FAR Supplement 1

1. When the Goods or Services furnished are for use in connection with a U.S. Government contract or subcontract, in addition to the Purchase Order General Terms and Conditions, the following provisions shall apply, as required by the terms of the applicable prime contract, or by operation of law or regulation. In the event of a conflict between these FAR provisions and the Purchase Order General Terms and Conditions, the FAR provisions shall control.

2. The following clauses set forth in the FAR in effect as of the date of the prime contract are incorporated herein by reference with the same force and effect as if they were in full text. In all clauses listed herein, the terms “Government”, “Contracting Officer” and “Contractor” shall be revised to suitably identify the contracting parties herein and effect the proper intent of the of the provision except where further clarified or modified below. Subcontractor”, however, shall mean “Seller’s Subcontractor” under this purchase order. Seller, by signing its offer, hereby certifies compliance with the following clauses and is, therefore, eligible for award.

3. Clauses in this document may not be applicable to specific orders due to the type of subcontract/purchase order to be issued, dollar thresholds under requirements of the FAR, DFARS or Public Law or Mandatory Flow Down requirements of a particular prime contract. Clauses not applicable for these reasons shall not be removed from this document and will be considered by all parties to be without force and effect.

A. APPLICABLE TO ALL ORDERS:

1. Definitions 52.202-1

2. Security Requirements 52.204-2

3. Annual Representations and Certifications 52.204-8

4. Personal Identity Verification of Contractor Personnel 52.204-9

5. Service Contract Reporting Requirements (subject to FAR 4.1705) 52.204-14

6. Service Contract Reporting Requirements for Indefinite Delivery Contracts (subject

to FAR 4.1705) 52.204-15

7. Basic Safeguarding of Covered Contractor Information Systems (subject to FAR 4.1903) 52.204-21

8. Material Requirements 52.211-5

9. Alternatives to Government – Unique Standards 52.211-7

10. Defense Priority and Allocation Requirements 52.211-15

11. Contract Terms and Conditions Required to Implement Statutes or Executive Orders –

Commercial Items (DEVIATION) (includes all Statutes or Orders issued) 52.212-5

12. Terms and Conditions – Simplified Acquisitions (other than Commercial items) 52.213-4

13. Small Business Program Representations 52.219-1

14. Utilization of Small Business Concerns 52.219-8

15. Post –Award Small Business Program Representation 52.219-28

16. Notice to the Government of Labor Disputes 52.222-1

17. Convict Labor 52.222-3

18. Child Labor – Cooperation with Authorities and Remedies 52.222-19

19. Service Contract Labor Standards 52.222-41

20. Combating Trafficking in Persons 52.222-50

21. Employment Eligibility Verification 52.222-54

22. Minimum Wages Under Executive Order 13658 (in conjunction with FAR 52.222-41) 52.222-55

23. Paid Sick Leave 52.222-62

24. Hazardous Material Identification and Material Safety Data – “Government” means

“Government and Buyer” 52.223-3

25. Notice of Radioactive Materials 52.223-7

26. Ozone Depleting Substances 52.223-11

27. Energy Efficiency in Energy-Consuming Products 52.223-15

28. IEEE 1680 Standard for the Environmental Assessment of Personal Computer Products 52.223-16

29. Encouraging Contractor Policy to Ban Text Messaging While Driving 52.223-18

30. Privacy Act 52.224-2

31. Privacy Training 52.224-3

32. Buy American Act – Supplies 52.225-1

33. Buy American Act Certificate 52.225-2

34. Trade Agreement 52.225-5

35. Trade Agreements – Certificate 52.225-6

36. Duty-Free Entry 52.225-8

37. Restrictions on Certain Foreign Purchases 52.225-13

38. Place of Manufacture (applicable to solicitations) 52.225-18

39. Contractors Performing Private Security Functions Outside the United States 52.225-26

40. Authorization and Consent – Alternate l 52.227-1

41. Royalty Information 52.227-6

42. Additional Data Requirements 52.227-16

43. Refund of Royalties 52.227-9

44. Filing of Patent Applications – Classified Subject Matter 52.227-10

45. Patent Rights – Ownership by the Contractor 52.227-11

46. Rights in Data – General 52.227-14

47. Commercial Computer Software License 52.227-19

48. Workers Compensation Insurance (Defense Base Act) 52.228-3

49. Workers Compensation and War-Hazard Insurance Overseas 52.228-4

50. Insurance – Work on a Government Installation 52.228-5

51. Limitation on Withholding of Payments 52.232-9

52. Progress Payments 52.232-16

53. Performance-Based Payments 52.232-32

54. Unenforceability of Unauthorized Obligations 52.232-39

55. Providing Accelerated Payments to Small Business Contractors (applicable only if

included in L3’s terms and conditions with its customer) 52.232.40

56. Protest After Award 52.233-3

57. Applicable Law for Breach of Contract Claim 52.233-4

58. Industrial Resources Developed Under Defense Production Act Title lll 52.234-1

59. Accident Prevention 52.236-13

60. Protection of Government Buildings, Equipment, and Vegetation 52.237-2

61. Privacy or Security Safeguards 52.239-1

62. Stop Work Order 52.242-15

63. Government Delay of Work 52.242-17

64. Changes – Fixed Price 52.243-1

65. Competition in Subcontracting 52.244-5

66. Subcontracts for Commercial Items 52.244-6

67. Government Property (or Alt I or Alt II, the Buyer shall so specify. If the Buyer does not specify

the requirement will default to the basic clause) 52.245-1

68. Government Property Installation Operation Services 52.245-2

69. Use and Charges 52.245-9

70. Preference for U.S. – Flag Air Carriers 52.247-63

71. Preference for Privately Owned U.S. – Flag Commercial Vessels 52.247-64

72. Termination for Convenience of the Government (Fixed-Price) (Short Form) 52.249-1

73. Computer Generated Form 52.253-1

B. ORDERS OVER $10,000 ALSO INCLUDE THE FOLLOWING:

1. Reporting Executive Compensation and First-Tier Subcontract Awards) 52.204-10

2. Walsh-Healy Public Contracts Act 52.222-20

3. Prohibition of Segregated Facilities 52.222-21

4. Equal Opportunity 52.222-26

5. Affirmative Action for Workers with Disabilities (Seller shall

comply with the requirements of 41 CFR 60-741.5(a)) 52.222-36

6. Notification of Employee Rights Under the National Labor Relations Act (para (f) only) 52.222-40

7. Buy American Act – North American Free Trade Agreement – Israeli Trade Act 52.225-3

8. Buy American Act North American Free Trade Agreement – Israeli Trade Act Certificate 52.225-4

C. ORDERS OVER THE SIMPLIFIED ACQUISITION PROGRAM (SAP) THRESHOLD

(or amounts as specified) ALSO INCLUDE THE FOLLOWING:

1. Certificate of Independent Price Determination 52.203-2

2. Gratuities 52.203-3

3. Covenants Against Contingent Fees 52.203-5

4. Restrictions on Subcontractor Sales to the Government 52.203-6

5. Anti-Kickback Procedures (less paragraph (c) (1)) 52.203-7

6. Cancellation, Rescission, and Recovery of Funds for Illegal or Improper Activity 52.203-8

7. Price or Fee Adjustment for Illegal or Improper Activity 52.203-10

8. Limitation on Payments to Influence Certain Federal Transactions 52.203-12

9. Preventing Personal Conflicts of Interest 52.203-16

10. Contractor Employee Whistleblower Rights and Requirements to Inform Employees of

Whistleblower Rights 52.203-17

11. Women-Owned Business (Other than Small Business) 52.204-5

12. Audit and Records – Negotiation 52.215-2

13. Integrity of Unit Prices 52.215-14

14. Contract Work Hours and Safety Standards Act – Overtime Compensation 52.222-4

15. Non-displacement of Qualified Workers (Service Contracts) 52.222-17

16. Equal Opportunity for Veterans (Seller shall comply with the requirements of

41 CFR 60-300.5(a)) 52.222-35

17. Employment Reports on Veterans 52.222-37

18. Compliance with Veterans’ Employment Reporting Requirements 52.222-38

19. Paycheck Transparency 52.222-60

20. Drug-Free Workplace 52.223-6

21. Estimate of Percentage of Recovered Material Content for EPA-Designated Items 52.223-9

22. Notice and Assistance Regarding Patent and Copyright Infringement 52.227-2

23. Federal, State, and Local Taxes 52.229-3

24. Bankruptcy 52.242-13

25. Change Order Accounting 52.243-6

26. Subcontracts (paragraphs (h) notice to L3 and (i) only apply) 52.244-2

27. Inspection of Supplies, Fixed Price 52.246-2

28. Inspection of Services, Fixed Price 52.246-4

29. Higher Level Contract Quality Requirement 52.246-11

30. Responsibility for Supplies 52.246-16

31. Value Engineering 52.248-1

32. Termination for Convenience of the Government (Fixed-Price) – “Government: shall mean

“Buyer”. In paragraph (c) the term “120 days” is changed to “60 days.” The term “one year

In Paragraph (e) is changed to “six months.” The term “90 days in paragraph (l) is changed

to “forty-five days,” per 49.502(e) 52.249-2

33. Default (Fixed Price Supply and Service) 52.249-8

D. ORDERS OVER $650,000 ALSO INCLUDE THE FOLLOWING:

1. Contractor Code of Business Ethics and Conduct 52.203-13

2. Display of Hotline Poster(s) 52.203-14

3. Pension Adjustments and Asset Reversions 52.215-15

4. Reversion or Adjustment of Plans for Postretirement Benefits (PRB) Other Than Pensions 52.215-18

5. Notification of Ownership Changes 52.215-19

6. Small Business Subcontracting Plan 52.219-9

7. Liquidated Damages – Subcontracting Plan 52.219-16

8. Pre-award On-Site Equal Opportunity Compliance Evaluation 52.222-24

E. UNLESS OTHERWISE EXEMPT ALSO INCLUDE THE FOLLOWING:

1. Audit and Records – Sealed Bidding 52.214-26

2. Price Reduction for Defective Certified Cost or Pricing Data – Modifications – Sealed Bidding 52.214-27

3. Subcontractor Certified Cost or Pricing Data – Modifications – Sealed Bidding 52.214-28

4. Price Reduction for Defective Certified Cost or Pricing 52.215-10

5. Price Reduction for Defective Certified Cost or Pricing Data – Modifications 52.215-11

6. Subcontractor Certified Cost or Pricing Data 52.215-12

7. Subcontractor Certified Cost of Pricing Data – Modifications 52.215-13

8. Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost

or Pricing Data 52.215-20

9. Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost

or Pricing Data – Modifications 52.215-21

10. Limitation on Pass-Through Charges – Identification of Subcontract Effort 52.215-22

11. Limitation on Pass-Through Charges (see application and exceptions in FAR 15.408(n) (2) 52.215-23

12. Contract Definitization 52.216-25

13. Prospective Subcontractor Requests for Bonds 52.228-12

14. Earned Value Management System 52.234-4

F. APPLICABLE TO COST REIMBURSEMENT, TIME & MATERIAL OR LABOR HOUR ORDERS:

1. Facilities Capital Cost of Money 52.215-16

2. Waiver of Facilities Capital Cost of Money 52.215-17

3. Allowable Cost and Payment (cost reimbursement – Seller agrees to execute assignment

documents in order to meet subsection (d) (5) 52.216-7

4. Fixed Fee – applicable if this is a cost plus fixed fee order 52.216-8

5. Incentive Fee – applicable if this is a cost plus incentive fee order 52.216-10

6. Cost Contract – No Fee (applicable if this is a cost no fee order) 52.216-11

7. Cost Sharing Contract – No Fee (applicable if this is a cost sharing, no fee order) 52.216-12

8. Payment for Overtime Premiums – insert “0%” in paragraph (a) unless indicated otherwise

on the face of this order 52.222-2

9. Fair Labor Standards Act and Service Contract Labor Standards — Price Adjustment

(Multiple Year and Option Contracts) 52.222-43

10. Fair Labor Standards Act and Service Contract Act — Price Adjustment 52.222-44

11. State of New Mexico Gross Receipts and Compensating Tax 52.229-10

12. Payments under Time-and Materials and Labor-Hour Contracts (“schedule” means

Purchase order, “voucher(s)” means Purchase order. “Government” means Buyer and

“Contracting Officer” means Buyer Purchasing Representative 52.232-7

13. Limitation of Cost (if fully funded) 52.232-20

14. Limitation of Funds (if incrementally funded) 52.232-22

15. Stop Work Order 52.242-15 Alt I

16. Changes – Cost-Reimbursement (applicable if this is a cost-reimbursement order) 52.243-2

17. Changes – Time and Material or Labor-Hours (applicable if this is a time and material

or labor hour order) 52.243-3

18. Inspection of Supplies – Cost-Reimbursement – “Contracting Officer” means “Buyer’s purchasing

representative” and “Government” means “Buyer and Government” (provided that

an inspection system accepted by the Government will be deemed accepted by the Buyer),

and where “Government” first appears in paragraph (k) it shall mean “Government or Buyer.”

The provisions in this clause for access, right to inspect, safety protection, and relief from

liability apply equally to Buyer and the Government. 52.246-3

19. Inspection of Services – Cost –Reimbursement – “Contracting Officer” means “Buyer’s

purchasing representative” and “Government” means “Buyer and Government” (provided that

an inspection system accepted by the Government will be deemed accepted by the Buyer)

and where “Government” first appears in paragraph (k) it shall mean “Government and Buyer.

The provisions in this clause for access, right to inspect, safety protection, and relief from

liability apply equally to Buyer and the Government. 52.246-5

20. Inspection – Time and Material and Labor Hour – “Contracting Officer” means “Buyer’s

purchasing representative” and “Government” means “Buyer and Government” (provided that

an inspection system accepted by the Government will be deemed accepted by the Buyer),

and where “Government” first appears in paragraph (k) it shall mean “Government and

Buyer.”

The provisions in this clause for access, right to inspect, safety protection, and relief

from liability apply equally to Buyer and the Government. 52.246-6

21. Submission of Transportation Documents for Audit 52.247-67

22. Termination (Cost-Reimbursement) – “Government” means “Buyer” and “Contracting

Officer” means “Buyer’s purchasing representative.” In paragraph (d) change “15 days” and

“45 days” to “30 days” and “90 days,” respectively. In paragraph (e) change “1 year” to “six

months.” Alternate IV is applicable to time and material or labor-hour orders only. 52.249-6 Alt IV

23. Excusable Delays 52.249-14

G. APPLICABLE TO CONSTRUCTION ORDERS

1. Subcontracts (Labor Standards). 52.222-11

2. Affirmative Action Compliance Requirements for Construction 52.222-27

3. Notice of Requirement for Project Labor Agreement 52.222-33

4. Project Labor Agreement 52.222-34

5. Affirmative Procurement of Bio-based Products Under Service and Construction Contracts 52.223-2

6. Buy American – Construction Materials 52.225-9

7. Notice of Buy American Requirement – Construction

Materials 52.225-10

8. Buy American – Construction Materials Under Trade Agreements 52.225-11

9. Required Use of American Iron, Steel, and Manufactured Goods, Buy American Statute –

Construction Materials 52.225-21

10. Notice of Required Use of American Iron, Steel, and Manufactured Goods – Buy American

Statute – Construction Materials 52.225-22

11. Required Use of American Iron, Steel, and Manufactured Goods, Buy American Act –

Construction Materials Under Trade Agreements 52.225-23

12. Notice of Required Use of American Iron, Steel, and Manufactured Goods – Buy American

Act – Construction Materials Under Trade Agreements 52.225-24

13. North Carolina State and Local Sales and Use Tax 52.229-2

14. Prompt Payment for Construction Contracts 52.232-27

15. Inspection of Construction 52.246-12

16. Value Engineering – Construction 52.248-3

1. CERTIFICATIONS

The Seller, by signing its offer, hereby certifies compliance with the following clauses and is,

Therefore, eligible for award.

A. Certification and Disclosure Regarding Payments to Influence Certain Federal Transactions 52.203-11

B. Reporting Executive Compensation and First-Tier Subcontract Awards 52.204-10

C. Certification Regarding Responsibility Matters 52.209-5

D. Protecting the Government’s Interest when Subcontracting with Contractors Debarred,

Suspended, or Proposed for Debarment 52.209-6

E. Certification Regarding Knowledge of Child Labor for Listed End Products 52.222-18

F. Previous Contracts and Compliance Reports 52.222-22

G. Affirmative Action Compliance 52.222-25

H. Affirmative Action for Workers with Disabilities 52.222-36

I. Bio-based Product Certification 52.223-1

J. Recovered Material Certification 52.223-4

K. Public Disclosure of Greenhouse Gas Emissions and Reduction Goals 52.223-22

L. Prohibition on Conducting Restricted Business Operations in Sudan Certification 52.225-20

M. Prohibition on Contracting with Entities Engaging in Certain Activities or Transactions Relating to Iran –

Representation & Certification 52.225-25

N. Cost Accounting Standards Notices and Certifications 52.230-1

2. Applicable to all contracts that are funded in whole or in part by the American Recovery and

Reinvestment Act of 2009 (“Recovery Act”):

1. Whistleblower Protections Under the American Recovery and Reinvestment Act 52.203-15

2. Audit and Records – Sealed Bidding 52.214-26

3. ADDITIONAL CLAUSES

COST ACCOUNTING STANDARDS (Applicable unless otherwise exempt)

Seller shall communicate and otherwise deal directly with the Contracting Officer to the extent practicable and

permissible as to all matters relating to Cost Accounting Standards. Seller shall provide Buyer with copies of all

communications between Seller and the Contracting Officer with respect to Cost Accounting Standards, FAR 52.230-

2; Disclosure and Consistency of Cost Accounting Practices, FAR 52.230-3; and Administration of Cost Accounting

Standards, FAR 52.230-6, provided Seller shall not be required to disclose to Buyer such communications containing

information which is privileged and confidential to Seller. In addition to any other remedies provided by law or under

this Order, Seller agrees to indemnify and hold Buyer harmless to the full extent of any loss, damage, or expense if

Buyer is subject to any liability as the result of a failure of the Seller or its lower-tier subcontractors to comply with the

requirements of FAR 52.230-2, 52.230-3, 52.230-4(if applicable), 52.230-5 or 52.230-6. Paragraph (b) is deleted in

each of the foregoing clauses.

TRUTH IN NEGOTIATIONS

Certified Cost or Pricing Data (applicable only if certified cost or pricing data has been provided). The clause entitled

“Subcontractor Certified Cost or Pricing Data” is a part of this Order if the Seller was required to furnish cost and

pricing data and a Certification of Current Cost or Pricing Data for this Order. If it was not required to furnish such

data and Certificate, the clause entitled “Subcontractor Cost or Pricing Data-Modification” is a part of this Order. Seller

shall update its proposal and re-certify its cost or pricing data whenever costs, factors, or prices change such that cost

or pricing data previously furnished is no longer, accurate, current, or complete.

1. Indemnification

If any price (including profit or fee) negotiated in connection with the prime contract between the

Government and the Buyer or any cost that is reimbursable under said contract is reduced because cost or

pricing data furnished by the Seller in connection with any proposal submitted by the Buyer relating to said contract or in connection with this Order was not accurate, complete, or current, the Seller shall indemnify the

Buyer in the amount of said reduction.

The phrase “certified cost or pricing data” as used herein shall be deemed to include any such data, which

related to a lower-tier prospective or actual subcontract, at any level, which was submitted by the Seller or which

it procured by submission of, in connection with the aforesaid proposal or this Order in support of its cost

estimate.

If any reduction in the contract price under this clause reduces the price of items for which payment was made

prior to the date of the modification reflecting the price reduction, the Seller shall be liable and shall pay the

Buyer at the time such overpayment is repaid:

i. Simple interest on the amount of such overpayment to be computed from the date(s) of overpayment to

the Seller to the date the Buyer is repaid by the Seller at that applicable underpayment rate effective for

each quarter prescribed by the Secretary of the Treasury under 26 U.S.C 6621(a)(2); and

ii. For Department of Defense contracts only, a penalty equal to the amount of the overpayment, if the Seller

knowingly submitted cost or pricing data which were incomplete, inaccurate, or non-current.

2. Certified Cost or Pricing Data for Changes

Prior to the pricing of any change or other modification to this Order which involves, increases and/or decreases

in costs plus applicable profit in excess of the contractually required threshold and resulting from a change in

the prime contract, subcontractors shall submit cost or pricing data and shall certify that the data, as defined in

Federal Acquisition Regulation 15.406-2, submitted either actually or by specific identification in writing are

accurate, complete, and current as of the date of completion of negotiations.

When required to obtain certified cost or pricing data or “Other Than Certified Cost and Pricing Data” from its

subcontractors, pursuant to the provisions of this Order, Seller shall provide such data.

DISPUTES – GOVERNMENT CONTRACTS

Any reference to the “Disputes clause” in any applicable FAR Clause under paragraph 2 above shall mean this

paragraph, Disputes – Government Contracts

i. Any dispute arising under this purchase order relating to any decision of the Contracting Officer under the prime

contract shall be resolved in accordance with Paragraph (ii) below. All other disputes will be resolved under

the Article entitled, “DISPUTES”, as found in the Purchase Order Terms and Conditions.

ii. 1. Notwithstanding any other provisions in this purchase order, any decision of the Contracting Officer under the

prime contract which binds Buyer shall bind both Buyer and Seller to the extent that it relates to this purchase

order –provided that:

a. The Buyer notifies with reasonable promptness the Seller of such decision

b. The Buyer, at its sole discretion, authorizes in writing the Seller to appeal in the name of the Buyer such

decision at its own expense, or

c. If Buyer should appeal such decision, Buyer at its sole discretion offers to the Seller the opportunity at its

own expense to join Buyer in such appeal.

2. Any decision upon such appeal, when final, shall be binding upon the Seller.

3. The Seller shall keep Buyer informed of any appeal it makes by providing copies of all pertinent documents to

Buyer.

4. The Seller shall indemnify and save harmless from any and all liability of any kind incurred by or imputed to

Buyer under Section 5, “Fraudulent Claims,” of the Contract Disputes Act of 1978, as amended, if Seller is

unable to support any part of its claim and it is determined that such inability is attributable to fraud or

misinterpretation of fact on the part of Seller.

iii. Pending any prosecution, appeal, or final decision or settlement of any dispute arising under this purchase order,

the Seller shall proceed diligently, as directed by Buyer, with the performance of this purchase order.

iv. Nothing in this clause nor any authorization or offer that may be made shall be deemed to constitute acceptance or acknowledgement by Buyer of the validity of Seller’s claim or any part thereof, nor be deemed to

limit or in any way restrict Buyer from taking any actions, included available remedies, it deems appropriate to

protect its own interests.

v. As used in this clause, the word “appeal” means an appeal taken under the contract Disputes Act of 1978, as

amended.

Submission of Incurred Cost Proposals (T&M and Cost Reimbursable only)

Seller shall submit its annual incurred cost proposal required by FAR 52.216-7 to Seller’s cognizant U.S. Government audit

agency within six (6) months after the end of Seller’s fiscal year. Seller shall confirm its submission in writing to Buyer, to

include the date of its incurred cost proposal submission to the aforementioned audit agency, the point of contact name

and address of audit agency. Such written notice shall be provided to Buyer within thirty (30) days of the Seller’s incurred

cost submission. Seller agrees that the audit results shall be reflected in timely adjustments to the prices paid by Buyer to

Seller under this Subcontract as reflected in Seller’s invoices to Buyer. Seller hereby grants its permission for Seller’s

cognizant U.S. Government audit agency to provide a copy of any resultant audit report to Buyer.