[Code of Federal Regulations]

[Title 48, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR49]



[Page 924-925]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 1--FEDERAL ACQUISITION REGULATION

 

PART 49_TERMINATION OF CONTRACTS--Table of Contents

 

                     Subpart 49.1_General Principles

 

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;



[[Page 925]]



    (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;

    (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]