[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR49]

[Page 909-910]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 49_TERMINATION OF CONTRACTS--Table of Contents
 
                     Subpart 49.1_General Principles
 
Sec.  49.105  Duties of termination contracting officer after issuance 
of notice of termination.

    (a) Consistent with the termination clause and the notice of 
termination, the TCO shall--
    (1) Direct the action required of the prime contractor;
    (2) Examine the settlement proposal of the prime contractor and, 
when appropriate, the settlement proposals of subcontractors;
    (3) Promptly negotiate settlement with the contractor and enter into 
a settlement agreement; and
    (4) Promptly settle the contractor's settlement proposal by 
determination for the elements that cannot be agreed on, if unable to 
negotiate a complete settlement.
    (b) To expedite settlement, the TCO may request specially qualified 
personnel to--
    (1) Assist in dealings with the contractor;
    (2) Advise on legal and contractual matters;
    (3) Conduct accounting reviews and advise and assist on accounting 
matters; and
    (4) Perform the following functions regarding termination inventory 
(see subpart 45.6):
    (i) Verify its existence.
    (ii) Determine qualitative and quantitative allocability.
    (iii) Make recommendations concerning serviceability.
    (iv) Undertake necessary screening and redistribution.
    (v) Assist the contractor in accomplishing other disposition.
    (c) The TCO should promptly hold a conference with the contractor to 
develop a definite program for effecting the settlement. When 
appropriate in the judgment of the TCO, after consulting with the 
contractor, principal subcontractors should be requested to attend. 
Topics that should be discussed at the conference and documented 
include--
    (1) General principles relating to the settlement of any settlement 
proposal, including obligations of the contractor under the termination 
clause of the contract;
    (2) Extent of the termination, point at which work is stopped, and 
status of any plans, drawings, and information that would have been 
delivered had the contract been completed;
    (3) Status of any continuing work;
    (4) Obligation of the contractor to terminate subcontracts and 
general principles to be followed in settling subcontractor settlement 
proposals;
    (5) Names of subcontractors involved and the dates termination 
notices were issued to them;
    (6) Contractor personnel handling review and settlement of 
subcontractor settlement proposals and the methods being used;
    (7) Arrangements for transfer of title and delivery to the 
Government of any material required by the Government;
    (8) General principles and procedures to be followed in the 
protection, preservation, and disposition of the contractor's and 
subcontractors' termination inventories, including the preparation of 
termination inventory schedules;

[[Page 910]]

    (9) Contractor accounting practices and preparation of SF 1439 
(Schedule of Accounting Information (49.602-3);
    (10) Form in which to submit settlement proposals;
    (11) Accounting review of settlement proposals;
    (12) Any requirement for interim financing in the nature of partial 
payments;
    (13) Tentative time schedule for negotiation of the settlement, 
including submission by the contractor and subcontractors of settlement 
proposals, termination inventory schedules, and accounting information 
schedules (see 49.206-3 and 49.303-2);
    (14) Actions taken by the contractor to minimize impact upon 
employees affected adversely by the termination (see paragraph (g) of 
the letter notice in 49.601-2); and
    (15) Obligation of the contractor to furnish accurate, complete, and 
current cost or pricing data, and to certify to that effect in 
accordance with 15.403-4(a)(1) when the amount of a termination 
settlement agreement, or a partial termination settlement agreement plus 
the estimate to complete the continued portion of the contract exceeds 
the threshold in 15.403-4.

[48 FR 42447, Sept. 19, 1983, as amended at 61 FR 39221, July 26, 1996; 
62 FR 51271, Sept. 30, 1997]