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. . (e) Notwithstanding the terms and conditions of paragraphs (a) and (b) above, the estimated cost of this contract and, 1f this contract is Incrementally funded, the funds al lotted for the ~erfor- manee of this contract, shall not be increased or considered to be Increased except by speCific written modiflcatlon of the contract indicating the new contract estimated cost and, if this contract rs incrementally funded, the new amount allotted to the contract. Until this modifica- tion is made, the Contractor shall not be obligated to continue performance or Incur costs beyond the polnt established In the l1mitat1on of Cost or Limitation of Funds clause of this contract. 1-1.7 52.244-2 SUBCONTRACTS UNDER COST-REIMBURSEMENT AND LETTER CONTRACTS (APR 1984) (i!I) "SUbconTracT," as used in this clause, Includes but Is not limited to purchase orders, and changes and modifications to purchase orders. The Contractor shal I notify the Contracting Officer reasonably in advance of entering Into any subcontract If-- (1) The proposed subcontract is of the cost-reimbursement, time-and-materials, or labor-hour type; (2) The proposed subcontract Is fixed-price and exceeds either $25,00001'" 5 percent of the total estimated cost of this contract: (3) The proposed subcontract has experimental, developmental, or research work as one of Its purposes; or (4) Th!s contract 1s not a faci I Ities contract and the proposed subcontract provides for the fabrication, purchase, rental, Installation, 01'" other acquisition of special test equipment valued In excess of $10,000 or of any Items of Industrial facilities. (b) (1) In the case of a proposed subcontract that (i) is of the cost-reimbursement, tlme-end- materials, or labor-hour type and Is estimated to exceed $10,000, including any fee, (II) is pro- posed to exceed S100,000, or (111) is one of a number of subcontracts with a single subcontractor, under this contract, for the same or related supplies or services that, In the aggregate, are expected to exceed S100,000, the advance notification required by paragraph (a) above shal I Include the Information specified tn subparagraph (2) below. (2) (1) A descrlpt10n of the supplies or services to be subconTracted. (11) Identification of the type ot subcontract to be used. (fli) fdentffieaTfon of the proposed subcontractor and an explanation of why and how the proposed subcontraCTor was selected, including the compeTition obtained. (Iv) The proposed subcontrect pr1ce and the Contractor's cost or price analysis. (v) The subcontractor's current, complete, and accurate cost or pricing data and Cert1flcate of Current Cost 01'" Pricing Data, 1f required by other contract provlslons. (vi) The subcontractor's Disclosure Statement or certificate relating to Cost Accounting Standards when such data are requIred by other proviSions of this conTract. tvJ)) A negotiation memorandum refJectJng- (A) The principal elements of the subcontract price negotiations: (6) The most significant cons1deratlons oontrol ling establishment of Initial or revised prices; (el The reason cost or pricing data were or were not required: (D) The extent, if any, to which the Contractor did not rely on the subcontractor's cost or pricing data in determining the price objective and In negotiating the final price; (E) The extent to which lt was recognized In the negotiation that the subcontractor's cost or pricing data were not accurate, complete, or current: the action taken by the Contractor and the subcontractor: and the effect of any such defective data on the tote I price negotiated: (F) The reasons tor any significant difference between the Contractor's prJce objective and the price negotiated; and (Gl A complete explanation of the Incentive fee or profit plan when incentIves are used. The explenatlon s~all identify each crlticel performance element, management decisions used to quantify each Incentive elemenT, reasons for the incentives, and a summary of all Trade-off possibilities considered. 1-3