PART 1850

**EXTRAORDINARY CONTRACTUAL ACTIONS**

**TABLE OF CONTENTS**

**SUBPART [1850.2](#OLE_LINK2) DELEGATION OF AND LIMITATIONS ON EXERCISE
OF**

**AUTHORITY**

1850.202 Contract adjustment boards.

**SUBPART [1850.3](#OLE_LINK3) CONTRACT ADJUSTMENTS**

1850.305 Processing cases.

1850.305-70 Submission of request to the Contract Adjustment Board.

1850.306 Disposition.

1850.306-70 Implementation of the Contract Adjustment Board\'s decision.

**SUBPART [1850.4](#OLE_LINK4) RESIDUAL POWERS**

1850.403 Special procedures for unusually hazardous or nuclear risks.

1850.403-1 Indemnification requests.

1850.403-170 Subcontractor indemnification requests.

1850.403-2 Action on indemnification requests.

1850.470 Lead NASA installation.

**PART 1850**

**EXTRAORDINARY CONTRACTUAL ACTIONS**

**Subpart** []{#OLE_LINK2 .anchor}**1850.2\--Delegation of and
Limitations on Exercise of Authority**

**1850.202** **Contract** **adjustment boards.**

14 CFR part 1209, subpart 3, Contract Adjustment Board, establishes the
Contract Adjustment Board (CAB) as the approving authority to consider
and dispose of requests from NASA contractors for extraordinary
contractual actions.

**Subpart** []{#OLE_LINK3 .anchor}**1850.3\--Contract Adjustments**

**1850.305**  **Processing** **cases.**

**1850.305-70 Submission** **of** **request** **to** **the**
**Contract** **Adjustment** **Board.**

\(a\) After investigating the facts and issues relevant to the
contractor\'s request, the contracting officer shall forward the request
to the Associate General Counsel for General Law (Code GG), including in
the forwarding letter \--

\(1\) The nature of the case;

\(2\) The recommended disposition; and,

\(3\) If contractual action is recommended, the contracting officer\'s
opinion that the action will facilitate the national defense.

\(b\) The forwarding letter shall enclose the contractor\'s request, all
supporting material submitted by the contractor, and any material the
contracting officer has obtained while investigating the facts and
issues relevant to the request. Any classified information in the
material forwarded shall be so identified.

\(c\) Electronic submittal is preferred for unclassified material.

**1850.306  Disposition.**

**1850.306-70 Implementation of the Contract Adjustment Board\'s**
**decision.**

\(a\) The contracting officer shall take action authorized in the CAB's
decision.

\(b\) Immediately upon execution, including any required Headquarters
approval, of a contract or contract modification or amendment
implementing the CAB decision, the contracting officer shall forward a
copy of the contractual document to the Associate General Counsel for
General Law (Code GG).

[]{#OLE_LINK4 .anchor}**Subpart 1850.4\--Residual Powers**

**1850.403 Special** **procedures** **for** **unusually hazardous**
**or** **nuclear** **risks.**

**1850.403-1 Indemnification** **requests.**

\(a\) Contractor indemnification requests must be submitted to the
cognizant contracting officer for the contract for which the
indemnification clause is requested. Contractors shall submit a single
request and shall ensure that duplicate requests are not submitted by
associate divisions, subsidiaries, or central offices of the contractor.

\(b\) The contractor shall also provide evidence, such as a certificate
of insurance or other customary proof of insurance, that such insurance
is either in force or is available and will be in force during the
indemnified period.

**1850.403-170 Subcontractor indemnification requests.**

Subcon­tractors shall submit requests for indemni­fication to the prime
contractor and through higher tier subcontractor(s), as applicable. If
the prime contractor agrees an indemnity clause should be flowed down to
the subcontractor, the prime contractor shall forward its written
request for subcontrac­tor indemnification to the cognizant con­tracting
officer for approval in accordance with [**FAR
50.403-1**](http://www.arnet.gov/far/current/html/Subpart_50_4.html#1046489).
The prime contractor\'s request shall provide informa­tion responsive to
1850.403-1, FAR 50.403-1, and [**FAR
50.403-2(a)(1)**](http://www.arnet.gov/far/current/html/Subpart_50_4.html#1046506),
(2), (4), (5) and (7). The agreed upon definition of the unusually
hazardous risk to be incorpo­rated into the subcontract shall be the same
as that incor­porated in the prime contract.

**1850.403-2** **Action** **on** **indemnification** **requests.**

\(a\) If recommending approval, the contracting officer shall forward
the required information to the Assistant Administrator for Procurement
(Code HS), along with the following:

**(i)** For contracts of five years duration or longer, a determina­tion,
with supporting rationale, whether the indemnification ap­proval and
insurance coverage and premi­ums should be reviewed for adequacy and
continued validity at points in time within the extended contract
period.

**(ii)** A recommended Memorandum of Decision. In addition to the
applicable requirements of [**FAR
50.306**](http://www.arnet.gov/far/current/html/Subpart_50_3.html#1046554),
the Memorandum of Decision shall contain the following:

**(A)** The specific definition of the unusu­ally hazardous risk to which
the contractor is exposed in the performance of the con­tract(s);

**(B)** A complete discussion of the contrac­tor\'s financial protection
program; and

**(C)** The extent to, and conditions under, which indemnification is
being approved for subcontracts.

\(d\) If approving subcontractor indemnification, the contracting
officer shall docu­ment the file with a memorandum for record addressing
the items set forth in [**FAR
50.403-2(a)**](http://www.arnet.gov/far/current/html/Subpart_50_4.html#1046506)
and include an analysis of the subcont­ractor\'s financial protection
program. In performing this analysis, the contracting officer shall take
into consideration the availability, cost, terms and conditions of
insurance in relation to the unusually haz­ardous risk.

**1850.470 Lead** **NASA installation.**

\(a\) Contractors applying for indemnification shall determine which
NASA installation has the highest dollar amount of contracts for which
indemnification is requested. The indemnification request should be
submitted to the procurement officer for that installation, who will
then designate a cognizant contracting officer. Contractors shall submit
a single request and ensure duplicate requests are not submitted by
associate divisions, subsidiaries, or central offices of the contractor.

\(b\) The receiving installation will become the lead installation and
will remain so indefinitely. Lead installation designation may change to
another installation if the affected procurement officers agree to the
change. Should a change occur in the lead installation, all records
related to indemnification of that contractor shall be transferred to
the gain­ing installation.