RF009
RS68 LONG-TERM AGREEMENT
Multi-year Contract
Notwithstanding the quantity and prices set forth elsewhere in this contract, this is a Multi-year
Contract for the procurement of 340 shipsets of supplies/services for the RS68 engine. The total
price for the 340 shipsets is $
. Buyer’s total obligation hereunder is subject to the funding
limitations and quantity variations set for the elsewhere in this contract.
Partial Funding Clause
A. Of the total price of this contract, the sum of $
is presently allotted hereto by Buyer.
From time to time additional funds may be allotted to this contract by Buyer until the total
price is allotted.
B. Seller agrees to perform work hereunder up to the point at which, is the event of cancellation
or termination of this contract pursuant to the clause(s) hereof entitled “Cancellation” or
“Termination”, the total amount payable by the Buyer to Seller (including Seller’s cost,
profit and amounts payable in respect of subcontracts and settlement costs), would in the
reasonable judgment of Seller approximate the total amount at the time allotted to this order.
Seller shall not be obligated to continue performance of the work beyond such point.
Notwithstanding any other provision of this contract, Buyer shall not be obligated in any
event to pay or reimburse Seller in excess of the amount from time to time allotted to this
contract. However, when and to the extent that the total amount allotted to this contract has
been increased, any costs incurred by Seller and any profit to which Seller may be entitled,
prior to the increase and in excess of the amount previously allotted, shall be allowable or
payable to the same extent as if such cost had been incurred and profit earned after such
increase in amount allotted.
C. Seller shall notify Buyer in writing when within the next 60 days of work Seller will reach a
point at which, in the event of cancellation or termination of this contract pursuant to the
clause(s) hereof entitled “Cancellation” or “Termination”, the total amount payable by Buyer
(including Seller’s cost, profit and amounts payable in respect of subcontracts and settlement
costs), will approximate 85% of the total amount then allotted to the contract. The notice
shall state the estimated date when such point will be reached.
D. If Seller incurs additional costs or is delayed in the performance of the work under this
contract solely by reason of the failure of Buyer to allot additional funds in amounts
sufficient for the timely performance of this order and if additional funds are allotted, an
equitable adjustment shall be made in the price or prices (including ceiling amounts where
applicable) of this contract or in the time of delivery, or both.
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E.
The provisions of this clause with respect to cancellation or termination shall in no way be
deemed to limit the rights of Buyer under the clause hereof entitled “Cancellation” or
“Termination.”
F.
Changes issued pursuant to the Changes provision of this contract shall not be considered an
authorization to the Seller to exceed the funds allotted to this contract, as set forth above, in
the absence of a statement in the change notice increasing the funds allotted.
G. This clause shall become inoperative upon the allotment of funds for the total price of said
work. If any succeeding time or times the total price of said work exceeds the amount
allotted to this contract, this clause shall again become operative and in full force and effect.
Cancellation
(a) Cancellation, as used in this clause, means that the Buyer is canceling its requirements for
supplies or services in program years subsequent to that in which notice of cancellation is
provided unless a later date is agreed to by Buyer and Seller. Cancellation shall occur if the
Buyer notifies Seller that funds are not available for contract performance for any
subsequent program year.
(b) Except for cancellation under this clause or termination under the Default clause, any
quantity reduction by the Buyer in the requirements of this contract shall be considered a
termination under the Termination for Convenience clause.
(c) The following is the not-to-exceed cancellation ceiling for each program year: The ceiling
amounts set forth below are the maximum potential liability to Buyer in event of
cancellation of the contract. The ceiling amount expires at the end of the program year.
Program Year
FY99
FY2000
FY2001
FY2001-2008
Ceiling Amount
$
$
$
$
(d) The cancellation charge will cover only (1) Cost (i) incurred by the Seller and/or its
subcontractor, (ii) reasonably necessary for performance of the contract, and (iii) that would
have been equitably amortized, over the entire multi-year contract period but, because of the
cancellation, are not so amortized, and (2) a reasonable profit of fee on the costs.
(e) The cancellation charge shall be computed and the claim made for it as if the claim were
being made under the Termination for Convenience clause of this contract. The Seller shall
submit the claim promptly but no later than 1 year from the effective date or cancellation.
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(f) The Seller’s claim may include - (1) Reasonable non-recurring costs (see Subpart 15.4 of the Federal Acquisition
Regulation) which are applicable to normally would have been amortized in all supplies
or services which are multi-year requirements;
(2) Allocable portions of the costs of facilities acquired or established for the conduct of
the work, to the extent that it is impracticable for the Seller to use the facilities in its
other work, and if the costs are not charged to the contract through overhead or
otherwise depreciated;
(3) Costs incurred for the assembly, training, and transportation to and from the job site of
a specialized work force, and
(4) Costs not amortized solely because the cancellation had precluded anticipated benefits
of Seller or subcontractor learning.
(a) The claim shall not include - (1) Labor, material, or other expenses incurred by the Seller or its subcontractors for
performance of the canceled work;
(2) Any cost already paid to the Seller;
(3) Anticipated profit or unearned fee on the canceled work.
General
Buyer issuance of this Contract is based in part on reliance upon Seller’s ability, expertise and
awareness of the intended use of the Goods. It is an essential consideration of this Contract that
Seller perform to the requirements of this Contract to ensure proper support of Buyer’s
operations and the RS-68 Program. In the event that Seller is unable to supply the items under the
terms of this Contract, or at the time, or in the quantities, or quality required by this Contract,
Seller agrees that Buyer may obtain items from other suppliers.
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