ENCLOSED IS OUR SUBCONTRACT FOR PHILADELPHIA.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89B00709R000200420015-5
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 80
• Document Creation Date: December 22, 2016
• Document Release Date: January 5, 2011
• Sequence Number: 15
• Publication Date: January 5, 1959
• Content Type: LETTER

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January 5, 1959
Cop. 03?g
COPY / O ! /
Dear Dan:
Enclosed is our subcontract for Philadelphia.
I would appreciate your early approval so that we may
send this to Philadelphia for signature.
Very, truly yours,
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 STAT-----
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LOCKHEED AIRCRAFT CORPORATION
MISSILE SYSTEMS DIVISION
Sunnyvale, California
See Paragraph entitled "Delivery"
1/2/59
Goverment Contract
As required
P
General Ileetrie Company
3198 Chestnut Street
Philadelphia 4, Pa.
L
SHIP TO: LOCKHEED AIRCRAFT CORPORATION
Seel 2aragraphs
I I IN 11
"Shipping,S ac1k
QUA W ITY
^2O STATJ TITS
2.1001.8999
General leetrie shall provid the necessary personnel
material, facilities Ling mid equipment to design,
develop, manufacture 4test a reconnaissance
recovery vehicle in ac ce with Lockheed Aircraft
Corporation, slle Sys Division, Specification
52.128 A, Rev. X),dated 1, dated 3 October 1958, and
Specification 19 December 1958.
Al and A3 certifications required.
CERTIFICATIONS
The following certifications are required if indicated above:
Al. Materials and/or parts furnished on this order have been manufactured in accordance
with all applicable instructions and specifications.
A2. (On Packing Sheet) Materials and/or parts furnished on this order have been manufac-
tured in accordance with all applicable instructions and specifications. Physical and
Chemical data pertaining to this order are available for inspection.
A3. (On Invoice) We hereby certify that these goods were produced in compliance with
all applicable requirements of Sections 6, 7 and 12 of the Fair Labor Standards Act, as
amended, and of regulations and orders of the United States Department of Labor
issued under Section 14 thereof.
B. Please sign and return acknowledgment copies immediately.
C. Invoice in triplicate, showing purchase order, item, part and Government contract
numbers, if any, on all copies, and mark one "Original."
D. Taxes payable by Buyer to Seller must be itemized on invoice.
E. Packing List must show Lockheed Part, Purchase Order and Item numbers. MARK
PACKING LIST AND INVOICE COVERING FINAL SHIPMENT "ORDER COMPLETED."
F. Include packing list in each shipment. Show bill of lading or express receipt number
and purchase order number on all packages. Mark each container to show number of
containers in shipment (such as I of 3). Attach packing list to number one container.
Show purchase order number on all paper.
PURCHASE ORDER
Philadelphia,: Pa.
VIA Air-F'
2.1001
or as specified
J. Be Linn
31444PA ZAGI?A"l
"i :Lll.)3 AbE; i i D"
G. DO NOT DECLARE VALUE on express or air shipments. Do NOT insure parcel post if
Buyer's risk. Obtain Parcel Post receipts. AIR MAIL COPY OF BILL OF LADING,
EXPRESS RECEIPT, OR AIRBILL TO OUR TRAFFIC DEPARTMENT IMMEDIATELY.
H. Load, block and brace rail shipments per latest loading rules of Association of Ameri-
can Railroads.
1. RADIOACTIVE MATERIAL-If the material covered by this order contains radioactive
material in excess of .1 millicuries, vendor shall show the following on all Packing
Sheets "Radioactive Material" Isotope
Amount
THIS ORDER CONSISTS OF THE NUMBER OF PAGES SPECIFIED ABOVE, AND IS
SUBJECT TO THE ABOVE INSTRUCTIONS AND THE TERMS AND CONDITIONS PRINTED
ON THE REVERSE SIDE HEREOF.
By
Authorized Purchasing Representative
100.81
D 1085
l1et 30
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LOCKHEED AIRCRAFT CORPORATION PURCHASE ORDER
MISSILE SYSTEMS DIVISION DATE PAGE OF NUMBER
Sunnyvale, California l/2/59 I 2 4 I 1X'8
REQUEST Ndi??JJ 5
tJ !-J..
101
102
103
10i
105
106
107
908
911
yAJ #u =ust 4, 1959
January 9, 1959
deb rUAL"6s 1959
Peb 6, 1959
1959
arch 6, 1959
#p'arch , 1959
April 1 1959
April 2 1959
123, 1959
tray 30, 1959
June 27, 3959
July L, 1959
3 July 183 1959
?zarEa
c: eneraal Electric Co ipa n.y
3198 Chestnut Street
? liladelphia F, ?aa.,
1. An inf n al monthly pm ;reess report, similar to an osalid type reprodu tion,.
ehall be submitted on or before the 15th of each calendar month, reporting
on the protes during the preceding calendar month.
2.1 A bri , info" monthly ttanaf event report shall b, submitted on or b %fore
the 15 of ea calendar month, .vine fund status including atont?1y ?
q tune
D,?11 1711
wwmwmmffiswa~
{e-entry c pules be delivered in accordance with the following, sche ules
Aa indicated in Wa Gtatement.
Lockheed Aircraft Corporation, issile Systems Division, shall supply, or cause to
be supplied,, nineteen (19) cassettes to 6 s eneeraal b lectric for performance reunder.
all s nts l be %ackcd m G cratct accordance with applicable sp cifications
Form MSD 967H COPY
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 STAT
REQUEST NO. 33-1085
for the P ction f delicate instrumentation in transit or in accoraanco th
all carri r a. eneral electric shall be resporetb a for the deli ry of
I
all chi to carriers' docks and f'orwarrd thee collect via bonded freight,
or as othe se d1 ' cited, to the address to be supplied
The, total ticipaled coat for the peerforaance of the Cork Jtatcmeent he r is
as olloarst
tat kstimated Cost )3,6Li3.,3O0.O0*
meted Fee
STAT
herein allowable charges under this contract
*,plant gemen in an wmwt not to exceed Y10,0.00 for a provisio of
special county rocedurss inherent in the performance of thi.ask is included
267,500.00
Total, Cost 3.908,800.00
All corres ndence including reports, ices, bi.Llrs of material etc.' 41ich is
transmit via U. 11. t sail be address
Palo Alto, Califo is. reports and o traotual correspondence or n ,
hwever, be rec to the atten f jesees It. Inch on contents r on an
Timor env, ope.
This def tive contract erases and cancels in its entirety the letter subcontract
ot.intent, dated ril 29, 1958, as subsequently amended. All costs which have been
incurred Oder the letter subcontract of intent in anticipation of this d nitised
contract, d whi costs would have been considered allowable subsequent the
issuance roofs be considered allowable hereunder, subject to the final accept-
ance by Conti ting Officer as allowable costs.'
Authorise to retry oL,ven for the use of overtime up to and including 5+' of
direct r r s in perforaance of work hereunder as necessu7 to mainlain the
ut very a dule. It is maaldatory,, however, that an act ee, estivate or
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LOCKHEED AIRCRAFT CORPORATION PURCHASE ORDER
MISSILE SYSTEMS DIVISION DATE PAGE OF NUMBER
Sunnyvale, California 2/2159 13 to ;0O.,8
General Electric pany-
3198 hoatnat Street
Philadelphia ts, Pa.
Form MSD 967H ropy
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 STAT
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LOCKHEED AIRCRAFT CORPORATION I PURCHASE ORDER
MISSILE SYSTEMS DIVISION
Sunnyvale, California
Ccnerssal Electric C any
3198 Chestnut Street
Philadelphia hp 'Pa.
Wing
month L'or 3hich - csstimate is preparsedo
1/2/59
antieipa overt
correspon nee ch
transfer,
t otwith
ledge
, he
armed hi
of the
tractor
Cant
di
r or de
fficer
in any given month be supplied to
thro
h the
.relo Indicated above at least one week in advance of t1'
calendar
other provisions of this subcontract, the Contractor 11s 11 not
otherwise ansign this contract, or any Interest the or any
der to any party or parties, bank, trust company or o er finen-
thout first receiving the written authorization of Lo .heed
not reveal (1) the specific nature or any details of the work
reunder or (ii) any information w eatsoever kith re 7ti ect the
erssssment sponsoring this contract and the,work the r evicept
cted or permitted to reveal such W,
ting officer or by his duly authorized repress
standing w W clause or section-of this contr
not interpret any clause or ,e ion of this
P14GE
100-:)
REQUEST N%.25
Lion by Lockheed
tive f security
t to the contrary,
ntract as requiring
r privates or to
ence of such information to rson, public
artment of the Gov ant without
his duly eutho represents
e,preess consent o the Con-
e for security matte 0s.
tencess v
is reel;
ctc.,
such
dieposy
th th
urity.
appoi
thin se schedule or sand conditions of this caret o=t where
ired to contact, corm ateth, or direct documents, reports,
or thro gh the Contracting Officer, Contractor is here directed
attere c nnection therewith to Lockheed, attention em es L.
tion Ins ions or forwarding to the Contracting Offs er, if
,reeption of those matters dealing with the maintenanc of
Under no condition Is Contractor to contact Contracting Officer
ted rev rs:scntative(s) other than on matters of security thout
of Lockheed.
The terms and con itions attached hereto a made a part hereof are apcli able to this
purchase rder, si perseding and cancelling those terms and conditions on the reverse
side of P ?e 1 of this purchase order. Article 33, entitled " enegotiati n," is deleted
in its entirety d is not a:plicable hereunder. If conflict emits r is deter-
mined to ixist be an the contents of any paragraph or sentences dellnea on the
face of t1is purclase order and the tome and conditions attached hereto, those typed
on the face of this purchase order shall override*
Aircraft
cif Ins
ary offi,
tracting
or permit
matters,
as the
and/or
departme
being per
The Cant
In all
the prior
or his
proper se
required,
Lynch, fo
to refer
invoices,
Form MSD 967H COPY
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 Sanitized Copy Approved for Release 2011/01/05: CIA-RDP89B00709R000200420015-5 CITAT
8P?128 -
Revision ,01
3 Oct. 1958
COVERT
W I8LATIMT
Developam t of a Reconnaissance Satellite Recovery Vehicle
1e st
The work shall consist of the design, development, asaufacture and test
of aReaomaissanoe Recovery vehicle for the covert (black) progras. The
basic recovery vehicle which includes the outer shill: re-entry propulsion,
spin devices, separation hardware and recovery aids shall be completely
compatible with both the black and white payloads.
The recovery vehicle shall be capable of returning a film cassette
hereinafter referred to as payload from the WS117L vehicle on orbit to
a designated recovery area on the earth's surface. Recovery aids shall
be provided to enviable air snatch recovery with backup rrcovwy from the
ocsap surfaos.
#ppl ab1 Sppeeoif! ti+ets~r .0%W Publiaationst
2,1 ~ I$$D 2916 - General Sttvircnaental Specifications for the 1I5117L Equip-
ment - Program Ilk with deviations as agreed to between
IN S9 and the subcontractor.
2.2 ?IiiSD 2950D ? Design Control Specification for the Bic-Medical
Recovery Capsule.
2.3 ;:IMD 60200 ? Statement of work ffio?Medioal Recovery Capsule
3. Re eaagtat
3.1 Detailed requirements for the development of the equipment required
for this reconnaissance recovery task are covered by IIySD 60200,9
referenced above, with the addition of the motion required for
carrying either the reconnaissance payload of the Bie.llodical
Recovery Capsule.
The 4evelopment and testing, except the Mark I Program, will be barnat
by the Black Program.
3.2 the cassette and its associated "take up" hardware will be furnished to
the General Slectrio Co. Design specifications and detailed qualifi-
cation tests for the cassette will be established by 0.3, and submitted
to IM D for incorporation with the camera system specifications.
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3.3 Sscuri s
Special security measures will be required throughout the program. The
;subcontractor will provide such special security measures within his
own facilities as may be required to conform with the IM B secuz7ttor
plan.
Manufacture and Delivery:
4.l Teet Unites
ANecessary test units will be provided to perform the drop tests and
laystezus tests required to prove deaf M qus ify the system.
14.2 KMocckv s
'The following mockup equipment will be required in addition to that
;required by the Bio*Medieal experiment.
.2.1 A Space Utilization ? We t and Balance Mockups Simulating
accurately the external surface of the recovery system.
Diaesicnal requirements are *.4.020 inch on critical surfaces
and 7.0.10 inch on non-critical surfaces. Electrical and
mechanical interface with the W3117L structure shall be ac-
curately represented. The total weight and C.G. shall be
represented to t5 pounds, ?one (1) inch respectively,
4.3 Design Models:
.1
.Two design models as described herein shall be provided per the attached
;;;schedule.
14.3.1 The experimental model shall contain all circuitry and seque nee
:14.3.2
devices, electrical and mechanical, but not necessarily In the
position or condition of final design* In addition to the purpose
specified in MIL Specification 8189, this model is to determine
the functional capability of the assembled system.
The developmental model shall contain all circuitry and sequence
devices: electrical and mechanical, in near final form and posi-
tion, In addition to the purpose specified in NIL Specification
8189, this model shall be completely functional to the *Runt of
proving thec.eperational capabilities of the system.
4.4 Fl gb its a
Fourteen (14) reconnaissance recovery units will be provided by G.E.
under this work statement plus the requisite mocks and design models
as specified in the following paragraphs. Delivery of tkoea articles
will be in accordance with the attached master schedule.
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Production Testa:
14.14.1.1 Acceptance Testss Following fabrication completion of
each flight un"3t, subcontractor shall conduct acceptance
teats in accordance with approved procedures which will
demonstrate readiness for flight use.
4*4*l
The contractor shall develop acceptance teat speci-
fication and acceptance test procedures which shall
demonstrate compliance of the completed subsystem with
this work statement. - -
14.14.1.2
Preflight Checkouts 0.8. will participate in such
checkout operations only to the point of providing an
experienced engineer in the early phases of the program
and training of the black operations crew.
14.5 Spares The spares concept for this program shall be that of providing readily
replaceable components or sub.assemblies.
:In addition to the spare units indicated on the attached schedule,
sufficient component and sub-assembly spares shall be provided for
.,all long-lead-time components to insure meeting the flight schedule
in case of unit malfunction. The spares indicated on the attached
schedule shall be modified as necessary between flights so as to be
in conformance with current design status at any given time. The
subcontractor shall provide IL) D with a spares provisioning list for
the reconnaissance system as soon as practicable.
Ground Support Egui__ pmts
5.1 Fabricate and provide all special assembly and maintenance tools,
5?
ground handling equipments and checkout equipment per the attached
,.schedule. Provide the ground support equipment listed in Table I.
Aasemb]y, teat, handling and maintenance manuals shall be provided
with each set of equipment. Simple reproduction methods will be
adequate such as typewritten copy and ozalid prints.
6. Reports s
The oubcontractor shall submit a monthly progress report on or before the
fifteenth of each month. This report shall include a technical sumaarys
not to exceed two pages, budget chart showing actual costs vs estimated
cosh and schedule status.
'.3-
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I. SC
OR= SDPPOERT IIQUTP=
It
1. RA Checkout Unit
2. R.A Simulator
3
3. , Beaoon Tast
1. ,Rocket Sling
5. Rocket Stand
l
6. Shipping Containers & Bandl. Fix.
two
7. D= w y Rockets
?4*
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Speci.ficiation No. ARV-1
December 19,, 1958
STSTIMS REQUIREMENT SPECIFICATION
for the
ADVANCED RECOVERY VEHICLE
ASSOCIATED GROUND SUPPORT EQUIPMENT
Approval
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19!x,.
i 1
, TIl t8 XQ {T3 BPBQIVIQATIO$
for the
BICII CAL B1WT C.*UULI
and
ASSOCIATU GaID SUPPOf' l IP T
1.0
.1.1 This r .fication defines the development and perfornanee r.q 1 reuonts
of the Advanced R.oomry Vehicle (ARV) and its associated ground supp+ - equipment
intended for use with the W3-117L vehicle system covert programs.
1.2 Ili - The mission of the Advanced Recovery Capsule in the ARV shall
be to retnxla `~~`i seance film cassette, hereinafter referred to ,as Parloe~t,
from the WS-117L vvhidle, on orbit to the prescribed recov ry area as the earths
2. Q APPLE i X ITB
2.1 Thee follo ing specifications,, other publicatioi A, i id drawing of the
issue speciSW herein shall form a part of this specification to the ezte t
specif ed
XEI Q-592'3C(U AB')
15 March 1956
MIL4.61818
29 N 4y 1953
IIIL-E'f`129A(1)
28 Febraari 1956
MTL-X-8090A'(AsG)
29 Febraaty 1956
WIL-w 6o8
19 July 1957
III'.-E? 189A (ASG) (1)
16 Apt 1957
MIL..Aaligaaaaent to within +1041 of an
rw J_ _JJ._Jir~r< _9.uylt
Ise Iwr a liahad at taro wee of final in house asseaaably-. If Ake ART is diaasseiibled.
# - the field, pio iclona a eald be made by the dorisant field persars i to
vfti t4 the same tips eii ent fixtures as were used by G.B, assembly personnel.
aa> Tex Aigna W5 bo rseaelfed by the ARY p -gKsarer
6?o or we recovery vehicle WJ L4. ve p n a neur+
a _ -_y __~ ?~l_Yw___ ~_~' ..... ?1._ tb0 .wA 4K 1Z4~1'~'1T.. vrlli. % . l'!_t~ ad ]'
fev 110t "Alig prous`aaia For we payload. addition to the cutter seal.,
v b100%k
otai
atl
d
d f
out a Ig*t/!va seal will be previded betiroen the span ig e>n a ou er
and the interim cavity of the recovery vehicle.
7 't ITIn SM a tivity Protection - G will design the overall A system
7 1 fippu wil, Performance ? The recovery vehicle shall be designed to
tv"%42 AiRRA e U 1W3-l]7 . vehicle perfarsaance factors d?fi wd herein.
the re vast
37.1.J !`!
3peea
01 i $o. 11 Y?1
Elaaaea~t9? lsa
Paw"
Pr .eiions shall be Wade for >fa it tai .'sf
tluon the WS T gr d aaaabaOM sis a.
Te e, wdt tra joetory time .aid 44,044019A
w7.1.3 Y"40- ilw.: r set w The W3.117 vehicle will opera ou a noninsl
) .
t
l
te
(
~
es
atu
>Ai
! OPWAWW. peace
an * toads if *UW I s
o r Po o a
g Beet riy direst scouring within 3 h alt e1 terel*Q
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0b4 AIM-3.
Lo Attitude - The. W83 i '. l irhieis shall be stabilised with the
v Ii ie orbital # ity vector, with, sn aoc a ee of
~his iu
ph" of ? jea+istan ehai not verir by mere .OW frog we W03.17 a>Mu
MIM, y The 5-117 vehicl- shall maintain the attiads net forth
3.7.1.E
5.n Paragraph ..U juste prior ;,to re*emtry phase. The vehicle will than be
programed to provide `? retro angle of 1200' (measured from the true hori sontal). This
retpo angle eha ,?!?5 maiatlined to within ? for the Xs* 2 8yatew. The aad*tth
d+ ration in the ejoetion attitude.- ll be t%e9 . The pitch and yaw ruse' the
e fton attitude will be random in nature with three sigma values of --&bo t 60 per
minut o maxi . The integrated ARV ejeetd.Qia ?vel.ocit y va for during tb..`Oowersd
^
a predetermined. ground commit nication. station. The re-entry traJectort be
such that landing will be in the selected sons within as area not greater "than 150
statute miles wide and 300 statute miles long, The recovery system (Tfs* to
Pa eaagreph 3.7,8), aball provide day or night recovery over ocean or land areas.
Sjeetion velocity of the recovery vehicle shall be 11.300 feet per seceeat (Nominal).
?J,7*1.6 _ Vehie1 e/WS.L17 Vehicle Saparation tD shall furnish for
sep tien,. to a eat on springs and eynchronieed Latching pin pullers, The
st; taniety of the pin pullers shall be 6 ei,lliseecv de (13 milliseconds a
3.1 ` lieeaond tine interval). The pin shall be pulled at T 1.5 seconds (Be.
'graph 3.6.2.1).
., js t ion shams. be initiated by programed granad command as the v.birr passes over
3.7.2 power As eaeeto - Fewer requirements from the VS-3-17 electrical.
System shad be av o e~as folio t
28 "It unregulated, 22 to 29.5 volts.
3.744 Pr io - Powered Flight and Orbital ART consgpti of
e117 supplied M as follewst 28 volt do regulated voltage will be
used in the ARV. !Ois duty cycle will be 10% ,maxim u a per orbit. The - drive motor
and sensor charaeterieties are not defined as of this time,
b. 28 volt do 2%, .0.5 ripple peak- cock,
Proference in the use of power form shall he in aecerdance with the oegw ease of
the above listing.
3.7.3.* ` er'a'" . 3i Re uir mMts? - The following pulse signal; shall
*60 ,by e w&.4, , :, vehicle to ARV.
T - 82 Arm Bison . 4.28 vp1te, do, non-.regulated,, 890 amps,; '50 .disco
b,. T s11, sfer Si,g aa. + 28 volts, de, nenorsgttha 3090 Vie, 50
i d.lltsaea ds.,
T ? 1.5 nechaesl release of ART by WS-317 vehicle.
g vvltag s for items " p' and 'b". be applied; for a x0adom of 0.9
Brea d. ' rta es i 4eated are anti
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Specification No. ARV-1
December 19, 1958
Page 9
3.7.3.2 Squibs sOther pyrotechnic Devices The electrical proportion
i rn i?ii r i for squibs and-Ofter c c c` ue comes Ift be as listed herein. However, the
design effort shall continue towards making them compatible with the WS-117.
Spin and Despin Rackets
and Explosive Bolts
8etro Rocket
0.2 amp/bridge for 5 minutes, 1 1.25
ebm/bridge, 2 bridge wires per unit
45 amp/bridge for 2 minutes, 0.7 :0.25
ohm/bridge, two squibs in parallel.
Tgv4t4 psi 0.5 sap continuous, 1.35 .!..15 ohms
Explosive Disconnect 0e11
Fjeatien piston
Prot,ehaie Switches
Dimple der
Thermal Batteries
r
Maxim= no fire current -0-5 amp,
Minimum all fire currant -2.0 amp,
Bridge Resistance ? 1.2 ohms
Maxim= no firs current - 0.5 amp,
Minimum an fire current -2.0 amp,
Bridge Resistance -1.0 ohms- !.2 ohm
Maximum no fire current - 0.020 amp
Test 0.1 amp
Minimum All fire current -0.3 amp
Bridge resistance - 1.6 ohms
Maximum no fire current'- 0.5 amp
Minim= all fire current - 2.0 amp
Bridge resistance - .5 ohm +-.3 ohm
Maximum no fire current - 0.200 amp
Minimum all fire current - 2.0 amp
Bridge resistance - 0.65 ohm
Piston oarness Outter Maximum no fire current - 0.5 amp
(Reefing Siam. Ontter) Minimum all fire current - 2.0 amp
1 Bridge resistance - 1.0 _25% ohms
Resting Use Outter Mechanical Actuation
3.7.3.3 technic ~ Precaution - The following pyrotechnics must be
shorted .prior p stl ng, s O all be done in such a manner that shorting may
be oenveniantlf , at, mating, as with plugs, and the required fusing and/or
firing circuit eapothi.ons are made.
a. Retro BIo et igniter.
be Spin andde-spin rocket igniter.
a. Explosive bolt squibs
d. Separation explosive piston squibs (both external and internal).
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F n goo, AXF-l
i0
The recovery hs+ sb '?a l' ad justa~ble
3.74 a.1 ~et~ < Mjestion shall be initiated by tip 00t tg ow
oo d throM a IM-AXT cO sad transponder system and shall provi '6be saps .e
, a 28..lt de few. Sdanee signal for ejection and rocket i LU a j
231.4 Megaaye2se
232.4 Megacayaoles
235.0 Megacsycla*
237.8 )I gaay$Ies
3 7 6 Vari"rmaento l Performance - The ART shall be ddesigned end oo"#raetod
.
t it-Z= 'un on as - as Drily ,hen subjected to ire env rOftental. re.
tha
tpa . eats of ~o beed peoifiaation Li~8D-2916 with deviations as agreed to between
and the dontraetor,
3.7.7 .. The MV recovery sTstem shall be desigt id. to pro {e
~a $~
for 'initial a on ovation in conjunction with LXSD recovery pia and
sysi was equipment The ART. recovery system including structure shall he o*pable
of sir on,''water awes sry in day or night operation. Recovery devises included in
the syartom$ shall co nati.st of the eamponents explained within the fel ng seetion.
lni ties or, this equipment it obtained at T PO of the reentry tra eatory and actu-
~,a#i shall be at an altitude of 55000 1 5000 feet. Recovery p~u$ design will
be or a velocity of 25 ft/second.at 1000) feet altitude.
3.7.7.1 Chaff: is ` The recovery unit will contain ;~l f e?po+Med
ps4age of eica?"f p with the parachute so that-it will be dispersed at the
emo time the parachute is deployed.
3.7.7.2 atf F en and Response < The chaff shall be capable of a
thoeretieal radar response as o owst
Fr*ggqy
"and 2880 mm
6,082 ft.2
7,*B and 9375 me
3,073 ft.2
3.7.7.2 Radio Be - The radio beacon shall be vertically polarised and
8411 operate ro cy of 232.k me with a 10)00 ape tone.
3.7.7.4 &-eov~'y? . rating - The radio beacon and light shall be
capable of opera a period o ten hours after water impacat.
3.7.7.5 P
sa aatoh shall JkO*o as 5g, a.
M eetiea Alts, -de M The parachute shall. be e$eated at
5,0000 est.
3+7t utly included for air*
craft observation at close rouge of the - oearch area has been aininised by t
radio.ho tg beacon1 The intensity t lights shall be s cruet eonme suratae w
3.7.7.9 Ron = krironaenta
follow*$
Wean Cloudiness
Percent of 8-trfaee Winds that show dead calla
Frequeney of Tog ,
Frequency of Mists
Frequency bf Thunder Shower
F requenoy of Bain
-Air Texron r* .*9 Surface
Water .,Tam'pwa a re at Surface
45 ,0$
1to3%
Less Ibm
1%
Lesar;: ft; 1x.
l b.
8to
A U1,30t Wsatal
75 to 834T 1? water
79 is 79 anomp
(Sea, temperature averages 2/2 higher than Air teMsratore)
Visibility near surface greater than 10 ISI 8o of, u
Cloud Ceiling (6/10th of sky obscured) less than 10#,000 ft. 73% of tim
Cloud Ceiling less than 5000 ft. 66% of ti ?'
Vector mean of winder Altitude From f e,
27+000 ft
SW
301
~a1'000 ft
w
28 t
,000 ft
w
201
060 ft
?B
log
100,000 ft.
1
10 1
50,000 ft
E
1,6 x
Surface WE 10 K
90 percent of tine the rug winds will be less thaw
Altitude
*_F
!2,040 ft
32000 ft
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Specifioation No. ARV-1
December 19, 1958
Page 12
(continued)
Altitude From Force
20,000 ft
B
.25 1
10,000 ft
EM$
25 1
5,000 ft
EIRE
20 L
Surface
NE
181
3.8 Ground ort_ Equipment .4
3.8.1 General Design- Bse uiremsnts - This specification covers only those
pieces of groom uppor e$ qupmen are required to support, to the extent
specified herein, the ARV Vehicle System when it is situated at the follentsg locationss
a. I,MSD Plant, Palo Alto
b. Flight Test Base, Vandenberg Air Force Bass
Specifications MIL-G-008512, MIL-A-8121, and MIL-W-8090 shall be used as guides for
the design of ground support equipment. This specification does not cover ground
handling equipments required to support ARP or AU GSE as these are not provided
by G.E.
3.8.2 Functional Requir
3.8.2.1 Shipping Equipment - The following shipping containers are required.
a. Re-entry Vehicle Shipping Container
b. Recovery Aid and Parachute Test Unit Shipping Container
c. Ground Support Equipment Shipping Containers
These shipping containers are required for security and environmental protection
of their contents during shipment from the factory to LMSD Plants Palo Alto or
Flight Test Bases Vandenberg Air Force Bass. Shipment will be by air under pre.
ferred handling conditions. Rail shipment of this equipment will not be a design
requirement for these shipping containers.
3.8.2.2 Weitht s d Balance Equipment - This equipment is for field use only
to weigh and determine the center of gravity of the Re-entry Vehicle about its three
axes. With this equipment and an Analytical Balancing Procedure that will be pro-
vided, the moments and products of inertia of the Re-entry Vehicle will be determined
by calculation. If the recommended limits are exceeded, ballasting will be accom-
plished in accordance with the Analytical Balancing Procedure noted above.
Space Requirements t !t' x b' x 5' long
Weights 1,500 lbs
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D"Waber 24.
Page 13
x.8.2.3 lleetrieal 4reund Support Bgai nt - The eq pmont listed below
will be required f$ field Ofte on o the ARV Vehicle Electrical Syetent
a. -entry le a 2 ckput Unit, - This a i.t will soosist oft
ARV Checkout Panel
Thrust Cone Checkout Panel
Recovery Aid Checkout Panel,
Beacon Checkout Panel
Necessary Power Supplies
Space R.equireaents: 70' trade x 70" high x 25" deep
Weightt 1,300 The (max.)
Simulator -The Su ralator will only be used as a means for chook g the
Vehicle Checkout U$.t prier, to its use with the ART Vehicle
Space Requir Bates 25" wide x 60" high x 24" deep
Weights 300 lbs
13.8.2.E Power Re irements - The power listed below will. be necessary to
operate the Ground uppor nipment described previously:
220 960 cycle 3 phase 15 amperes
110 V 60 oysle 1 phase 50 amperes
3.8,,3 around E t Finish Re uirements - Finishes for ground sn'port
equipment shi'll conform the requirements of the following paragraphs.
3.8.3.1 Front Pane l# - Finish exterior with one spray coat of MIL-E-7729,
Type II Enamel K- emperature Baking). Air dry 30 minutes, followed by a twev.
hour bake at 170-180?F. Color light grey, ANA or FED-STD-595,
3.8.3.2 Elsetronic Enclosurest
a. Finish exterior with one spray coat of MIL-E4729, Typo II Enamel (1o*
Temperature Baking). Air dry 30 minutes, followed by a twoohpur bake at
170-18?10F. Color light green, ANA or FED-9TD:-595,
_ 3.8.3?3 Fixed and Mobile Equipment - Finish exterior surtaeeg:withq~ brush
or Ipray coat o L-E-7 29 ype Foamel (Air Drying). Air dry at least.~aight
hours before handling. (Forty eight hours air dry is recommended for maximmm'hardness.)
Color Strata Blue ANA or 8TD-595.
3.8.14 Ground 9u rt p Eg~ent Environmental Re fits ? Ground ft wort
equiment a o designed and constructed such that it Will tiun satin rtorily
when subjected tb the environmental requirements of Lockheed S eeLticatisi D 2916
with deviations as agreed to between IMSD and the contractor.
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$peaiftoatton $o. AIIEY.1
Dtesasber I+ly 1958
cge 11
14.0 INSPECTION AND AOC PTANCS PEt3
4.1 Ins ?stion ? The contractor shall provide for the inspection of aaterr
ial and p s In- ascordana* with the requirements set forth in 8peoifi4aation
MIL-Q-5923, Phase A.
14.2 QQ ia3,itioatien Tests - Qualification Tests shall be performed on the
complete recovery vehicle ad individual couponents in escordancq with contractee'
prepared specifications which shall be submitted to ZM.$D.
L.3 Acceptance Tests -P Acceptance Teats sW3 be performed on the complete
recovery vhh&c1e anon ividual co*ponente in aoeordanoe with contractor p7 r.d
specifications which shall be submitted to I I1. The testing. shall be pie j
by the contrae?tor, and monitored by LM 3D.
5.0 PREPARATION FOR DELIVERY
5.1 Preservation and Paaksging - Preservation and pang requi is for
the ARV, its ceapo` nome, and ground support equipment shall "be as spoeitl t on the-. ~-
individual equipment drawings.
5.2 Mares for Shipmeent - Marking for sh IOeaent *hall be in acee~rdaa7eze with
the I1 SD requirements.
,5.3 Modes of Transportation ? The packaged units s re411 be shipped by r
under presferrree Fan g conditions. There shall be no shipment by rail of any
units..
6.0 Nons - Net applicable.
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if AND LO 017UDIAAL AOC ATIDA 8ZUTCRI PROGRAM
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SCA-18
TERMS AND CONDITIONS OF PURCHASE
(For CPFF Subcontracts under Prime Contracts with the Air Force)
ARTICLE
Page
1.
PROVISIONS APPLICABLE TO SERVICES AND
SUPPLIES TO BE FURNISHED
2
2.
PACKING AND CRATING
2
3.
CHANGES
2
4.
LIMITATION OF ALLOWABLE COSTS
3
5.
ALLOWABLE COSTS AND FIXED FEE
4
6.
PAYMENT
5
7.
RELEASE PROVISIONS
7
8.
INSPECTION AND CORRECTION OF DEFECTS
8
9.
INDEMNIFICATION
9
10.
ASSIGNMENT OF CLAIMS
10
11.
RECORDS
11
12.
SUBCONTRACTS
12
13.
UTILIZATION OF SMALL BUSINESS CONCERNS
13
14.
TERMINATION
13
15.
EXCUSABLE DELAYS
17
16.
BUY AMERICAN ACT
18
17.
EIGHT-HOUR LAW OF 1912
19
18.
WALSH-HEALEY PUBLIC CONTRACTS ACT
19
19.
NONDISCRIMINATION IN EMPLOYMENT
19
20.
NOTICE TO LOCKHEED AND TO THE GOVERNMENT
OF LABOR DISPUTES
20
(i)
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ARTICLE
Page
21.
CONVICT LABOR
20
22.
GOVERNMENT PROPERTY
20
23.
PRIORITIES, ALLOCATIONS AND ALLOTMENTS
24
24+.
OFFICIALS NOT TO BENEFIT
24
25.
INDEPENDENT CONTRACTOR
24
26.
PATENT RIGHTS
24
27.
FILING OF PATENT APPLICATIONS
2
28.
NOTICE AND ASSISTANCE REGARDING
PATENT INFRINGEMENT
30
29.
REPORTING OF ROYALTIES
30
30.
PAYMENT OF ROYALTIES
30
31.
AUTHORIZATION AND CONSENT
31
32.
EXCESS PROFIT
31
33?
RENEGOTIATION
31
34+.
MILITARY SECURITY REQUIREMENTS
31
35?
NEW FEATURES OF DESIGN
33
36.
REPORTS OF WORK
33
37.
RIGHTS IN DATA - UNLIMITED
33
38.
REPRODUCTION RIGHTS
34
39?
NON-DISCLOSURE OF INFORMATION
34+
40.
FEDERAL, STATE AND LOCAL TAXES
35
4+1.
AMENDMENTS REQUIRED BY PRIME CONTRACT
35
4+2.
COVENANT AGAINST CONTINGENT FEES
35
13.
QUALITY CONTROL SPECIFICATION
36
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SCA? 18
ARTICLE
Page
44.
GRATUITIES
36
1+5.
DELAY IN DELIVERY DATA
36
46.
LIMITS OF CONTRACT
37
)7.
ADVANCE MANUFACTURE AND SHIPMENT
37
48.
INTERPRETATION
37
19.
APPROVAL
37
50.
ALTERATIONS
Indicates change. Refer to section commencing on page 39.
38
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SCA ~8
AGREEMENT AS TO TERMS AND CONDITIONS
APPLICABLE TO CPFF PURCHASE ORDERS
ISSUED UNDER AIR FORCE PRIME CONTRACTS
THIS AGREEMENT is entered into as of the day of , 195-,
between LOCKHEED AIRCRAFT CORPORATION, a corporation organized and existing
under the laws of the State of California (herein called "Lockheed") and
, a corporation organized and existing under the laws
of the State of (herein called "Contractor").
Lockheed and Contractor agree as follows:
Lockheed and Contractor have agreed upon the contract clauses contained in
the attached "Terms and Conditions of Purchase" for use in negotiated cost type
subcontracts or Purchase Orders between Lockheed and Contractor in connection
with Lockheed's performance of cost-plus-fixed-fee Prime Contracts with the
Department of the Air Force. Unless otherwise agreed to in writing at the time
of execution, all such subcontracts or Purchase Orders entered into after the
date of this Agreement and prior to its termination shall, if reference is made
to this Agreement, incorporate by reference all of said "Terms and Conditions
of Purchase". However, a copy of this Agreement or of said "Terms and Conditions
of Purchase" need not be, and will not be, attached to any such subcontracts
or Purchase Orders.
Any clause set forth in the attached "Terms and Conditions of Purchase" may
be deleted, or modified, or additional clauses may be added thereto. This
Agreement may be terminated in its entirety by either party upon thirty (30) days
notice in writing to the other party. No deletion, modification, addition or
termination shall affect any subcontract or Purchase Order theretofore entered into
between the parties in which this Agreement has been incorporated by reference.
No unilateral action by either party shall alter this Agreement or alter its
application to any contract wherein this Agreement has been incorporated.
Notwithstanding any other provisions of this Agreement, the attached "Terms
and Conditions of Purchase" shall be applicable only to subcontracts and Purchase
Orders executed or issued by the Missile Systems, Division of Lockheed.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above set forth.
By
By
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TERMS AND CONDITIONS OF PURCHASE
(For CPFF Subcontracts under Prime Contracts with the Air Force)
As used throughout these terms and conditions of purchase, the following terms shall
have the meanings set forth below:
a. The terms "the Department means the Department of the Air Force.
b. The term "Secretary" means the Secretary, the Under Secretary, or any
Assistant Secretary of the Department and the term "his duly authorized
representative" means any person or persons or-board (other than the con-
tracting Officer), authorized to act for the Secretary.
c. The term "said ,purchase order" means the purchase order or purchase orders
by Lockheed and accepted by Contractor which incorporates these terms and
conditions of purchase by reference.
d. The term "this subcontract" means said purchase order and these terms and
conditions of ;purchase which are included therein by reference.
e. The term "Lockheed" means Lockheed Aircraft Corporation, acting on behalf
of its Missile Systems Division.
f. The term "Contractor" means the party who accepts said purchase order.
g. The term ".prime contract" means the contract between Lockheed and the United
States of America under which this subcontract is issued, the number of
which is specified on the face of said purchase order.
h. The term "Contracting Officer" means the person executing the prime 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 subcontract, the authorized representative of
a Contracting Officer acting within the limits of his authority.
i. The terms "work" or "services" mean all work to be performed under this sub-
contract including any studies covering fundamental, theoretical, or exper-
imental investigations; any extension of the investigative findings and
theories of a scientific or technical nature into practical application;
any tangible items (hereinafter referred to as "supplies") furnished to
Lockheed; and any reports, data, computations, .plans, drawings and speci-
fications with respect to any of the foregoing.
Lockheed and Contractor agree as follows:
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TERMS AND CONDITIONS:
ARTICLE 1 - PROVISIONS APPLICABLE TO SERVICES AND SUPPLIES TO BE FURNISHED
IV
a. Contractor agrees to perform the services and furnish and deliver the
supplies specified in said purchase order in accordance with, (i) the terms and
conditions contained herein, (ii) the specifications and requirements, delivery
schedules, printed "Instruction", and typed provisions all as specifically set
forth in said purchase order, and (iii) in accordance with each written changed
purchase order and purchase order change notice relating to said purchase order
issued pursuant to the provisions of Article 3 (Changes) hereof or entered into
by mutual agreement between the parties hereto. Acceptance of such changed purchase
orders and purchase order change notices shall be by signing and returning the ac-
knowledgment copy thereof to Lockheed within fifteen (15) days after receipt of same.
b. Said purchase order and all changed purchase orders and purchase order
change notices relating thereto which are accepted by Contractor are by this refer-
ence made a part of this subcontract. The terms of this subcontract shall supersede
the terms set forth on the back of said purchase order. Any typewritten provisions
appearing on the face of said purchase order or on the face of any such changed
purchase orders or purchase order change notices shall supersede these terms and
conditions to the extent in conflict therewith.
c. Said purchase order includes an amount covering estimated cost and fixed-
fee, if any monetary consideration is to be paid by Lockheed.
ARTICLE 2 - PACKING AND CRATING
All supplies shall be packed in suitable containers for protection in ship-
ment and storage except as otherwise specified in this subcontract. Packing must
conform to requirements of carriers' tariffs. Contractor shall be responsible for
damage in transit as a result of insufficient or improper packaging and for repair
or replacement required as a result of non-conformance by Contractor with the
terms of this article.
ARTICLE 3 - CHANGES
Lockheed may at any time, by a written order, and without notice to sureties,
if any, require additional work within the general scope of said purchase order or
make changes, within the general scope of said purchase order, in any one or more
of the following:
(i) drawings, designs, or specifications;
(ii) method of shipment or packing;
(iii) place of delivery; and
(iv) the amount of Government-furnished or Lockheed-furnished property.
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If any such change or addition causes an increase or decrease in the estimated
cost of, or the time required for performance of said purchase order, or otherwise
affects any other provision of said purchase order, an equitable adjustment shall
be made (i) in the estimated cost or delivery schedule, or both, (ii) in the
amount of any fixed fee to be paid to Contractor, and (iii) in such other provisions
of said purchase order as may be so affected, and said purchase order shall be
modified in writing accordingly. Any claim by Contractor for adjustment under
this article must be asserted within thirty (30) days from the date of receipt
by Contractor of the notification of change or addition: provided, however, that
Lockheed, if it decides that the facts justify such action, may receive and act
upon any such claim asserted at any time prior to final payment under this sub-
contract. Nothing in this article, however, shall excuse Contractor from pro-
ceeding with this subcontract as changed.
ig ARTT LE 4 - LIMITATION OF ALLOWABLE COSTS
a. It is estimated that the total cost to Lockheed, exclusive of any
fixed fee, for the performance of this subcontract will not exceed the estimated
cost set forth in said purchase order. Contractor agrees to use its best efforts
to perform the work's,pecified in said purchase order and all obligations under
this subcontract within such estimated cost, If at any time Contractor has reason
to believe that the costs which it expects to incur in the performance of said
purchase order in the next succeeding thirty (30) days, when added to all costs
previously incurred, will exceed eighty-five percent (85%) of the estimated cost
then set forth in said purchase order or if at any time Contractor has reason
to believe that the total cost to Lockheed, exclusive of any fixed fee, for the
performance of said purchase order will be substantially greater or less than
the then estimated cost thereof, Contractor shall notify Lockheed in writing to
that effect, giving its revised estimate of such total cost for the performance
of said purchase, order, together with an appropriate breakdown of such estimate
and a statement setting forth a reason for such anticipated increase or decrease
in cost so that at the discretion of Lockheed and with the approval of the Con-
tracting Officer, an appropriate increase or decrease may be made in the esti-
mated cost without a corresponding change in fixed fee except as to adjustment
in the fixed fee as provided for in Article 3 (Changes).
b. Lockheed shall not be obligated to reimburse Contractor for costs
incurred-in excess of the estimated cost set forth in said purchase order and
Contractor shall not be obligated to continue performance under this subcontract
or to incur costs in excess of the estimated cost set forth in said purchase
order, unless and until Lockheed shall have notified Contractor in writing that
such estimated cost has been increased and shall have specified in such notice
a revised estimated cost which shall thereupon constitute the estimated cost of
performance of this subcontract. When and to the extent that the estimated cost
set forth in said purchase order has been increased, any costs incurred by Con-
tractor in excess of such estimated cost prior to the increase in estimated cost
shall be allowable to the same extent as if such costs had been incurred after
such increase in estimated cost, if so stated in writing at the time such increase
is authorized.
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ARTICLE 5 - ALLOWABLE COSTS AND FIXED FEE
a. Lockheed shall pay to Contractor, at the time and in the manner
hereinafter set forth, for all services and supplies to be furnished here-
under the allowable costs therefor determined as hereinafter set forth in
paragraph (b) of this article, plus a fee based on a percentage of the
total estimated cost as specified in said purchase order. If Lockheed,
because of the requirement of the Government, or for any other reasons,
accepts services or supplies under this subcontract which do not conform
to the guarantees set forth in Article 8 (Inspection and Correction of
Defects) hereof, Lockheed shall pay the allowable costs as hereinafter
defined of furnishing and delivering such services and supplies, subject
to the provisions of said Article 8. The total estimated cost and fixed
fee shall be subject to increases and decreases resulting from changes or
additions as provided in Article 3 (Changes) hereof, or from changes in
the scope or nature of the work to be performed under this subcontract
which are agreed to by Contractor and Lockheed.
b. The allowable costs of performing this subcontract shall be those
incurred by Contractor and properly chargeable to the subcontract which
are claimed by Contractor and accepted as such by the Contracting Officer.
The following criteria shall apply to the determination of allowable costs:
1. Allowable costs of performance shall be determined in
accordance with Part 2 of Section XV of the Armed
Services Procurement Regulations as in effect on the
date of the prime contract.
2. Costs incurred for the performance of overtime work
shall be allowable items of cost hereunder only if
and to the extent that the overtime work for which
such payments are made shall be authorized by Lockheed
in writing prior to the performance of such overtime
work. Each request for such authorization shall be
submitted to Lockheed via the cognizant Government
Representative at Contractor's plant.
3? Costs incurred by Contractor by reason of its use and
occupancy of facilities furnished pursuant to facilities
contracts authorized for use in connection with this
subcontract insofar as they are allocable to the perform-
ance of this subcontract shall be allowable costs except
to the extent that Contractor is reimbursed for such
costs under other contracts or to the extent that
provision is made apart from this subcontractor other
contracts for the payment of such costs by the Government
or otherwise than by Contractor, and except to the extent
that such costs are included in Contractor's overhead.
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4. Appropriate credit shall be given to Lockheed for
disposal of scrap and salvage and any surplus parts
or material. Lockheed shall not be charged for
excessive procurement of material and parts.
5?
Costs incurred by Contractor in connection with third
party claims based on bodily injury or death or
property damage shall not be considered as allowable
costs under this subcontract.
6. There shall be included as allowable indirect costs
such overhead rates as may be established by Con-
tractor and the Contracting Officer or his authorized
representative in accordance with the principles of
Armed Services Procurement Regulations. Pending
establishment of final overhead rates for any period,
Contractor shall be reimbursed at billing rates
acceptable to the Contracting Officer or his author-
ized representative, which billing rates may be
revised from time to time with the approval of the
Contracting Officer or his authorized representative,
subject to appropriate adjustment when the final rates
for that period are established.
ARTICLE 6 - PAYM NT AND REfl4BURSEMENT
a. Payment of the fixed fee provided for herein and reimbursement of
allowable costs shall be made upon the basis of invoices submitted to the
Contracting Officer which shall be in such form and detail as the Contracting
Officer may require and shall be supported by statements of costs incurred
by Contractor in the performance of this subcontract and claimed to constitute
allowable costs.
b. The originals and two copies of such invoices covering allowable
costs and fixed fee, certified by an Officer or other responsible official
of the Contractor Authorized by it to certify such statements shall be sub-
mitted to the Contracting Officer for approval and three additional copies
shall be submitted to the cognizant Government audit agency. Such invoices
may be provisionally approved by the Contracting Officer subject to final
audit by the cognizant United States-Government audit agency for Contractor's
plant. The original and two copies of such invoices bearing the certifi-
cation of such approval of the Contracting Officer shall be forwarded to
Lockheed but not more frequently than once every thirty (30) days (or at
more frequent intervals if approved by Lockheed). Within thirty (30) days
after receipt and acceptance of such invoices, Lockheed shall make payment
of such allowable costs approved by the Contracting Officer plus eighty-
five per cent (85%) of the accrued fixed fed, as such fixed fee may be
adjusted from time to time pursuant to Article .(Changes).. Accrual of such
fixed fee shall be based upon the percentage of the performance of the work
-5-
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actually done hereunder as determined from estimates made by Contractor
and approved by Lockheed. Upon completion of this subcontract, including
execution of the release called for in Article 7 (Release Provisions)
hereof, and the furnishing of the documents, data and reports called for
in Article 29 (Patent Rights) hereof, the unpaid balance of the fixed fee,
as the same may: have been adjusted from time to time shall be paid to
Contractor. All payments of allowable costs made pursuant hereto shall
be subject to adjustment from time to time as a result of audit by the
cognizant United States Government auditing agency, which adjustments
shall be recognized and accepted by.Contractor to the extent that such
adjustments are approved by Lockheed and the Contracting Officer.
c. At any time or times prior to the final payment on account of
allowable costs, the Contracting Officer or Lockheed may cause to be
made such audit of invoices and statements of cost as shall be deemed
proper. Payments made by Lockheed shall be subject to reduction to the
extent of amounts included in any invoices which are found by the Con-
tracting Officer not to constitute allowable costs and shall also be
subject to reduction for overpayments or to increase for under-payments
made on preceding invoices.
d. If any amount actually paid by Lockheed to Contractor is dis-
allowed to Lockheed by Lockheed's local Government Auditors, by the
Contracting Officer at Lockheed's plant or by the General Accounting
Office, as an item of cost under its Government prime contract, or if
Lockheed is required, because of any action of the Government to refund
or credit to the Government any amount with respect to an item of cost
for which it has reimbursed Contractor, Contractor shall, on demand
made by Lockheed after such disallowance or after Lockheed shall have
made such refund or given such credit, promptly repay to Lockheed the
amount which Lockheed has paid to Contractor with respect to any such
item or items;. provided, however, that to the extent such disallowance
or such refund or credit is the result of the performance by Contractor
of work authorized by Lockheed but not authorized by the prime contract,
Contractor shall not be required to repay to Lockheed the amount which
Lockheed has paid to Contractor with respect to the performance of such
work. In the event Lockheed shall recover any amount so disallowed
or so refunded or credited by it to the Government with respect to any
such item or items, Lockheed shall pay the amount of such recovery to
Contractor. if the same shall not theretofore have been repaid to
Contractor.
e. In the event that any department, agency or representative of
the Government disallows any cost granted under this subcontract and in
Lockheed's opinion it appears that such disallowance is inequitable
and that such cost should be considered allowable, then Lockheed agrees
to negotiate with such department, agency or representative of the Govern-
ment to obtain the reinstatement of such costs as allowable under the
terms of this subcontract.
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ARTICLE 7 -- RELEASE PROVISIONS
a. Contractor and each assignee under an assignment entered into
under this subcontract and in effect at the time of final payment under
this subcontract shall execute and deliver at the time of and as a
condition precedent to final payment under this subcontract, a release
discharging Lockheed and the Government, and their respective officers,
agents and employees, of and from all liabilities, obligations, and
claims arising out of or under this subcontract subject only to the
i ollo gyring exceptions:
1. Specified claims in stated amounts or in estimated
amounts where the amounts are not susceptible of
exact statement by Contractor.
2. Claims, together with reasonable expenses incidental
.thereto, based upon the liabilities of Contractor to
third parties arising out of the performance of this
subcontract (but not including claims based on bodily
injury or death or property damage) which are not
known to Contractor on the date of the execution of
the release, and of which Contractor gives notice in
writing to Lockheed not more than five (5) years after
the date of the release or the date of any notice to
Contractor that Lockheed is prepared to make final
payment, whichever is earlier.
Claims for reimbursement of costs (other than ex-
penses of Contractor by reason of its indemnification
of Lockheed and the Government against patent liabili-
ty), including reasonable expenses incidental thereto,
incurred by Contractor under the provisions of this
subcontract relating to patents.
b. Contractor agrees that any refunds, rebates or credits (including
any interest thereon) accruing to or received by Contractor or any assignee
which arise out of the .performance of this subcontract and on account of
which Contractor has received reimbursement shall be paid by Contractor to
Lockheed. Contractor and each assignee under an assignment entered into
under this subcontract and in effect at the time of final payment under
this subcontract shall execute and deliver at the time of and as a condi-
tion precedent to final payment under this subcontract, an assignment to
Lockheed of refunds, rebates or credits (including any interest thereon)
arising out of the performance of this subcontract, in form and substance
satisfactory to Lockheed. Reasonable expenses incurred by Contractor for
the ,purpose of securing any such refunds, rebates or credits shall consti-
tute allowable costs when approved by the Contracting Officer.
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c. In addition to the release required by paragraph (a) above,
Contractor shall, prior to final payment, comply with the provisions
of paragraph (i) of Article 26 hereof and with paragraph (i) of Article
22 hereof.
ARTICLE 8 - INSPECTION AND CORRECTION OF DEFECTS
~17r a. All work under this subcontract shall be subject to inspection
and test by the Government and/or Lockheed, to the extent practicable at
all times and ,places, including the period of performance, and in any
event prior to final acceptance. Contractor shall provide and maintain
and shall require its subcontractors to provide and maintain an inspection
system acceptable to the Government and Lockheed covering the work here-
under. The Government and/or Lockheed, through any authorized representa-
tive, may inspect the plant or plants of Contractor or any of its sub-
contractors engaged in the performance of this subcontract. If any in-
spection or test is made by the Government or Lockheed on the premises
of Contractor or its subcontractor, Contractor shall provide and shall
require its subcontractors to provide all reasonable facilities and
assistance for the safety and convenience of Lockheed or the Government
inspectors in the performance of their duties. All inspections and tests
by the Government or Lockheed shall be performed in such a manner as will
not unduly delay the work.
b. Contractor warrants that the services rendered in the performance
of this subcontract will conform to the requirements of this subcontract
and to high professional standards in the field, and that any supplies
delivered to Lockheed and/or the Government under this subcontract will
conform to the requirements of this subcontract and will not be defective
in material or workmanship.
c. At any time during the performance of this subcontract, but not
later than twelve (12) months after final acceptance by the Government
of the services or supplies furnished hereunder, the Government or
Lockheed may require Contractor to remedy by correction or replacement,
as directed by the Contracting Officer, any failure by Contractor to
comply with its obligations unaer paragraph (b) hereof. Except as
otherwise provided in paragraph (d) hereof, the cost of any such replace-
ment or correction shall be included in allowable costs determined as
provided in the article of this subcontract entitled "Allowable Costs
and Fixed Fee", but no additional fee shall be payable with respect
thereto. Corrected supplies shall not be tendered again for acceptance
unless the former tender and the requirement of correction is disclosed.
If Contractor fails to proceed with reasonable promptness to perform
such replacement or correction, Lockheed (i) may by contract or other-
wise perform such replacement or correction and charge to Contractor
any increased cost occasioned Lockheed thereby or may reduce any fixed
fee payable under this subcontract, (or require repayments of any fixed
fee theretofore paid) in such amount as may be equitable under the
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circumstances, or (ii) in the case of supplies not delivered, may require
the delivery of such supplies, and shall have the right to reduce any
fixed fee payable under this subcontract (or to require repayment of any
fixed fee theretofore paid) in such amount as may be equitable under the
circumstances, or (iii) may terminate this subcontract for default as
provided in the article of this subcontract entitled "Termination".
d. Notwithstanding the provisions of paragraph (c) hereof, Lockheed
may at any time require correction or replacement of services or supplies
by Contractor without cost to Lockheed, which are defective in material or
workmanship, or otherwise not in conformity with the requirements of this
subcontract if such failure is due to fraud, lack of good faith or willful
misconduct on the part of any of Contractor's directors or officers, or
on the part of any of its managers, superintendents, or other equivalent
representatives, who has supervision or direction of (i) all or sub-
stantially all of Contractor's business, or (ii) all or substantially
all of Contractor's operations at any one plant or separate location in
which this subcontract is being performed, or (iii) a separate and com-
plete major industrial operation in connection with performance of this
subcontract. Fraud, lack of good faith or willful misconduct on the part
of any such supervisory personnel shall be deemed to include the selection
of individual employees or the retention of employees after any of such
supervisory personnel has reason to believe that such employees are
habitually careless or otherwise unqualified.
e. Corrected services or supplies tendered as replacements, shall
be subject to-the provisions of this article in the same manner and to
the same extent as supplies originally delivered under this subcontract.
f. Records of all inspection work shall be maintained by Contractor
and shall be kept complete and available to the Government and Lockheed
during the performance of this subcontract and for such longer period as
may be specified in this subcontract.
g. Except as otherwise provided in this subcontract, Contractor's
obligation to correct or replace Government-furnished property (which is
property in the possession of or acquired directly by the Government and
delivered or otherwise made available to Contractor) shall be governed
by the provisions of the article of this subcontract entitled "Government
Property".
h. Preliminary inspection and acceptance, if any, shall be at
Contractor's plant as set forth in said purchase order; but in any event
final inspection and acceptance by Lockheed shall be at Lockheed's plant.
4V ARTICLE 9 - IDEMNIFICATION
In the event Contractor, its employees, agents, subcontractors and/or
lower-tier subcontractors enter premises occupied by or under the control of
Lockheed in the performance of this subcontract, Contractor agrees that it will
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indemnify and hold harmless Lockheed, its officers and employees from any loss,
cost, damage, expense or liability by reason of property damage or personal
injury of whatsoever nature or kind arising out of, as a result of, or in
connection with such performance occasioned in whole or in part by the actions or
omissions of Contractor, its employees, agents, subcontracors and/or lower-tier
subcontractors; and Contractor agrees that it and its subcontractors and lower-
tier subcontractors will maintain public liability and property damage insurance
in reasonable limits covering the obligations set forth above, and will maintain
proper workmen's compensation insurance covering all employees rendering per-
formance under this subcontract.
a. Neither this subcontract nor any interest hereunder nor any sums becoming
due to Contractor hereunder shall be assigned by Contractor without the prior written
consent of Lockheed, except that claims for monies due or to become due Contractor
from Lockheed, under this subcontract may be assigned to a bank, trust company or
other financing institution, including any federal lending agency. Any such
assignment of monies due or to become due shall cover all amounts payable under
this subcontract and not already paid, and shall not be made to more than one party,
except that any such assignment may be made to one party as agent or trustee for
two (2) or more parties participating in such financing. Payment by Lockheed to
an assignee of any claim under this subcontract shall be subject to set-off or
recoupment for any present or future claim or claims arising in connection with
this subcontract which Lockheed may have against Contractor.
b. In the event of any such assignment the assignee shall file four (4)
signed copies of a written notice of the assignment, together with one copy of the
instrument of assignment, with Lockheed.
c. Any claim under this subcontract which has been assigned pursuant to the
foregoing provisions of this article may be further assigned and reassigned only
with the prior wrtten consent of Lockheed to a bank, trust company or other fin-
ancing institution, including any federal lending agency. In the event of such
further assignemnt or reassignment the assignee shall be required to file one
signed copy of a written notice of the further assignment or reassignment, to-
gether with a true copy of the instrument of further assignment or reassignment
with Contractor; and shall file four (4) signed copies of such written notice,
tpgetjer with four (4) copies of such instrument with Lockheed.
d. No assignee shall divulge any information concerning this subcontract
except to those persons concerned with the transaction. In no event shall copies
of this subcontract or of any plans, specifications,. or other similar documents
relating to work under this subcontract, if marked "Top Secret", "Secret" or
"Confidential", be furnished'to any assignee of any claim arising under this sub-
contract or to any other person not entitled to receive the same; provided, that
a copy of any part or all of this subcontract so marked may be furnished, or any
information contained therein may be disclosed, to such assignee upon the prior
written authorization of Lockheed or the Contracting Officer.
e. Indication of the assignment of claim and of any further assignment
thereof and the name of the assignee shall be made on all vouchers or invoices
certified by Contractor.
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ARTICLE 11 - RECORDS
a. Contractor agrees to maintain books and records, documents and
other evidence pertaining to the costs and expenses of this subcontract
(hereinafter collectively called the "records") to the extent and in
such detail as will properly reflect all net costs, direct and indirect,
of labor, materials, equipment, supplies and services, and other costs
and expenses of whatever nature for which reimbursement is claimed
under the provisions of this subcontract. Contractor's accounting pro-
cedures and practices shall be subject to the approval of the Contract-
ing Officer; provided, however, that no material change will be required
to be made in Contractor's accounting procedures and practices if they
conform to generally accepted accounting practices and if the costs
properly applicable to this subcontract are readily ascertainable there-
from.
b. Contractor agrees to make available at the office of Contractor
at all reasonable times during the period set forth in paragraph (d)
below any of the records for inspection, audit or reproduction by any
authorized representative of the Department or of the Comptroller General.
c. In the event the Comptroller General or any of his duly author-
ized representatives determine that his audit of the amounts reimbursed
under this subcontract as transportation charges will be made at a place
other than the office of Contractor, Contractor agrees to deliver, with
the reimbursement voucher covering such charges, or as may be otherwise
specified, within two (2) years after reimbursement of charges covered
by any such voucher, to such representatives 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
General or any of his duly authorized representatives.
d. Except for documentary evidence delivered to the Goverment
pursuant to paragraph" (c) above, Contractor shall preserve and make
available its records for a period of six (6) years (unless a longer
period of time is provided by applicable statute) from the date of the
voucher or invoice submitted by Contractor after the completion of the
work under this subcontract and designated by Contractor as the "com-
pletion voucher" or "completion invoice", or, in the event this sub-
contract has been completely terminated, from the date of the termina-
tion settlement agreement; provided, however, that records which relate
to (i.) appeals under the clause of the prime contract entitled "Disputes",
(ii) litigation or the settlement of claims arising out of the .perform-
ance of this subcontract, or (iii) costs or expenses of the subcontract
as to which exception has been taken by the Comptroller General or any
of his duly authorized representatives, shall be retained by Contractor
until such appeals, litigation, claims or exceptions have been disposed
of, but in no event for less than the six-year period mentioned above.
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e. Except for documentary evidence delivered pursuant to'paragraph
(c) above, and the records described in the proviso of paragraph (c)
above, Contractor may in fulfillment of its obligation retain its records
as required by this article substitute photographs, microphotographs or
other authentic reproductions of such records, after the expiration of
two (2) years following the last day of the month of reimbursement to
Contractor of the invoice or voucher to which such records relate, unless
a shorter period is authorized by the Contracting Officer with the con-
currence of the Comptroller General or his duly authorized representative.
f. The provisions of this article, including this paragraph (f)
shall be applicable to and included in each subcontract hereunder which
is on a cost, a cost-plus-fixed-fee, time-and-material or labor-hour
basis.
g. Contractor shall include in each subcontract hereunder, other
than those described in paragraph (f) above, a provision to the effect
that the subcontractor agrees that the Comptroller General or the Depart-
ment, or any of their duly authorized representatives, shall, until the
expiration of three (3) years after final payment under the subcontract,
have access to and the right to examine any directly pertinent books,
documents, papers, and records of such subcontractor involving transac-
tions related to the subcontract. The term "subcontract", as used in
this paragraph (g) 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.
ARTICLE 12 - SUBCONTRACTS
a. Contractor shall give advance notification to Lockheed and the
Contracting Officer of any proposed subcontract or puchase order here-
under which (i) is on a cost or cost-plus-a-fixed-fee basis or (ii) is
on a fixed-price basis exceeding in dollar amount either $25,000 or
five percent (5%) of the total estimated cost of this subcontract.
b. Contractor shall not, without the prior written consent of
Contracting Officer, place any subcontract or purchase order which (i)
is on a cost or a cost-plus-a-fixed-fee basis, or (ii) is on a fixed-
price basis exceeding in dollar amount either $25,000 or five percent
(5%) of the total estimated cost of this subcontract, or (iii) provides
for the fabrication, purchase, rental, installation or other acquisition,
of any item of industrial facilities, or of special tooling having a
value in excess of $1,000 or (iv) is on a time-and-material or labor-
hour basis. Lockheed may, in its discretion, ratify in writing any
such subcontract; such action shall constitute the consent of Lockheed
as required by this paragraph (b).
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c. Contractor agrees that no subcontract or purchase order placed
under this subcontract shall provide for payment on a cost-plus-a-per-
centage-of-cost basis.
d. The Contracting Officer may, in its discretion, specifically
approve in writing any of the provisions of a subcontract. However,
such approval or the consent of the Contracting Officer obtained as
required by this clause shall. not be construed to constitute a determi-
nation of the allowability of an ost under this subcontract, unless
such approval specifically;.provides'that it constitutes a determination
of the allowability of such cost.
e. Contractor shall give Lockheed and the Contracting Officer
immediate notice-in writing of any action or suit filed, and prompt
notice of any claim made against Contractor by any subcontractor or
vendor which, in`the opinion of Contractor, may result in litigation,
related in any way to this subcontract with respect to which Contractor
may be entitled to reimbursement from Lockheed.
ARTICLE 13 - UTILIZATION OF SMALL BUSINESS CONCERNS
a. It is the ,policy of the Government as declared by the Congress
to bring about the greatest utilization of small business concerns which
is consistent with efficient production.
b. Contractor agrees to accomplish the maximum amount of sub-
contracting to small business concerns that Contractor finds to be
consistent with the efficient performance of this subcontract.
:ARTICLE 14 - TERMINATION
a. The performance of work under this subcontract may be terminated
by Lockheed in accordance with this article in whole, or from time to
time in part, (i) whenever Contractor shall default inperformance
of this subcontract in accordance with its terms (including in the term
"default" any such failure by Contractor to make .progress in the prose-
cution of the work hereunder as endangers such performance), and shall
fail to cure such default within a period of ten days`(or such longer
periods as Lockheed may allow) after receipt from Lockheed of a notice
specifying the default, or (ii) in the event of the institution of any
proceedings by or against Contractor in bankruptcy or insolvency or
under any provisions of the Bankruptcy Act or for the appointment of a
receiver or trustee or an assignment for the benefit of Contractor's
creditors, or (iii) whenever for any reason Lockheed shall determine
that such termination is necessary. Any such termination shall be
effected by delivery to Contractor of a Notice of Termination specify-
ing the reason for such termination, the extent to which performance
of work under the subcontract is terminated, and the date upon which
such termination becomes effective. If, after notice of termination
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of this subcontract for default under (i) above, it is determined that
Contractor's failure to perform or to make progress in performance is
due to causes beyond the control and without the fault or negligence
of Contractor pursuant to the provisions of the article of this sub-
contract entitled "Excusable Delays," the Notice of Termination
shall be deemed to have been issued under (iii) 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 other-
wise directed by Lockheed, Contractor shall (i) stop work under the
subcontract on the date and to the extent specified in the Notice of
Termination; (ii) place no further orders or subcontracts for materials,
services or facilities except as may be necessary for completion of
such portion of the work under the subcontract as is not terminated;
(iii) terminate all orders and subcontracts to the extent that they
relate to the performance of work terminated by the Notice of Termi-
nation; (iv) assign to Lockheed, in the manner and to the extent
directed by Lockheed, all of the right, title and interest of Con-
tractor under the orders or subcontracts so terminated, in which
case Lockheed shall have the right in its discretion to settle or
pay any or' all claims arising out of the termination of such orders
and subcontracts; (v) with the approval or ratification of Lockheed,
to the extent it may require, which approval or ratification shall
be final and conclusive for all purposes of this article, settle all
outstanding liabilities and all claims arising out of such termination
of orders and subcontracts, the cost of which would be reimbursable, in
whole or in part, in accordance with the provisions of this subcontract;
(vi) transfer title (to the extent that title has not already been
transferred) and, in the manner, to the extent and at the times di-
rected by Lockheed, deliver to Lockheed (A) the fabricated parts 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,
(B) the completed or partially completed plans, drawings, information
and other property which, if the subcontract had been completed, would
be required to be furnished to Lockheed, and (C) the ) jigs, dies and
fixtures, and other special tools and tooling acquired or manufactured,
for the performance of this subcontract, for the cost of which Con-
tractor has been or will be reimbursed under this subcontract; (vii)
use its best efforts to sell in the manner, at the time, to the extent,
and at the price or prices directed or authorized by Lockheed, any
property of the types referred to in provision (vi) of this'paragraph;
provided, however, that Contractor (A) shall not be required to extend
credit to any purchaser, and (B) may acquire any such property under
the conditions prescribed by and at a price or prices approved by
Lockheed; and provided, further, that the proceeds of any such transfer
or disposition shall be applied in reduction of any payments to be made
by Lockheed to Contractor under this subcontract or shall otherwise be
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credited to the price or cost of the work covered by this subcontract
or paid in such other manner as Lockheed may direct, (viii) complete
performance of such part of the work as shall not have been terminated
by the Notice of Termination; and (ix) take such action as may be
necessary; or as Lockheed may direct, for the protection and preserva-
tion of the property related.to this subcontract which is in the
possession of Contractor and in which Lockheed or the Government have
or may acquire an interest. Contractor shall proceed immediately with
.the performance of the above obligations notwithstanding any delay in
determining or adjusting the amount of the fixed fee or any item or
reimbursable cost, under this article.
c. After receipt of a Notice of Termination, Contractor shall
submit to Lockheed its termination claim in the form and with the
certification prescribed by Lockheed. Such claim shall be submitted
promptly but in no event later than twelve (12) months from the
effective date of termination, unless one or more extensions in writing
are granted by Lockheed upon request of Contractor made in writing within
such twelve (12) month period or authorized extension thereof. However,
if Lockheed determines that the facts justify such action, it may receive
and act upon any such termination claim at any time after such twelve
(12) month period or any extension thereof. Upon failure of Contractor
to submit its termination claim within the time allowed, Lockheed shall
determine, with the approval of the Contracting Officer, on the basis
of information available to it, the amount, if any, due to Contractor
by reason of the termination and shall thereupon pay to Contractor
the amount so determined.
d. Subject to the provisions of paragraph (c), Contractor and
Lockheed may agree upon the whole or any part of the amount or amounts
to be paid (including an allowance for the fixed fee) to Contractor
by reason of the total or partial termination of work pursuant to this
article. Said purchase order shall be amended accordingly, and Con-
tractor shall be paid the agreed amount.
e. In the event of the failure of Contractor and Lockheed to agree
in whole or in part, as provided in paragraph (d) above, as to the amounts
with respect to costs and fixed fee or as to the amount of the fixed fee,
to be paid to Contractor in connection with the termination of work pursu-
ant to this article, Lockheed shall determine, on the basis of information
available to it, the amount, if any, due to Contractor by reason of the
termination and shall pay to Contractor the amount determined as follows:
(i) If the settlement includes cost and fixed fee
(A) There shall be included therein all costs and expenses
reimbursable in accordance with this subcontract, not
..previously paid to Contractor for the performance of
this subcontract prior to the effective date of the
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Notice of Termination, and such of these costs as may
continue for a reasonable time thereafter with the
approval of or as directed by Lockheed; provided, however,
that Contractor shall proceed as rapidly as practicable
to discontinue such costs.
(B) There shall be included therein, so far as not included
under (A) above, the cost of settling and paying claims
arising out of the termination of work under subcontracts
or orders, as provided in paragraph (b) (v) above, which
are properly chargeable to the terminated portion of this
subcontract.
(C) There shall be included therein the reasonable costs of
settlement, including accounting, legal, clerical and other
expenses reasonably necessary for the preparation of settle-
ment claims and supporting data with respect to the termi-
nated portion of the subcontract and for the termination and
settlement of purchase orders and subcontracts thereunder,
together with reasonable storage, transportation, and other
costs incurred in connection with the protection or dispo-
sition of termination inventory; provided, however, that
if the termination is for a reason specified in paragraph
(a) (i) or (a) (ii) of this Article 14 there shall not be
included any amounts for the preparation of Contractor's
settlement proposal.
(D) There shall be included therein a portion of the fixed fee
payable under the subcontract determined as follows:
(1)
In the event of the termination of this subcontract
pursuant to paragraph (a) (iii) of this Article 14,
there shall be paid a percentage of the fee equivalent
to the percentage of the completion of work contemplated
by this subcontract, less fixed fee payments previously
made hereunder.
(2) In the event of the termination of this subcontract for
the reasons specified in paragraph (a) (i) and (ii,)
this Article 14+, the total fixed fee payable shall
be such proportionate part of the fee (or, if this
subcontract calls for supplies of different types, of
such part of the fee as is reasonably allocable to the
type of supplies under consideration) as the total
number of supplies delivered to and accepted by Lockheed
bears to the total number of supplies of a like kind
called for by this. subcontract. If the amount
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determined under this paragraph is less than the
total payment of fixed fee theretofore made to
Contractor, Contractor shall repay to Lockheed
the excess amount.
(ii) If the settlement includes only the fixed fee, the amount
thereof will be determined in accordance with subparagraph
(e) (i) (D) above.
f. In arriving at the amount due Contractor under this article there
shall be deducted (i) all unliquidated advance or other unliquidated payments,
theretofore made to Contractor, (ii) any claim which Lockheed may have against
Contractor in connection with this subcontract, and (iii) the agreed price for,
or the proceeds of sale of, any materials, supplies or other things acquired
by Contractor or sold pursuant to the provisions of this article and not other-
wise recovered by or credited to Lockheed.
g. In the event of a partial termination, the portion of the fixed fee
which is payable with respect to the work under the continued portion of the
subcontract shall be equitably adjusted by agreement between Contractor and
Lockheed, and such adjustment shall be evidenced by an amendment to said
purchase order.
h. Lockheed 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 Contractor in connection with the terminated portion of the sub-
contract whenever in the opinion of Lockheed the aggregate of such payments
shall be within the amount to which Contractor will be entitled hereunder. If
the total of such payments is in excess of the amount finally determined to be
due under this article, such excess shall be payable by Contractor to Lockheed
upon demand, together with interest computed at the rate of six per cent (6%)
per annum, for the period from the date such excess payment is received by
Contractor to the date on which such excess is repaid to Lockheed; provided,
however, that no interest shall be charged with respect to any such excess pay-
ment, attributable to a reduction in Contractor's claim by reason of retention
or other disposition or termination inventory until ten (10) days after the date
of such retention or disposition.
i. The provisions of this article relating to the fixed fee shall be
inapplicable if this contract does not provide for payment of a fixed fee,
ARTICLE 15 - EXCUSABLE DELAYS
4V a. Contractor shall not be in default by reason of any failure in per-
formance of this subcontract in accordance with its terms (including any failure
by Contractor to make progress in the prosecution of the work hereunder which
endangers such performance) if such failure arises out of causes beyond the
control and without the fault or negligence of Contractor. Such causes
include, but are not restricted to: acts of God or of the public enemy; acts
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of the Government; fires; floods; epidemics; quarantine restrictions; strikes;
freight embargoes; unusually severe weather; and failure of lower-tier sub-
contractors to perform or make progress due to such causes, unless Lockheed
shall have determined that the supplies or services to be furnished under the
lower-tier subcontract were obtainable from other sources and shall have ordered
Contractor in writing to procure such services or supplies from such other
sources, and Contractor shall have failed reasonably to comply with such order,
Contractor shall promptly notify Lockheed of any anticipated failure of perfor-
mance by reason of such causes. Upon request of Contractor, Lockheed shall
ascertain the facts and extent of such failure and if it shall determine that
such failure was occasioned by any one or more of the said causes, the delivery
schedule shall be revised accordingly, subject to the rights of Lockheed and
the Government under the Article hereof entitled "Termination".
b. If Contractor, by reason of a cuase, or,causes, other than those
specified in (a) above, will be unable to complete the contract work and make
delivery at the time specified in said purchase orders, it may give Lockheed
written notice of the anticipated default with the reasons therefor, provided
such notice is given not less than forty-five (45) days before the delivery
dates specified in said purchase order or within such time as Lockheed deems
sufficient. If such notice is duly given, then, to the extent the interest of
Lockheed makes an extension desirable, Lockheed may, in its discretion, extend
the period of time specified in said purchase order for such period as it deems
advisable, and the said purchase order shall then be modified in writing accordingly.
ARTICLE 16 - BUY AMERICAN ACT
Contractor agrees that there will be delivered under this subcontract only
such unmanufactured articles, materials, and supplies (which term "articles,
materials, and supplies" is hereinafter referred to in this article as "supplies")
as have been mined or produced 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 American Act (41 U.S. Code lOa-d), the foregoing provision
shall not apply (i) with respect to supplies excepted by the Secretary from the
application 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 subcontract
which are of a class or kind determined 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 subcontract are manufactured, as are
of a class or kind determined 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, 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 sufficient and reasonably available commercial quanties
and of a satisfactory quality
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ARTICLE 17 - EIGHT-HOUR LAW OF 1912
This subcontract, to the extent that it is of a character specified
in the Eight-Hour Law of 1912 as amended (40 U.S. Code 324-326) 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 provisions and exceptions of said Law:
No laborer or mechanic doing any part of the work contemplated by this
subcontract, in the employ of Contractor or any subcontractor contracting for
any part of the said work, 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 article. The wages of every such laborer and mechanic em-
ployed by Contractor or any subcontractor engaged in the performance shall be
computed on a basic day rate of eight hours per day; and work in excess of
eight hours per day is permitted only upon the condition that every such laborer
and mechanic shall be compensated for all hours 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 article a penalty of five dollars
shall be imposed upon 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 accordance
with this article; and all penalties thus imposed shall be withheld for the use
and benefit of the Government.
ARTICLE 8 - WALSH-HEALEY PUBLIC CONTRACTS ACT
If this subcontract is for the manufacture or furnishing of materials,
supplies, articles or equipment in an amount which exceeds or may exceed
$10,000 and is otherwise subject to the Walsh-Healey Public Contracts Act as
amended (41 U.S. Code 35-45), there are hereby incorporated by reference all
representations 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 interpretations of the Secretary
of Labor which are now or may hereafter be in effect.
ARTICLE 19 - NONDISCRIMINATION IN EMPLOYMENT
a. In connection with the performance of work under this subcontract,
the Contractor agrees not to discriminate against any employee or applicant
for employment because of race, creed, 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 termination; rates of pay or other forms of compensa-
tion; and selection for training, including apprenticeship. Contractor
agrees to post hereafter in conspicuous places, available for employees
and applicants for employment, notices which Contractor shall obtain from
the Government setting forth the provisions of the nondiscrimination clause.
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b. Contractor further agrees to insert the foregoing provision in
all subcontracts hereunder except subcontracts for standard commercial
supplies or raw materials.
ARTICLE 20 - NOTICE TO LOCKHEED AND TO THE GOVERNMENT OF LABOR DISPUTES
Whenever Contractor has knowledge that any actual or potential labor
dispute is delaying or threatens to delay the timely performance of this sub-
contract, Contractor shall immediately give notice thereof, including all
relevant information with respect thereto, to Lockheed and to the Contracting
Officer.
ARTICLE 21 - CONVICT LABOR
In connection with the performance of work under this subcontract,
Contractor agrees not to employ any person undergoing sentence of imprisonment
at hard labor.
ARTICLE 22 - GOVERNMENT PROPERTY
a. Title to all property purchased by Contractor, for the cost of which
Contractor is entitled to be reimbursed as a direct item of cost under this
subcontract, shall pass to and vest in the Government upon delivery of such
property by the vendor. Title to other property, the cost of which is
reimbursable to Contractor under this subcontract, shall pass to and vest in
the Government upon (i) issuance for use of such property in the performance
of this subcontract, or (ii) commencement of processing or use of such property
in the performance of this subcontract, or (iii) reimbursement of the cost
thereof by Lockheed, whichever first occurs.
b. All property owned by the Government which is furnished by Lockheed
or the Government to Contractor in connection with the performance of this
subcontract, together with all property acquired by Contractor title to which
vests in the Government pursuant to paragraph (a) of this article, are
collectively referred to in this article as "Government Property". If the
delivery or performance dates for the supplies or services to be furnished by
Contractor under this subcontract are based upon the expectation that Government-
Furnished Property suitable for use will be delivered to Contractor at the
times stated in said purchase order or, if not so stated, in sufficient time
to enable Contractor to meet such delivery or performance dates; then upon
timely written request made by Contractor, Lockheed will make a determination
of the delay occasioned Contractor and shall equitably adjust the estimated cost,
fixed fee, or delivery or performance dates or all of them, and any other
contractual provisions affected by such delay in accordance with the procedures
provided for in the clause of this subcontract entitled "Changes" (Article 3).
In the event that Government-Furnished Property is received by Contractor in a
condition not suitable for the intended use,. Contractor shall upon receipt
thereof notify Lockheed of such fact and as directed by the Contracting Officer
either (i) return such property at Government expense or otherwise dispose of the
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property, or (ii) effect repairs or modification. Upon completion of (i) or (ii)
above and upon written request of Contractor, Lockheed shall equitably adjust
the estimated cost, fixed fee, or delivery or performance dates, or all of them,
and any other contractual provision affected by the return, disposition, repair
or modification, in accordance with the procedures provided for in Article 3
of this subcontract. The foregoing provisions for adjustment are exclusive
and Lockheed shall not be liable to suit for breach of contract by reason of
any delay in delivery of Government-Furnished Property or delivery of such
property in a condition not suitable for its intended use.
c. Title to Government Property shall not be affected by the incorporation
or attachment thereof to any property not owned by the Government, nor shall
such Government Property, or any part thereof, be or become a fixture or lose
its identity as personality by reason of affixation to any realty. Contractor
shall establish and operate a system acceptable to Lockheed for maintenance of
property control records and identification of the Government Property in
accordance with the requirements of the "Manual for the Control of Government
Property in Possession of Contractors" (Appendix B, Armed Services Procurement.".
Regulation), as in effect on the date of the prime contract, which manual is
hereby incorporated by reference and made a part of this subcontract.
d. The Government Property provided or furnished pursuant to the term of
this subcontract shall, unless otherwise provided herein, be used only for the
performance of this subcontract.
e. Contractor shall maintain and administer in accordance with sound
industrial practice, a program for the maintenance, repair, protection and
preservation of Government Property so as to assure its full availability and
usefulness for the performance of this subcontract. Contractor shall take all
reasonable steps to comply with all appropriate directions or instructions
which Lockheed or the Contracting Officer may prescribe as. reasonably necessary
for the protection of Government Property.
f. (i) Contractor shall not be liable for any loss of or damage to the
Government Property, or for expenses incidental to such loss or damage, except
that Contractor shall be responsible for any such loss or damage (including
expenses incidental thereto) (A) which results from wilful misconduct or lack
of good faith on the part of any of Contractor's directors or officers, or on.
the part of any of its managers, siperintendents, or other equivalent represen-
tatives, who has supervision or direction of (I) all or substantially all of
Contractor's business, or (II) all or substantially all of Contractor's operations
at any one plant or separate location in which this subcontract is being performed,
or (III) a separate and complete major industrial operation in connection with
the performance of this subcontract; or (B) which results from a failure on the
part of Contractor due to the wilful misconduct or lack of good faith on the
part of any of its directors, officers, or other representatives mentioned in
subparagraph (A) above, (I) to maintain and administer, in accordance with
sound industrial practice, the program for maintenance, repair protection and
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and preservation of Government Property as required by paragraph (d) hereof,
or (II) to take all reasonable steps to comply with any appropriate written
directions of the Contracting Officer under paragraph (d) hereof, or (C) for
which Contractor is otherwise responsible under the express terms of this
subcontract; or (D) which results from a risk expressly required to be insured
under this subcontract, but only to the extent of the insurance so required
to be procured and maintained, whichever is greater; or (E) which results from
a risk which is in fact covered by insurance or for which Contractor is other-
wise reimbursed, but only to the extent of such insurance or reimbursement;
provided that, if more than one of the above exceptions shall be applicable in
any case, Contractor's liability under any one exception shall not be limited
by any other exception. This Article shall not be construed as relieving a
lower-tier subcontractor from liability for loss or destruction of or damage
to Government Property in its possession or control, except to the extent that
the lower-tier subcontract, with the prior approval of Lockheed or the Govern-
ment, may provide for the relief of the lower-tier subcontractor from such
liability. In the absence of such approval, the lower-tier subcontract shall
contain appropriate provisions requiring the return of all Government Property
in as good condition as when received, except for reasonable wear and tear or
for the utilization of the property in accordance with the provisions of the
prime contract.
(ii) Contractor shall not be reimbursed for, and shall not include as
an item of overhead, the cost of insurance, or any provision for a reserve,
covering the risk of loss of or damage to the Government Property, except
to the extent that Lockheed may have required Contractor to carry such insurance
under any other provision of this subcontract.
(iii) Upon the happening of loss or destruction of or damage to the
Government Property, Contractor shall notify Lockheed and the Contracting
Officer thereof, and shall communicate with the Loss and Salvage Organiza-
tion, if any, now or hereafter designated by the Contracting Officer, and
with the assistance of the Loss and Salvage Organization so designated (un-
less the Contracting Officer has designated that no such organization be em-
ployed), shall take all reasonable steps to protect the Government Property
from further damage, separate the damaged and undamaged Government Property,
put all the Government Property in the best possible order, and furnish to
Lockheed and the Contracting Officer a statement of (A) the lost, destroyed
and damaged Government Property, (B) the time and origin of the loss, destruc-
tion or damage, (C) all known interest in the commingled property of which the
Government Property is a part, and (D) the insurance, if any, covering any part
of or interest in such commingled property. Contractor shall make repairs and
renovations of the damaged Government Property or take such other action as Lockheed
directs.
(iv) In the event Contractor is indemnified, reimbursed, or otherwise com-
pensated for any loss or destruction of or damage to the Government Property, it
shall use the proceeds to repair, renovate or replace the Government Property
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involved, or shall credit such proceeds against the cost of the work covered
by the subcontract, or shall otherwise reimburse Lockheed or the Government,
as directed by Lockheed. Contractor. shall do nothing to predudice the Govern-
ment's right to recover against third parties for any such loss, destruction
or damage and, upon the request of Lockheed or the Contracting Officer, shall,
at Lockheed's or the Government's expense, furnish to the Government and Lock-
heed all reasonable assistance and cooperation (including the prosecution of
suit and the execution of instruments of assignment in favor of the Government)
in obtaining recovery. In addition, where a lower-tier subcontractor has not
been relieved from liability for any loss or destruction of or damage to Govern-
ment Property, Contractor shall enforce liability of the lower-tier subcontractor
for such loss or destruction of or damage to the Government Property for the
benefit of the Government.
g. Lockheed and the Government shall at all reasonable times have access
to the premises where any of the Government Property is located.
h. The Government Property shall remain in the possession of Contractor
for such period of time as is required for the performance of this subcontract
unless Lockheed or the Contracting Officer determines that the interests of the
Government require removal of such .property. In such case Contractor shall
promptly take such action as Lockheed or the Contracting Officer may direct with
respect to the removal and shipping of Government Property. In any such instance,
the subcontract may be amended to accomplish an equitable adjustment in the terms
and provisions thereof.
i. Upon-the completion of this subcontract, or at such earlier date as
may be fixed by Lockheed or the Contracting Officer, Contractor shall submit
to Lockheed, in acceptable form, inventory schedules covering all items of
the Government Property not consumed in the performance of this subcontract
(including any resulting scrap), or not theretofore delivered to Lockheed or
the Government, and shall deliver or make such other disposal of the Government
Property as may be directed by Lockheed or the Contracting Officer. Recoverable
scrap shall be reported in accordance with a procedure and in such form as Lock-
heed or the Contracting Officer may direct. The net proceeds of any such dis-
posal approved by Lockheed or the Contracting Officer shall be credited to the
cost of the work covered by the subcontract or shall be paid in such manner as
Lockheed or the Contracting Officer may direct.
J. Unless otherwise provided herein, Lockheed or the Government shall
not be under any duty or obligation to restore or rehabilitate or to pay the
costs of the restoration or rehabilitation of Contractor's plant or any portion
thereof which is affected by the removal of any Government Property.
. k. Directions of Lockheed and the Contracting Officer and communications
of Contractor issued pursuant to this article shall be in writing.
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ARTICLE 23 - PRIORITIES, ALLOCATIONS AND ALLOTMENTS
Contractor agrees, in the procurement and use of materials required for
the performance of this subcontract, to comply with the provisions of all
applicable rules and regulations of the Business and Defense Services Adminis-
tration, including Defense Materials System regulation.
ARTICUE 24 - OFFICIALS NOT TO BENEFIT
No member of or delegate to Congress, or Resident Commissioner, shall be
admitted to any share or part of this subcontract or to any benefit that may
arise therefrom; but this provision shall not be construed to extend to this
subcontract if made with a corporation for its general benefit.
QV ARTICLE 25_= INDEPENDENT CONTRACTOR
It is understood and agreed that Contractor shall be deemed to be an
independent contractor in all its operations and activities hereunder; and
that the employees furnished by Contractor to perform work on this project shall
be deemed to be Contractor's employees exclusively without any relation whatever
to Lockheed as employees or as independent contractors; that said employees shall
be paid by Contractor for all services in this connection; that Contractor shall
carry workmen's compensation insurance and that Contractor shall be responsible
for all obligations and reports covering social security, unemployment insurance,
workmen's compensation, income tax, and other reports and deductions required
by State and/or Federal law.
ARTICLE 26 - PATENT RIGHTS
a. As used in this article, the following terms shall have the meanings
set forth below:
(1) The term "Subject Invention" means any invention, improvement or
discovery (whether or not patentable) conceived'or first
actually reduced to practice either--
(A) in the performance of the experimental, developmental,
or research work called for or required under this
subcontract, or
(B) in the performance of any experimental, developmental,
or research work relating to the subject matter of
this subcontract which was done upon an understanding
in writing that a subcontract would be awarded; pro-
vided that the term "Subject Invention" shall not
include any invention which is specified in said pur-
chase order as being excluded from the license granted
by this article.
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(ii) The term "Technical Personnel" means any person employed by
or working under contract with Contractor (other than a
subcontractor whose responsibilities with respect to rights
accruing to the Government in inventions arising under
subcontracts are set forth in paragraphs (g), (h), and (i)
of this article) who, by reason of the nature of his duties
in connection with the performance of this subcontract,
would reasonably be expected to make inventions.
(iii) The terms "subcontract" and "subcontractor" mean any
subcontract or subcontractor of Contractor, and any
lower-tier subcontract or subcontractor under this subcontract.
b. (1) Contractor agrees to and does hereby grant to Lockheed and the
Government an irrevocable, nonexclusive, nontransferable, and royalty-free
license to practice, and cause to be practiced by or for Lockheed and the
United States Government, throughout the world, each Subject Invention in
the manufacture, use and disposition according to law, of any article or
material, and in the use of any method. No license granted herein shall
convey any right to the Government to manufacture, have manufactured, or
use any Subject Invention for the purpose of providing services or supplies
to the general public in competition with Contractor or Contractor's commer-
cial licensees in the licensed field.
(2) With respect to:
(i) any Subject Invention made by other than Technical Personnel;
(ii) any Subject Invention conceived prior to, but first actually
reduced to practice in the course of, any of the experimental,
developmental, or research work specified in (a) (i) above;
and
(iii)the practice of any Subject Invention in foreign countries;
the obligation of Contractor to grant a license as provided
in (b) (1) above, to convey title as provided in (d) (ii) (B) or
(d) (iv) below, and to convey foreign rights as provided in
(e) below, shall be limited to the extent of Contractor's
right to grant the same without incurring any obligation to
pay royalties or other compensation to others solely on
account of said grant. Nothing contained in this Patent
Rights article shall be deemed to grant any license under
any invention other than a Subject Invention.
c. Contractor shall furnish to the Contracting Officer through Lockheed
the following information and reports concerning Subject Inventions which
reasonably appear to be patentable:
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(i) a written disclosure promptly after conception or first
actual reduction to practice of each such Invention together
with a written statement specifying whether or not a United
States patent application claiming the Invention has been or
will be filed by or on behalf of Contractor:
(ii) Interim reports, at least every twelve months, commencing with
the date of this subcontract, each listing all such inventions
conceived or first actually reduced to practice more than three
months prior to the date of the report, and not listed on a prior
interim report, or certifying that there are no such unreported
inventions; and.
(iii)prior to final settlement of this subcontract, a final report
listing all such inventions including all those previously listed
in interim reports.
d. In connection with each Subject Invention referred to in (c) (i)
above, Contractor shall do the following:
(i)- if Contractor specifies that a United States patent application
claiming such invention will be filed, Contractor shall file or
cause to be filed such application in due form and time; however,
if Contractor, after having specified that such an application
would be filed, decides not to file or cause to be filed said
application, Contractor shall so notify the Contracting Officer
through Lockheed at the earliest practicable date and in any event
not later than eight months after first publication, public use or sale.
(ii) if Contractor specifies that United States patent application
claiming such invention has not been filed and will not be filed
(or having specified that such an application will be filed there-
after notifies the Contracting Officer with copies to Lockheed
to the contrary), Contractor shall:
(A). inform the Contracting Officer through Lockheed in writing
at the earliest practicable date of any publication of such
invention made by or know to Contractor or, where applicable,
of any contemplated publication by Contractor, stating the
date and identity of such publication or contemplated publication;
and
(B) convey to the Government the Contractor's entire right, title,
and interest in such invention by delivering to the Contracting
Officer through Lockheed upon written request such duly executed
instruments (prepared by the Government) or assignment and
application, and such other papers as are deemed necessary
to vest in the Government Contractor's right, title, and interest
aforesaid, and the right to apply for and prosecute patent
applications covering such invention throughout the world,
subject, however, to the right of the Contractor specified
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in (e) below to file foreign applications, subject to
the reservation of the license granted by Contractor
to Lockheed pursuant to paragraph (b) of this article,
and subject further to the reservation of a nonexclusive
and royalty-free license to Contractor (and to its
existing and future associated and affiliated companies,
if any, within the corporate structure of which Contractor
is a part) which license shall be assignable to the
successor of that part of Contractor's business to which
such-Invention pertains;
nine months from the date a corresponding United States
application is filed;
(ii) six months from the date permission is granted to file
foreign applications where such filing had been prohibited
for security reasons;
(iii) such longer period as may be approved by the Contracting
Officer. Contractor shall, upon written request of the
Contracting Officer through Lockheed, convey to the Government
(iii) Contractor shall furnish promptly to Lockheed and the Contract-
ing Officer on request an irrevocable power of attorney to
inspect and make copies of each United States patent appli-
cation filed by or on behalf of Contractor covering any such
invention;
(iv) in the event Contractor, or those other than the Government
deriving rights from Contractor, elects not to continue pro-
secution of any such United States patent application filed
by or on behalf of Contractor, Contractor shall so notify
the Contracting Officer via Lockheed not less than sixty days
before the expiration of the response period and, upon written
request, deliver to the Contracting Officer through Lockheed
such duly executed instruments (prepared by the Government)
as are deemed necessary to vest in the Government Contractor's
entire right, title, and interest in such invention and the
applications, subject to the reservations as specified in
(d) (ii) above; and
(v) Contractor shall deliver to Lockheed and the Contracting
Officer duly executed instruments fully confirmatory of any
license rights herein agreed to be granted to Lockheed and
the Government.
e. Contractor, or those other than the Government deriving rights from
Contractor, shall have the exclusive rights to file applications on Subject
Inventions in each foreign country within:
(i)
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Contractor's entire right, title and interest in each
Subject Invention in each foreign country in which an
application has not been filed within the time above
specified, subject to the reservation of a nonexclusive
and royalty-free license to Contractor and Lockheed together
with the right of Contractor and Lockheed to grant sublicenses,
which license and right shall be assignable to the successor
to that part of Contractor's or Lockheed's business to which
the Subject Invention pertains.
f. Contractor shall exert all reasonable effort in negotiating for the
inclusion of this Patent Rights clause in any subcontract hereunder of three
thousand dollars ($3,000) or more having experimental, developmental, or re-
search work as one of its purposes. In the event of refusal by a subcontractor
to accept the Patent Rights clause, Contractor shall not. proceed with the sub-
contract without written authorization of Lockheed, and upon obtaining such
authorization, shall cooperate with Lockheed in the negotiation with such sub-
contractor of an acceptable patent rights clause; provided, however, that Con-
tractor shall in any event require the subcontractor to grant the Government
and Lockheed patent rights under Subject Inventions of no less scope and on no
less favorable terms than those which Contractor has under such subconracts,
except that in no event shall the subcontractor be required to grant to Lockheed
and the Government patent rights in excess of those herein agreed to be granted
to Lockheed and the Government by Contractor.
g. Contractor shall, at the earliest practicable date, notify the Contract-
ing Officer and Lockheed in writing of any subcontract, containing a patent rights
clause, furnish the Contracting Officer and Lockheed a copy of such clause, and
notify the Contracting Officer and Lockheed when such subcontract is completed.
It is understood that with respect to such subcontract clause, Lockheed and the
Government are third party beneficiaries; and Contractor hereby assigns to the
Government and Lockheed all the rights that Contractor would have to enforce
the subcontractor's obligations for the benefit of the Government and Lockheed
with respect to Subject Inventions. Contractor shall not be obligated to enforce
the agreements of any subcontractor hereunder relating to Subject Inventions.
h. When Contractor shows that it has been delayed in the performance of
this subcontract by reason of its inability to obtain in accordance with (f)
above a suitable patent rights clause from a qualified subcontractor for any
item or service required under this subcontract for which Contractor itself
does not have available facilities or qualified personnel Contractor's delivery
dates shall be extended for a period of time equal to the duration of such delay;
and, upon request of Contractor, Lockheed shall determine to what extent, if any,
an additional extension of the delivery dates and an increase in contract prices
based upon additional costs incurred by such delay are proper under the circum-
stances; and the subcontract shall be modified accordingly. If Contractor,
after exerting all reasonable effort, is unable to obtain a qualified subcontractor
as set forth above, Contractor may submit to Lockheed a written request for waiver
or modification of the requirement that a suitable patent rights clause be
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included in the subcontract. Such request shall specifically state that
Contractor has used all reasonable effort to obtain such qualified subcontractor,
and shall cite the waiver or termination provision hereinafter set forth. If,
within thirty-five (35) days after the date of receipt of such request for a
waiver or modification of said requirement, Lockheed shall fail to deny in writing
such request,, the requirement shall be deemed to have been waived by Lockheed.
If within such period "Contractor shall receive a written denial of such request
by Lockheed, this subcont act shall thereupon automatically terminate and the
rights and obligations of the parties shall be governed by the provisions of
the article of this subcontract entitled "Termination".
i. Contractor shall, prior to final payment, furnish Lockheed with the
following:
(i) A list of all patents, if any, issued on Subject Inventions under
this subcontract;
(ii) A list of all Subject Inventions, if any, not yet reduced to a
patent but which are or will be the subject of a patent application;
(iii)A statement that there are no patented or patentable Subject Inven-
tions if, in fact, there are none.
tARTICLE 27 - FILING OF PATENT APPLICATIONS
a. Before filing or causing to be filed a patent application disclosing
any subject matter of this subcontract, which subject matter is classified
"Secret" or higher, Contractor shall, citing the thirty (30) day provision below,
transmit. the proposed application through Lockheed to the Contracting Officer
for determination whether, for reasons of national security, such application
should be placed under an order of secrecy of sealed in accordance with the
provisions of 35 U. S. Code 181-188 or the issuance of a patent should be other-
wise delayed under pertinent statutes or regulations; and Contractor shall ob-
serve any instructions of the Contracting Officer with respect to the manner
of delivery of the patent application to the U. S. Patent Office for filing,
but Contractor shall not be denied the right to file such. patent application.
If the Contracting Officer shall not have given any such instructions within
thirty (30) days from the date of mailing or other transmittal of the proposed
application, Contractor may file the application.
b. Contractor shall furnish to Lockheed and the Contracting Officer, at
the time of or prior to the time when Contractor files or causes to be filed
a patent application disclosing any subject matter of this subcontract, which
subject matter is classified "Confidential", a copy of such application should
be placed under an order of secrecy or the issuance of a patent should be other-
wise delayed under pertinent statutes or regulations.
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c. In filing any patent application coming within the scope of this
article, Contractor shall observe all applicable security regulations
covering the transmission of classified subject matter.
ARTICLE 28 - NOTICE AND ASSISTANCE REGARDING PATENT INFRINGEMENT
a. Contractor shall report to Lockheed, promptly and. in reasonable
written detail, each notice or claim of patent infringement based on the
performance of this subcontract, or any subcontract hereunder of which
Contractor has knowledge.
b. In the event of litigation against the Government and/or Lockheed
on account of any claim of infringement arising out of the performance of
this subcontract or out of the use of any supplies furnished or services
performed hereunder, Contractor agrees that it will furnish to the Govern-
ment and/or Lockheed, upon request, all evidence and information in its
possession pertaining to such litigation. Such evidence and information
shall be furnished at the expense of the Government and/or Lockheed,
except in those cases in which Contractor has agreed to indemnify the
Government and/or Lockheed against the claim being asserted.
XNARTICLE 29 - REPORTING OF ROYALTIES
If this contract is in an amount which exceeds $10,000, the Contractor
agrees to report in writing to Lockheed, during the performance of this
contract and prior to its completion or final settlement, the amount of
any royalties or royalty rates paid or to be paid by it directly to others
in connection with the performance of this contract, together with the
names and addresses of licensors to whom such payments are made and either
the patent numbers involved or such other information as will permit
identification of the patents or other basis on which royalties are to
be paid. If this contract is in an amount which exceeds $10,000, and no
royalties or royalty rates are paid or to be paid directly to others
under the circumstances set forth above, the Contractor agrees'so to
report in writing to Lockheed prior to completion or final settlement
of this contract.
ARTICLE 30 - PAYMENT OF ROYALTIES
Payments by Contractor of any sum for royalties or patent rights
not included in the ordinary purchase price of standard commercial supplies
shall not constitute items of allowable cost hereunder, unless and until
approved by Lockheed and the Contracting Officer. Reimbursement to
Contractor on account of any such payments shall not be construed as an
admission by Lockheed and/or the Government of the enforceability, validity
or scope of, or title to any of the patents involved, nor shall any such
reimbursement constitute a waiver of any rights or defenses respecting
such patents.
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ARTICLE 31 - AUTHORIZATION AND CONSENT
The prime contract under which this is a subcontract contains a
section in which the Government gives authorization and consent with
respect to patented inventions, as follows:
"AUTHORIZATION AND CONSENT - - The Government hereby gives,
its authorization and consent for all use and manufacture
of any patented invention in the performance of this con-
tract or any part hereof or any amendment hereto or any
subcontract hereunder (including any lower-tier subcon-
tract)."
ARTICLE 32 - EXCESS PROFIT
The Contractor agrees that, unless otherwise provided by law, this
contract shall be subject to all the provisions of 10 U.S.C. 2382 and
7300 and shall be deemed to contain all the agreements required by
those sections; provided, however, that this clause shall not be con-
strued to enlarge or extend by contract the obligations imposed by
those section. The Contractor agrees to insert in the subcontracts
specified in those sections either the provisions of this clause or
the provisions required by those sections.
a. To the extent required by law, this contract is subject to the
Renegotiation Act of 1951 (P.L. 9, 82d Cong., 65 Stat 7) as amended
(P.L. 761+, 83d Cong., 68 Stat. 1116; P.L. 216, 84th Cong., 69 Stat 447),
and to any subsequent act of Congress providing for the renegotiation of
contracts. Nothing contained in this clause shall impose any renegotiation
obligation with respect to this contract or any subcontract hereunder
which is not imposed by an act of Congress heretofore or hereafter
enacted. Subject to the foregoing this contract shall be deemed to con-
tain all the provisions required by Section 104 of the Renegotiation Act
of 1951, and by any such other act, without subsequent contract amendment
specifically incorporating such provisions.
b. The Contractor agrees to insert the provisions of this clause,
including this paragraph b, in all subcontracts, as that term is defined
in section 103g of the Renegotaition Act of 1951 or in any subsequent
act of Congress providing for the renegotiation of contracts.
ARTICLE 34 - MILITARY SECURITY REQUIREMENTS
a. The provisions of this article shall apply to the extent that
this subcontract involves access to information classified "Confidential"
including "Confidential--Modified Handling Authorized" or higher.
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b. Lockheed shall notify Contractor of the security classification
of this subcontract and the elements thereof, and of any subsequent
revisions in such security classification, by the use of a Security
Requirements Check List (DD Forms 254 and 254+-1).
c. To the extent Lockheed has indicated as of the date of this
subcontract, or thereafter indicates, security classification under
this subcontract as provided in paragraph (b) above, Contractor shall
safeguard all classified elements of this subcontract 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 441), including the
Department of Defense Industrial Security Manual
for Safeguarding Classified Information as in effect
on the date of this subcontract, and any modifica-
tion to the Security Agreement for the purpose of
adapting the Manual to Contractor's business; and
(ii) any amendments to said Manual made after the date
of this subcontract, notice of which has been
furnished to Contractor by the Security Office of
the Military Department having security cognizance
over the facility.
d. Representatives of the Military Department having security
cognizance over the facility and representatives of the contracting
Military Department shall have the right to inspect at reasonable in-
tervals the procedures, methods, and facilities utilized by Contractor
in complying with the security requirements under this subcontract.
Should the Government, through these representatives, determine that
Contractor is not complying with the security requirements of this sub-
contract Contractor shall be informed in writing by the Security Office
of the cognizant Military Department of the proper action to be taken
in order to effect compliance with such requirements.
e. If subsequent to the date of this subcontract, the security
classifications or security requirements under this subcontract are
changed by the Government as provided in this article and if such
change causes an increase or decrease in the estimated cost of the
performance of this subcontract, the estimated cost and fixed fee shall,
to the extent appropriate, be subject to an equitable adjustment. Any
such equitable adjustment shall be accomplished in the manner set forth
in the changes article of this subcontract.
f. Contractor agrees to insert, in all subcontracts hereunder
which involve access to classified information, provisions which shall
conform substantially to the language of this article, including this
paragraph.
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g. Contractor also agrees that it shall determine that any sub-
contractor proposed by it for the furnishing of supplies and services
which will involve access to classified information in Contractor's
custody has been granted an appropriate facility security clearance,
which is still in effect, prior to being accorded access to such
classified information.
a ARTICLE 35 - NEW FEATURES OF DESIGN
In the event Contractor, prior to completion of work hereunder,
develops (i) any improvement in the design of the supplies called for
by this subcontract, which is not incorporated in the supplies delivered
hereunder, or (ii) any alternative or improved method of accomplishing
the objectives of this subcontract, which is not employed in the per-
formance hereof, Contractor shall promptly give full information with
respect thereto to Lockheed.
ARTICLE 36 - REPORTS OF WORK
Contractor shall submit reports making full disclosure of all
services done and the results hereof, in the manner, at the times and
to the extent set forth in said purchase order; provided, however,
that except as may be otherwise specified in said purchase order, Con-
tractor shall submit such reports in triplicate from time to time as
requested and upon completion (or earlier termination) of the services.
Except as may be otherwise specified in said purchase order, or unless
Contractor is otherwise instructed, Contractor shall, upon completion
(or earlier termination) of the services, deliver any working drawings
and specifications of such prototypes as may have been developed.
5t ARTICLE 37 - RIGHTS IN DATA - UNLIMITED
a. The term "Subject Data" as used herein includes writings,
sound recordings, pictorial reproductions, drawings or other graphical
representations, and works of any similar nature (whether or not copy-
righted) which are specified to be delivered under this contract. The
term does not include financial reports, cost analyses and other in-
formation incidental to contract administration.
b. Subject to the proviso of c. below, the Government and Lockheed
may duplicate, use, and disclose in any manner and for any purpose
whatsoever, and have others so do, all Subject Data delivered under
this contract.
c. Contractor agrees to and does hereby grant to the Government,
and to its officers, agents, and employees acting within the scope of
their official duties, and to Lockheed, a royalty-free, non-exclusive
and irrevocable license throughout the world, to publish, translate,
reproduce, deliver, perform, dispose of, and to authorize others so to
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do, all Subject Data now or hereafter covered by copyright; provided that
with respect to such Subject Data not originated in the performance of
this contract but which is incorporated in the work furnished under this
contract such license shall be only to the extent that Contractor, its
employees, or any individual or concern specifically employed or assigned
by Contractor to originate and prepare such Data under this contract,
now has, or prior to completion or final settlement of this contract may
acquire, the right to grant such license without becoming liable to pay
compensation to others solely because of such grant.
d. Contractor shall exert all reasonable effort to advise Lockheed,
at the time of delivery of the Subject Data furnished under this contract,
of all invasions of the right of privacy contained therein and of all
portions of such Data copied from work not composed or produced in the
performance of this contract and not licensed under this clause.
e. Contractor shall report to Lockheed promptly and reasonable
written detail, each notice or claim of copyright infringement received
by Contractor with respect to all Subject Data delivered under this
contract.
f. Nothing contained in this clause shall imply a license to the
Government or Lockheed under any patent or be construed as affecting
the scope of any license or other right otherwise granted to the Govern-
ment or Lockheed under any patent.
g. Contractor shall not affix any restrictive markings upon any
Subject Data, and if such markings are affixed, the Government or Lockheed
shall have the right at any time to modify, remove, obliterate or ignore
any such marking.
ARTICLE 38 - REPRODUCTION RIGHTS
Lockheed does not grant or convey to Contractor by virtue of this
subcontract (i) any reproduction rights in or to the articles called
for hereunder, or (ii) any right to use designs, drawings or other infor-
mation belonging to Lockheed or supplied by or on behalf of Lockheed for
us in the performance of this subcontract, in the production, manufacture
or design of any articles or materials for anyone other than Lockheed.
OCARTICLE 39 - NON-DISCLOSURE OF INFORMATION
Contractor shall not, without the prior written consent of Lockheed,
disclose information relative to this subcontract, except as may be
required to insure performance.,
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ARTICLE 1+0 - FEDERAL, STATE AND LOCAL TAXES
Except as otherwise provided in this subcontract, Federal, State, and
Local taxes (other than (i) Federal taxes on income and excell profits,
(ii) taxes in connection with financing, refinancing, or refunding opera-
tions, and (iii) Federal excise taxes from which exemption is obtainable
under Sections 4220 or 4222 of the Internal Revenue Code or for which a
credit is obtainable under Section 6+16 (b) (3) (B) thereof) paid by
Contractor, of any cost of cost-plus-a-fixed-fee subcontractor hereunder
(provided that there was no fixed-price subcontractor intervening between
such subcontractor and Contractor) and incident to the performance of
this subcontract shall constitute items of allowable cost under this sub-
contract or such cost or cost-plus-a-fixed-fee subcontract if (i) Contractor
has requested Lockheed to furnish tax exemption certificates or other
similar evidence of exemption for use by Contractor and such cost or cost-
plus-a-fixed-fee subcontractor in obtaining exemption from such Federal,
State or Local Taxes and (ii) Lockheed has notified Contractor that it
will not furnish such evidence of exemption. Payments of taxes for which
evidence of exemption has been furnished hereunder shall constitute items
of allowable cost under this subcontract (i) if the applicable Federal,
State or Local taxing authorities have refused to accept such evidence
of exemption and Contractor has notified Lockheed of such refusal, (ii)
if Contractor has caused the tax in question to be paid in such manner as
to preserve all rights to refund thereof, (iii) if Contractor causes to
be assigned to the Government any and all rights to any refund of such
taxes and (iv) if being so directed by the Contracting Officer, Contractor
takes the necessary action in cooperation with and for the benefit of the
Government, to secure a refund of such tax.
ARTICLE 41 - AMENDMENTS REQUIRED BY PRIME CONTRACT
Contractor agrees that upon the request of Lockheed it will from
time to time enter into amendments to this subcontract to incorporate
additional provisions herein or to change provisions hereof, as Lockheed
may reasonably deem necessary, in order to comply with the provisions of
the prime contract or with the provisions of amendments to the prime
contract. If any such amendment to this subcontract causes an increase
or decrease in the cost of, or the time required for, performance of this
subcontract, an equitable adjustment shall be made in the estimated cost
and fixed fee or delivery schedule, or both, pursuant to Article 3 (Changes)
hereof.
ARTICLE 42 - COVENANT AGAINST CONTINGENT FEES
Contractor warrants that no person or selling agency has been employed
or retained to solicit or secure this subcontract upon an agreement or
understanding for a commission, percentage, brokerage or contingent fee,
excepting bona fide employees or bona fide established commercial or selling
agencies maintained by Contractor for the purpose of securing business.
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For breach or violation of this warranty Lockheed shall have the right to
annul this subcontract without liability or, in its discretion, to deduct
from the subcontract price of consideration the full amount of such
commission, percentage, brokerage or contingent fee.
ARTICLE. )43 - QUALITY CONTROL SPECIFICATION
Except as otherwise provided in this subcontract, Contractor's system
of quality control during the performance of this subcontract shall be in
accordance with the provisions of Military Specification MIL-Q-5923, as in
effect on the date of this subcontract.
ARTICLE 44 - GRATUITIES
a. Lockheed may, by written notice to Contractor, terminate the right
of Contractor to proceed under this contract if Lockheed has a reasonable
cause to believe that gratuities (in the form of entertainment, gifts, or
otherwise) were offered or given by Contractor, or any agent or represent-
ative of Contractor, to any officer or employee of Lockheed with a view
toward securing a contract or securing favorable treatment with respect
to the awarding or amendment, or the making of any determination with
respect to the performing of such contract.
b. In the event this contract is terminated as provided in paragraph
a. hereof, Lockheed shall be entitled to pursue the same remedies against
Contractor as it could pursue in the event of a breach of the contract by
Contractor.
c. The rights and remedies of Lockheed 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.
ARTICLE 45 - DELAY IN DELIVERY OF DATA
a. It is understood that the efficient use by Lockheed of the supplies
called for hereunder requires that the data called for hereunder be delivered
not later than the time or respective times herein specified. If such
data are not delivered at said time or times, Lockheed may, at its election,
so long as such data remain undelivered, unless the delay in delivery there-
of arises out of causes beyond the control and without the fault or negli-
gence of Contractor within the meaning of the clause hereof entitled
"Excusable Delays", withhold payment to Contractor for any of the amounts
then due, refuse approval of Contractor's vouchers and refuse to accept
further deliveries hereunder from Contractor or take any other action
authorized by law or regulation now or hereafter in effect, including termi-
nation of the contract for default to the extent and in the manner author-
ized by "Termination," and may take any or all of the foregoing actions
separately or in combination.
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b. The provisions of this clause shall only be applicable to technical
data, such as handbooks, service manuals, or other information necessary for
the proper maintenance or servicing of the end items called for herein.
ARTICLE 4+6 - LIMITS OF CONTRACT
This contract supersedes all prior offers, negotiations or agreements
concerning the subject matter hereof and constitutes the entire contract
between the parties.
ARTICLE 4+7 - ADVANCE MANUFACTURE AND SHIPMENT
Contractor shall not, without Lockheed's prior written consent, manu-
facture in advance of Contractor's normal flow time or deliver in advance
of schedule. Lockheed may return, shipping charges collect, all articles
received in advance of schedule.
ARTICLE 4+8 - INTERPRETATION
This subcontract shall be construed and interpreted solely in accord-
ance with the laws of the State of California.
ARTICLE 4+9 - APPROVAL
This subcontract shall not become effective until approved by the
Contracting Officer at Lockheed's Plant.
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ARTICLE 50 - ALTERATIONS
1. Article 8 - Inspection And Correction Of Defects
Page 9, Paragraph d, line 8, 3rd word, delete "has"
and substitute "have".
2. Article 10 - Assignment Of Claims
Page 10, Paragraph c, line 9, lst word, delete
tpgetjer" and substitute "together".
3. Article 11- Records
Page 12, Paragraph e, line 3, add the word "to"
after the word "obligation".
4. Article 26 - Patent Rights
Page 26, Paragraph d (ii) (A), line 3, 5th word,
delete "know" and substitute "known".
5. Article 27 - Filing of Patent Applications
Page 29, Paragraph a, line 6, 9th word, delete "of"
and substitute "or".
6. Article 36 - Reports of Work
Page 33, line 2, 6th word, delete "hereof" and substitute
"thereof".
7. Article 37 - Rights in Data - Unlimited
Page 34, Paragraph e, line 1, add the word "in" after
the word "and".
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? The foregoing Terms and Conditions are changed as follows:
Article 50 ("Alterations"):
8. Article 6 - Payment and Reimbursement
Page 6, Sub-paragraph (b), line 5, delete the word and figure
"Article 29" and substitute the word and figure "Article 26"
therefor.
9. Article 6 - Payment and Reimbursement
Page 5, Sub-paragraph (b), line 15, delete the words "Article
(CHANGES)" and substitute the words and figure "Article 3
(CHANGES)" therefor.
10. Article 15 - Excusable Delays
Page 18, Sub-paragraph (b), line 1, delete the word "cuase" and
substitute the word "cause" therefor.
',11. Article 22 - Government Property
Page 21, Sub-paragraph (c), line 4, delete the word "personality"
and substitute the word "personalty" therefor.
12. Article 22 - Government Property
Page 22, Sub-paragraph (f), lines 1 and 3, delete the letter
"(d)" and substitute the letter "(e)" therefor.
13. Article 26 - Patent Rights
Page 29, Sub-paragraph (h), line 8, delete the word "subcontact"
and substitute the word "subcontract" therefor.
14. Article 40 - Federal, State and Local Taxes
Page 35, line 2, delete the word "excell" and substitute the word
"excess" therefor.
15. Article 1 - ("PROVISIONS APPLICABLE TO SERVICES AND SUPPLIES TO BE FURNISHED")
shall be amended as follows:
a. Sub-paragraph (a) - Delete the words and figures "fifteen (15) days"
appearing in line 10 therein and substitute the words and figures "thirty (30)
days" therefor.
b. Sub-paragraph (c) - Delete the word "includes" appearing in line 1
therein and substitute the words "shall include".
16. Article 3 - ("CHANGES") shall be amended as follows:
Delete the figure and word "30 days" appearing in line 8, page 3
therein, and substitute the figure and word "60 days" therefor.
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17. Article 4 - ("LIMITATION OF ALLOWABLE COSTS") shall be amended to read as
follows:
"a. It is estimated.that the total cost to Lockheed, exclusive of any
fixed fee, for the performance of this subcontract will not exceed the esti-
mated cost set forth in said purchase order. Contractor agrees to use its best
efforts to perform the work specified in said purchase order and all obligations
under this subcontract within such estimated cost. The fixed fee for complete
performance of this subcontract is specified in said purchase order.
b. The sum presently available for payment, and allotted to this subcon-
tract, is specified in said purchase order. It is anticipated that from time to
time additional funds will be allotted to this subcontract up to the full esti-
mated cost, including any fixed fee. Lockheed shall not be obligated to
reimburse Contractor for costs incurred, including any fixed fee to which Con-
tractor may be entitled, in excess of the total amount from time to time
allotted to this subcontract, and Contractor shall not be obligated to continue
performance under this subcontract or to incur costs, including any fixed fee
to which Contractor may be entitled, in excess of the total amount from time to
time allotted to this subcontract. When and to the extent that the total
amount allotted to this subcontract has been increased, any costs, including
any fixed fee to which Contractor may be entitled, incurred by Contractor
'prior to the increase and in excess of the amount previously allotted, shall
be allowable to the same extent as if such costs had been incurred after such
increase in amount allotted.
c. If at any time Contractor has reason to believe that the costs which
it expects to incur in the performance of this subcontract in the next suc-
ceeding thirty (30) days, when added to all costs previously incurred,
including any fixed fee to which Contractor may be entitled, will exceed
eighty-five per cent (85%) of the amount then allotted to this subcontract,
Contractor will so notify Lockheed. If at any time Contractor has reason to
believe that the total cost to Lockheed, exclusive of any fixed fee, for per-
formance of this subcontract will be substantially greater-or less than the
estimated cost set forth in said purchase order, Contractor shall so notify
Lockheed in writing to that effect, giving its revised estimate of such total
cost for performance hereunder.
d. If Lockheed determines that the amount allotted to this subcontract
has been expended and that no additional amount will be allotted to this sub-
contract, Lockheed shall terminate this subcontract as may be determined
necessary pursuant to sub-paragraph a(iii) of Article 14 (TERMINATION) hereof.
e. In the event that sufficient amounts are not allotted to this sub-
contract to allow completion of the work contemplated herein, Contractor shall
be entitled, subject to the limitations of 'paragraph b of this article, to a
percentage of the fixed fee set forth in said purchase order equivalent to the
percentage of 'completion of the work contemplated by this subcontract."
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18. Article 5 - ("ALLOWABLE COSTS AND FIXED FEE") shall be amended to read as
follows:
"a. Lockheed shall pay to Contractor, at the time and in the manner
hereinafter set forth, for all services and supplies to be furnished hereunder
the allowable costs therefore determined as hereinafter set forth in paragraph
(b) of this article, plus the fixed fee specified in the subcontract. If
Lockheed, because of the requirement of the Government, or for any other
reasons, accepts services or supplies under this subcontract which do not con-
form to the guarantees set forth in Article 8 (Inspection and Correction of
Defects) hereof, Lockheed shall pay the allowable costs as hereinafter defined
of furnishing and delivering such services and supplies, subject to the pro-
visions of said Article 8. The total estimated cost and fixed fee shall be
subject to increases and decreases resulting from changes or additions as
provided in Article 3 (Changes) hereof, or from changes in the scope or nature
of the work to be performed under this subcontract which are agreed to by
Contractor and Lockheed in writing.
b. For the purpose of determining the amounts payable to the Contractor
under this subcontract, allowable items of cost will be determined in accordance
with generally accepted accounting principles and practices of the Contractor
which are in accordance with Part 2 of Section XV of the Armed Services
Procurement Regulation as in effect on the date of this subcontract. It is
understood and agreed that to the extent such costs are accepted as allow-
able costs by the Contracting Officer, the following shall be considered as
allowable items of cost under this subcontract when properly allocable to
the subcontract and incurred or paid by the Contractor in accordance with
this subcontract provided, however, that no costs shall be disallowed by
Lockheed on the basis that such work is not authorized by Lockheed's prime
contract if such work is authorized by Lockheed in connection with this sub-
contract.
(1) All materials and supplies (excluding special purpose
machinery and equipment) acquired or produced by the Contractor in
reasonable quantity for use in the performance of the work under
this subcontract. The Contractor shall be free but not obligated to
use any articles customarily produced or assembled by the Contractor
.in the regular course of its business provided that such articles are
billed in accordance with its established intracompany buying practice.
(2) Purchase'and installation of special purpose machinery and
equipment necessary for the performance of this subcontract as ex-
cluded in (1)'above, and not required in the normal course of the
Contractor's business in excess of $500.00 for any single purchase
shall be subject to the prior written approval of Lockheed, provided
that such purchases in excess of the previous stated amount made by
the Contractor may be ratified and approved subsequent to such
purchase.
(3) All labor, usually termed "shop labor" properly chargeable
directly to this subcontract, including traveling time and labor
directly applicable to inspections, tests, or demonstrations in the
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Contractor's plant and labor djpectly applicable to packing, crating,
boxing, shipment, loading, unlg4d}ng, dismantling, moving and removing
materials, supplies, and equipmen but not including labor covered by
Sub-paragraphs (4), (5), or (7) below.
(4) All engineering labor, including all compensation of engineers,
scientists, physicists, chemists, draftsmen, technicians, and other
salaried employees, other '11;a- crr loyees coming within Sub-paragraph (6)
below, chargeable dire(-:!y .atid properly to this subcontract including
travel time but excluti.r,f7 vacatigr}, holiday, sick, personal or military,
jury or election duty compensation. In case the full working time of any
such employee is not applied to the work contemplated by this subcontract,
his compensation shall be included under this sub-paragraph only in pro-
portion to the actual time applied to any such subcontract.
(5) All labor performed under this subcontract in regularly es-
tablished tool making rooms of the Contractor and all labor chargeable
to the cost of constructing, maintaining or replacing machinery, tools,
equipment, dies, molds, jigs, gauges, patterns and fixtures which are to
be used in the production of items in quantity in connection with the work
proviOcd for under this subcontract and which are the property of or which
are to become the property of the Government. All labor directly applicable
to inspection, test or demonstration outside of the Contractor's plant or
applicable to any work incident to such outside inspection, test or demon-
stration in connection with the work provided for under this subcontract
shall be considered to come within the scope of this sub-paragraph.
However, no labor performed by employees coming within Sub-paragraph (6)
below will be considered to come within the scope of this sub-paragraph.
(6) All labor performed by employees of the Contractor's Research
Laboratory and of the Contractor's General Engineering Laboratory (GEL),
including travel time, directly and properly chargeable to the work
provided for under this subcontract, excepting holiday, vacation, sick,
personal or military, jury or election duty compensation.
(a) Premium cost of overtime wage payments shall be allowable
items of cost hereunder only if and to the extent that the overtime
work for which such payments are made shall be authorized by Lockheed
in writing and approved by the Contracting Officer.
(7) There shall be added to the amount of all expenditures for which
reimbursement is authorized and paid to the Contractor in accordance with
the provisions of this Article, certain negotiated provisional or billing
rates providing for indirect expenses. These rates shall be periodically
readjusted to final overhead rates as approved by the Government. Billing
from other departments within the other operating components of the Con-
tractor shall be at such provisional rates and adjusted to such final rates
as are approved by the Government.
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(a) The final overhead rates specified in this Subcontract in-
clude provision for the cost of the normal insurance coverages
regularly carried by the Contractor but shall not be in excess of
that approved by the Government under contracts of a similar nature,
but do not include provision for additional insurance, if any, as may
be required or'approved by Lockheed or the Contracting Officer in
connection with contract performance.
(b) For purposes of negotiation of final overhead rates under
this paragraph, a proper and reasonable share of Contractor's over-
all general research and development costs shall be included as an
allowable expense if such costs are not directly reimbursable under
any other contract.
(c) For purposes of negotiation of final overhead rates and to
the extent consistent with the Contractor's policy in its regular
'operations the cost, including incidental expenses and premium (if
any) of 'providing such death, injury, internment, and other benefits
for the Contractor's employees engaged in performing services under
this subcontract as Lockheed or the Contracting Officer may approve
or require.
(8) Subject to the provisions of the Article 12 hereof' entitled
"Subcontracts", all payments and expenditures in connection with Subcon-
tracts made for the purpose of performing this subcontract and expenditures
for consulting services and to reimburse other employers for services per-
formed by their employees released for or engaged in performance of the
work provided for under this subcontract.
(9) To the extent such expenditures are consistently recorded by the
Contractor in its regular operations as elements of material costs and to
the extent that direct reimbursement for such expenditures under this
Article does not represent duplication of'payments made pursuant to any
other provision of this subcontract, all sales, excise, use, occupational
gross receipts, import or export taxes, duties, or imports or other similar
taxes or,charges and all permits and license fees (but not Federal income
and excess profits taxes) required or used in connection with the work
provided for under this subcontract subject, however, to the provisions of
Article 40 (Federal, State, and Local Taxes).
(10) With the approval of Lockheed, all rentals incurred in con-
nection with the use of special facilities (to the extent such use is
permitted under this subcontract) not customarily employed in the Con-
tractor's ordinary operations. It is contemplated by the parties hereto
that all such rentals will be for exclusive use hereunder. unless the
rental costs are equitably adjusted.
(11) To the extent not reimbursable under-any facilities contract
between the Contractor and the Government, all costs-and expenditures,
incurred by the Contractor in connection with the storage of any necessary
facilities which shall be supplied to the Contractor by Lockheed or the
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Government or acquired by the Contractor hereunder, to carry out the
work and which shall be left with the Contractor after completion or
termination of the subcontract and all costs, and expenditures incurred
by the Contractor before or after such completion or termination in
connection with dismantling, moving, boxing, shipping, and transporting
such facilities.
(12) Royalties and other costs incurred in the acquisition of
necessary patent and technical rights, provided that, in the case of
such rights acquired solely for the purpose of carrying out this sub-
contract, arrangement for the use of such patent and technical rights
under such, this subcontract shall be subject to written approval of the
Contracting Officer.
(13) All costs and expenses determined to be allowable-costs under
'any other article of this subcontract.
(14) All costs of packing, crating, boxing, markings, tagging,
labelling, shipment, transportation, loading, unloading, dismantling,
moving, removing, and storage charges on material, supplies,and equip-
ment, except such costs as may be covered by-Sub-paragraph 11below.
(15) The cost of reconstructing'and replacing any of the work or
property lost, destroyed, or damaged, and not covered by insurance
(except pursuant to Article 22 hereof ' entitled, ("Government Property")
but the Contractor shall not undertake the reconstruction or replacement
of property of the Government except with the prior written authorization
of Lockheed or the Contracting Officer.
(16) The cost incurred by the Contractor in complying with the
provisions of'Sub-paragraphs f(i) and f(iii) or Article 22 hereof'en-
titled "Government Property." Agreement may be made on the basis of a
negotiated sum therefore in lieu of the actual costs thereof.
(17) To the extent not reimbursable under-any facilities contract
between Contractor and the Government and subject to the approval of
Lockheed or the Contracting Officer 'all labor, materials, and supplies
directly applicable to plant alterations or to rearrangement of plant or
facilities in connection with work provided for under this subcontract.
No materials or supplies coming with Sub-paragraph (b) 1 above or labor
coming within Sub-paragraph (b) 3 above will be considered to come with-
in the scope of this sub-paragraph. Allowable costs under this sub-
paragraph shall be treated as items of overhead, in accordance with
Contractor's customary accounting procedure.
(18) The term "materials and supplies", as set forth in Sub-
paragraph (b) 1 above shall include tools, dies, patterns, molds, jigs,
fixtures, gauges, and shall also include. materials and supplies purchased
for stock and subsequently issued for'operations under this subcontract
or'acquired for the purpose of performing this subcontract and sub-
sequently scrapped for any reason, subject to the provisions of the
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Article 22 hereof entitled, "Government Property", as well as waste
resulting from operations under this subcontract.
19. Article 6 - ("PAYMENT AND REIMBURSEMENT") shall be amended as follows:
a. Sub-paragraph (b) - Following the words "and the Contracting Officer.",
the following sentence shall be inserted: "Failure to agree to any such ad-
justment shall be a dispute concerning a question of fact within the meaning
of the clause of this contract entitled 'Disputes'."
b. Sub-paragraph (e) shall be deleted.
20. Sub-paragraph (a) (2) of Article 7 ("RELEASE PROVISIONS") shall be amended by
deleting the words"(but not including claims based on bodily injury or death
or'property damage)" in line 4 therein.
21. Article 8 - ("INSPECTION AND CORRECTION OF DEFECTS") shall be amended to read
as follows:
a. Sub-paragraph (a) - Following the word "inspect" in line 8 therein,
insert the words "the affected portions of".
' b. Sub-paragraph (c) - Delete the words and figure "twelve (12) months"
appearing in line 2 therein and substitute the words and figure "six (6)
months".
22. Article 9 - ("INDEMNIFICATION") shall be deleted.
23. Article 12 - ("SUBCONTRACTS") shall be amended as follows:
a. Sub-paragraph (b)'- Delete the word "Lockheed" appearing in line 9
therein and substitute the words "Contracting Officer" therefor.
b. Sub-paragraph (b) - Delete the word "Lockheed" appearing in line 10
therein and substitute the words "Contracting Officer" therefor.
c. Sub-paragraph (b) - Delete the period after the word "basis" appearing
in line 9 therein and add the following: ", or (v) involves research and
development work."
d. Sub-paragraph (d)'- Delete the word "clause" appearing in line 4 there-
in and substitute the word "article" therefor.
e. The following shall be added as Sub-paragraph (f).
"f. The Contracting Officer may approve all or any part of Con-
tractor's purchasing system and from time to time rescind or reinstate
such approval. Such approval shall be deemed to fulfill the requirements
for obtaining the Contracting Officer's consent to Subcontracts as pre-
scribed in paragraph (b) above."
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21k Article 14 - ("TERMINATION") shall be amended as follows:
a. Sub-paragraph (a) - Following the word "Lockheed" appearing in line
13 add the words "and/or the Government".
b. Sub-paragraph (c) - Delete the words'and figures "twelve (12) months"
appearing in lines 4, 7, and 10 therein, and substitute the words and figures
"eighteen (18) months" therefor.
c. The following shall be added as Sub-paragraph (j):
"j. Contractor shall have the right of appeal under the article
hereof entitled "Disputes", from any decision made by Lockheed under
paragraphs c ore above, except that if Contractor has failed to submit
its claim within the time provided in paragraph (c) above and has failed
to request extension of such time, he shall have no such right of appeal.
In any case where Lockheed has made a determination of the amount due
under paragraph (c) or (e) above, Lockheed shall pay Contractor the
following:
(1) If there is no right of appeal hereunder or if no timely
appeal has been taken, the amount so determined by Lockheed; or
(2) If an appeal has been taken, the amount finally determined
on such appeal.
25. Article 22 - ("GOVERNMENT PROPERTY") shall be amended as follows:
a. Sub-paragraph (b) - Delete the word "clause" appearing in line 15
therein and substitute the word "article" therefor.
b. Sub-paragraph (c) - Delete the words "a system acceptable to Lockheed"
appearing in line 5 therein.
c. Sub-paragraph (c) - Delete the words "the prime contract" appearing in
line 9 therein and substitute the words "this Subcontract" therefor.
d.. Sub-paragraph (i) shall be amended to read as follows-
"i. Upon the completion of this subcontract, or at such earlier
date as may be fixed by Lockheed or the Contracting Officer, Contractor
shall submit to Lockheed, in acceptable form inventory schedules cover-
ing all items of the Government Property not consumed in the performance
of this subcontract (including any resulting scrap), or'not theretofore
delivered to Lockheed or the Government and shall deliver or make such
other disposal of the Government Property as may be directed by Lockheed
or the Contracting Officer. Recoverable scrap shall be reported in ac-
cordance with a procedure and in such form as Lockheed or the Contracting
Officer may direct. The net proceeds of any such disposal approved by
Lockheed or the Contracting Officer shall be credited to the cost of the
work covered by the subcontract or shall be paid in such manner,as
Lockheed or the Contracting Officer may direct. For the purpose of the
Subcontract, the terms 'resulting scrap' and 'recoverable scrap' shall
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be deemed to include all scrap except material generated as scrap in the
usual production process having only a remelting or reprocessing value.
For the purpose of establishing a policy and clarifying the intent of the
parties with respect to the disposition of scrap other than resulting
scrap or recoverable scrap, it is understood and agreed that such scrap
need not be physically segregated from Contractor-owned scrap for account-
ing purposes, it being recognized that the Contractor's method of crediting
the proceeds from the disposition of such scrap has been taken into consider-
ation in establishing the estimated cost under this subcontract. Therefore,
the Contractor will not be required to render-any other-accountability
for such scrap separately for this subcontract. Title to such scrap shall
vest in the Contractor."
26. Article 25 - ("INDEPENDENT CONTRACTOR") shall be amended by deleting the words
"that Contractor shall carry workmen's compensation insurance and" appearing
in lines 6 and 7 therein.
27. Article 26 - ("PATENT RIGHTS") shall be amended as follows:
a. Sub-paragraph (b) (1) - Delete the sentence beginning with the words
"No license granted" appearing in line 6 therein and substitute the following
sentence therefor:
"b. (1) No license granted herein shall convey any right to Lockheed
or the Government to manufacture, have manufactured, or use any
Subject Invention for the purpose of providing services or supplies
to the general public in competition with Contractor or Contractor's
commercial licensees in the licensed field."
b. Sub-paragraph (k)'- Following the word "furnish" appearing in line 1
therein, insert the words "the Contracting Officer through".
28. Article 27 - ("FILING OF PATENT APPLICATIONS") shall be amended as follows.*
a. Sub-paragraph (a) - Delete the words "through Lockheed" appearing in
line 4 therein.
b. Sub-paragraph (b) - Delete the words "Lockheed and" appearing in line 1
therein.
c. Sub-paragraph (b)- After the word "application" appearing in line 4,
insert the words "for determination whether, for reasons for national security,
such application".
29. Article 29 - ("REPORTING OF ROYALTIES") shall be deleted.
30. Article 30 - ("PAYMENT OF ROYALTIES") shall be amended by deleting the word
"Lockheed" appearing in lines 4 and 6 therein.
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31. Article 32 - ("EXCESS PROFIT") shall be amended as follows:
a. Delete the word "contract" appearing in line 2 therein and substitute
the word "subcontract" therefor.
b. Delete the word "clause" appearing in line 4 therein and substitute
the word "article" therefor.
c. Delete the word "clause" appearing in lines 4+ and 7 therein and
substitute the word "article" therefor.
d. Delete the word "section" appearing in line 6 therein and substitute
the word "sections" therefor.
32. Article 33 - ("RENEGOTIATION") shall be amended as follows:
a. Sub-paragraph (a) - Delete the word "contract" appearing in lines 1,
6, and 8 therein and substitute the word "subcontract" therefor.
C
b. Sub-paragraph (a) - Delete the word "clause" appearing in line 5
therein and substitute the word "article" therefor.
c. Sub-paragraph (b) - Delete the word "clause" appearing in line 1
therein and substitute the word "article" therefor.
33. Article 35 - ("NEW FEATURES OF DESIGN") shall be amended to read as follows:
"In the event contractor, prior to completion of work hereunder, and in
the performance of the subcontract knowingly develops (i) any improvement of
the design of the supplies called for by the subcontract, which is not incorpor-
ated in the supplies delivered hereunder, or (ii) any alternative or improved
method of accomplishing the work set forth in the statement of work included
in this subcontract, which is not implemented in the performance hereof,
contractor shall give information with respect thereto to Lockheed."
34. ?Article 37 - ("RIGHTS IN DATA - UNLIMITED") shall be amended as follows:
a. Sub-paragraph (b) shall be amended to read as follows:
"b. Subject to the proviso of (c)'below, the Government may duplicate,
use, and disclose in any manner and for any purpose whatsoever, and have
others so do, all Subject Data delivered under this contract."
b. Sub-paragraph (c) - Delete the words "and to Lockheed," appearing in
line 3 therein.
c. Sub-paragraph (d) - Following the words "advise Lockheed," appearing
in line 1 therein, insert the words "and the Contracting Officer".
d. Sub-paragraph (e) -Following the words "to Lockheed" appearing in
line 1 therein, insert the words "and the Contracting Officer".
e. Sub-paragraph (g) - Following the words "or Lockheed" appearing in
line 2 therein,. insert the words "with the approval of the Contracting Officer".
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35. Article 38 - ("REPRODUCTION RIGHTS") - shall be deleted.
36. Article 39 - ("NON-DISCLOSURE OF INFORMATION") shall be amended to read as
follows:
"Contractor shall refrain from disclosing to other parties the existence of
this subcontract, or any details relating thereto in such a manner as to reveal
the existence of this subcontract, except, (i) with the consent of Lockheed, or
(ii) to the extent which may be required to insure performance, provided, how-
ever, except as may be otherwise provided in Article 34 (Military Security Re-
quirements) hereof, Contractor shall in no event be liable for inadvertent
disclosure of any such information where reasonable care commensurate with the
effort which Contractor customarily exercises with respect to preservation of
its own information, has been taken to prevent such disclosure."
37. Article 41 - ("AMENDMENTS REQUIRED BY PRIME CONTRACT") shall be amended as
follows:
38
a. Delete the words "enter into" appearing in line 2 therein and substi-
tute the word "negotiate" therefor.
Article 44 - ("GRATUITIES") shall be amended as follows:
a. Sub-paragraph (a) - Delete the word "contract" appearing in line 2
therein and substitute the word "subcontract" therefor.
b. Sub-paragraph (b) - Delete the. word "contract" appearing in lines 1
and 3 therein and substitute the word "subcontract" therefor.
c. Sub-paragraph (c) - Delete the word "contract" appearing in line 3
therein and substitute the word "subcontract" therefor.
d. Sub-paragraph (c) - Delete the word "clause" appearing in line 1
therein and substitute the word "article" therefor.
39. Article 45 - ("DELAY IN DELIVERY OF DATA") shall be amended as follows:
a. Sub-paragraph (a) - Delete the word "clause" appearing in line 7
therein and substitute the word "article" therefor.
b. Sub-paragraph (b) - Delete the word "clause" appearing in line 1
therein and substitute the word "article" therefor.
40. Article 46 - ("LIMITS OF CONTRACT") shall be amended as follows:
a. Delete the word "contract" appearing in line 1 therein and substitute
the word "subcontract" therefor.
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41. Said Terms and Conditions shall be further amended by adding the following
articles thereto:
a. "ARTICLE 51 - DISPUTES
Any decision, disapproval or omission made or omitted by Lockheed or
the Contracting Officer hereunder concerning question of fact, if disagreed
with by Contractor, shall be treated by Lockheed as a dispute under the
"Disputes" clause in the prime contract, and Lockheed shall, at Contractor's
expense, take all available steps thereunder to the extent required by
Contractor to resolve such dispute, except that Lockheed shall not be obli-
gated to litigate the matter in any court. Any resolution of such dispute
pursuant to such clause shall be binding upon both parties. Lockheed
agrees that it will permit Contractor to participate with Lockheed in all
such proceedings. If Lockheed fails to take action pursuant to this
article, Contractor may appeal such dispute by pursuing any right or
remedy it may have at law or in equity in any court of competent juris-
diction. Pending final decision of any dispute hereunder, Contractor
shall proceed diligently with the performance of this subcontract and in
accordance with the decision appealed from."
b. "ARTICLE 52 - LIABILITY TO THIRD PERSONS
a. Contractor shall procure and thereafter maintain workmen's compen-
sation, employer's liability, comprehensive general liability (bodily
injury) and comprehensive automobile liability (bodily injury and property
damage) insurance with respect to performance under this subcontract, and
such other insurance as the Contracting Officer or Lockheed may from time
to time require with respect to performance under this subcontract; pro-
vided that Contractor, in fulfillment of its obligation to procure
workmen's compensation insurance may, with the approval of the Contracting
Officer, and pursuant to statutory authority, maintain a self-insurance
program. All insurance required pursuant to the provisions of this para-
graph shall be in such form in such amounts and for such periods of time,
as the Contracting Officer or Lockheed may from time to time require or
approve, and with insurers approved by the Contracting Officer.
b. Contractor agrees, to the extent and in the manner required by
the Contracting Officer, to submit for the approval of the Contracting
Officer'any other insurance maintained by Contractor in connection with
the performance of the subcontract and for which the Contractor seeks
reimbursement hereunder.
c. Contractor shall be reimbursed: (i) for the portion allocable to
this subcontract of the reasonable cost of insurance as required or'ap-
proved pursuant to the provisions of this article, and (ii) for liabilities
to third persons for loss of or damage to property (other than property
(A) owned, occupied, or used by Contractor or rented to Contractor, or
(B) in the care, custody, or control of Contractor), or for death or bodily
injury, not compensated by insurance or otherwise, arising out of the per-
formance of this subcontract, whether or not caused by the negligence of
Contractor, its agents, servants, or employees, provided such liabilities
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are represented by final judgments or by settlements approved in writing
by the Government, and expenses incidental to such liabilities, except
liabilities (I) for which Contractor is otherwise responsible under the
express terms of the article or articles, if any, specified in said
purchase order, or (II) with respect to which Contractor has failed to
insure as required or maintain insurance as approved by the Contracting
Officer, or (III) which results from willful misconduct or lack of good
faith on the part of any of Contractor's directors or officers, or on the
part of any of its managers, superintendents, or other equivalent repre-
sentatives, who have supervision or direction of (1) all or substantially
all of Contractor's business, or (2) all or substantially all of Con-
tractor's operations at any one plant or separate location in which this
subcontract is being performed, or (3) a separate and complete major
industrial operation in connection with the performance of this subcontract.
The foregoing shall not restrict the right of Contractor to be reimbursed
for the cost of insurance maintained by Contractor in connection with the
performance of this subcontract, other than insurance required to be sub-
mitted for approval or required to be procured and maintained pursuant to
the provisions of this article, provided such cost would constitute
"allowable cost" under Article 5 (ALLOWABLE COST AND FIXED FEE) hereof.
d. Contractor shall give the Government or its representatives and
Lockheed immediate notice of any suit or action filed, or prompt notice
of any claim made, against Contractor arising out of the performance of
this subcontract, the cost and expense of which may be reimbursable to
Contractor under the provisions of the subcontract, and the risk of which
is then uninsured or which the amount claimed exceeds the amount of
coverage. Contractor shall furnish immediately to the Government through
Lockheed, copies of all pertinent papers received by Contractor. If the
amount of liability claimed exceeds the amount of coverage, Contractor
shall authorize representatives of Lockheed and the Government to
collaborate with counsel for the insurance carrier, if any, in settling
or defending such claim. If the liability is not insured or covered by
bond, Contractor shall, if required by the Government or Lockheed, author-
ize representatives of the Government or Lockheed to settle or defend any
such claim and to represent Contractor in or take charge of any litigation
in connection therewith; provided, however, that Contractor may, at its
own expense, be associated with representatives of Lockheed or the Govern-
ment in the settlement or defense of any such claim or litigation."
Sanitized Copy Approved for Release 2011/01/05: CIA-RDP89B00709R000200420015-5