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(1) Termination for cause. - The Federal agency may terminate any cooperatlve agreement in whole, or in part, at any time before the date of completion, whenever it is determined that the recipient has failed to comply with the conditions of the cooperative agreement. The Federal agency shall promptly notify the recipient in writing of the determination and the reasons for the termination, together with the effective date. Payments made to recipients or recoveries by the Federal agencies under cooperative agreements terminated for cause shall be in accord with the legal rights and liabilities of the parties. (2) Termination for convenience. - The Federal agency or recipient may termlnate the cooperatlve agreement in whole, or in part, when both parties agree that the continuation of the project would not produce beneficial results commensurate with the further expenditure of funds. The two parties shall agree upon the termination conditions, including the effective date, and in the case of partial terminations, the portion to be terminated. The recipient shall not incur new obligations for the terminated portion after the effective date, and shall cancel a~ many outstanding obligations as possible. The Federal agency shall allow full credit to the recipient for the Federal share of the noncancelable obligations, properly 4ncurred by the recipient prior to termination. 10. Procurement Standards. - a. The standards contained in this provlslon do not relieve the recipient of the contractual responsibilities arising under its sub- contracts. The recipient is the responsible authority, without recourse to the Federal agency regarding the settlement and satisfaction of all contractual and administrative issues arising out of procurements entered into, in support of the cooperative agreement. This includes but is not limited to: Disputes, clatms, protests of award, or other matters of a contractual nature. Matters concerning violation of law are to be referred to such local, State, or Federal authority as may have proper jurisdiction. b. Recipients may use their own procuranent regulations which reflect applicable State and local law, rules, and regulations provided that procurements made with Federal funds adhere to the standards set forth as follows: (1) The recipient shal I maintain a code or standard of conduct which shall govern the performance of its officers, employees, or agents in contracting with and expending Federal funds. Recipient's officers, employees, or agents shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or potential contractors. To the extent permissible by State or local law, rules, or regulations, such standards shall provide for penalties, sanctions or other disciplinary actions to be applied for violations of such standards by either the recipient officers, employees, or agents, or by subcontractors or their agents. 10