(c) Except as otherwise provided in this contractor the term
"subcontracts" includes purchase orders under this contract.
(d) The term "contract work" means all work to be performed
under this contract including any studies covering fundamental, theo-
retical, or experimental investigations; any extension of the inves-
tigative findings and theories of scientific and technical nature
into practical application; any tangible terms, hereinafter referred
to as supplies, if called for herein;. furnished to the Government;
and any reports, data, computations, plans, drawings, and specifica-
tions with respect to the foregoing.
(e) The term "direct labor," as used in the Payments clause,
shall be defined in the schedule.
The Contracting Officer may at any time, by a written order, within
the general scope of this contract, and without notice to any sureties,
make changes in (i) drawings, des; ns, or specifications, (ii) direct
the addition of work or services; (iii) make changes in method of
shipping or packing, and (iv) make changes in place of delivery. If
such changes require a change in the time of performance of the work
called for hereunder, the contract shall be modified in writing
accordingly. The hourly rate set forth in the schedule shall not be
adjusted by reason of any change ordered under this clause.
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3. INSPECTION
(a) AU material and workman hip shall be subject to inspection
and test by representatives of the.. Government. For this purpose, the
Contractor shall allow, at all reasonable times, inspectors and other
Government personnel free access to the plant and operations and shah.
furnish such facilities as may be.required for the work. The Contractor
shall inform the inspector when the work is ready for inspection. The
Government representative shall have the right to (i) require the
replacement of parts which are not in accordance with applicable speci-
fications, and (ii) require the correction of defects.
(b) The Contractor shall provide and maintain an inspection
system acceptable to the Government covering the inspection of the
supplies and services furnished under this contract. Records of all
inspection work by the Contractor shall be kept complete and available
to the Government during the performance of the contract.
(c) The Contractor agrees that it will employ only qualified
and competent employees in the performance of this contract and that
the services performed will conform to the highest professional
standards for the work involved.
(a) Prior to final acceptance by the Government, any correction
of defects in supplies or. services, or replacement of materials to
make tho item conform to contract requirements, which correction or
replacement is made necessary by inferior workmanship or materials,
shall be at no cost to the Government.
(e) Final acceptance by the Government shall be conclusive
except as regards latent defects, fraud, or such gross mistakes as
amount to fraud., The Contractor sho11, before or after final ac-
ceptance, remedy defects or failures due to such causes at no cost
to the Government.
The Contractor shall be paid as follows upon the submission of
properly certified invoices or vouchers approved by the Contracting
Officer:
(a) Time Rate.
(1) The amounts
or rates set forth i
performed, which rate
ministrative expense
be payable on a prored
computed,b Iapplying the "ppropriate time rate
scbed tote number , direct labor hours
timecards, preferably
Payments will normally
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FraC onal p s of an hour shall
ntrac ' will substantiate
and b individual daily job
erforming the services.
s payroll intervals,
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but may be varied by the Contracting Officer if conditions so warrant.
(ii) N9t withstanding the.provisions of subparagraph (i) hereof)
the Contracting Officer, as provided in the schedule, shall withhold
payment of certain amounts due under this contract. Such amounts' shall
become payable upon completion o.f"this contract.
(iii) Unless provisions of the schedule hereof otherwise
specify, the hourly rate or rates set forth in the schedule shall
not be varied by virtue of the Contractor having performed work on an
overtime basis. If the schedule provides rates for overtime, the
premium portion of those rates will not be reimbursable unless the over-
time is approved in writing by the Contracting Officer,
Subcontcts).
direct materials shall be determined
fed by
mate
product, or which re uj r c
the furnishing of such p duct,
(i) Allowable costs
by the Contracting Officer
the Armed Services rocur
support all materi c sts
storeroom requisit' Di
s
are defined as the ate
(b) TUiaterials (Including
hitting paid invoices or
s as referenced by this clause
tinter directly into the end
ed directly in connection with
(i.i) The cost of subcontracts which are authorized pursuant
to the clause hereof entitled "Subcontracts" shall be reimbursable
costs hereunder. z
(iii) The Contractor shall) to the extent of its ability,
procure materials at the most advantageous prices available) with
daze regard to securing prompt delivery of satisfactory materials,
take all cash and trade discounts, rebates, allowances, credits,
salvage, commissions, and bonific.tions, and when unable to take
advantage of such benefits it shall. promptly notify the Contracting
Officer to that effect and the reason therefor. Credit shall be
given to the Government for cash and trade discounts, rebates,
allowances, credits, salvage, the value of resulting scrap, when
the amount of such scrap is appreciable, commissions and boni-
fications which have accrued to the benefit of the Contractor or
would have so accrued except for the fault or neglect of the Con-
tractor. Such benefits lost through no fault or neglect on the
part of the Contractor or lost through fault of the Government,
shall not be deducted from gross costs.
(c) As of the date of execution of this contract, there has
been allotted for it the total sum set forth in the schedule. This
sum, may be increased from time to time by the Government solely at
its discretion, and the contract shall be amended accordingly. Not-
withstanding any other provisions of this contract, the Contractor shall
not be obligated to perform any services, pursuant hereto, the
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aggregate price of which when added to the aggregate price of all
services theretofore t-rnished pursuant hereto would exceed said
sumo If at any time the Contractor considers it likely that the
aggregate amount sec forth in the schedule may be exceeded within
45 days, the Contractor will so notify the Contracting Officer and
the parties maythereupon enter into negotiations for an amendment
to or modification of this contract, as may be appropriate. Anything
in this contract to the contraiy_notwr_thstanding, the Government shall
not be obligated to pay to the Contractor any amount in excess of the
sum allotted for this contract. ,
(a) Pursuant to the provisions of the Assignment of Claims
Act of 1940 as amended (31 U. S. Code 203, 41 U. S. Code 15), if
this contract provides for payments aggregating :1,000 or more,
claims for moneys due or to became due to 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 re--
assigned to any such institution, Any such assignment or re-
assignment 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 or agent or trustee for two or more parties
participating in such financing, Notwithstanding any other
provision of this contract, payment 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 set--off,
(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)" "COIToIDENTIAL, "
be furnished to any assignee of any claim arising under this con-
tract or to any other person not entitled to receive the same;
PROVIDED, That a copy or any part or all of this contract so
masked may be furnished, or any information contained therein
may be disclosed, to such assignee upon the prior written author-
ization of the Contracting Officer,
(c) The Contractor shall obtain the written authorization of
the Contracting Officer prior to the assignment of any rights under
this contract.
6. EXCUSABLE DELAYS
The Contractor shall not be in default by reason of any failure
in performance of this contract in accordance with its terms (including
any failure by the Contractor to make progress in the prosecution of
the work hereunder which endangers such performance) if such failure
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arises out of causes beyond the eontrol and without the fault or
negligence of the Contractor.,'`.5urh causes include, but are not
restricted to: acts of God or of the public enemy; acts of the
Government; fires; floods; epidemics; quarantine restrictions;
strikes; freight embargoes; unusually severe weather; and failure of
subcontractors to perform or make progress due to such causes,
unless the Contracting Officer shall have determined that the
supplies or services to be furnished under the subcontract were ob-
tainable from other sources and shall have ordered the Contractor
in writing to procure such services or supplies from such other
sources, and the Contractor shall have failed reasonably to comply
with such order. Upon request of the Contractor, the Contracting
Officer shall ascertain the facts and extent of such failure and,
if he shall determine that such f ilure was occasioned by any one
or more of the said causes, the delivery schedule shall be revised
accordingly subject to the rights cif the Government under the clause
hereof entitled "Termination."
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. Within thirty
(30) days from the date of receipt of such copy, the Contractor may
appeal by mailing or otherwise furnishing to the Contracting Officer
a written appeal addressed to the Secretary, and the decision of the
Secretary or his duly authorized representative for the hearing of
such appeals shall, unless determiied by a court of competent juris-
diction to have been fraudulent or capricious or arbitrary or so
grossly erroneous as necessarily to imply bad faith, or not supported
by substantial evidence, be final and conclusive; PROVIDED,. That, if
no such appeal is taken, the decision of the Contracting Officer shall
be final and conclusive. 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. Pend-
ing final decision of a dispute hereunder, the Contractor shall pro-
ceed diligently with the performance of the contract and in accord-
ance with the Contracting Officeris decision.
8, NOTICE A Z ASSISTANCE REGARDING PATENT INFRINGEMENT
The provisions of this clause shall be applicable only if the
amount of this contract is in excess of w5,000.
(a) The Contractor shall report to the Contracting Officer,
promptly and in reasonable written detail, each notice or claim of
patent infringement based on the performance of this contract of which
the Contractor has knowledge.
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(b) In the event of litigation against the Government on
account of any claim of patent Infringement arising out of the per.-
formance 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, upon request, all evidence and information in
possession of the Contractor' pertaining to such litigation, Such
evidence and information shall be .'furnished at We expense of the
Government except in those cases in which the Contractor has agreed
to indemnify the Government against the claim being asserted.
9. BUY AMERICAN ACT
The Contractor agrees that there will be delivered under this
contract only such unmanufactured articles, materials and supplies
(which term "articles, materials and supplies" is hereinafter re-
ferred to in this clause as "supplies") as have been mined or pro-
duced in the United States, and only such manufactured supplies as
have been manufactured in the United States substantially all from
supplies mined, produced or manufactured, as the case may be, in
the United States. Pursuant to the Buy Americal Act (41 U. S,
Code lOa-d), the foregoing provision shall not apply (i) with
respect to supplies excepted by the Secretary from the applica-
-ion of that Act, (ii) with respect to supplies for use outside
the United States, or (iii) with respect to the supplies to be
delivered under this contract which are of a class or kind de-
termined by the Secretary or his duly authorized representative
not to be mined, produced, or manufactured, as the case may be,
in the United States in sufficient'and reasonably available
commercial quantities and of a satisfactory quality, or (iv)
with respect to such supplies from'which the supplies to be
delivered under this Contract are manufactured, as are of a
class or kind, determined by the Secretary or his duly author-
ized representative not to be mined, produced, or manufactured,
as the case may be, in the United States in sufficient and rea-
sonably available commercial quantities and of a satisfactory
quality: PROVIDED, That this exception (iv) shall not permit
delivery of supplies manufactured outside the United States if
such supplies are manufactured in the United States in suffi-
cent and reasonably available commercial quantities and of a
satisfactory quality.
10, CONVICT LABOR
In connection with the performance of work under this contract,
the Contractor agrees not to employ any person undergoing sentence
of imprisonment at hard labor,
11. EIGHT-HOUR LAW OF 1912
This contract, to the extent that it is of a character specified
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in the Eight-Hour Law of 193.2 as amended (40 U. S. Code 32,4---326} and
is not covered by the Walsh-Healey Public Contracts Act (41 U. S.
Code 35-45) is subject to the following provisions and exceptions
of said Eight-Hour Law of 1912 as amended, and to all other provi-
sions and exceptions of saidLaw
No laborer or mechanic doing any part of the work contemplated
by this contract, in the employ of the Contractor shall be required
~,.-or permitted to work more than eight hours in any one calendar day
upon such work, except upon the condition that compensation is paid
to such laborer or mechanic in accordance with the provisions of
this clause. The wages of every q*uch laborer and mechanic employed
by the Contractor shall be computed on a basic day rate of eight
hours per day; and work in excess:.of eight hours per day is per-
mitted only upon the condition that every such laborer and mecha::'.c
shall be compensated for all hourp.worked in excess of eight hours
per day at not less than one and one-half times the basic rate of
pay. For each violation of the requirements of this clause a
penalty of five dollars shall be #aposod upon the Contractor for
each such laborer or mechanic for every calendar day in which such
employee is required or permitted to labor more than eight hours
upon said work without receiving compensation computed in accord-
ance with this clause; and all penalties thus imposed shall be
withheld for the use and benefit of the Government.
W LSH-BEALEY PUBLIC CONTRACTS ACT
If this contract is for the manufacture or furnishing of
materials, supplies, articles or equipment in an amount which
exceeds or may exceed 2.0,000 and 'is otherwise subject to the
Walsh-Henley Public Contracts Act as amended (41 U. S. Code
35-45), there are hereby incorporated by reference all repre-
sentations and stipulations required by said Act and regulations
issued thereunder by the Secretary of Labor, such representations
and stipulations being subject to all applicable rulings and inter-
pretations of the Secretary of Labor which are now or may hereafter
be in effect, except that the Contractor shall not be required to in-
clude this clause in subcontracts issued hereunder when the inclusion
of this clause in a subcontract would jeopardize or conflict with
the security considerations established in connection with this
contract.
13. NCIDISCRIMINATION IN EMPLOYMENT
(a) In connection with the performance of work under this con-
tract, the Contractor agrees not to discriminate against any employee
or applicant for employment because of race, religion, color, or
national origin. The aforesaid provision shall include, but not
be limited to, the following: employment, upgrading, demotion, or
transfer; recruitment or recruitment advertising; layoff or termina-
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tion; rates of pay or otner forms of compensation; and selection for
training, including apprenticeship, The Contractor agrees to -post
hereafter in conspicuous places, 'available for employees and appli-
cants for employment,, notices to be'provided by the Contracting
Officer setting forth the provisions of the nondiscrimination clause,
(b) The Contractor further agrees to insert the foregoing
provision in subcontracts issued iereunder, except subcontracts for
standard coiziercial supplies or raw materials, and except as in-
sertion of the foregoing provision in a subco-tract would jeopardize
or conflict with the security considerations established in connec-
tion with this contract.
14, OFFICIALS NOT TO BENEFIT
No member of or delegate to Congress, or resident commission:.,
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,
COVENANT AGAINST CONTINGENT FEES
The Contractor warrants that no person or selling agency has
been employed or retained to solicit or secure this contract upon
an a ree:~ent or understanding for a commission, percentage, broker-
age, or contingent fee, excepting bona fide employees or bona fide
established connercial or selling agencies maintained by the Contractor
for the purpose of securing business. For breach or violation
of this warranty the Government shall have the right to annul
this contract without liability or in its discretion to deduct
from the contract price or considdtation the full amount of such
commission, percentage, brokerage or contingent fee.
REPORTING OF ROYALTIES
The provisions of this clause shall be applicable only if
the amount of the contract is in excess of ;p10,000.
(a) The Contractor shall report in writing (in quadruplicate)
to the Contracting Officer as soon as practicable after execution
of this contract whether or not any royalties in excess of :250
navo been paid.. or are to be paid- by 'the Contractor directly to any
person or firm in connection with the performance of this contract.
If royalties in excess of X250 have been paid or are to be paid to
any person or firm, the report shall include the following items of
information with respect to such royalties (including the initial
;v250 )
(1) The name and address of each licensor to whom royalties
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in excess of .;;;250 have been paid or are to be paid,
(2) The patent numbers, patent application serial numbers
(with filing dates), or other identification of the
basis for such royalties,
(3) The manner of computing 'the royalties consisting of
(i) a brief identification of each royalty-.bearing unit
or process, (ii) the total amount of royalties, and (iii)
the percentage rate or dollars and cents amount of royal-
ties on each such unit or process; PROVIDED that if the
royalties cannot be computed in terms of units or dollars
and cents value, than other data showing the manner in
which the Contractor computes the royalties.
(b) In lieu of furnishing a report under paragraph (a), the
Contractor may furnish a single, consolidated report for each
accounting period of the Contractor during which the Contractor
has contracts with the Government, provided the Contractor has
requested and obtained the prior written approval of the Contracting
Officer. Such consolidated report shall be furnished, when the
furnishing thereof has been approved, in the number of copies as
apprevod, as soon as practicable after the close of the accounting
period covered by the report, Such consolidated report shall be
made in accordance with Contractor1s established accounting practice
and shall include, for the accounting period, the total ariount of
royalties accruing to each licensor at a rate in excess of w-',000
per annum on the Contractorts over.-all business together with (i)
the name and address of each such licensor, (ii) the patent numbers,
patent application serial numbers (with filing dates), or other
identification of the basis for si ch royalties, (iii) a brief
description of the subject matter'of the license under which
royalties are charged, (iv) the percentage rate or unit amount,
cr if the royalties do not accrue by rate or unit amount., such
other data showing the manner by which the royalties accrue to
licensor, and (v) an estimate or approximation (without detailed
accounting) of the portion of such royalties that may be attrib-
utable to Government contracts. The Contractor shall, if requested
by the Government) furnish at Government expense a more detailed
allocation of such royalty payments attributable to Government
contracts.,
(c) In the event that the Contractor requests written approval
to furnish consolidated reports under paragraph (b) above, the Con-
tracting Officer shall promptly consider the request and furnish -to
the Contractor a letter stating whether or not the request is approved
and, notwithstanding any such approval, the Contracting Officer shall
have the right to question any such subsequently furnished report as
to accuracy or completeness of data and to ask for additional in-
formation. The Contractor shall furnish a copy of such letter of
approval to the Contracting Officer administering this contract.
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(d) After payi.ient of eighty percent (80%) of the amount of
this contract, as from time to U ac amended, further payment shall
be withheld until a reserve of either (i) ten percent (10%) of
such amount or (ii) 10,000, whichever is less, shell have been
set aside, such reserve or the balance thereof to be retained
until the Contracts= shell have furnished to the Contracting
Officer the report called for by p,:?agraph (a) hereof or the
copy of the letter approving the Contractor's request to furnish
the report under paragraph (b); PROVIDED that no aLiount shall
continue to be withheld from payment for the causes specified in
this paragraph (d) if the Contracting Officer shall find that the
Contractor has not been furnished 'a letter as required by paragraph
(c) within a reasonable tine after making written request to submit
a single, consolidated report under the provisions of paragraph (b)
of this clause; and PROVIDED FURTAZR that the Contracting Of.L .ce,.
may, in his discretion, order payment to be withheld in the amount
and manner above provided if the report called for by paragraph (a)
is unsatisfactory or if the report' called for by paragraph (b) is
due but has not been received, or .f received, is found to be unsat-
isfactory. No amount shall be withheld under this paragraph when
the a.Lniilum amount specified by this paragraph is being withheld
under other provisions of this contract. The withholding of any
amount or subsequent payment thereof to the Contractor shall not
be construed as a waiver of any right accruing to the Government
under this contract.
(b) The Contractor agrees that it will exert all reasonable
effort to advise the Contracting Officer, at the tine of
delivering any copyrightable or copyrighted work furnished
under this contract, of any adversely held copyrighted or
copyrightable material incorporated in any such work and of
any invasion of the right of privaoy therein contained.
(c) The Contractor agrees to report to the Contracting Officer,
promptly and in reasonable written detail, any notice or claim
of copyright infringement received by the Contractor with re-
spect to any material delivered under this contract.
17, TERMINATION FOR CONVENIENCE OF THE GOVERNIv'IE11T
(a) The performance of work under this contract may be
terminated by the Government in accordance with this clause in
whole, or from tins to time in part, (1) whenever the Contractor
shall default in performance of this contract in accordance with
its terms (including in the tern default any such failure by the
Contractor to make progress in the prosecution of the work here-
under as endangers such performance), and shall fail to cure such
default within a period of 10 days (or such longer period as the
Contracting Officer may allow) after receipt from the Contracting
Officer of a notice specifying the default, or (2) whenever for
any reason the Contracting Officer shall determine that such
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termination is in the best interests of the Government. Any such
termination shall be effected by delivery to the Contractor of a
Notice of Termination specifying, whether termination is for the
default of the Contractor or for the convenience of the Government,
the extent to which performance pf work under the contract is
terminated, and the date upon which such termination becomes
effective. If, after Notice of Termination of this contract for
default under (1) above, it is determined that the Contractor's
failure to perform or to note progress in performance is due to
causes beyond the control and without the fault or negligence of
the Contractor pursuant to the provisions of the clause of this
contract entitled 'Excusable Delays)" the Notice of Termination
shall be deemed to have been issued under (2) above, and the rights
and obligations of the parties hereto shall in such event be governed
accordingly?
(b) After receipt of a Notice of Termination and except as
otherwise directed by the Contracting Officer, the Contractor shall
(1) stop work under the contract on the date and to extent specified
in the Notice of Termination; (2) place no further orders or sub-
contracts for materials) services, or facilities except as may be
necessary for completion of such portion of the work under the contract
as is not terminated; (3) terminate all orders and subcontracts to
the extent that they relate to the performance of work terminated
by the Notice of Termination; (4) assign to the Government, in the
manner and to the extent directed by the Contracting Officer all of
the right, title, and interest of the Contractor under the orders or
subcontracts so terminated; (5) with the approval or ratification of
the Contracting Officer, which approval or ratification shall be final
and conclusive for all the purpogcs of this clause, settle all out-
standing liabilities and all claims arising out of such termination of
orders and subcontracts, the cosi-6f which would be reimbursable, in
whole or in part, in accordance with the provisions of this contract;
(6) transfer title (to the extent that title has not already been
transferred) and, in the manner, to the extent, and at the times
directed by the Contracting Officer, deliver to the Government (i)
the fabricated or unfabricated parts, work in process, completed
work, supplies, and other material produced as a part of, or acquired
in respect of the performance of, the work terminated by the Notice of
Termination; (ii) the completed or partially completed plans, drawings,
information, and other property which, if the contract had been com-
pleted, would be required to be furnished to the Government; and (iii)
the jigs, dies, fixtures, and other special tools and tooling acquired
or manufactured for the performance of this contract for the cost of
which the Contractor has been or will be reimbursed under this con-1
tract; (7) use its best efforts to sell in the manner, at the tines,
to the extent, and at the price or prices directed or authorized
by the Contracting Officer, any property of the types referred to in
provision (6) of this paragraph: PROVIDED, HOWEVER, That the
Contractor (i) shall not be required to extend credit to any purchcser.,
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and (ii) may acquire any such property under the conditions prescribed
by and at a price or prices approved by the Contracting Officer: J.ND
PROVIDED FURTHER, That the pzoc6eds of any such transfer or disposition
shall be applied in reduction of any payments to be made by the
Government to the Contractor: under this contract or shall otherwise
be credited to the price or cost of work covered by this contract or
paid in such r. anner as the Contracting Officer nay direct; (8) complete
performance of such part of the work as shall not have been terminated
by the Notice of Termination; and (9) take such action as may be
necessary, or as the Contracting Officer may direct, for the protection
and preservation of the property related to this contract which is in
the possession of the Contractor and in which the Government has or
may acquire an interest, The Contractor shall proceed immediately with
the performance of the above obligations notwithstanding any delay in
determining or adjusting any amount reimbursable under the prov_i.s:..ons
of this clause. At any time after `expiration of the plant clearance
period, as defined in Section VIII, Armed Services Procurement Regi- ation;,
as it may be a.lended from time to'
o time, the Contractor may submit to the
Contracting Officer a list, certified as to quantity and quality, of
any or all items of termination inventory not previously disposed of,
exclusive of items the dispositioz.of which has been directed or
authorized by the Contracting Officer, may request the Government
to remove such items or enter into a storage agreement covering trcLh
Not later than fifteen (15) days thereafter$ the Government will accept
title to such items and remove them or enter into a storage agreement
covering the same, provided that the list submitted shall be subject to
verification by the Contracting Officer upon removal of the items, or
if the items are stored, within Forty-five (45) days from the date of
submission of the list, and any necessary adjustment to correct the
list as submitted shall be made prior to final settlement,
(c) After receipt of a Notice of Terr:,ination, the Contractor
shall submit to the Contracting Officer its termination claim, in
the form and with the certification prescribed by the Contracting
Officer. Such claim shall be submitted promptly but in no event
later than 2 years from the effective date of termination, unless one
or more extensions in writing are granted by the Contracting Officer
upon request of the Contractor made in writing within such 2-year
period or authorized extension thereof. However, if the Contracting
Officer determines that the facts justify such action, he may receive
and act upon any such termination claim at any time after such 2-year
period or any extension thereof. Upon failure of the Contractor to
submit its termination claim within the time allowed, the Contracting
Officer may determine on the basis of information available to him, the
amount if any due to the Contractor by reason of the termination and
shall thereupon pay to the Contractor the amount so determined.
(d) Subject to the provisions of paragraph (c), the Contractor
and the Contracting Officer may agree upon the whole or any part of
the amount or amounts to be paid to the Contractor by reason of the
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total or partial termination of work pursuant to this clause which
amount or a l::ounts clay include a reasonable allowance for profit on
work done. The contract shall be amended accordingly, and the Con-
tractor shall be paid the agreed amount.
(e) In the event of the failure of the Contractor and the Con-
tracting Officer to agree in whole or in parts as provided in paragraph
(d) above, as to the amounts to be paid to the Contractor in connection
with the termination of work pursuant to this clause, the Contracting
Officer shall determine on the basis of information available to hti:,,
the amount, if any, due to the Contractor by reason of the termination
and shall pay to the Contractor the amount determined as follows:
(1) If the termination of the contract is for the convenience of
the Government:
(i.) There shall be included for direct labor hours (as defined
in the Schedule of the contract) = amount which shall be determined
by multiplying the number of direct labor hours expended prior and up
to the effective date of termination by the hourly rate or rates set
forth in the Schedule less any hol4rly rate payments theretofore made
to the Contractor.
(ii) There shall be included therein all costs of material
reiiJbursable in accordance with this contract not previously paid to
the Contractor for the performance of this contract prior to the effeci.ve
date of the Notice of Termination.
(iii) There shall be included therein the reasonable costs of
settlement, including accounting, legal, clerical, and other expenses
reasonably necessary for the preparation of settl?:lent claims and
su.pportint; data with respect to the terminated portion of the contract
and for the termination and settlement of subcontracts thereunder,
together with reasonable storage, transportation, and other costs
incurred in connection with the protection or disposition of teind nation
inventory.
(2) If the termination of the contract is for the default of the
Contractor:
(i) There shall be included for all direct labor hours (as
defined in the Schedule of the contract) an amount which shall be
determined by r_iultiplyin the number of direct labor hours expended
prior and up to the effective date of termination by the hourly rate
or rates set forth in the Schedule less the profit factor contained
therein as indicated in the Schedule and less any hourly rate pay-
ments theretofore made ,
(ii) There shall be included therein such costs as are set
forth in subparagraphs (1) (ii) and (iii) of this paragraph (e):
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PROVIDED, HO;JEVER, That there shall not be included any aiaounts for the
preparation of the Contractors S'c;ttlenent Proposal.
(3) If the amount determined under subparagraphs (1) and (2),
above, is less than the total payments theretofore i.iade to the Con-
tractor, the Contractor shall repay the excess mount to the Goveriu.ient;
;,
(f) The Contractor shall have the right of appeal, under the
clause of this contract entitled "Disputes," from any determination
made by the Contracting Officer under paragraphs (c) or (e) above,
except that if the Contractor hadfailed to submit its claim within
the time provided in paragraph (c) above, and has failed to request
extension of such time, it shall have no such right of appeal. In
any case where the Contracting Officer has made a determination of the
amount due under paragraph (c) or e) above, the Government s~:.a- 1. pay
to the Contractor the following: ~i) if there is no right of appeal
hereunder or if no timely appeal has been taken, the amount so de-
termined by the Contracting Officer, or (ii) if an appeal has been
taken, the amount finally determined on such appeal.
( ) In arriving at the amount due to the Contractor under 'hi.,,,,
clause there shall be deducted (1) all unliquidated advance or other
unlicm.-J-dated payments theretofore made to the Contractor, (2) any
claim which the Government may have against the Contractor in connection
with this contract, and (3) the agreed price for, or the proceeds of
sale of any materials, supplies, or other things acquired by the Con-
tractor or sold pursuant to the provisions of this clause and not
otherwise recovered by or credited to the Government,
(h) In the event of a parti ter:_ina.tion, the portion of the
contract relating to hourly rates which are payable with respect to
the work under the continued portion of the contract shall be equitably
adjusted by agreement between the Contractor and the Contracting Officer,
and such adjustment shall be evidenced by an amendment to this contract.
(i) The Government may from time to time, under such terms and
conditions as it may prescribe, make partial payments and payments on
`account against costs incurred by the Contractor in connection with the
terminated portion of the contract whenever in the opinion of the
Contracting Officer the aggregate of such payments shall be within the
amount to which the Contractor will be entitled hereunder, If the
total of such payments is in excess of the nu.iount finally determined
to be due under this clause, such excess shall be payable by the Con-
tractor to the Government upon demand, together with interest coz-
puted at the rate of 6 percent per annuri, for the period from the
date such excess is repaid to the Government; PROVIDED, HOLZVER, That
no interest shall be charged with respect to any such excess payment
attributable to a reduction in the Contractorts claim by reason of
retention or other disposition of termination inventory until 10 days
after the date of such retention or disposition.
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(j) Unless otherwise provided for in this contract, or by
applicable statute, the Contractor from the effective date of
termination and for a period of 6 years after final settlement under
this contract shall preserve and make available to the Government
at all reasonable tines at the office of the Contractor, but without
direct charge to the Governrgent, all' its books, records, documents,
and other evidence bearing on the cost and expenses of the Contractor
under this contract and relating to the work terminated or
to the extent approved by the Contracting Officer, photographs, hereunder, s
;iicrophotographs, or other authentic reproductions thereof.
'8. SUBCONTRACTS
(a) No contracts shall be 11ade by the Contractor for the
furnishing of any of the work herein contracted for without the
written approval of the Contracting Officor. For the purposes of
this clause, purchase of raw material or cornlercial stock items shall
not be considered work.
(b) The Contractor agrees that no subcontract placed under this
contract shall provide for payment on a cost-plus-percentage-of-cos basis.
(a) (1) The Contractor agrees to maintain books, records,
documents and other evidence pertaining to the costs and expenses of
this contract (hereinafter collectively called the "records") to the
extent and in such detail as will properly reflect all net costs,
direct and indirect, of. labor, mateTials, equipment, supplies and
services, and other costs and expenses of whatever nature for which
reii_lbursorsent is claimed under the .provisions of this contract. The
Contractors accountin6 procedures and practices shall be subject to
the approval of the Contracting Officer;. PROVIDED, however, that no
:material change will be required to be made in the Contractor's
accounting procedures and practices if they conform to generally
accepted accounting practices and if the costs properly applicable to
this contract are readily ascertainable therefrom.
(2) The Contractor agrees to make available at the office
of the Contractor at all reasonable tines during the period set
forth in subparagraph (4) below any of the records for inspection,
audit or reproduction by the Comptroller of the Contracting
Government agency or his authorized representatives.
(3) In the event the Comptroller of the Contracting
Government agency or any of his duly authorized representatives
determines 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,
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with the reimbursement voucher cover. _ng such charges or as may be
otherwise specified within two years after reimbursement of charges
covered by any such voucher, to,sueh 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 of tie Contracting Government agency
or any of his duly authorized ro resentcives,
(4) Except for docuraeitary evidence delivered to the
Government pursuant to subparabraph (3) above, the Contractor shall
preserve and make available its records fora period of six years
,(unless a longer period of tine is provided by applicable statute)
from the date of the voucher or invoice submitted by the Contractor
after the completion of the work .under the contract and desigrated
by the Contractor as the "completion voucher" or "conpl.eti_on
or, in the event this contract hap been completely terminated, from
the date of the termination settlement agreement; PROVIDED, however,
that records which relate to (A) appeals under the clause of this
contract entitled "Disputes," (B) litigation or the settlement of
clair;s arising out of the performance of this contract, or (C) costs
or expenses of.the contract as, to which exception has been taken by
the Comptroller of the Contracting, Government agency or any of his
duly authorized representatives, shall be retained by the Contractor
until such appeals, litigation, c aims, or exceptions have been dis-
posed of, but in no event for less than the six-year period mentioned
above.
(5) Except for documentary evidence delivered pursuant to
subparagraph (3) above, and the records described in the proviso of
subparagraph (4) above, the Contractor may in fulfillment of its
obligation to retain its records..c.s required by this clause, sub-
stitute photographs, nicro-piotographs or other authentic reproduc-
tions of such records, --ter the expiration of two years following
the last day of the Y.ionth 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 of the Contracting Government agency or his duly
authorized representative.
(6) The provisions of this paragraph (a), including this
subparagraph (6), shall be applicable to and included in each sub-
contract herei~ndor which is on a cost, cost-plus-a-fixed-fee, ti-
:e-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 subparagraph
(a) (6) above, a provision to the effect that the subcontractor
agrees that the Comptroller of the Contracting Government agency or any
of his duly authorized representatives, shall, until the expiration
of three years after final payment under the subcontract, have access
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to and the right to examine any directly pertinent books, documents,
papers, and records of such subcontractor involving transactions
related to the subcontract, The teri._ "subcontract," as used in this
paragraph (b) only, excludes (i) purchase orders not exceeding :1,000
and (ii) subcontracts or purchase orders for public utility services
at rates established for uniform applicability to the general public,
20, GRATUITIES
(a) The Government inay, by written notice to the Contractor,
terminate the right of the Contractor to proceed under this
contract if it is found, after notice and hearing, by the
Secretary or his duly authorized representative, that grat-
uities (in the form of entertainment, gifts, or otherwise)
were offered or given by the Contractor, or any agent or
representative of the Contractor, to any officer or employee
of the Government with a view toward securing a contract or
securing favorable treatment with respect to the awarding or
amending, or the making of any determinations with respect to
the performance of such contract;` PROVIDED, That the existence
of the facts upon which the Secretary of his duly authorized
representative makes such findins shall be in issue and may
be re;Viewed in any competent court
(b) In the event this contract is terminated as provided in
paragraph (a) hereof, the Government shall be entitled (i) to
pursue the sm-le remedies against the Contractor as it could
pursue in the event of a breach of the contract by the Con-
tractor, and (ii) as a penalty in. addition to any other damages
to which it nay be entitled by law, to exemplary damages in an
amount (as determined by the Secretary or his duly authorized
representative) which shall be not-.less than three nor i.iore
than ten tins the costs incurred by the Contractor in provid-
ing any such gratuities to any such officer of employee.
(c) The rights and remedies of the Government provided in this
clause shall not be exclusive and are in addition to any other
rights and remedies provided by law or under this contract,
21.,, GOVERNMENT-FURNISHED PROPERTY
(a) The Government shall deliver to the Contractor, for use
in connection with and under the terms of this contract, the
property described in the Schedule or specifications, together
with such related data and information as the Contractor riay re-
quest and as nay reasonably be required for the intended use of
such property (hereinafter referred to as "Government-furnished
Property"). The delivery or performance dates for the supplies or
services to be furnished by the Contractor under this contract are
based upon the expectation that Government-furnished Property
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suitable for use will be delivered to the Contractor at the times
stated in the Schedule or, if not so stated, in sufficient time to
enable the Contractor to meet such delivery or performance dates.
In the event that Government-furnished Property is not delivered to
the Contractor by such time or times, the Contractin Officer shall,
upon timely written request :rude by the Contractor, make a determination
of the delay occasioned the Contractor thereby, and shall equitably
adjust the delivery or performance dates or the contract price, or
both, and any other contractual provision affected by such delay, in
accordance with the procedures provided for in the clause of this
contract entitled "Changes." In the event the Government-furnished
Property is received by the Contractor in a condition not suitable
for the intended use the Contractor shall, upon receipt thereof,
notify the Contracting Officer of such fact and, as directed by the
Contracting Officer, either (i) return such property at the Gover_i?-
mentss expense or otherwise dispose of the property, or (ii) effect
repairs or modifications. Upon the completion of (i) or (ii) above,;
the Contracting Officer upon written request of the Contractor shill
equitably adjust the delivery or performance dates or the contract
price a
, or both, and any other contractual provision affected by the
rejection or disposition or the repair or modification, in accordance
with the procedures provided for in the clause of this contract e t.tled
"Chan.eso" The foregoing provisions for adjustment are exclusive and
the Government shall not be liable to suit for breach of contract by
reason of any delay in deliver,- of Government-furnished Property orv
delivery of such property in a condition not suitable for its intended
uses
(b) By notice in writing the Contracting Officer may decrease
the property furnished or to be furnished by the Government under
this contract. In any such case, the Contracting Officer upon the
written request of the Contractor. shall equitably adjust the deliveT-~'
or performance dates or the contract price, or both, and any other '
contractual provisions affected by the decrease, in accordance with.the
procedures provided for in the cla pe of this contract entitled. "Changes'?
(c) Title to the Governl:.ent-furnished property shall remain in the
Government. Title to Government-furnished property shall not be
affected by the incorporation or attachment thereof to any property
not owned by the Goverment, nor shall such Government-furnished
property, or any part thereof, be or become a fixture or lose its
identity as personalty by reason of affixation to any realty. The
Contractor shall maintain adequate property control records of
Government-furnishes property in accordance with the provisions of the
"Manual for the Control of Government Property in the Possession of
Contractors" (Appendix B, Armed Services Procurement Regulation) as
in effect on the date of the contract, which Manual is hereby incor-
porated by reference and made a part of this contract.
(d) The Govermmmet-furnished property shall, unless otherwise
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provided herein, be used only for the performance of this contract,
(e) The Contractor shall maintain and administer, in accordance
with sound industrial practice, a program for the maintenance, repair,
protection and preservation of Govern;nent-furnishod property, until
disposed of by the Contractor in accordance with this clause. In the
event that any damage occurs to Gcvernment-fvrni.shed Property the
risk of which has been assumed by the Government under this contract,
the Government shall replace such' items or the Contractor shall hake
such repair of the property as the Government directs; provided,
however, that if the Contractor c =ot effect such repair within the
time required, the Contractor shall dispose of such property in the
:=tanner directed by the Ccntractind Officer: The contract price
includes no compensation to the Contractor for the performance of
any repair or replacement for which the Government is respond? l'ie P
and an equitable adjustment will. be Made in the contract price for
any such repair or replacement of Government-furnished property nade
at the direction of the Government., Any repair or replacement for
which the Contractor is responsible under the provisions of this
contract shall be accomplished by the Contractor at its own expense
(f) (i) Except for loss, destruction or damage resulting from
a fat? ure of the Contractor, due to willful misconduct or lack of
hood faith of any of the Contractor's managerial personnel as defined
herein, to maintain and administer the program for the maintenance,
repair, protection and preservation of the Government-furnished
property as required by paragraph (e) hereof, and except as specificaLly
provided in clause (s) _ of this contract or in the clause or
clauses of this contract designated in the Schedule, the Contractor
shall not be liable for loss or destruction of or damage to the Govern-
ment-furnished property (A) caused by any peril while the property is
in transit off the Contractorts premises, or (B) caused by any of the
following perils while the property is on the Contractorts or sub-
cont.ractorts pre,,:-dses, or on any other premises where such property
nay properly be located, or by rein val therefror.i because of any of the
following perils:
(I) Fire; lightning; windstorm, cyclone, tornado, hail;
explosion; riot, riot attending a strike, civil commotion; vandalism
and malicious mischief; sabotage; aircraft or objects falling therefrom;
vehicles running on land or tracks, -excluding vehicles owned or
operated by the Contractor or any agent or employee of the Contractor;
smoke; sprinkler leakage; earthquake or volcanic eruption; flood, r._oaning
thereby rising: of a body of water; hostile or warlike action, including
action in hindering, coi.ibating, or defending against an actual, impend--
ing or expected attack by any government or sovereign power (de jure
or de faato), or by any authority using; military, naval, or air forces,
or by an agent of any such government, power, authority, or forces; or
(II) Other peril, of a type not listed above, if such other
peril is customarily covered by insurance (or by a reserve for self-
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insurance) in accordance with the normal practice of the Contractor,
or the prevailin; practice in the industry in which the Contractor is
engaged with respect to similar property in the sane general locale.
The perils as set forth in (A) and (B) above are hereinafter
called "excepted perils."
This clause shall not be congtrued as relieving a subcontractor
from liability for loss or destruction of or damage to the Govern ent-
Furnished property while in its possession or control, except to tn.e
extent that the subcontract, with the prior approval of the Contracting
Officer, nay provide for the relief of the subcontractor from Such
liability. In the absence of such approval, the subcontract shall
contain appropriate provisions regturing the return of all Governrnt-
Furnished property in as good condition as when received, except or
reasonable wear and tear or for the utilization of the property in
accordance with the provisions of the prime contract.
The term "Contractorts managerial personnel" as used herein moans
the Contractorts directors, officers and any of its managers, super ntenw.
dents, or other equivalent representatives who have supervision or
direction of (I) all or substantially all of the Contractorts busin<
III) all or substantially all of the Contractorts operation at any one
plant or separate location at which-the contract is being perfori.ied;
(III) a separate and complete major industrial operation in connection
with the performance of this contract.
(ii) The Contractor represents that it is not including in the
price hereunder, and agrees that it will not hereafter include in any
price to the Government, anycharge or reserve for insurance (including
self--insurance funds or reserves) coverin loss or destruction of or
damage to the Government-furnished property caused by any excepted peri0
(III) Upon the happening of loss or destruction of or damage to
any Government-furnished property.0aused by an excepted peril, the
Contractor shall notify the Contracting Officer thereof, and shall
communicate with the L,,ss and Sulva4e Or7anization, .if any, now or
hereafter designated by the Contracting Officer, and with the assistance
of the Loss and Salvage Organization so designated (unless the Con-
tracting Officer has directed that no such organization be employed),
shall take all reasonable steps to protect the Goveriu.ient-.furnished
property from further da..iage, separate the damaged and undamaged Govern-
ment-furnished property, put all the Government-furnished property
in the best possible order, and furnish to the Contracting Officer a
statement of ; (A) the lost, destroyed and dammed Government-furnished
property (B) the time and origin of the loss, destruction or dar_;.age,
(C) all known interests in commingled property of which the Government-
furnished property is a part, and (D) the insurance, if any, covering'
any part of or interest in such commingled property. The Contractor
shall be reimbursed for the expenditures made by it in performing
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its obligations under this subparagraph (iii) (including charges made
to the Contractor by the Loss and Salvage Organization, except any of
such charges the paymont of which the Government has, at its option,
assumed directly), to the extent approved by the Contracting Officer
and set forth in a Supplemental. As:reei:lent.
(iv) With the approval of the Contracting Officer after loss or
destruction of or damage to Govern ment--furnished property, and subject
to such conditions and limitations as may be imposed by the Contracting
Officer, the Contractor may, in oiler to minimize the loss to the Gov---
ern: ent or i.i or;.er to perElit resumption of business or the like, sell
for the account of the Government any item of Government-furnished
property which has Leon damaged beyond practicable repair, or which
is so commingled or combined with property of others, including the
Contractor, that separation is impracticable.
(v) Except to the extent of any loss or destruction of or
damage to Government-furnished property for which the Contractor j-.
relieved of liability under the foregoing provisions of this clauso,
and except for reasonable wear and tear or depreciation, or the-uttliza~,: .fu
of the Government-furnished property in accordance with the provisions
of this contract, the Governr:ient-furnished property (other than proffer. -y
permitted to be sold) shall be returned to the Government in as Bond
condition as when received byr the Contractor in connection with this
contract, or as repaired under paragraph (e) -Love.
(vi) In the event the Contractor is reimbursed or compensated
for any loss or destruction of or dai.:age to the Government-furnished
property, caused by an excepted peril, it shall equitably reimburse
the Governi:icnt, The Contractor shall do nothing to prejudice the
Govern entgs rights to recover against third parties for any such
loss, destruction or damage and, upon the request of the Contracting
Officer, shall at the Government t s., expense, furnj.sh to the Government
all reasonable assistance and cooperation (including the prosecution
of suit and the execution of instrui:ients of assignment in favor of the
Government) in obtaining recovery. In addition, where a subcontractor
has not been relieved from liability for any loss or destruction of or
damage to the Government-Furnished property, the Contractor shall enforce
the liability of the subcontractor for such loss or destruction of or
damage to the Governi..ent-Furnished property for the benefit of the
Government.
(vii) (Where applicable). In the event any aircraft are to be
furnished under this contract, any loss or destruction of, or damage
to, such aircraft or other Government-furnished property occurring in
connection with operations of said aircraft will be governed by the
clause of this contract captioned "Flight Risks", to the extent such
clause is, by its terms, applicable.
(g) The Government shall at all reasonable times have access to
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0 a
the premises wharein any Govern_.ient-furnisaed property is located,
(h) Upon the completion of this contract, or at such earlier
date as may be fixed by the Contracting Officer, the Contractor
shall submit, in a form acceptable to the Contracting Officer,
inventory schedules covering all items of Govern:.lent-furnished property
not consumed in the performance of this contract (including any res_llt-=
ing scrap), or not theretofore delivered_ to the Government, and shall
deliver or make such other disposal of such Government-furnished
property, as tiny be directed or authorized by the Contracting, Officer
Recoverable scrap from GovernI:ent---furnished property shall Lo reported
in accordance with a procedure and in such form as the Contracting Offi.
cer may direct. The net proceeds of any such disposal shall be credited
to the contract price or shall Le paid in such other manner as the Con-
tracting Officer may direct.
(i) Directions of the Contracting. Officer and coL;:.iuiiicat.ions of
the Contractor shall he in writing.
EMPLOYMTuT OF ALIENS
If this contract calls for furnishing or constructing aircraft,
aircraft parts, or aeronautical accessories, no aliens employed by
the Contractor shall be permitted to have access to the plans or
specifications, or the work under construction, or to participate
in the contract trials, without the written consent beforehand of
the Secretary ur his duly authorized representative.
:. .. MILITARY SECURITY REQUIREMENT'S
(a) The provisions of this clause shall apply to the extent
that this contract involves access to security information classified
"Confidential" i ncludi% "Confidential-.-Modified Handlin6 Authorized''
or hi.g,lpr-
(b) The Government shall notify the Contractor of the security
classification of this contract and the elements thereof, and of any
subsequent revisions in such security classification, by the use of
a Security Requirements Check List (DD Form 254 and 254-1).
(c) To the extent the Government has indicated as of the date
of this contract, or thereafter indicates, security classification
under this contract as provided in paragraph (b) above, the Con-
tractor shall safeguard all classified elements of this contract and
shall provide and maintain a system of security controls within its
own organization in accordance with the requirements of:
(i) the Security Agreement (DD Form 41,1.), including the
Depart lent of Defense Industrial Security Manual for Safeguarding
Classified Information as in effect on date of this contract, and
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any modification to the Security A?reeuent for the purpose of
adapting; the Manual to the Contractorrs business; and
(ii) any amendments to said Manual made after the date of
this contract, notice of which has boon furnished to the Contractor
by the Security Office of the Military Department having security
coEnizance over the facility,
(a) Representatives of the. Military Department having
security c .gnizance over the facility and representatives of the
contracting Military Department shall have the right to inspect at
reasonable intervals the procedures, methods, and facilities utilized
by the Contractor in complying with the security requirements under
this contract. Should the Govern::jent, through its authorized repro-
sentative, determine that the Contractor has not complied wit'-.l s-),h
requirements, the Government shall inform the Contractor in writing
of the proper actions to be taken in order to effect compliance with
such requirements.
(e) If,, subsequent to the date of this contract, the security
classifications or requirements under this contract are chanted by
the Government as provided in this clause and the security costs,
under this contract are thereby increased or decreased, the con-
tract price shall be subject to an equitable adjustment by reason
of such increased or decreased costs. Any equitable adjustment
shall be accomplished in the sar..e manner as if such changes were
directed under the "Changes" clause in this contract.
(f) The Contractor agrees to insert, in all subcontracts here-
under which involve access to classified security information, pro--
visions which shall conform substantially to the landua e of this
cLdose, incluuin.- this pera raph (f) but excluding the last sentence
of parai;raph (e) vof this clause.
(`;) The Contractor also ar.rees that it shall determine that
any subcontractor proposed by it for the furnishing of supplies
and services which will involve access to classified information
in the Contractors custody has Leon granted an appropriate facility
security clearance, which is still in effect, prior to being accorded
access to such classified security information.
24, COPYRIGHT
(a) The Contractor acrees to and does hereby Lrant to the Govern-
ment, and to its officers, agents and employees acting within the
scope of thier official duties, (i) a royalty-free, nonexclusive
and irrevocable license to reproduce, translate, publish, use,
and dispose of, and to authorize others so to do, all copyright--
aLle material first produced or composed and delivered to the
Government under this contract by the Contractor, its employees
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or any individual or concern specifically ei_ipioyed or assi{ ned to
originate and prepare such .iaterial; and (ii) a license as afore-
said under any and all copyrichted or copyrightalle work not first
produced or composed by the Contractor in the performance of this
contract but waicn is incorporated in the material furnished under
this contract, provided that such license shall he only to the
extent the Contractor now has, or prior to completion or final
settlement of the contract may acquire, the right to grant such
license without beconinL liable to pay compensation to others
solely because of such rant,
25, FILING OF PATENT APPLICATIONS
(a) Before filing or causini' to be filed a patent application
disclosing any subject matter of his contract, which subject
matter is classified "Secret" or higher, the Contractor shall,
citing the thirty (30) day provision below, transmit the pro-
posed application to the Con_tracti,u Officer for determination
whether, for reasons of national security, such application
should be placed under an order of secrecy or sealed in accord-
ance with the provisions of 35 U~ S. Code 181-188 or the issuance
of a patent shout be otherwise delayed under pertinent statutes
or re`^.lations;.and the Contractor shall observe any instructions
of the Contracting Officer with respect to the ..canner of delivery
of the patent application to the U. S. Patent Office for .filing,
but the Contractor shall not be denied the right to file such
patent application. If the ContractinL,; Officer shall not have
Liven any such instructions within thirty,136)days from the date
of Liaili% or other transmittal of the proposed application, the
Contractor i.iay file the application.
(u) The Contractor shall furnish to the Contracting Officer, at
the time of or prior to the time when the Contractor files or
causes to be filed a patent application disclosing any subject
matter of this contract, which subject matter is classified
"Confidential," a copy of such application for determination
whether, for reasons of national security, such application
should be placed under an order of secrecy or the issuance of
a patent should be otherwise delayed under pertinent statutes
Cr regulations?
(c) In filing; any patent application coming within the scope of
this clause, the Contractor shall observe all applicable security
.regulations,ooverinf,, the transmission of classified subject matter,
26. NOTICE TO THE'GOVER T40F TUPOit DISPUTES
Whenever the Contractor has knowledge that any actual or potential
labor dispute is delaying or threatens to delay the timely performance
of this contract, the Contractor shall immediately give notice thereof,
including all relevant information with respect thereto, to the Con-
tracting Officer.
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?
27. kTJTHORIZi;TI0 D COlISE:4i
The Gover:u.iont Hereby ? ives its authorization c na, consent
(witii.:,ut prejudice to its rights of indci-aificatiun, if such riLhts
are provide: for in this contract) for all use end ::enufacture, in
the )erforncnce of this contract or any part hereof or any
:.ient hereto or any su:~contract hereunder (inclulin may lower-tier
su',_,contr act) , d,f any patented invention (i) e._iuo iec in the; struc-
turc or co1.ijiositi.on of any article the delivery of which is accepted
by the Gevern_.iont under this contract, ~r (ii) utilized in tae
...ac inery, tools, or .iethods the ise of which necessarily results
fro:.: conpliicnce by the Contractor or the usi.n" subcontractor witn
(a) specifications or written provisions now or hereafter forni.nL
a part of this contract, or (L) 4pecific written instructions
Liven by the Contractin` Officer directinL the :.iaxner of perf:;r-
nance, The Contr. actor 1 s entire liability to the Covern:_ient for
patent infrinLe:.ient shall Lc doteri.ained solely by the provisions
cf the inn:e.. i.ty clause, if any, included in the contract and the
Goveri.lent assumes liability for all other infrinte:.oent to tae
extent of the authorization end consent hereinabove `ranted,
26, ALTERd'TIONS IN CONTRf fT
The followin- alterations were ia.:o in this contract prior to
signature thereof by the parties to this contract:
XA Gene P"Yaion
the fMoving verse to
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o
Is Gems. Provls a $,t UMUSO 1b g epti (s)(t) is deleted and the
following ea is ~.'4 ted th n
(a) Time Rate.
(i) the .mss a to d by applying ate time rate
or rates set Wirth in the sohe dul.e to the nmdw of direct. labor
hours perOmmid, , d- rates shall include wases, overhead., general
andL s. 1nistrative expense and. profit. Fraetioml parts of an hour
shall
be payable an a r sta basis. Vouchers will be subsequently substantiated
by the Owtrmatw tag site aaftt by the c wt Governsnestt auditor
by evidence at acbmal p and Individual 643,v 14* time-aarrds,
w ably viand by the vexters, performing the services or equivalent
r e c o r d s . IvIdeme o f d e l i v e r i e s o f completed work will. be; furnished
by the t bracto r during site audit. Papummts will normally be made
.y.
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