NEGOTIATED CONTRACT CONTRACT NO. SE-510

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89B00709R000200460001-6
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 44
• Document Creation Date: December 22, 2016
• Document Release Date: January 5, 2011
• Sequence Number: 1
• Publication Date: January 14, 1960
• Content Type: MISC

STAT
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F. ?
CL ASS I F I CAT ION
T1SNCUMENTRENNIES SPEC[AL WDLONG
HANDLING PROCEDURES
? .01P.
1HIS DOCUMENT CONTAINS INFORMATION REGARDING A HIGHLY CLASSIFIED
ACTIVITY. PERMISSION TO TRANSFER CUSTODY, OR PERMIT ACCESS TO
THIS DOCUMENT MUST BE OBTAINED FROM THE ORIGINATOR. HAND CARRY
PROCEDURES WILL BE APPLIED TO ANY INTER-OFFICE OR INTRA-AGENCY
MOVEMENT OF THIS DOCUMENT.
REFERRED TO
RECEIVED
RELEASED
SEEN,BY
OFF ICE
SIGNATURE
DATE
TIME
DATE
TIME
NAME AND OFF ICE SYMBOL
DATE
ri : I/
AI ?f"

CLASSIFICATION
r-F-0 RPA
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STAT
STAT
STAT
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CONTRACT SO. enc43.0
NEGOTIATED COMO!
Granger Associates
966 Cmeserciel Street
Palo Alto, Calliword*
Contract tor: See Sehedule
Amount: ta38#652.00
iilInvoices to:
Performance Period:
See Saba&le
Atbsinistretive Dates
a wed
America, hereinafter milled the Government, represented by the
Contracting Officer executing this eantrast, and the above named
Coutraotor which is a corporation, insorporatod in the State Of
California hereinafter (gelled the **tractor.
The parties hereto agree that the Contrector shell furnish the
realities end deliver all supplies end petters all the services
set forth in the ettiehed schedule issued hereunder, for the con
siderntion steted therein.
The rielts end obligations of the parties to this eontract shall be
subject to and governed by the ettached schedule and General Previ-
sions. In the event of ay. inconeietener betimes the Salida* and
the General Provisions, the Schedule shall control.
1E MUSS WHEREO,? the parties hereto have executed this acctract
as of
germ
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Contract No. SE-510
I , certify that I am
CistalrICATS
the Assistant Secretary of the Corporation named
elp Contractor herein; thatL who
signed this contract on behalf of the Contractor was then
President
of said Corporation; that said contract
was duly signed for and in behalf of said Corporation by authority of
its governing body, and is within the scope of its Corporate powers.
- 2 -
(Corporate Seal)
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? Colit."44 NO. Etz.slo
DUX TO AMID=
PARTI SCOPE or wog
PANT IT ?ESZTVERT. ? ? ? 4
PART xxx UM OP RIQUIR/SOCIVS OP =ORAL
PPOVISIONS.. ? * ** **** 5
PART If ? SPEOYAL SISOURTPT SNOTRICTIONS * 5
ror OOMOSSINT4URN3BISID PSOPIZTT 6
PART VX tarns COMMA= SUMMED . ? 6
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Contract No. SE-510
SCODULE
PART I * SCOPE 0111 WORK
Contractor shall furnish the necessary smile", services
and materials to accomplish the work set forth below:
Item 1 * Fabricate five (5) each of Contractor's Model
504 B receptive Repeaters with Pilots Control Box and
Switch as described in Contractor's Proposal No. 59-
1148, dated October 1, 1959, incorporated herein by
reference-0 at a unit price of $19,800 and a total price
of $990000.
Item 2 . Furnish Spare Parts for Item 1 above in
accordance with Appendix I attached hereto at a total
price of $340343.
Item 3 . Furnish Test Equipment for support of Item 1
in accordance with Appendix II:attached hereto at a
total price of $1,309.
Item 4 * As a result of the reduction in spare ;arts
and units called for under the Letter Contract, it
is Recognized that a surplus of parts have accrued.
Contractor shall make every effort to utilize these
parts in the perfOrmance of this contract or other
work. For all parts which cannot be utilized in
the above manner, Contractor shall furnish a list
and prices for such parts to the Contracting Officer.
Upon approval or agreement on the prices of said parts,
the list shall be made a part of this contract by
amendment. A sum of $4,000.o0 is obligated under this
Item 4 to cover the cost of such parts.
PART rx DELIVERY
(a) Contractor shall furnish the work called for under
PART I above in accordance with the following schedule:
Item]. - Contractor shall deliver the unite as follows:
1960
Jan Fab Mar April
?37,- 1
Item 2 - Contractor shall exert its best efforts to
4
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deliver the su.s soneurrent with
rtes 1 obeys.
/tea 3 Centreetor 441 deliver the test equip-
en or before 31 *rah 1960.
nowit - Delivery shall be in aceerdsnes with the
prevision' of Dna 4.
(b) tiaspe0/01 and aeseplource shall be at Zlestinition.
MO": lastrtuniums will be furnished won ropnist of
Cent:600r.
pART 011111..vo coggPROVISZONS
Notwithstendiag the requirements of any of the General
Previsions of this 40101410 to the contrary, whensoever the
Centreeter? in pertereance of the work under this ',outrank,
shall find that the requirements of aro' of the clauses of
the Oraeral Previsierur are in conflict with security inetruorticas
issued to the Contractor by the Contracting Miser or by MO
duly authorised reeresentattnt ter security natters, the
Contractor shall cell the attention of the Contracting Officer
to such vonfliet and the ***rooting Officer or' his _duly authorised
representative for security natters *ban (1) andity or rescind
such security roquisocants or (U) the Colaftettag Officer shall
issue to the Contractor a vaiver of ;Mee with the require-
ments or the Genera Provisions sontlitng with such security
requirements. Any minor of oaU with?the General Previsions
of this centment issued by the Coat Writer shall be in
writing *zees, that the approval by the Omitrootioit Officer of
any subcontract toned hereunder by the Centractne shall he deemed
to constitute apprevel of tatter of any clauses of the General
Provisions in sonfliet with the stipulations of such subeoetragt.
PART I!
The Cent ) the specific nature or
any details of the verb Wag performed hereunder or(ii) any
infervertion whatsoever with respect to the departmeet et the
00yeralle0 speesering this contract and the work thereunder
except as the Centrastor is divested or permitted to rived, outh
infersation by the Contracting %View or by his duly ***wised
repreeentative tor security matters, and act withstanding ce.Y
*Immo or sorties or 'this contract to the contrary, the Oentmeater
shall *et istexpret any Clause or sorties of this ?entreat as
requiring or pernitting divalgenee of such infOrmatien to say
person, public or private, or to any officer or depertiont of the
Government without the ewes* cease* of the Contracting ?Meer
or his duly authorized representative for security *litters.
5
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PAX V GOVIERAM4aANTEA1ED PROMPT
Di the pertoraince of the work called for under PART 2
love the C41000.10011 Is authertieed to use the Saweestof furnished
X( the Goverseent under Contract We.L_EA-509. /
PART VI - LITTER_OORTRACT SUPOSZEID
This is the De:Unitive Conteect ecnteelated by the Letter
Contract NO. Si0510 dated 14 October 1959. This Definitive
**tract supersedes add Lotter Contract in its isatirety. Work
peewee and moots aide wieder said Letter Contract shall
be droned to be work peritearel and gosents aide wader this
Definitive Contract. To the evert or confliet between this
Definitive Contract and said Utter Contrast, this Definitive
Contract shall. govern.
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mown n
=wpm No. sz.53.0
SST =MOW
Description
Quaatity
1
Tecesination* WO power* hewlett 'Weird
X412A
2 ea,
2
Cooler* directional Deamapaosardi 632
2 ea.
3
, MOuat, erystal detecter* eage 10133
1 ste,
4
Detector, crystal* Sylvania 33358A
3. es.
5
Teat Control Sox* Mawr CC-1016
2 ea*
6
WA** leaver, GilWier XU41039
2 at.
7
CO": WAWA priortegr ZU-IMT
2 ea.
8
CO3.** ipower* Gnaw =4018
9
*lad, sower, Groom Xt10-3.020
2 es,.
10
Ada:Vier, %tea** ReallettAistard X-2814
3 ea.
11
cyralitte, *made rtitiseareit R.920
3. is.
22
Coax Attenuotor, AitatittsAV--
2 ets.
6thAmiect
(men - (6.d&
, ercoto-vt-L4
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1
2
3
4
5
6
8
9
10
APPENDU
Mu= NO, EM43.0
SPAM Pals
Description:,nttt
Mover, Rottrou 464y0,11 5 es.
Vanstorser, Pico Gk4599 5 es.
Trenstorner? Pio* (10.41600A 5
Electron Tube, Litton 1rle36i -5 5g (3 5 is. (e)-
Elec4ron Tate, Litton b-3e66-4- .6?66) 5 c
$langes, Walreguirlo? GA41-2934.1 2 4.49
Modules? GA0800218201 4,
Module*, Git.13C.2783.1 444.
Modules, GA-130-2784.1
Modules, GA.80-2785-1 4 ea.
Modules, GA4C-2786A
modules, OA-so-27874 4 ea.
Modules, GA-SC.27814
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INDEX TO GENERAL PROVISIONS
Article No.
Page No.
1.
DEFINITIONS
1
2.
CHANGES
3,
EXTRAS
2
L.
VARIATION IN QUANTITY
2
5.
INSPECTION
2
6.
RESPONSIBILITY FOR SUPPLIES
3
?.
PAYMENTS
3
8.
AcS1CNMENT(OF CLAIMS
4
9.
ADDITIONAL B Ni) SECURITY
4
10.
FEDERAL, STATE, AND LOCAL T?)CES
4
U.
DEFAULT L.
6
12.
DISPUTES
8
13.
SOVIET CONTROLLED AREAS
8
14.
EIGHT-HOUR LAi OF 1912
9
15.
ALM-HEALEY PUBLIC CONTRACTS ACT
9
16.
NOACISCRICE T ION IN EMPLOYMENT
9
17.
OFFICIALS NOT TO BENEFIT
10
18.
COVENANT AGAINST CONTINGENT FEES
10
19,
TERMINATION FOR CONVENIENCE BF THE GOVERMENT
10
20,
AUTHORIZATION AND CONSENT
15
21.
NOTICE AND ASSISTANCE REGARDING PATENT-
INFRINGEMENT
15
22.
BUY AMERICAN ACT
15
23,
FILING OF PATENT APPLICATIONS
16
24.
PATENT RIGHTS
17
25.
REPORTING OF ROYALTIES
21
26.
RIGHTS IN DATA - UNLIMITED
23
27.
MILITARY SECURITY REQUIREMENTS
24
28.
UTILIZATION OF SMALL BUSINESS CONCERNS
25
29,
EXAMINATION OF RECORDS
25
30.
GRATUITIES
26
31.
CONVICT LABOR
26
32.
NOTICE TO THE GOVERMENT OF LABOR DISPUTES
26
33.
MATERIEL INSPECTION AND RECEIVING REPORT
26
34.
SUBCONTRACTS
27
35.
SUBCONTRACTS
36,
AIRCRAFT IN THE OPEN
27
37,
INSPECTION AND AUDIT
28
38.
GOVERNMENT.FURNISBED PROPERTY
28
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GENERAL PROVISIONS
1. DEFINITIONS (ASPR 7-103.1)
As used throughout this contract, the following terms shall have
the meanings set forth below:
(a) The term "Se6reta0" Means the Secretary, or any Assistant
Secretary of the Department, aid the head or any assistant head of the
Federal agency; and the term ."his duly authorized representative" means
any person or persons or board (other than the Contracting Officer)
authorized to act for the Secretary.
(b) The term "Contracting Officer" means the person executing
this contract on behalf of the'Government, and any other officer or
civilian employee who is a properly designated Contracting Officer;
and the term includes, except at otherwise provided in this contract,
the authorized representative Of a Contracting Officer acting within
the limits of his authority.
(c) Except as otherwise provided in this contract, the term
subcontracts" includes purchase orders under this contract.
2. CHANGES (ASPR 7-103.2)
The Contracting Officer may at any time, by a written order, and
without notice to the sureties, make changes, within the general scope
of this contract, in any one or more of the following; (i) Drawings,
designs, or specifications, where the supplies to be furnished are to
be specially manufactured for the Go4ernment in accordance therewith;
(ii) method of shipment or packing; and (iii) place of delivery. If
any such .change causes an increase or decrease in the cost of, or the
time required for the performance of any aprt of the work under this
contract whether changed or not changed by any auch order an equitable
adjustment shall be made in the contract price or delivery schedule, or
both, and the contract shall be modified in writing accordingly. Any
claim by the Contractor for adjustment under this clause must be asserted
within 60 days from the date of receipt by the Contractor of the noti-
fication of chage; PROVIDED, however, That the Contracting Officer, if
he 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 contract. Where the cost of property made obsolete or excess
as result of a change is included in the Contractorls claim for
adjustment, the Contracting Officer shall have the right to prescribe
the manner of disposition of such property, Failure to agree to any
adjustment shall be a dispute concerning a question of fact within the
meaning of the clause of this contract entitled "Dispute," However,
nothing in this clause shall excuse the Contractor from prodeeding with
the contract as changed.
BP or PR
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3. EXTRAS (ASR 7,4033)
Except as Otherwise provided in this contract, no payment for extras
shall he made unless such extras and the price therefor have been
authorized in writing by the Contracting Officer.
L.
VARIATION IN QUANTITY
No variation in the quantity of any item called for by this contract
will be accepted unless such variation has been caused by conditions of
loading, shipping, or packing, or allowances in manufacturing processes,
and then only to the extent, if,any, specified elsewhere in this
contract.
5. INSPECTION (ASPR 7-10.5)
(a) all supplies Which term throughout this clause includes without
limitation raw materials, components, intermediate assemblise, and end
products) shall be subject to the inspection and test by the Government,
to the extent practicable at all times and places including the period
of manufacture, and in any event prior to acceptance.
(b) In case any supplies or lots of supplies are defective in
material or wcrkmanship or otherwise not in conformity with the requiremetts
of this contract, the Government shall have the right eith to reject
them (with or without instructions as to their (disposition) or to
require their correction. Supplies or lots of supplies which have been
rejected or required to be corrected shall be removed or, if permitted
or required by the Gontracting-Officer,.corrected in place by and at
the expense of the Contractor promptly .after notice, and shall not
thereafter be tendered for acceptance unless the former rejection or
requirement of correction is disclosed. If the Contractor fails promptly
to remove such supplies or lots of supplies which are required to be
removed, or promptly to replace or correct such supplies or lots of
supplies, the Government either .((i) may by contract or otherwise replace
or correct such supplies and charge to the Contractor the cost occasioned
the Government thereby, or (ii) may terminate this contrPct for default
as provided in the clause of this contract entitled "Default." Unless
the. Contractor corrects or replaces such supplies within the delivery
schedule, the Contracting Officer may require the delivery of such supplies
at a reduction in price which is equitable under the circumstances. Fail..
ure to agree to such reduction of price shall be a dispute concerning a
question of fact within the meaning of the clause of this contrect
entitled "Disputes."
(c) If any inspection or test is made by the Government on the premises
of the Contractor or a subcontractor, the Contractor without additional
charge shall provide all reasonable facilities and assistance for the
safety and convenience of the Government inspectors in the performance of
their duties. If Government inspection or test is made at a point other
than the premises of the Contractor or a subcontractor) it shall be at
the expense of the Government except as otherwise provided in this
FP or PR
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contract: PROVIDED, That in case of rejection the Government shall not
be liable for any reduction in: value of samples used in connection with
such inspection or test. All inspections and tests by the Government
shall be performedin such a manner-as not to unduly delay the work.
The Government reserves the right to charge to the Contractor any additional
cost of Government inspection and test when supplies are not ready at the
time such inspection and test is requested by the Contractor or when rein-
spection or retest is necessitated by prior rejection. Acceptance or
rejection of the supplies shailbe made as promptly as practicable after
delivery, except as otherwise Provided in this contract; but failure to
inspect and accept or reject supplies shall neither relieve the Contractor
from responsibility for such supplies as are not in accordance with the
contract requirements nor impose liability on the Government therefor.
(d) The inspection and test by the Government of any supplies or lots
thereof does not relieve the Contractor from any responsibility regarding
defects or other failures to:meet the contract requirements which may be
discovered prior to acceptance. Except as otherwise provided in this
contract, acceptance shall be conclusive except as regards latent defect8i
fraud, or such gross mistakes as amount to fraud.
(e) The Contractor shall provide and maintain an inspection system
acceptabel to the Government covering the supplies hereunder. Records of
all inspection work by the Contractor shall be kept complete and available
to the Government during the performance of this contract and for such
longer period as may be specified elsewhere in this contract.
6. RESPONSIBILITY FOR SUPPLIES (APR 7-10.6)
Except as otherwise provided in this contract, (i) the Contractor shall
be responsible for the supplies covered by this contract until they are
delivered at the designated delivery point, regardless of the point of
inspection; (ii) after delivery to the Government at the designated point
and prior to acceptance by the Government or rejection and giving notice
thereof by the Government, the Government shall be responsible for the loss
or destruction of or damage to the supplies only if such loss, destruction,
or damage results from the negligence of officers, agents, or employees of
the Government acting within the scope of their employment; and (iii) the
Contractor shall bear all risks as to rejected supplies after notice of
rejection, except that the Government shall be responsible for the loss,or
destruction of, or damage to the supplies only if such loss, destruction or
damage results from the gross negligence of officers, agents, or employees
of the Government acting within the scope of their employment.
7. PAYIENTS (ASPR 7-103.7)
The Contractor shall be paid, upon the submission of proper invoices or
vouchers, the prices stipulated herein for supplies delivered and accepted
or services rendered and accepted, less deductions, if any, as herein
provided. Unless otherwise specified4 payment will be made on partial
FP or PR
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deliveries accepted by the Government when the amount due on such de-
liveries so warrants; or, when requested by the Contractor, payment for
accepted partial deliveries shall be made whenever such payment would
equal or exceed either 41,00(Yor 56 percent of the total amount of
this contract.
8. ASSIGNI1E1JT OF CLAIMS (ASP. 7La03.8)
(a) Pursuant to the provisions of the Assignment of Claims Act of
1940, as amended (31 U. S. Code 203,, 41 U. S. Code 15) if this contract
provides for payments aggregating $10000 or more, claims for monies due
or to become due the Contractor from the Government under this contract
may be assigned to a bank, trust cOmpany, or other financing institution,
including any Federal lending agenCy, and may thereafter be further
assigned and re-assigned to any such institution. Any such assignment or
reassignment shall cover all apounts payable under this contract and not
7 already paid, and shall not be; madO to more than one party, except that
any such assignment or reassignment may be made to one party as agent or
trustee for two or more parties participating in such financing. Notwith-
standing any provisions of this contract, payments to an assignee of any
monies due or to become due under this contract shall not, to the extent
provided in said Act, as amended, be subject to reduction or set-off.
(b) In no event shall copies of this contract or of any plans,
specifications, or other similar doquments relating to work under this
contract, if marked "Top Secret," "Secret," or "Confidential", be
furnished to any assignee of any claim arising under this contract or to
any other person not entitled to receive the same: PROVIDED, That a
copy of any part or all of this contract so marked may be furnished, or
any information contained therein may be disclosed, to such assignee upon
the prior written authorization of the Contracting Officer
(c) The Contractor shall obtain theu?itten authorization of the
Contracting Officer prior to the assignment of any rights under this
contract.
a
_
9. ADDITIONAL BOND SECURITY (ASPR 7-103.9)
If any surety upon any bond furnished in connection with this contract
becomes unacceptable to the Government, or if any such surety fails to
furnish reports as to his financial condition from time to time as
requested by the Government, the Contractor shall promptly furnish such
additional security as may be required from time to time to protect the
interests of the Government and of persons supplying labor or materials
in the prosecution of the work contemplated by this contract.
10. FEDERAL, STATE, AND LOCAL TAXES (ASPR 11-401.1)
(a) As used throughout this clause, the term "tax inclusive date" means
the date of negotiated contracts and the date set for the opening of bids
for contracts entered into through formal advertising. As to additional
FP or PR
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supplies or services procured by modification to this contract, the term
"tax inclusive date" means the date of such modification.
(b) Except as may be otherwise provided in this contract, the
contract price includes all Federal, State, and local taxes and duties
in effect and applicable to the contract on the tax inclusive date, except
taxes, (other than 'Federal transportation takes) from which tht Government,
the Contractor, or the transaCtions or property covered by this Contract
are then exempt. Unless speCifically excluded, duties are included in
the contract price, and, if freight is included in the contract price,
Federal transportation taxes are likewise included.
(c) (1) If the Contractor is rehuired to pay or bear the burden
(i) of any tax or duty, which either was not to be included in the
contract price pursuant to thereqUirements of paragraph (b) or was
specifically excluded from the contract price by a provision of this
contract; or
(ii) of an increase in rat,. of any tax or duty, whether or not such
tax or duty was excluded from the contract price; or of any interest or
penalty thereon, the contract price shall be correspondingly increased;
PROVIDED, that the Contractor warrants in writing that no amount for such
tax, duty, or rate increase was included in the contract price as a contin-
gency reserve or otherwise; and PROVIDED further that liability for such
tax, duty, rate increase, interest, or penalty tax,waz not incurred through
the fault or negligence of the Contractor or its failure to follow instruc-
tions of the Contracting Officer.
(2) If the Contractor is not required to pay or bear the burder, or
obtains a refund or drawback, in whole or in part, of any tax, duty,
interest, or penalty which (i) was to be included in the contract price
pursuant to the requirements of paragraph (b), (ii) was included in the
contract price, or (iii) was the baits of an increase in the contract
price, the contract price shall be correspondingly decreased or the amount
of such relief, refund, or drawback shall'be. paid to the Government, as
directed by the Contracting Officer. The contract price also shall be
correspondingly decreased if the Contractor, through its fault or negli-
gence or its failure to follow instructions of the Contracting Officer,is
required to pay or bear the burden, or does not obtain a refund or draw-
back of any such tax, duty, interest, or penalty. Interest paid or credited
to the Contractor incident to a refund. of taxes shall inure to the benefit
of the Government to the extent that such interest was earned after the
Contractor was paid or reimbursed by the Government for such taxes.
(3) Invoices or vouchers covering any adjustment of the contract price
pursuant to this paragraph (c) shall set forth the amount thereof as a
separate item and shall identify the particular tax involved.
(4) Nothing in this paragraph, (c) shall be applicable to social
security taxes; net income taxes; excess profit taxes; capital stock taxes;
Federal transportation taxes, except changes in the rate thereof, in-
cluding repeal; pertaining to shipments from the Contractor to the
FP or FR
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Government; unemployment compensation taxes; or any State and local
taxes, except those levied on or measured by the Contract or sales price
of the services or completed supplies furnished under this Contract,
including gross income taxes, gross receipts taxes, sales and use taxes,
excise taxes, or franchise or occupation taxes measured by sales or
receipts from sale.
(5) No adjustment of,leSS than Sl0 shall be made in the contract
price pursuant to this paragraPh.
(d) Unless there does not:exist any reasonable basis to sustain an
exemption, the Government agrees upon request of the Contractor, without
further liability except as otherwise provided in this contract to
furnish evidence appropriate to establish exemption from (i) any Federal
tax, which the Contractor warrants fin writing was excluded from the
contract price, or (ii) any State or local tax;. PROVIDED that evidence
appropriate to establish exemption: from duties will be furnished, and
Government bills of lading will be. issued only at the discretion of the
Contracting Officer. In addition, the Contracting Officer may furnish
evidence appropriate to establish exemption frcm any tax that may,
pursuant to this clause, give rise to either an increase or decrease in
the contract price.
(e)(1) The Contractor shall promptly notify the Contracting Officer
of all matters pertaining to Federal, State, and local taxes and duties
that reasonably may result in either an increase or decrease in the
contract price.
(2) Whenever an increase or decrease in the contract pride may be
required under this clause', the Contractor shall take action as directed
by the Contracting Officer, and the ,contract price shall be equitably
adjusted to cover the costs of such action, including any interest, pen-
alty, and reasonable attorney's fees,
11. DEFAULT (ASPR 7,.103.11)
(a) The Government may; subject to the provisions of paragraph (c)
below, by written notice of default to the Contractor, terminate the
whole or any part of this contract in any one of the following circum-
stances:
j,(i)If the Contractor fails to make delivery of the supplies or to
perform the services within the time specified herein or any extension
thereof; or
(ii) if the Contractor fails to perform any of the other provisions
of this contract, or so fails to make progress as to endanger performance
of this contract in accordance with its terms, and in either of these two
circumstances does not cure such failure within a period of 10 days (or
such longer period as the Contracting Officer may authorize in writing)
after receipt of notice from the Contracting Officer specifying such
failure.
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(b) In the event the Government trminates this contract in whole or
in part as provided in paragraph (a) of this clause, the Government may
procure, upon such terms and:in such manner as the Contracting Officer
may deem appropriate, supplies or services similar to those so terminated,
and the. Contractor shall be liable to the Government for any excess
costs for such similar supplies or services: PROVIDED, That the Con-
tractor shall continue the performance of this contract, to the extent
not terminated under the prOVibions of this clause.
(c) Except with respect to defaults of subcontractors, the Con-
tractor shall not be liable f0 any excess costs if the failure to
perform the contract arise S out of causes beyond the control and without
the :fault or negligence of the Contractor. Such causes may include, but
are not restricted to, acts ofGod Cr of the public enemy, acts of the
Government in either its sovereign or contractual capacity, fires, floods,
epidemics, quarantine restrictions, strikes, freight embargoes, and u
unusually severe weather; but in elrery case the'failure to perform must
be beyond the control and without the fault or negligence of the
Contractor. If the failure to perform is caused by the default of a
subcontractor, and if such default'ariies out of causes beyond the control
of both the Contractor and subcontract6r, and without the fault or
negligence of either of them, the Contractor shall not be liable for any
excess costs for failure to perform, unless the supplies or Services to
be furnished by the subcontractor wereobtainable from other sources in
sufficient time to permit the Contr4ctor to meet the required delivery
schedule.
(d) If this paragraph (a) of this clause, the Government, in addition
to any other rights provided in thiS clause, may require the Contractor to
transfer title and deliver to the Government, in the manner and to the
extent directed by the Contracting Officer, (i) any completed supplies, and
(ii) such partially completed supplits and materials, parts, tools,. dies,
jigs, fixtures, plans, drawings, information and contract rights (herein-
after called "manufacturing materials") as the Contractor has specifi-
cally produced or specifically acquired for the performance of such part
of this contract as has been terminated; and the Contractor shall, upon
direction of the Contracting Officer, protect and preserve property in
possession of the Contractor in which the Government has an interest,
Payment for completed supplies delivered to and accepted by the Government
shall be at the contract price. Payment for manufacturing materials
delivered to and accepted by the Government and for the protection and
preservation of property shall be in an amount agreed upon by the Con-
tractor and Contracting Officer; failure to agree to such amount shall be
a dispute concerning a question of fact within the meaning of the clause
of this contract entitled "Disputes."
(e) If, after notice of termination of this contract under the
provisions of paragraph (a) of this clause, it is determined that the
failure to perform this contract is due to causes beyond the control and
without the fault or negligence of the Contractor or subcontractor pur-
suant to to_the provisions of paragraph (c) of this clause, such notice of
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default shall be deemed to have been issued pursuant to the clause of
this contract entitled "Termination for Convenience of the Government,"
and the rights and obli[ations of the -parties hereto shall in such event
be governed by such clause. ,Except as otherwise orovided in this contract,
this paragraph (e) applies only if this contract is with a military
department
(f) The rights and,remOies ok the Government provided in this
clause shall not be exclusive and are in addition to any other rights
and remedies provided by law or under this contract.
12. DISPUTES 0.SPR 7-103912Y
(a) Except as otherwise provided in this contract, any dispute
concerning a auestion of fact arising under this contrrct which is not
disposed of by agreement shall-be decided by the Contracting Officer,
who shall reduce his decision to writing and mail or otherwise furnish
a copy thereof to the Contractor. The decision of the Contracting Officer
shallbbe final and conclusive unless, within 30 days from the date of
receipt of such copy, the Contractor mails or otherwise furnishes to
the Contracting Officer a written appeal addressed to the Secretary. The
decision of the Secretary or his day authorized representative for the
determination of such appeals shall:be final and conclusive unless
determined bya court of competent jurisdiction to have been fraudulent,
or capricious, or arbitrary, or so grosSly erroneous as necessarily to
imply bad fiath, or not supported 13.- substantial evidence.. In connection
with any appeal proceeding under this clause, the Contractor shall be
afforded an opportunity to be heard and to offer evidence in support of
its appeal. Pending final decision of a dispute hereunder, the Contractor
shall proceed diligently, with the performance of the contract and in
accordance with the Contracting Offi4erls decision.
(b) This "Disputes" clause does not preclude consideration of law
questions in connection with decisions provided for in paragraph (a) above:
PROVIDED,'?That_.nothing in this contract shall be conStrued as making final
the decision of any administrative official, representative, or board
on a question of law.
13. SOVIET CONTROLLED AREAS (AS PR 6-403)
(a) The Contractor shall not acquire for use in the performance
of this contract any supplies or services originating from sources within
Soviet-controlled areas, as listed in the Schedule of this contract, or
from Hong Kong or Macao, without the written approval of the Contracting
Officer.
(b) The Contractor agrees to insert the provisions of this clause,
including the Soviet-controlled areas listed in the Schedule and this
subparagraph (b), in all subcontracts hereunder.
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14. EIGHT-HOUR LAW OF 1912 (ASPR 12-30341)
This contract, 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-Healy Pubic 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 comtemplated by
this contract, in the employ of the Contractor or any subcontractor con-
tracting for any part of the said Work contemplated, 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 provision 8 of this clause.
The wages of every laborer and mechanic employed by the Contractor or
any subcontractor engaged in the performante of this contract shall be
computed cn 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 tompensated 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 vieAation of the requirements of this
clause a penalty of five dollars shall be imposed for each 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 clause, and all penalties
thus imposed shall be withheld for the use and benefit of the Government.
15. WALSH-HEALY PUBLIC CONTRACTS ACT (ASPR 12-604 mod)
If this contract is for the manufacture of furnished 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 3545), 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, "except that the Contractor shall not be required
to include this clause in subcontracts issued hereunder when the
inclusion of this clause in a subcontract would jeopardize or conflict
with the security considerations established in connection with this contract.
16. NONDISCRIMINATION IN EIIPLOYPIENT (ASPR 12-802 mod)
(a) In connection with the performance of work under this contract, the
Contractor agrees not to disctiminate against any employee or applicant
for employment because of race, religion, color, or national origin. The
aforesaid provision shall include, but not be limited to, the following:
employment, upgrading, demotion/or transfer; recruitment or recruitment
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advertising, layoff or termination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship.
The Contractor agrees to post hereafter in conspicuour places, available
for employees and applicants for employment, notices to be provided
by the Contracting Officer setting :forth the provisions of the
nondiscrimination clause.
(b) The Contractor furthr agrees to insert the foregoing provision
in all subcontracts hereunder, except subcontracts for standard com-
mercial supplies or raw materials,"and except as insertion of the fore-
going provision in a subcontract would jeopardize or conflict with the
security considerations established in connection with this contract."
17. OFFICIALS NOT TO BENEFIT (ASPR 7-103.19)
No member of or delegate to Congress or resident commissioner, shall
be admitted to any share or partof this contraCt, or to any benefit that
may arise therefrom; but this provision shall not be construed to extend
to this contract if mead with a corporation for its general benefit.
18. COVENANT AGAINST CONTINGENT FEES (ASPR 7-103.20)
The Contractor warrants that no person or selling agency has been
employed or retained to solicit or secure this contract 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 the Contractor for the purpose of
securing business. For breach or violation of this warranty the Government
shall have the right to annul this qontract without liability or in its
discretion to deduct from the contract price or consideration, or otherwise
recover, the full amount of such commission, percentage, brokerage, or
contingent fee.
19. TIT,'RAIT.,TAT ION FOR CONVENIENCE OF TIE GOVER1\11,ENT (AS PR 8-701)
(a) The performance of work under this contract may be terminated by
the Government in accordance with this clause in whole, or from time to
time in part, whenever the Contracting Officer shall determine that such
termination is in the best interests of the Government. Any such
termination shall be effected by delivery to the Contractor of a Notice
of Termination specifying the extent to which performance of work under
the contract is terminated, and the date upon which such termination be-
comes effective.
(b) After receipt of a Notice of Termination, and except as other-
wise directed by the Contracting Officer, the Contractor shall (1) stop
work under the contract on the date and to the extent specified in the
Notice of Termination; (2) 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 contract as is not terminated;
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(3) terminate all orders and subcontracts to the extent that they relate
to ther performance of work terminated by the Notice of Termination;
(4) assign to the Government,in.thejmanner, at the times, and to the
extent directed by the Contracting OffiOer, all of the right, title and
interest of the Contractor under the orders and subcontracts so terminated,
in which case the Government shall Pavethe right, in its discretion, to
settle or pay any or all claS arising- out of the termination of such
Orders and subcontract; (5) settle all Outstanding liabilities and all
claims arising out of such terMination of orders and subcontracts, with
the approval or ratification of; the Contracting Officer, to the extent
he may require, which approval or ratification shall be final for all
the purposes of this clause; (6) transfer titled and deliver to the Govern-
ment, in the manner, at the times, and to the extent, if any, directed by
the Contracting Officer, (i) the fabricated or unfabricated parts, work in
process, completed work, supplies, and other material produced as a part of,
or acquired in connection with the performance of, the work terminated by
the Notice of Termination, and (ii) the completed or partially completed.
plans, drawings, information, and other property which, if the contract had
been completed, would have been required to be furnished to the Government;
(7) use its best efforts to sell, in the manner, at the times, to the
extent, and at the price or prices directed or authorized by the Contracting
Officer, any property of the types referred to in provision (6) of this
paragraph, PROVIDED, however, that the Contract (i) shall not be required
to extend credit to any purchaser, and (ii) may acquire any such
property under the conditions prescribed by and at a price or prices
approved by the Contracting Officer; and provided further that the proceeds
of any such transfer or disposition shall be applied in reduction of any
payments to be made by the Government to the Contractor under this Contract
or shall otherwise be credited to tPe price or cost of the work covered by
this contract or paid in such oth,r manner as the Contracting Officer may
direct; (8) complete performance of such part of the work as shall not have
been terminated by the Notice of Termination; and (9) take such action as
may be necessary, or as the Contradting Officer may direct, for the pro-
tection and preservation of the property related to this contract which
is in the possession of the Contractor and in which the Government has or
may acquire an interest. At any time after expiration of the plant
clearance period, as defined in Section VIII, Armed Services Procurement
Regulation, as it may be amended from time to time, the Contractor may
submit to the Contracting Officer a list, certified as to quantity and
quality, of any or all items of termination inventory not previously dis-
posed of, exclusive of items the disposition of which has been directed or
authorized by the Contracting Officer, and may request the Government to
remove such items or enter into a storage agreement covering them. Not
later than fifteen (15) days thereafter, the Government will accept title
to such items and remove them or enter into a storage agreement covering
the same, PROVIDED that the list submitted shall be subject to verification
by the Contracting Officer upon removal of the items, or if the items are
stored, within forty-five (45) days from the date of submission of the list,
and any necessary adjustment to correct the list as submitted shall be made
prior to final settlement.
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(c) After receipt of a Notice of Termination, the Contractor shall
submit to the Contracting Officer its termination claim, in the form and
with the certification prescribed by the Contracting Officer. Such claim
shall be submitted promptly bit in no event later than two years from the
effective date of termination i unless one or more extensions in writing
are granted by the Contracting ?Meer,' upon request of the Contractor
made in writing within such'tWo-year period or authorized extension thereof.
However, if the Contracting Officer determines that the facts justify
such action, he may receive and act upon any such termination claim at any
time after such two-year peioctor any extension thereof. Upon failure
of the Contractor to submit its te#mination claim within-the time allowed,
the Contractinp Officer may determine, on the basis of information
available to him, the amount) if any, due to the Contractor by reason of
the termination and shall thereupon pay to the Contractor the amount so
determined.
(d) Subject to the provisions of paragragh (c), the Contractor and
the Contracting Officer may agree upon the whole or any part of the amount
or amounts to be paid to the ContraOtor by reason of the total or partial
termination of work pursuant to thie clause) which amount or amounts
may include a reasonable allowance 'or. profit on work done. The contract
shall be amended accordingly, and the Contractor shall be paid the agreed
amount. Nothing in paragraph (e) or this clause, prescribing the amount
to be paid to the amount to be paid to the Contractor in the event of
failure of the Contractor and the Qontracting Officer to agree upon the
whole amount to be paid to the Contractor by reason of thetermination of
work pursuant to this clause, shall be deemed to limit, restrict, or
otherwise determine or affect the amount or amounts which may be agreed
upon to be paid to the Contractor pursuant to this paragraph (d).
c)) In the event of the failure of the Contractor and the Contracting
Officer to agree as provided in paragraph (d) upon the whole amount to be
paid to the Contractor by reason of the termination of work pursuant to
this clause the Contracting Officer shall determine, on the basis of in-
formation available to him, the amount, if any, due to the Contractor by
reason of the termination and shall pay to the Contractor the amounts
determined as follows:
(1) For completed supplies accepted by the Government (or sold or
acquired as provided in paragraph (b) (7) above) and not theretofore paid
for, a sum equivalent to the aggregate price for such supplies computed in
accordance with the price or prices specified in the contract, appropri-
ately adjusted for any saving of freight or other charges;
k2) The total of--
(i) The costs incurred in the performance of the work terminated,
including initial costs and preparatory expense allocable thereto, but
exclusive of any costs attributable to supplies paid or to be paid for
under paragraph (e) .(1) hereof;
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(ii) The cost of Settling and paying claims arising out of the
termination of work under subcontractor orders, as provided in
paragraph (b) (5) above, which are properly chargeable to the terminated
portion of the contract (exClUsive 'ofamounts paid or payable on account
of supplies or materials delivered or*rvices furnished by subcontractors
or vendors prior to the effective date-of the Notice of Termination,
which amounts shall be included'in.the costs payable under (i) above).
(iii) A sum equal to 2% of that part of the amount determined under
(i) which represents the cost of articles and materials not processed by
the Contractor, plus a sum equal to. 8% of the remainder of such amount
but the aggregate of such sums shall not exceed 6% of the amount determined
under subdivision (i) above, which amount for the purpose of this sub-
division (iii) shall exclude any charges for interest on borrowings;
provided, however, that if it appears that the Contractor would have
sustained a loss on the entire contract had it been completed, no profit
shall be included or allowed under this subdivision (iii) and an appropri-
ate adjUstment shall be made reducing the amount of the settlement to
reflect the indicated rate of loss.''
(3) The reasonable costs of adittlement including accounting, legal,
clerical, and other expenses reasonable necessary for the preparation
of settlement claims and supporting: data with respect to the terminated
portion of the contract and for the termination and settlement of sub-
contracts thereunder, together with reasonable storage, transportation?
and other costs incurred in connection with the protection or disposition
of property allocable to this contract.
The total sum to be paid to the Contractor under (1) and (2) of this
paragraph (e) shall not exceed the total contract price as reduced by the
amount of payments otherwise madeand as further reduced by the contract
price of work not terminated, Except for normal spoilage, and except to
the extent that the Government shall have otherwise expressly assumed the
risk of loss, there shall be excluded from the amounts payable to the Con-
tractor as provided in paragraph (e) (1) and paragraph ;e) (2) W, the
fair value, as determined by the Contracting Officer, of property which
is destroyed, lost, stolen, or damaged so as to become undeliverable to the
Government, or to a buyer pursuant to paragraph (b)(7).
(f) Any determination of costs under paragraph (c) or (e) hereof shall
be governed by the Statement of Principles for Consideration of Costs set
forth in Part L. of Section VIII of the Armed Services Procurement Regulation,
as in effect on the date of this contract.
(g) The Contractor shall have the right of appeal, under the clause
of this contract entitled "Disputes," from any determination made by the
Contracting Officer under paragraphs (c) or (e) above, except that if the
Contractor 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 the Contracting
Officer has made a determination of the amount due under paragraph (6) or (e)
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above, the Government shall pay to the Contractor the following: (i) if
there is no richt of appeal here4ndet or if no timely appeal has been
taken, the amount so determined by the Contracting Officer, or (ii)
if an appeal has been taken, the amount finally determined on such
appeal.
(h) In arriving at the amount due the Contractor under this clause
there shall be deducted (1) all unliquidated advance or other unliquidated
payments on account theretofore made to the Contractor, (2) anY claim
which the Government may have against the Contractor in connection with
this contract, and (3) the agreed price for, or the proceeds of sale of,
any materials, supplies, or other things acquired by the Contractor or
sold, pursuant to the provisions of this clause, and not otherwise re-
covered by or credited to the Government.
(i) If the termination hereunder be partial, prior to the settlement
of the terminated portion of this contract, the Contractor may file with
the Contracting Officer a request in writing for an equitable adjustment
of the price or prices specified in the contract relating to the continued
portion of the contract (the portion not terminated by the Notice of
Termination), and such equitable adjustment as may be agreed upon shall be
made in such price or prices.
(j) The Government may from time to time, under such terms and
conditiens as it may prescribei. make partial payments and payments on
account against costs incurred by the Contrattor in connection with the
terminated portion of this contract whenever inthe opinion of the Con-
tracting Officer the aggregate of such payments shall be within the amount
to which the Contractor will be entitled hereunder. If the total of
such payments is in excess of the amount finally agreed or determined to
be due under this clause, such excess shall be payable by the Contractor to
the Government upon demand, together with interest computed at the rate of
per annum, for the period from the date such excess payment is received
by the Contractor to the date on which such excess is repaid to the'Govern-
ment; provided, however, that no interest shall be charged with respect to any
such excess payment attributable to a reduction in the Contractor's claim
by reason of retention or other disposition of termination inventory until
ten days after the date of such retention or disposition.
(k) Unless otherwise provided for in this contract, or by applicable
statute, the Contractor, from the effective date of termination and for
a period of six years after final settlement under this contract, shall
preserve and make available to the Government at all reasonable times at
the office of the Contractor but without direct charge to the Government,
all its books, records, documents, and other evidence bearing on the costs
and expenses of the Contractor under this contract and relating to the
work terminated hereunder, or, to the extent approved by the Contracting
Officer, photographs, micro-photographs, or other authentic reproductions
thercof.
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20. AUTHORIZATION AND CONSENT (APR 9.-102.1)
The Government hereby gives its authorization and consent (without
prejudice to its rights of indemnification, if such rights are provided
for in this contract) .for all use and manufacture, in the performance of ,
this contract or any part hereof or any amendment hereto or any subcontract
hereunder (including any lower-tier subcontract), of any patented invention
(i) embodies in the structure or composition of any article the delivery
of which is accepted by the Government under this contract, or (ii)
utilized in the machinery, tools, or methods the use of which necessarily
results from compliance by the Contractor or the using subcontractor with
(a) specificstions or written proVisions now or hereafter forming a part
of this contract, or (b) specific.written instructions given by the
Contracting Officer directing the manner of performance: The Contractor's
entire liability to the Government for patent infringement shall be
determined solely by the provisions of the indemnity clause, if any,
included in the contract and the Government assumes liability for all other
infringement to the extent of the authorization and consent hereinabove
granted.
21. NOTICE AND ASSISTANCE REGARDING PATENT LIFRINGEMENT (ASPR 9-104)
The provisions of this claUse,shall be applidable only if the amolint
of this contract is in excess of