Part I - The Schedule

Sections B through H

### TABLE OF CONTENTS {#table-of-contents .TOC-1}

**STANDARD FORM 33 SOLICITATION, OFFER AND
AWARD....................................... 1**

[Section B - SUPPLIES OR SERVICES AND PRICES/COSTS
5](#section-b---supplies-or-services-and-pricescosts)

[B-1 SERVICES BEING ACQUIRED 5](#services-being-acquired)

[B-2 CONTRACT TYPE AND VALUE 5](#__RefHeading___Toc104224701)

[Section C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK
9](#section-c---descriptionspecificationsstatement-of-work)

[C-1 STATEMENT OF WORK 9](#statement-of-work)

[Section D - PACKAGING AND MARKING - Reserved
9](#section-d---packaging-and-marking---reserved)

[Section E - INSPECTION AND ACCEPTANCE
9](#section-e---inspection-and-acceptance)

[E-1 FAR 52.246-5 INSPECTION OF SERVICES -- COST-REIMBURSEMENT
(APR 1984)
9](#far-52.246-5-inspection-of-services-cost-reimbursement-apr-1984)

[E-2 FAR 52.246-9 INSPECTION of RESEARCH and DEVELOPMENT (Short Form)
(APR 1984)
10](#far-52.246-9-inspection-of-research-and-development-short-form-apr-1984)

[E-3 INSPECTION AND ACCEPTANCE 10](#__RefHeading___Toc104224708)

[Section F - DELIVERIES OR PERFORMANCE
10](#section-f---deliveries-or-performance)

[F-1 PLACE OF PERFORMANCE 10](#place-of-performance)

[F-2 PERIOD OF PERFORMANCE 11](#period-of-performance)

[F-3 FAR 52.242-15 STOP-WORK ORDER (AUG 1989) ALTERNATE I (APR 1984)
11](#far-52.242-15-stop-work-order-aug-1989-alternate-i-apr-1984)

[Section G - CONTRACT ADMINISTRATION DATA
12](#section-g---contract-administration-data)

[G-1 GOVERNMENT CONTACTS 12](#government-contacts)

[G-2 CONTRACTOR CONTACT 13](#contractor-contact)

[Section H - SPECIAL CONTRACT REQUIREMENTS
13](#section-h---special-contract-requirements)

[H-1 REDEFINING THE FEDERAL/CONTRACTOR RELATIONSHIP TO IMPROVE
MANAGEMENT AND PERFORMANCE
13](#redefining-the-federalcontractor-relationship-to-improve-management-and-performance)

[H-2 PERFORMANCE DIRECTION 14](#performance-direction)

[H-3 CONTRACTOR MULTI-YEAR STRATEGY FOR PERFORMANCE IMPROVEMENT
16](#contractor-multi-year-strategy-for-performance-improvement)

[H-4 CONTRACTOR ASSURANCE SYSTEM 16](#contractor-assurance-system)

[H-5 NNSA OVERSIGHT 18](#nnsa-oversight)

[H-6 PARENT ORGANIZATION'S OVERSIGHT PLAN
18](#parent-organizations-oversight-plan)

[H-7 ACCOUNTABILITY 19](#accountability)

[H-8 UTILIZATION OF PARENT ORGANIZATION SUPPORT
19](#utilization-of-parent-organization-support)

[H-9 TRANSITION 21](#transition)

[H-10 BENCHMARKING AND STANDARDS MANAGEMENT
21](#benchmarking-and-standards-management)

[H-11 CONTRACTOR REINVESTMENT OF COST EFFICIENCIES
22](#contractor-reinvestment-of-cost-efficiencies)

[H-12 PERFORMANCE BASED MANAGEMENT 22](#performance-based-management)

[H-13 AWARD TERM 24](#__RefHeading___Toc104224729)

[H-14 PERFORMANCE INCENTIVES 25](#performance-incentives)

[H-15 ENTERPRISE PURCHASING 25](#__RefHeading___Toc104224731)

[H-16 NNSA DIRECT CONTRACTS 26](#nnsa-direct-contracts)

[H-17 CONTRACTOR EMPLOYEES 27](#contractor-employees)

[H-18 REPRESENTATIONS AND CERTIFICATIONS
27](#__RefHeading___Toc104224734)

[H-19 MODIFICATION AUTHORITY 27](#modification-authority)

[H-20 PRIVACY ACT SYSTEMS OF RECORDS 28](#__RefHeading___Toc104224736)

[H-21 FLOWDOWN OF RIGHTS TO PROPOSAL DATA
28](#flowdown-of-rights-to-proposal-data)

[H-22 CONTINUATION OF PREDECESSOR CONTRACTOR'S OBLIGATIONS
28](#__RefHeading___Toc104224738)

[H-23 SEPARATE CORPORATE ENTITY AND PERFORMANCE GUARANTEE
28](#separate-corporate-entity-and-performance-guarantee)

[H-24 NNSA AND CONTRACTOR COMMUNITY COMMITMENTS
29](#nnsa-and-contractor-community-commitments)

[H-25 SPECIAL HAZARDS 29](#special-hazards)

[H-26 DEFENSE AND INDEMNIFICATION OF EMPLOYEES
31](#defense-and-indemnification-of-employees)

[H-27 PERFORMANCE OF WORK AT FACILITIES AND SITES OTHER THAN LOS ALAMOS
NATIONAL LABORATORY
32](#performance-of-work-at-facilities-and-sites-other-than-los-alamos-national-laboratory)

[H-28 OPEN COMPETITION AND LABOR RELATIONS UNDER MANAGEMENT AND
OPERATING AND OTHER MAJOR FACILITIES CONTRACTS
32](#open-competition-and-labor-relations-under-management-and-operating-and-other-major-facilities-contracts)

[H-29 THIRD PARTIES 33](#third-parties)

[H-30 ADVANCE UNDERSTANDING REGARDING ADDITIONAL ITEMS OF ALLOWABLE AND
UNALLOWABLE COSTS AND OTHER MATTERS
33](#advance-understanding-regarding-additional-items-of-allowable-and-unallowable-costs-and-other-matters)

[H-31 SERVICE CONTRACT ACT OF 1965 (41 U.S.C. 351)
34](#service-contract-act-of-1965-41-u.s.c.-351)

[H-32 WALSH-HEALY PUBLIC CONTRACTS ACT
34](#walsh-healy-public-contracts-act)

[H-33 CONTRACTOR ACCEPTANCE OF NOTICES OF VIOLATIONS OR ALLEGED
VIOLATIONS, FINES, AND PENALTIES
34](#contractor-acceptance-of-notices-of-violations-or-alleged-violations-fines-and-penalties)

[H-34 WORKERS' COMPENSATION 35](#workers-compensation)

[H-35 ADDITIONAL LABOR REQUIREMENTS 35](#additional-labor-requirements)

[H-36 WORKFORCE TRANSITION, CONTRACTOR COMPENSATION, BENEFITS AND
PENSION
36](#workforce-transition-contractor-compensation-benefits-and-pension)

[H-37 INTELLECTUAL AND SCIENTIFIC FREEDOM
46](#intellectual-and-scientific-freedom)

[H-38 CONFLICTS OF INTEREST COMPLIANCE PLAN
47](#conflicts-of-interest-compliance-plan)

[H-39 LOBBYING RESTRICTIONS 47](#__RefHeading___Toc104224755)

\[this page is intentionally left blank\]

**[Part I - The Schedule]{.underline}**

### [Section B - SUPPLIES OR SERVICES AND PRICES/COSTS]{.underline}

### SERVICES BEING ACQUIRED

> The Offeror (also referred to herein as "Contractor") shall, in
> accordance with the terms and conditions of this Contract, provide the
> personnel, equipment, materials, supplies, and services, (except as
> may be furnished by the Government) and otherwise do all things
> necessary for, or incident to providing its best efforts to
> effectively, efficiently and safely manage and operate the Los Alamos
> National Laboratory (hereinafter "the Laboratory" or "LANL") for the
> U.S. Department of Energy (DOE) National Nuclear Security
> Administration (NNSA).

### CONTRACT TYPE AND VALUE

> \(a\) This Contract is a Cost-Reimbursement Management and Operating
> type contract that includes Fixed Fees and a Performance Incentive Fee
> for the Basic Term of the Contract and the Award Term earned periods.
> Fee is associated with the DOE/NNSA work and Reimbursable work.
> DOE/NNSA Work as used herein is the work performed by the Contractor
> that is funded out of the Laboratory's Table included in the
> President's annual budget request for LANL. Reimbursable work as used
> herein is the work performed by the Contractor that is not funded out
> of the Laboratory's Table included in the President's annual budget
> request for LANL.

\(b\) Total Estimated Cost for the Contract's Transition Term.

> \(1\) The Total Estimated Cost for the Transition Term of the Contract
> is:
>
> [Transition Term of the Contract]{.underline} [Total Estimated
> Cost]{.underline}
>
> 01Dec05 -- 31May06 [\$11,796,228]{.mark}
>
> \(2\) The Transition Term effort shall be performed on a
> Cost-Reimbursement, no fee basis.

\(c\) Total Estimated Cost, including Fee, for the Contract's Basic Term
related to the DOE/NNSA work effort, excluding Reimbursable work.

> \(1\) The Total Estimated Cost, including fee, for the DOE/NNSA work
> effort, excluding Reimbursable work, for the Basic Term of the
> Contract is:
>
> [Basic Term of the Contract]{.underline} [Total Estimated Cost and
> Fee]{.underline}
>
> 01Jun06 -- 30Sep06 \$ 610,730,667
>
> 01Oct06 -- 30Sep07 \$1,832,192,000
>
> 01Oct07 -- 30Sep08 \$1,832,192,000
>
> 01Oct08 -- 30Sep09 \$1,832,192,000
>
> 01Oct09 -- 30Sep10 \$1,832,192,000
>
> 01Oct10 -- 30Sep11 \$1,832,192,000
>
> 01Oct11 -- 30Sep12 \$1,832,192,000
>
> 01Oct12 -- 30Sep13 \$1,832,192,000
>
> \(2\) The Maximum Available Fee related to the DOE/NNSA work effort,
> excluding Reimbursable work, for the Basic Term of the Contract is:
>
> [\_\_Contract Period\_\_]{.underline} [Maximum Available
> Fee]{.underline}
>
> 01Jun06 -- 30Sep06 \$17,788,272
>
> 01Oct06 -- 30Sep07 [\$73,280,000]{.mark}
>
> 01Oct07 -- 30Sep08 [\$73,280,000]{.mark}
>
> 01Oct08 -- 30Sep09 [\$73,280,000]{.mark}
>
> 01Oct09 -- 30Sep10 [\$68,700,000]{.mark}
>
> 01Oct10 -- 30Sep11 [\$68,700,000]{.mark}
>
> 01Oct11 -- 30Sep12 [\$64,120,000]{.mark}
>
> 01Oct12 -- 30Sep13 [\$59,540,000]{.mark}
>
> \(3\) Since the Maximum Available Fee has been established, there will
> be no annual negotiation of the Maximum Available Fee. However, in the
> event the Congressional appropriation for a particular fiscal year
> deviates by more than (plus or minus) 10% from the Total Estimated
> Cost and Fee, the Contracting Officer shall unilaterally modify the
> Contract to adjust the Maximum Available Fee for DOE/NNSA related work
> amounts, except for Reimbursable work, utilizing the calculation
> method described below:
>
> Annual Appropriation Maximum Adjusted
>
> \-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-- X Available =
> Maximum Available
>
> Estimated Fee Base Fee Fee for that Year.
>
> \(4\) For the Fiscal Year (FY) 2006 period, the Maximum Available Fee
> shall be Fixed Fee. For FY 2007 through FY 2013, 30% of the Maximum
> Available Fee will be applied to Fixed Fee and 70% of the Maximum
> Available Fee will be applied to Performance Incentive Fee.
>
> \(d\) The Maximum Available Fee related to the DOE/NNSA work effort,
> excluding Reimbursable work, for the Contract's Award Term period
> earned by the Contractor is:
>
> \(1\) For the Award Term period specified in (d)(2) below, 30% of the
> Maximum Available Performance Incentive Fee will be applied to Fixed
> Fee and 70% of the Maximum Available Performance Incentive Fee will be
> applied to Performance Incentive Fee.
>
> \(2\) The Fixed Fee for each Award Term period earned by the
> Contractor related to the DOE/NNSA work effort, excluding for
> Reimbursable work, is [0.90%]{.underline} of the Total Estimated Cost.
> The Total Estimated Cost is the Laboratory Table amount included in
> the President's Budget request to Congress, divided by 1.03.
>
> [Contract Period]{.underline} [Total Estimated Cost]{.underline}
> [Fixed Fee]{.underline}
>
> \* \$ \* \$ \*
>
> \*To be completed by the Contracting Officer prior to the applicable
> award term period
>
> \(3\) The Maximum Available Performance Incentive Fee for each Award
> Term period earned by the Contractor related to the DOE/NNSA work
> effort, excluding Reimbursable work, is [2.1%]{.underline} of the
> Total Estimated Cost. The Total Estimated Cost is the Laboratory Table
> amount included in the President's Budget request to Congress, divided
> by 1.03.
>
> Maximum Available
>
> [Contract Period]{.underline} [Total Estimated Cost]{.underline}
> [Performance Incentive Fee]{.underline}
>
> \* \$ \* \$ \*
>
> \*To be completed by the Contracting Officer prior to the applicable
> award term period
>
> The sum of the Total Estimated Cost plus the Fixed Fee and Maximum
> Available Performance Incentive Fee is the total Laboratory Table
> amount.
>
> \(4\) In the event Congressional appropriation deviates by more than
> (plus or minus) 10% from the applicable fiscal year Laboratory Table
> in the President's Budget annual requests, the Contracting Officer
> shall unilaterally modify the Contract to adjust the Fixed Fee and
> Maximum Available Performance Incentive Fee for DOE/NNSA related work,
> except for Reimbursable work. The fee will be adjusted in proportion
> to the change between the President's Budget and the Congressional
> appropriation.
>
> \(e\) Estimated Cost and Fee for Reimbursable Work.
>
> \(1\) The Fixed Fee for FY 2007 and each subsequent fiscal year during
> the Basic Term of the Contract and for each Award Term period earned
> by the Contractor, will be established by NNSA prior to the
> commencement of the applicable fiscal year and will be incorporated
> into paragraph (e)(2) below. The Fixed Fee for each fiscal year shall
> be [2.5%]{.underline} of the Estimated Cost of NNSA's total estimated
> budget for Reimbursable work.
>
> \(2\) The Estimated Cost and Fixed Fee related to the Reimbursable
> work effort for the specified period is:
>
> Total Cost Plus
>
> [\_\_Contract Period\_\_]{.underline} [Estimated Cost]{.underline}
> \_[Fixed Fee\_]{.underline} [Fixed Fee]{.underline}
>
> 01Jun06 -- 30Sep06 \$88,310,784 \$1,766,216 \$90,077,000
>
> 01Oct06 -- 30Sep07
>
> 01Oct07 -- 30Sep08
>
> 01Oct08 -- 30Sep09
>
> 01Oct09 -- 30Sep10
>
> 01Oct10 -- 30Sep11
>
> 01Oct11 -- 30Sep12
>
> 01Oct12 -- 30Sep13
>
> \(f\) Provisional Payment of Fee.
>
> \(1\) For the DOE/NNSA related work, except for Reimbursable work, the
> Fixed Fee for FY 2006 for non-transition period related work
> performance shall be paid in equal monthly increments for the actual
> performance period where the Contractor is managing and operating the
> Laboratory. The Fixed Fee for FY 2007 and each subsequent fiscal year
> shall be paid monthly at the rate of one-twelfth (1/12) of the annual
> amount per month. Such payment amounts are to be drawn down by the
> Contractor from the Contract's special financial institution account
> in monthly installments on the last day of each month.
>
> \(2\) (i) The Performance Incentive Fee for DOE/NNSA related work,
> except for Reimbursable work, is authorized for draw down by the
> Contractor from the Contract's special financial institution account
> as follows:
>
> \(I\) in monthly provisional fee payments equivalent to 3% of the
> Maximum Available Performance Incentive Fee, and
>
> \(II\) the balance, if any, upon issuance of the Contracting Officer's
> notification in accordance with the Section H Clause entitled
> "Performance Incentives."
>
> \(ii\) If the provisional payments made in (2)(i) above exceed the
> Performance Incentive Fee earned determination, the Contractor shall
> remit any balance due payable to the Government in accordance with
> directions to be provided by the Contracting Officer.
>
> \(3\) The Fixed Fee for Reimbursable work is authorized for draw down
> by the Contractor on the last day of each specified Contract period.
>
> \(g\) Except for the condition identified in (c)(3) and (d)(4) above,
> there shall be no adjustment in the amount of the Contractor\'s fee by
> reason of differences between any estimate of cost for performance of
> the work under this Contract and the actual cost of performance of
> that work.
>
> \(h\) Pursuant to the Contract's Section I Clause entitled
> "Obligations of Fund," the total amount obligated by the Government is
> [\$5,000,000]{.mark} and associated accounting and appropriation data
> is:
>
> [[PR Number]{.underline} [App Symbol]{.underline} [Allott]{.underline}
> [B&R No.]{.underline} [FT]{.underline} [OBJ]{.underline}
> [Amount]{.underline}]{.mark}
>
> [NA25396 89X0240.91 NS6091 DP1513000 TC 252 \$5,000,000]{.mark}

(i) \(1\) If the Contractor is part of a teaming arrangement as
    described in Federal Acquisition Regulation (FAR) 9.601, the team
    shall share in the Fixed Fee and Performance Fee structure in
    paragraphs (c), (d) and (e) of this clause. Separate additional
    subcontractor fees for individual team members will not be
    considered an allowable cost under the Contract.

> \(2\) If a subcontractor, supplier, or lower-tier subcontractor is a
> wholly owned, majority owned, or affiliate of any team member, any fee
> or profit paid to such entity will not be considered an allowable cost
> under this Contract unless otherwise approved by the Contracting
> Officer.

### 

### [Section C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK]{.underline}

### STATEMENT OF WORK

> The work to be performed is set forth in the Contract's Section J
> Appendix entitled "Statement of Work."

### 

### [Section D - PACKAGING AND MARKING - Reserved]{.underline}

### 

### [Section E - INSPECTION AND ACCEPTANCE]{.underline}

### FAR 52.246-5 INSPECTION OF SERVICES -- COST-REIMBURSEMENT (APR 1984)

> \(a\) *Definition.* \"Services,\" as used in this clause, includes
> services performed, workmanship, and material furnished or used in
> performing services.
>
> \(b\) The Contractor shall provide and maintain an inspection system
> acceptable to the Government covering the services under this
> contract. Complete records of all inspection work performed by the
> Contractor shall be maintained and made available to the Government
> during contract performance and for as long afterwards as the contract
> requires.
>
> \(c\) The Government has the right to inspect and test all services
> called for by the contract, to the extent practicable at all places
> and times during the term of the contract. The Government shall
> perform inspections and tests in a manner that will not unduly delay
> the work.
>
> \(d\) If any of the services performed do not conform with contract
> requirements, the Government may require the Contractor to perform the
> services again in conformity with contract requirements, for no
> additional fee. When the defects in services cannot be corrected by
> reperformance, the Government may-
>
> \(1\) Require the Contractor to take necessary action to ensure that
> future performance conforms to contract requirements; and
>
> \(2\) Reduce any fee payable under the contract to reflect the reduced
> value of the services performed.
>
> \(e\) If the Contractor fails to promptly perform the services again
> or take the action necessary to ensure future performance in
> conformity with contract requirements, the Government may-
>
> \(1\) By contract or otherwise, perform the services and reduce any
> fee payable by an amount that is equitable under the circumstances; or
>
> \(2\) Terminate the contract for default.

### FAR 52.246-9 INSPECTION of RESEARCH and DEVELOPMENT (Short Form) (APR 1984)

> The Government has the right to inspect and evaluate the work
> performed or being performed under the Contract, and the premises
> where the work is being performed, at all reasonable times, and in a
> manner that will not unduly delay or disrupt the work. If the
> Government performs inspection or evaluation on the premises of the
> Contractor or a subcontractor, the Contractor shall furnish and shall
> require subcontractors to furnish all reasonable facilities and
> assistance for the safe and convenient performance of these duties.

### INSPECTION AND ACCEPTANCE

> The Contracting Officer or any other duly authorized representative
> shall accomplish inspection of all activities and acceptance for all
> work and effort under this Contract.

### 

### [Section F - DELIVERIES OR PERFORMANCE]{.underline}

### PLACE OF PERFORMANCE

> The work under this Contract is to be carried out at a variety of
> locations within and outside the United States, but the principal
> place of performance will be at the Laboratory in Los Alamos County,
> New Mexico.

### PERIOD OF PERFORMANCE

> \(a\) The Contract's period of performance includes, unless sooner
> reduced, terminated or extended in accordance with the provisions of
> this Contract:
>
> \(1\) a Transition Term (01Dec05 through 31May06);
>
> \(2\) a Basic Term (01Jun06 through 30Sep13); and
>
> \(3\) an Award Term, if earned (01Oct13 through 30Sep26).
>
> \(b\) The Contract's maximum period of performance, if extended beyond
> the Basic Term of the Contract, shall not exceed twenty (20) years,
> ten (10) months.
>
> \(c\) The Transition Term shall be for the transition activities
> identified in the Contract Section J Appendix entitled "Contractor's
> Transition Plan." The Contractor's responsibility for management and
> operation of the Laboratory against the Statement of Work shall
> commence with the Basic Term. The Award Term conditions are set forth
> in the Contract's Section H Clause entitled "Award Term."

### FAR 52.242-15 STOP-WORK ORDER (AUG 1989) ALTERNATE I (APR 1984)

\(a\) The Contracting Officer may, at any time, by written order to the
Contractor, require the Contractor to stop all, or any part, of the work
called for by this Contract for a period of 90 days after the order is
delivered to the Contractor, and for any further period to which the
parties may agree. The order shall be specifically identified as a
stop‑work order issued under this clause. Upon receipt of the order, the
Contractor shall immediately comply with its terms and take all
reasonable steps to minimize the incurrence of costs allocable to the
work covered by the order during the period of work stoppage. Within a
period for 90 days after a stop‑work order is delivered to the
Contractor, or within any extension of that period to which the parties
shall have agreed, the Contracting Officer shall either‑‑

> \(1\) Cancel the stop‑work order; or
>
> \(2\) Terminate the work covered by the order as provided in the
> Contract's Section I Clause entitled "Termination (Cost
> Reimbursement)."

\(b\) If a stop‑work order issued under this clause is canceled or the
period of the order or any extension thereof expires, the Contractor
shall resume work. The Contracting Officer shall make an equitable
adjustment in the delivery schedule, the estimated cost, the fee, or a
combination thereof and in any other terms of the contract that may be
affected, and the contract shall be modified, in writing, accordingly,
if‑‑

> \(1\) The stop‑work order results in an increase in the time required
> for, or in the Contractor\'s cost properly allocable to, the
> performance of any part of this contract; and
>
> \(2\) The Contractor asserts its right to the adjustment within
> 30 days after the end of the period of work stoppage; provided, that,
> if the Contracting Officer decides the facts justify the action, the
> Contracting Officer may receive and act upon a proposal submitted at
> any time before final payment under this contract.

\(c\) If a stop‑work order is not canceled and the work covered by the
order is terminated for the convenience of the Government, the
Contracting Officer shall allow reasonable costs resulting from the
stop‑work order in arriving at the termination settlement.

\(d\) If a stop‑work order is not canceled and the work covered by the
order is terminated for default, the Contracting Officer shall allow, by
equitable adjustment or otherwise, reasonable costs resulting from the
stop‑work order.

### [Section G - CONTRACT ADMINISTRATION DATA]{.underline}

### GOVERNMENT CONTACTS

(a) The NNSA Manager, Los Alamos Site Office (LASO), is the
    Administrative Contracting Officer responsible for this Contract.
    The LASO Manager is the Contractor's primary point of contact for
    all matters, except as identified in (b) below, regarding this
    Contract. The LASO Manager can be reached at:

> U.S. Department of Energy
>
> National Nuclear Security Administration
>
> Manager, Los Alamos Site Office
>
> 528 35^th^ Street
>
> Los Alamos, NM 87544
>
> Telephone: (505) 667-5105
>
> \(b\) The Patent Counsel, Office of Chief Counsel, NNSA Service
> Center, is the Contractor's focal point for items concerning patent,
> intellectual property, technology transfer, copyright, open source,
> licenses and technical data issues. The Patent Counsel can be reached
> at DOE/NNSA Service Center, Office of Chief Counsel, P.O. Box 5400,
> Albuquerque, New Mexico, 87185‑5400; Telephone: (505) 845-5172.
>
> \(c\) Correspondence. To promote timely and effective administration,
> correspondence submitted under this Contract shall contain a subject
> line commencing with the Contract Number, as illustrated below:
>
> \"SUBJECT: Contract No. DE-AC52-06AL25396, Request For Subcontract
> Placement Approval.\"

### CONTRACTOR CONTACT

> The Contractor's Laboratory Director is responsible for all matters
> regarding this Contract, except for the Contractor's Parent
> Organization's involvement under the Contract. Parent Organization's
> costs, incurred under this Contract, have the same meaning as Home
> Office Expenses in DOE Acquisition Regulation subpart DEAR
> 970.3102-3-70 "Home office expenses**"**.

### [Section H - SPECIAL CONTRACT REQUIREMENTS]{.underline}

### REDEFINING THE FEDERAL/CONTRACTOR RELATIONSHIP TO IMPROVE MANAGEMENT AND PERFORMANCE

> \(a\) General
>
> This clause sets forth an overview of NNSA's approach to improving the
> effectiveness and efficiency of the Nuclear Weapons Complex without
> compromising Integrated Safety Management (ISM) and Integrated
> Safeguards and Security Management (ISSM). The principles of ISM and
> ISSM shall serve as the foundation of the implementing mechanisms at
> the Laboratory.
>
> \(b\) Clarifying the Contract Relationship
>
> NNSA will establish the work to be accomplished by the Contractor, set
> applicable requirements to be met by the Contractor and provide
> performance direction to the Contractor regarding what NNSA wants in
> each of its programs. NNSA will issue performance direction to the
> Contractor only through a warranted Contracting Officer or a
> designated Contracting Officer's Representative. All other Federal
> staff and oversight components are therefore precluded from tasking
> contractor personnel. The Contractor shall utilize its expertise and
> ingenuity in determining how to perform the work, implement NNSA
> requirements, and to comply with NNSA performance direction. The
> Contractor is accountable for assuring safe, secure, effective and
> efficient operations in accordance with the terms and conditions of
> this Contract.
>
> \(c\) Approach to Oversight
>
> NNSA will increase Contractor accountability as a result of
> implementation of the Contractor's Assurance System to achieve
> improved Contractor performance in all aspects of the Contract. Parent
> oversight of the Contractor's implementation of the Assurance System
> is key to achieving performance improvements. NNSA will assess
> Contractor progress in improvement of its performance resulting from
> implementation of the Assurance System. At all times during the term
> of the Contract, NNSA will continue, preserve and maintain the right
> to determine the level of NNSA oversight of all Contractor activities
> under this Contract. NNSA's oversight program will ensure that the
> Contractor's activities provide adequate protection to the health and
> safety of workers and the public.
>
> \(d\) Empowering Contractor Expertise
>
> The Contractor is encouraged to identify and evaluate best commercial
> standards and best business practices and to continuously pursue
> improvements in all aspects of Contract performance where cost
> effective and efficient improvements can be achieved without
> compromising ISM and ISSM. The Contractor is also encouraged to use
> the private-sector expertise of its Parent Organization to improve
> Contract performance as appropriate.
>
> \(e\) Results-Oriented, Streamlined Performance Appraisal
>
> Performance objectives that focus on those areas of greatest strategic
> value to NNSA, and systems-based measures and targets will be used in
> a results-oriented, streamlined performance appraisal process.
>
> \(f\) Reward for Achieving Cost Efficiencies
>
> The Contractor will be rewarded for the achievement of cost
> efficiencies through investment of cost savings at the Laboratory and
> through Contractor Directed Research and Development and the
> opportunity to earn additional Contract term.

### PERFORMANCE DIRECTION

> \(a\) The Contractor is responsible for the management and operation
> of the site in accordance with the Terms and Conditions of the
> Contract, duly issued Work Authorizations (WAs), and written direction
> and guidance provided by the Contracting Officer and the Contracting
> Officer's Representative (COR). NNSA is responsible for establishing
> the work to be accomplished, the applicable requirements to be met,
> and overseeing the performance of work of the Contractor. The
> Contractor will use its expertise and ingenuity in Contract
> performance and in making choices among acceptable alternatives to
> most effectively, efficiently and safely accomplish the work called
> for by this Contract. If the Contractor fails to comply with NNSA
> requirements, NNSA may direct the Contractor in how to complete the
> work.
>
> \(b\) Only the Contracting Officer may issue, modify, and priority
> rank WAs.
>
> \(c\) (1) The Contracting Officer and the NNSA Administrator will
> appoint, in writing, specific NNSA employees as CORs with the
> authority to issue Performance Direction to the Contractor. CORs are
> authorized to act within the limits of their delegation letter. A copy
> of each letter will be provided to the Contractor. COR functions
> include technical monitoring, inspection, and other functions of a
> technical nature not involving a change in the scope, cost, or terms
> and conditions of the Contract. The COR is authorized to review and
> approve technical reports, drawings, specifications, and technical
> information delivered by the Contractor.
>
> \(2\) The Contractor must comply with written Performance Directions
> that are signed by the COR and:
>
> \(i\) Redirect the Contract effort, shift work emphasis within a work
> area or a WA, require pursuit of certain lines of inquiry, further
> define or otherwise serve to accomplish the Statement of Work (SOW),
> or
>
> \(ii\) Provide information that assists in the interpretation of
> drawings, specifications, or technical portions of the work
> description.
>
> \(3\) Performance Direction does not:
>
> \(i\) authorize the Contractor to exceed the funds obligated on the
> Contract;
>
> \(ii\) authorize any increased cost or delay in delivery in a WA;
>
> \(iii\) entitle the Contractor to an increase in fee; or
>
> \(iv\) change any of the terms or conditions of the Contract.
>
> \(d\) The Contractor shall accept only Performance Direction that is
> provided in writing by a COR and that is within the SOW and a WA.
>
> \(e\) (1) The Contractor shall promptly comply with each duly issued
> Performance Direction unless the Contractor reasonably believes that
> the Performance Direction violates this clause. If the Contractor
> believes the Performance Direction violates this clause, the
> Contractor shall suspend implementation of the Performance Direction
> and promptly notify the Contracting Officer of its reasons for
> believing that the Performance Direction violates this clause. Oral
> notification to the Contracting Officer shall be confirmed in writing
> within ten days of the oral notification.
>
> \(2\) The Contracting Officer will determine if the Performance
> Direction is within the SOW and WA. This determination will be issued
> in writing and the Contractor shall promptly comply with the
> Contracting Officer\'s direction. If it is not within the SOW or WA,
> the Contracting Officer may issue a change order pursuant to the
> Contract's Section I Clause entitled "Changes."
>
> \(f\) The Parties agree to maintain full and open communication at all
> times, and on all issues affecting Contract performance, during the
> term of this Contract.

### CONTRACTOR MULTI-YEAR STRATEGY FOR PERFORMANCE IMPROVEMENT

> []{.mark}
>
> The Contractor shall develop a multi-year strategy that details (1)
> its planned efforts and expected accomplishments by year, to
> continuously improve its management and performance at the Laboratory,
> and (2) the planned efforts and contributions of its Parent
> Organization. The multi-year strategy shall also address planned
> efforts to (1) enhance Contractor communications, cooperation and
> integration with the NNSA Weapon Complex, with emphasis on Lawrence
> Livermore National Laboratory; and, (2) contribute to overall NNSA
> Weapon Complex improvements in performance. The listing of the
> Contractor's planned efforts and expected accomplishments from its
> Offer in response to Solicitation No. DE-RP52-05NA25396 for FY 2006
> (June 1, 2006 -- September 30, 2006, partial year) and FY 2007 shall
> be addressed in the initial multi-year strategy. Subsequent annual
> updates shall be submitted to the Contracting Officer no later than
> May 15^th^ of each year. Performance measures for these planned
> efforts and expected accomplishments may be considered for inclusion
> in the Contract's Performance Evaluation Plan.

### CONTRACTOR ASSURANCE SYSTEM

> The Contractor shall develop a Contractor Assurance System to improve
> management and performance. The Contractor Assurance System shall be
> approved and monitored by the Contractor's Parent Organization. The
> Contractor's Assurance System, at a minimum, shall have the following
> key attributes:
>
> \(a\) A comprehensive description of the Contractor Assurance System
> with risks, key activities and accountabilities clearly identified.
>
> \(b\) A process for notifying the Contracting Officer of significant
> Assurance System changes.
>
> \(c\) Incorporates the principles of the Contractor's quality
> assurance program to assure that products or services meet or exceed
> customer expectations.
>
> \(d\) Rigorous, risk, performance and behavior based credible
> self-assessments, and feedback and improvement activities including
> utilization of nationally recognized experts, and other independent
> reviews to assess and improve its work process and to carry out
> independent risk and vulnerability studies. The Contractor is
> encouraged to seek third party certifications (such as Voluntary
> Protection Program and International Standards Organization (ISO) 9001
> or ISO 14001), audits, peer reviews and independent assessments with
> external certification or validation.
>
> \(e\) Incorporates the principles of the Contractor's performance
> measurement program that ensures comprehensive gathering of
> operational and other appropriate data, adequate causal analysis, risk
> analysis, trending, comparison to metrics, includes leading and
> lagging indicators, dissemination of operational data, measures both
> worker and subcontractor performance and identifies and corrects
> negative performance/compliance, including ISM/ISSM, trends before
> they become significant issues.
>
> \(f\) Incorporates the principles of the Contractor's Issues
> Management Program that ensure review by senior management, decision
> making, tracking, setting of expectations and organization, worker and
> management accountability to achieve continuous improvement.
>
> \(g\) Incorporates the principles of the Contractor's Occurrence/Event
> Investigation Program that ensures root cause analysis is performed
> and includes a corrective actions process that identifies any systemic
> problems at the Laboratory, and utilizes a Lessons Learned program to
> implement improvements to Laboratory operations.
>
> \(h\) A method for validating assurance processes.
>
> \(i\) Integrated with the Contractor's management systems, including
> ISM and ISSM.
>
> \(j\) A process for development of performance metrics and performance
> targets to assess programmatic and operational performance, including
> benchmarking of key functional areas with other NNSA/DOE contractors
> and industry and research institutions to enhance processes, that will
> result in achievement of best in class/industry performance where
> efficient, cost effective and does not compromise ISM and ISSM.
>
> \(k\) Continuous ISM and ISSM feedback and performance improvement.
>
> \(l\) An implementation plan that defines a transition period for the
> implementation of the Contractor Assurance System.
>
> \(m\) A process for timely and appropriate communication to the
> Contracting Officer, including electronic access, of all assurance
> related information.

### NNSA OVERSIGHT

> At all times during the term of this Contract, NNSA will continue,
> preserve and maintain the right to determine the level of NNSA
> oversight of all Contractor activities under this Contract. In
> addition to the rights and remedies provided to the Government under
> other provisions of this Contract, the Contractor shall fully
> cooperate with NNSA oversight personnel, NNSA Facility
> Representatives, and subject matter experts in the performance of
> their assigned oversight functions and shall provide complete access
> to facilities, information, and Contractor personnel. NNSA's oversight
> program will ensure that the Contractor's activities provide adequate
> protection to the health and safety of workers and the public.

### PARENT ORGANIZATION'S OVERSIGHT PLAN

> \(a\) On an annual basis, the Contractor shall provide a Parent
> Organization's Oversight Plan that details the Parent Organization's
> planned activities to monitor the Contractor's performance of
> statement of work activities including ISM and ISSM performance, and
> to assist the Contractor in meeting Laboratory mission and operational
> requirements. Elements of the Plan may be incorporated into the
> Laboratory's Performance Evaluation Plan. The Parent Organization's
> Oversight Plan for the FY 2006 (June 1, 2006 -- September 30, 2006,
> partial year) and FY 2007 time period is set forth as an appendix to
> the Contract's Section J. The Oversight Plan shall identify the Parent
> Organization's responsible official for administration of the plan.
>
> \(b\) The annual Parent Organization's Oversight Plan update shall be
> submitted to the Contracting Officer six months prior to the
> forthcoming fiscal year for Contracting Officer review and approval.
>
> \(c\) The estimated cost for the Parent Organization's Oversight Plan
> for the FY 2006 (June 1, 2006 -- September 30, 2006, partial year) and
> FY 2007 is [\$1,296,719]{.mark} and [\$3,065,489]{.mark},
> respectively. Costs associated with subsequent annual Plan updates for
> the remainder of the Contract term will be incorporated into this
> clause via supplemental agreement modification. Costs shall only
> include: the actual direct labor costs of the persons performing such
> services; a percentage factor of direct labor costs to cover fringe
> benefits and payroll taxes; travel; and other direct costs. The
> percentage factor of direct labor costs to cover fringe benefits and
> payroll taxes will be applied in accordance with the Contractor's
> Parent Organization's disclosed accounting practices, or, if
> applicable, Cost Accounting Standards Disclosure Statement. No other
> costs or a separate fee are allowable. The Contractor shall charge to
> the account of the Government using the special financial institution
> account as provided in the Contract's Section I Clause entitled
> \"Payments and Advances,\" or as otherwise directed by the Contracting
> Officer.
>
> \(d\) The Contractor shall provide periodic reports of Parent
> activities and costs incurred as required by the Contracting Officer.

\(e\) Cost limitations set forth in paragraph (c) above shall not be
exceeded without prior Contracting Officer approval. The Parties agree
that the costs may be reviewed further for appropriateness and scope. In
addition, the Parties agree that a tracking process, acceptable to the
Contracting Officer, providing sufficient detail for reasonable
accountability, shall be implemented. The Parties agree to negotiate in
good faith any adjustments to these amounts as a result of empirical
information from any such tracking system or reviews.

### ACCOUNTABILITY

> The Contractor is responsible for the quality of its products and
> services and for ensuring that ISM and ISSM are integrated into its
> operations. The Contractor is also responsible for assessing its
> operations, programs, projects and business systems, identifying
> deficiencies and implementing needed improvements in accordance with
> the Contract's terms and conditions. Where NNSA oversight has
> evaluated the Contractor's performance in meeting its obligations
> under this Contract, the Contractor shall not rely upon NNSA's
> assessment but is accountable for performing its own assessment of
> these areas.

### UTILIZATION OF PARENT ORGANIZATION SUPPORT

> \(a\) Parent Organization Systems
>
> \(1\) The Parties agree that applying the Contractor's Parent
> Organization systems to site operations for the purpose of
> streamlining the Laboratory's operational, administrative and business
> systems, and Parent Organization services provided for that purpose,
> are allowable costs. The use of the Contractor's Parent Organization
> systems is encouraged provided that such systems are more efficient
> and represent an overall cost savings to the Government versus
> existing site systems, and data is readily transferable to a successor
> contractor. The Contracting Officer must approve the Contractor's
> proposed plan to use its Parent Organization systems. Such system and
> related support services are not considered a "Subcontract" as
> contemplated by the Contract's Section I Clause entitled \"DEAR
> 970.5244-1 Contractor Purchasing System.\"
>
> \(2\) If the Contractor's proposed plan is approved by the Contracting
> Officer, the Contractor may incur amounts for the approved systems and
> related support services and shall charge to the account of the
> Government using the special financial institution account as provided
> in the Contract's Section I Clause entitled \"Payments and Advances,\"
> or as otherwise directed by the Contracting Officer. Costs shall only
> include: the actual direct labor costs of the persons performing such
> services; materials; subcontracts; travel; other direct costs; and
> applicable indirect costs applied in accordance with the Contractor's
> Parent Organization's disclosed accounting practices, or, if
> applicable, Cost Accounting Standards Disclosure Statement. A separate
> fee for use of such systems and associated services is unallowable.
>
> \(3\) The Contractor shall provide periodic reports of activities and
> costs incurred as required by the Contracting Officer.
>
> \(4\) Rights in software and systems. The Contractor agrees to and
> does hereby grant to the Government an irrevocable, nonexclusive,
> paid-up license by or for the Government, in any Contractor-owned
> software and systems brought in and used under this Clause. Said
> license shall be limited to the continued operations of the Los Alamos
> National Laboratory by successor contractors.
>
> \(b\) Parent Organization Experts
>
> \(1\) The utilization of Parent Organization experts[[, which are
> defined herein as employees of the Parent
> Organization,]{.underline}]{.mark} for the purpose of achieving
> improvement in management and performance either to resolve
> deficiencies identified through Parent Organization oversight or in
> accordance with the Section H clause entitled "Contractor Multi-Year
> Strategy For Performance Improvement" are allowable costs subject to
> the conditions contained herein. The total estimated cost for Parent
> Organization experts' services is \$\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \[to
> be determined during the Transition Period, and annually thereafter,
> and added via supplemental agreement contract modification\]. Such
> Parent Organization experts' services are not considered a
> "Subcontract" as contemplated by the Contract's Section I Clause
> entitled \"DEAR 970.5244-1 Contractor Purchasing System.\"
>
> \(2\) The Contractor may incur costs for its Parent Organization
> experts and shall charge to the account of the Government using the
> special financial institution account as provided in the Contract's
> Section I Clause entitled \"Payments and Advances,\" or as otherwise
> directed by the Contracting Officer. Costs shall only include: the
> actual direct labor costs of the persons performing such services; a
> percentage factor of direct labor costs to cover fringe benefits and
> payroll taxes; travel; and other direct costs. The percentage factor
> of direct labor costs to cover fringe benefits and payroll taxes will
> be applied in accordance with the Contractor's Parent Organization
> Cost Accounting Standards Disclosure Statement. No other costs or a
> separate fee are allowable.
>
> \(3\) The Contractor shall provide periodic reports of activities and
> costs incurred as required by the Contracting Officer.

### TRANSITION

> Contract Clauses H-2 through H-10 provide a mechanism for the
> Contractor to improve its management and performance. The Laboratory's
> management systems that exist on the date of Contract award will
> continue until the Contractor addresses the applicable requirements
> contained in Contract Clauses H-2 through H-10. For changes that do
> require NNSA approval, the Contractor will not implement a change
> until it is formally approved by the Contracting Officer.

### BENCHMARKING AND STANDARDS MANAGEMENT

> \(a\) [Benchmark with Industry]{.underline}. The Contractor shall
> regularly benchmark with industry to identify best commercial
> standards and best business practices that will improve site
> operations with the goal of improving performance where effective and
> efficient without compromising ISM and ISSM.
>
> \(b\) [Proposal of Alternative]{.underline}. Where best commercial
> standards or best business practices are identified that will improve
> site operations consistent with paragraph (a) above, the Contractor
> may, at any time during performance of this Contract, propose an
> alternative procedure, standard, or assessment mechanism (collectively
> referred to herein as "alternative") in a Directive or DOE/NNSA
> requirement by submitting to the Contracting Officer a signed
> proposal(s) that describes (1) the nature and scope of the alternative
> and Contractor system of oversight, (2) the anticipated benefits,
> including any cost benefits, to be realized in performance under the
> Contract, (3) a schedule for implementation of the alternative, (4) a
> detailed evaluation and a statement that the revised alternative is an
> effective, efficient means to meet the Directive without compromising
> ISM and ISSM, and (5) any additional information required by NNSA.
> NNSA will evaluate the Contractor's proposal, and the Contractor will
> not implement a proposed change until it is formally approved by the
> NNSA and communicated to the Contractor by the Contracting Officer.
>
> \(c\) [Deficiency and Remedial Action]{.underline}. If, during
> performance of this Contract, NNSA determines that a previously
> approved alternative is not satisfactory, the Contracting Officer will
> require the Contractor to prepare a corrective action plan for NNSA
> approval. If NNSA is not satisfied with the corrective action taken,
> the Contracting Officer may direct corrective action to remedy the
> deficiency, including, if appropriate, the reinstatement of the
> Directive or DOE/NNSA requirement.
>
> \(d\) [Laws and Regulations Excepted]{.underline}. The process
> described in this clause shall not affect the application of otherwise
> applicable laws and regulations of the United States, including DOE
> regulations.

### CONTRACTOR REINVESTMENT OF COST EFFICIENCIES

\(a\) As soon as practical after the annual budget is determined, the
NNSA and the Contractor may identify and agree upon listings of
un-funded priority direct mission work identified by specific
appropriation and budget and reporting category. Throughout the fiscal
year, the Contractor shall apply cost efficiencies achieved through
streamlining systems and operations only to un-funded priority direct
mission work within the same appropriation and budget and reporting
category (Obligation Control Level) unless a formal reprogramming action
is approved by NNSA. Indirect cost savings from efficiencies, which has
been documented by the Contractor, shall be returned to the mission work
in the form of reduced indirect rates, applied to un-funded priority
indirect work, and/or applied to Contractor Directed Research and
Development (CDRD) pursuant to paragraph (b) below. The extent of
un-funded priority work accomplished in each fiscal year shall serve as
a key performance target when measuring the Contractor\'s success in
improving performance and achieving cost efficiencies without
compromising ISM and ISSM. Extent of un-funded priority work
accomplished may also be one of the Award Term or Incentive Fee measures
during the Contract's term.

\(b\) As an additional Laboratory incentive to achieving increased
efficiencies, the NNSA will allow the Contractor to apply a percentage
of the indirect costs savings realized from efficiencies toward CDRD at
LANL, New Mexico universities, other universities and small technology
companies in northern New Mexico. The Contracting Officer shall define
the percentage of savings allocated to CDRD on an annual basis. CDRD
must be complementary to the Contract's SOW. On an annual basis, the
Contractor shall develop a CDRD Plan, for Contracting Officer review and
approval that, establishes: (1) the nature and scope of the CDRD planned
activities, and (2) the permitted locations where CDRD is to be
performed.

\(c\) Although it is the intent of the NNSA that the Contractor shall
apply cost efficiencies at the site, the NNSA reserves the right to
reallocate direct mission work cost efficiencies to other programmatic
mission critical needs.

### PERFORMANCE BASED MANAGEMENT

> \(a\) [Performance-Based Management System]{.underline}. This Contract
> is a management and operating contract, which holds the Contractor
> accountable for performance. This Contract uses clearly defined
> standards of performance consisting of performance objectives and
> performance incentives as described in the Contract's Section H Clause
> entitled "Performance Incentives," and award term incentives as
> indicated in Contract's Section H Clause entitled "Award Term" with
> measures and targets for each area established on a fiscal year basis
> and incorporated into the Performance Evaluation Plan.
>
> \(b\) [Performance Appraisal Process]{.underline}.
>
> \(1\) [Performance Evaluation Plan.]{.underline}
>
> \(i\) A Performance Evaluation Plan shall be developed and finalized
> by the Contracting Officer, with Contractor input, prior to the
> scheduled start date of the appraisal period. The Performance
> Evaluation Plan shall document the process and associated performance
> objectives, performance incentives, award term incentives and
> associated measures and targets by which the Contractor's performance
> will be evaluated. The Parties will attempt to reach mutual agreement
> on performance objectives, performance incentives, award term
> incentives and associated measures and targets that reflect expected
> business, operational and technical performance tied to key end
> products and NNSA/DOE strategic goals and objectives. The NNSA Los
> Alamos Site Office Manager reserves the unilateral right to make the
> final decision on all performance objectives and performance
> incentives (including the associated measures and targets) used to
> evaluate Contractor performance. The NNSA Administrator reserves the
> unilateral right to make the final decision on all award term
> incentives (including the associated measures and targets) used to
> evaluate Contractor performance.
>
> \(ii\) Only the Contracting Officer may revise the Performance
> Evaluation Plan, consistent with the Contract's Statement of Work,
> during the appraisal period of performance. The Contracting Officer
> shall notify the Contractor:
>
> \(I\) Of such bilateral changes at least sixty calendar days prior to
> the end of the affected appraisal period;
>
> \(II\) Of such unilateral changes at least ninety calendar days prior
> to the end of the affected appraisal period and at least thirty
> calendar days prior to the effective date of the change; or
>
> \(III\) If such change, whether unilateral or bilateral, is urgent and
> high priority, at least thirty calendar days prior to the end of the
> appraisal period.
>
> \(2\) [Contractor Self-Assessment]{.underline}. An annual
> self-assessment will be prepared by the Contractor of its performance
> against each of the performance objectives and incentives contained in
> the Performance Evaluation Plan. The annual self assessment shall be
> submitted within five-working days after the end of the appraisal
> period. The Contracting Officer will identify the structure and medium
> to be used by the Contractor in delivering its annual self-assessment.

### AWARD TERM

(a) Commencing in Fiscal Year 2008, the Contract's term as set forth in
    the Contract's Section F Clause entitled "Period of Performance"
    will be extended if, in its annual NNSA Performance Appraisal
    Report, the Contractor both: (1) obtains the required ratings on the
    Fixed Fee and At-Risk Performance Incentive Fee Sections' objectives
    contained in the Performance Evaluation Plan; and (2) meets the
    Award Term Incentives set forth in the Award Term Section of the
    Performance Evaluation Plan. If the Contractor does not receive the
    required rating in (1) above, this Award Term clause becomes
    inoperable for the associated evaluation period.

(b) The NNSA Los Alamos Site Office Manager will make an award term
    recommendation to the NNSA Fee Determination Official (FDO) based
    upon his/her evaluation in accordance with paragraph (a) above. The
    decision whether to award additional term will be made by the FDO if
    the conditions in paragraph (a) above are met in conjunction with
    the annual performance evaluation determination.

(c) The award term decision is a unilateral determination of the FDO.

(d) If the FDO's determination is to award additional term, the Contract
    shall be modified unilaterally by the Contracting Officer to extend
    the term of the Contract by one year.

(e) The Contract's maximum term, including all earned award term, shall
    not exceed the term identified in the Contract Section F Clause
    entitled "Period of Performance."

(f) If the Contractor fails 4 times to earn award term, the operation of
    this Award Term clause will cease.

(g) A significant failure as determined by the Contracting Officer of
    the Contractor's management controls, as defined in the Contract's
    Section I Clause entitled "Management Controls," or a performance
    failure, as utilized in the Contract's Section I Clause entitled
    "Conditional Payment Of Fee, Profit, Or Incentives -- Facilities
    Management Contracts," by the Contractor may result in the
    forfeiture of up to 4-years of previously earned award term in
    addition to other remedies provided for in the contract. Such
    reduction in Contract term, if exercised by the Government, does not
    constitute a termination action pursuant to the Contract's Section I
    Clause entitled "Termination (Cost Reimbursement) (May 2004) as
    modified by DEAR 970.4905-1(b)."

> \(i\) The rights and remedies of the Government specified herein in
> this Award Term clause are not exclusive, and are in addition to any
> other rights and remedies provided by law, regulation, or under this
> Contract. This Award Term clause does not confer any other rights or
> remedies to the Contractor other than those specified in this Award
> Term clause.

### PERFORMANCE INCENTIVES

\(a\) The NNSA shall, at the conclusion of each specified appraisal
period, evaluate the Contractor\'s performance for all Performance
Incentive requirements.

> \(b\) The Performance Incentive Fee determination will be made in
> accordance with the Performance Evaluation Plan. The determination as
> to the amount of Performance Incentive Fee earned is a unilateral
> determination made by the Fee Determining Official.

\(c\) The Contracting Officer will issue the Fee Determination
Official's final total Performance Incentive Fee amount earned
determination, and the basis of the Performance Incentive Fee
determination, in accordance with: the schedule set forth in the
Performance Evaluation Plan; or as otherwise set forth in this Contract.
However, a determination must be made within sixty calendar days after
the receipt by the Contracting Officer of the Contractor\'s
self-assessment report or a longer period if the Contractor and
Contracting Officer agree. If the Contracting Officer evaluates the
Contractor\'s performance of specific requirements on their completion,
the payment of any earned fee amount must be made within seventy
calendar days (or such other time period as mutually agreed to between
the Contracting Officer and the Contractor) after such completion. If
the determination is delayed beyond that date, the Contractor shall be
entitled to interest on the determined total available fee amount earned
at the rate established by the Secretary of the Treasury under section
12 of the Contract Disputes Act of 1978 (41 U.S.C. 611) that is in
effect on the payment date. This rate is referred to as the
\"Renegotiation Board Interest Rate,\" and is published in the Federal
Register semiannually on or about January 1 and July 1. The interest on
any late total available fee amount earned determination will accrue
daily and be compounded in 30-day increments inclusive from the first
day after the schedule determination date through the actual date the
determination is issued. That is, interest accrued at the end of any
30-day period will be added to the determined amount of fee earned and
be subject to interest if not paid in the succeeding 30-day period.

\(d\) Performance Incentive Fee not earned during the evaluation period
shall not be allocated to future evaluation periods.

### ENTERPRISE PURCHASING

\(a\) Enterprise purchasing involves the complex-wide assessment of
commodity and service requirements and formulation of enterprise-wide
contract mechanisms used by members of the enterprise to acquire those
commodities and services. Enterprise purchasing can result in better
pricing, better products, more timely delivery, reduced administrative
costs and lead times for both the Contractor and the NNSA, greater
standardization and interchangeability across the NNSA complex, and
increased awards to small business entities.

\(b\) The Contractor shall cooperate with NNSA and other NNSA
contractors in identifying requirements under this Contract that are
suitable for enterprise purchasing and shall facilitate the
identification of work to be directly acquired by NNSA to support the
objectives discussed below. The Contractor shall use the contracting
mechanisms identified by the NNSA as enterprise purchases and those
awarded by the Integrated Contractor Purchasing Team (ICPT) to meet all
suitable requirements under this Contract unless the cost of using such
contracting mechanisms is shown to be excessive, does not provide the
best value and or impacts the Contractor's schedule. The Contractor may
propose alternative acquisition strategies to the Contracting Officer.

### NNSA DIRECT CONTRACTS

\(a\) The Contracting Officer may identify any of the work identified or
in support of the Contract's Section J Appendix entitled "Statement of
Work" to be performed either by another contractor directly contracted
by the NNSA or by Government employees. The Contractor agrees to fully
cooperate with such other contractors and Government employees,
carefully fit its own work to such other work as may be directed by the
Contracting Officer, and provide reasonable support as required. The
Contractor shall not commit or permit any act which will interfere with
the performance of work by any other contractor or by Government
employees. For work identified for performance by another contractor
directly contracted by the NNSA:

> \(1\) The Government and the Contractor will confer in advance on the
> strategy for changing responsibility for the work and will do so with
> the objective of minimum disruption to the site operations.
>
> \(2\) The Government may designate the Contractor as the Technical
> Monitor for such contracts that are directly related to the scope of
> this Contract. The Contractor agrees to perform such monitoring duties
> as shall be more further described in the designation for each such
> contract. No designation shall include, and the Contactor shall not
> perform, the following duties:
>
> \(i\) Award, modification, change, or termination of the contract.
>
> \(ii\) Receipt, processing or adjudication of any claims, invoices, or
> demands for payment of any form.
>
> \(iii\) Any function determined to be inherently governmental.
>
> \(3\) The Technical Monitor shall report to the Contracting Officer,
> or the Contracting Officer's Representative, any performance of a
> designated contract that may not be in compliance with its terms and
> conditions but is not authorized to take any other action regarding
> such noncompliance.
>
> \(4\) Additionally, the NNSA may insert provisions in such contracts
> substantially as follows:
>
> *H-\_\_\_. TECHNICAL MONITOR*
>
> *The Government may designate the Los Alamos National Laboratory
> Management and Operating Contractor as Technical Monitor for any
> right, duty or interest in this contract. In that event, the
> contractor further agrees to fully cooperate with the Los Alamos
> National Laboratory Management and Operating Contractor for all
> matters under the terms of the designation.*

\(b\) Appropriate adjustments shall be made to the Contractor\'s
Subcontracting Plan to recognize the changes to the subcontracting base
and goals.

### CONTRACTOR EMPLOYEES

> In carrying out the work under this Contract, the Contractor shall be
> responsible for the employment of all professional, technical,
> skilled, and unskilled personnel engaged by the Contractor in the work
> hereunder, and for the training of personnel. Persons employed by the
> Contractor shall be and remain employees of the Contractor and shall
> not be deemed employees of the NNSA or the Government; however,
> nothing herein shall require the establishment of any
> employer-employee relationship between the Contractor and consultants
> or others whose services are utilized by the Contractor for the work
> hereunder.

### REPRESENTATIONS AND CERTIFICATIONS

> The Representations, Certifications, and Other Statements of Offeror
> as completed by the Contractor are hereby incorporated in this
> Contract by reference.

### MODIFICATION AUTHORITY

Notwithstanding any of the other provisions of this Contract, a
Contracting Officer shall be the only individual on behalf of the
Government to:

> \(a\) Accept nonconforming work;
>
> \(b\) Waive any requirement of this Contract; or
>
> \(c\) Modify any term or condition of this Contract.

### PRIVACY ACT SYSTEMS OF RECORDS 

> The Contractor shall design, develop, or operate the following systems
> of records on individuals to accomplish an agency function pursuant to
> the Contract's Section I Clause entitled \"Privacy Act.\"
>
> [DOE System No.]{.underline} [Title]{.underline}
>
> DOE-33 Personnel Medical Records
>
> DOE-35 Personnel Radiation Exposure Records

The above list shall be revised from time to time by mutual agreement
between the Contractor and the Contracting Officer as may be necessary
to keep it current. Such changes need not be formally incorporated
before the annual Contract update modification, but shall have the same
effect as if actually listed above for the purpose of satisfying the
listing requirement contained in Paragraph (a)(1) of the Contract's
Section I Clause entitled "Privacy Act."

### FLOWDOWN OF RIGHTS TO PROPOSAL DATA

The Contractor shall include the clause of 48 CFR 52.227-23 \"Rights to
Proposal Data (Technical)\" in any subcontract awarded based on
consideration of a technical proposal.

### CONTINUATION OF PREDECESSOR CONTRACTOR'S OBLIGATIONS

> On June 1, 2006, the Contractor shall assume responsibility and will
> continue to perform any existing agreements and regulatory obligations
> entered into under Contract No. W-7405-ENG-36 by the predecessor
> contractor. These agreements and regulatory obligations include all
> (a) subcontracts and purchase orders; (b) agreements with domestic and
> foreign research organizations; (c) agreements with universities and
> colleges; (d) agreements with Federal, Tribal, municipalities and
> state regulatory agencies; (e) operating permits and licenses; and (f)
> any other agreements in effect prior to June 1, 2006.

### SEPARATE CORPORATE ENTITY AND PERFORMANCE GUARANTEE

[]{.mark}

> \(a\) The work performed under this Contract by the Contractor shall
> be conducted by a separate corporate entity from its Parent
> Organization(s). The separate corporate entity must be set up solely
> to perform this Contract and shall be totally responsible for all
> Contract activities.
>
> \(b\) The Contractor's Parent Organization(s) shall guarantee
> performance of the Contract as evidenced by a performance guarantee.
> The performance guarantee is set forth in the Contract's Section J
> Appendix entitled "Performance Guarantee."
>
> \(c\) In the event any of the signatories to the performance guarantee
> enters into proceedings related to bankruptcy, whether voluntary or
> involuntary, the Contractor agrees to furnish written notification of
> the bankruptcy to the Contracting Officer.

### NNSA AND CONTRACTOR COMMUNITY COMMITMENTS

> \(a\) The Contractor shall perform the activities described in the
> Contract's Section J Appendices entitled "Regional Initiatives",
> "Regional Purchasing Program" and "Technology Commercialization",
> which sets forth the NNSA's commitments to support the community.
> Costs (direct or indirect) incurred by the Contractor in performing
> these activities are allowable and reimbursable, to the extent
> authorized under the Contract.
>
> \(b\) The Contract's Section J Appendix entitled "Contractor and
> Parent Organization Commitments, Agreements, and Understandings" sets
> forth the Contractor's Community Commitment plan that describes its
> planned activities as to how the Contractor will be a constructive
> partner to the communities in northern New Mexico, the eight northern
> pueblos, and to citizens of the State of New Mexico who should all
> benefit from the Contractor's management and operation of Los Alamos
> National Laboratory. All costs (direct or indirect) to be incurred by
> the Contractor and/or its Parent Organizations in providing the
> "Contractor and Parent Organization Commitments, Agreements, and
> Understandings" are expressly unallowable and non-reimbursable under
> this Contract.

### SPECIAL HAZARDS

> \(a\) The performance of the Contractor\'s operations hereunder may,
> in extraordinary circumstances, subject workers to special hazards for
> which workers\' compensation laws, other statutes, the Contractor\'s
> welfare plan and policies, or the worker's private insurance may not
> provide adequate financial protection to the worker in the event of
> disability, or to the worker's estate in the event of death.
>
> \(b\) Definitions.
>
> \(1\) \"Worker\" as used in this clause shall mean any person who is
> or has been employed by the Contractor or any subcontractor, or who is
> or has been engaged as a consultant or borrowed personnel by the
> Contractor or any subcontractor.
>
> \(2\) \"Within the course and scope of employment\" as used in this
> clause shall mean that the worker was performing duties as assigned,
> in conformance with the direction of the Contractor or a subcontractor
> or an agreement with the Contractor, and in furtherance of the work
> under this Contract.
>
> \(c\) The Contractor is authorized to pay to a worker, or in the event
> of the worker's death, the worker's estate, a sum in an amount which
> the Contractor determines appropriate, not to exceed the worker's
> annual salary, whenever--
>
> \(1\) The Contractor believes that a worker has become disabled or has
> died as a result of any special hazard listed in paragraph (d) below
> to which the worker has been exposed within the course and scope of
> employment;
>
> \(2\) The Contractor believes that Workers' Compensation laws, other
> statutes, the Contractor\'s welfare plan and policies, or the worker's
> private insurance does not provide adequate financial protection under
> the particular circumstances of the worker's disability or death; and
>
> \(3\) The Contracting Officer approves the payment.
>
> \(d\) The special hazards referred to in paragraphs (a) and (c) above
> are:
>
> \(1\) Exposure to radiant energy or emitted particles from radioactive
> materials or from high voltage sources or machines, including
> ingestion, inhalation or other bodily uptake of radioactive materials.
>
> \(2\) Exposure to explosions due to atomic disintegrations or to
> explosions in the course of experimental work with or using high
> explosives or propellants, or to explosions arising in the course of
> field experimentation with nuclear propulsion systems.
>
> \(3\) Exposure to toxic materials comprising polonium, uranium,
> plutonium, tritium, fluorine, barium, cadmium, beryllium, any
> compounds of these, phosgene, or any other material in use in the
> course of authorized work which may be shown to have toxic effects.
>
> \(4\) Work assignments not specifically covered in this clause and of
> such a nature as will invalidate the worker\'s personal insurance
> otherwise applicable to the injury or death and in effect at the time
> of performance of the assigned duties.
>
> \(5\) Exposure to hazards incident to flights in military aircraft in
> the course of which necessary experimental work is conducted. Where a
> release of liability has been signed, such release will in no way bar
> the worker from receiving any payment under this clause.
>
> \(6\) Exposure due to hazards from the fall of bombs or mockups from
> planes as opposed to hazards due to explosion.
>
> \(7\) Exposure in the course of employment incident to flights in
> chartered or military aircraft or transportation on military vessels.
> Where a release of liability has been signed, such release will in no
> way bar the worker from receiving any payment under this clause.
>
> \(8\) Exposure peculiar to and as the result of work assignment
> required to be conducted outside the continental United States.
>
> \(9\) Such other exposures not now known but which may later be
> discovered and which by the nature thereof are similar to the exposure
> or hazards set forth above. Such other exposures as may from time to
> time be agreed upon in writing by the Contractor and the Contracting
> Officer as a basis for payment.
>
> \(e\) The total sum authorized to be paid under this clause to a
> worker or a worker's estate shall not exceed the worker's annual
> salary even where (1) a payment has been made to a worker on account
> of a disability and who thereafter dies as a result of the disabling
> injury or (2) a worker is disabled by one injury compensable under
> this clause and dies of a separate injury compensable under this
> clause. The Contractor assumes no obligation hereunder to make any
> payment from the Contractor\'s own funds. A release may be required
> from the payee if the Contracting Officer and the Contractor deem it
> necessary or appropriate.
>
> \(f\) Whenever there is an injury or death which is compensable in
> accordance with paragraph (c) above, the Contractor may also, with
> Contracting Officer approval, pay for the cost of transportation
> (including hotel, subsistence and other incidental expenses) of the
> spouse and one or more of next of kin of such injured or dead worker
> from their respective homes to the place where such injured or dead
> worker shall be situated and their return.

### DEFENSE AND INDEMNIFICATION OF EMPLOYEES

> \(a\) The Parties recognize that the Contractor could be required to
> defend and indemnify its officers and employees from and against civil
> actions and other claims which arise out of the performance of work
> under this Contract. Except for defense costs made unallowable by the
> Contract's Section I Clause entitled "Payments and Advances", or the
> Major Fraud Act (41 U.S.C. §256(k)), the costs and expenses, including
> judgments, resulting from the defense and indemnification of employees
> from and against such civil actions and claims shall be allowable
> costs under this contract if incurred pursuant to the terms of the
> Contract's Section I Clause entitled "Insurance--Litigation and
> Claims".
>
> \(b\) Costs and expenses, including judgments, resulting from the
> defense and indemnification of employees from civil fraud actions
> filed in federal court by the Government will be unallowable where the
> employee pleads nolo contendere or the action results in a judgment
> against the defendant.
>
> \(c\) Where the Contractor determines under applicable law it must
> defend an employee in a criminal action which arise out of the
> performance of work under this Contract, NNSA will consider in good
> faith, on a case-by-case basis, whether the Contractor has such an
> obligation. If NNSA concurs, the costs and expenses, including
> judgments, resulting from the defense and indemnification of employees
> shall be allowable.
>
> \(d\) The Contractor shall immediately furnish the Contracting Officer
> written notice of any such claim or civil action filed against any
> employee of the Contractor arising out of the work under this contract
> together with copies of all pleadings filed. The Contractor shall
> furnish to the Contracting Officer a written determination by the
> Contractor's counsel that the defense or indemnity of the employee is
> required because the employee was acting within the course and scope
> of employment at the time of the acts or omissions which gave rise to
> the claim or civil action, and that any exclusions for fraud,
> corruption, or malice on the part of the employee do not apply. A copy
> of any Contractor letter asserting a reservation of rights with
> respect to the defense or indemnification of such employee shall also
> be provided to the Contracting Officer. The costs associated with the
> settlement of any such claim or civil action shall not be treated as
> an allowable cost unless approved in writing by the Contracting
> Officer.

### PERFORMANCE OF WORK AT FACILITIES AND SITES OTHER THAN LOS ALAMOS NATIONAL LABORATORY

In performance of the Contract's work at DOE or NNSA facilities and
sites other than LANL, the Contractor shall comply with applicable
requirements set forth in this Contract's Appendix entitled "List of
Applicable Directives," and any additional directives which have been
established for the DOE/NNSA Prime Contractor at that DOE/NNSA
facility/site that are applicable to the Contractor's work being
performed and that are applicable to the associated hazards at the
particular facility or site.

### OPEN COMPETITION AND LABOR RELATIONS UNDER MANAGEMENT AND OPERATING AND OTHER MAJOR FACILITIES CONTRACTS

> "Labor organization," as used in this clause, shall have the same
> meaning it has in 42 U.S.C. 2000e(d).
>
> \(a\) Unless acting in the capacity of a constructor on a particular
> project, the Contractor shall not -
>
> \(1\) Require bidders, offerors, contractors, or subcontractors to
> enter into or adhere to nor prohibit those parties from entering into
> or adhering to agreements with one or more labor organizations, i.e.,
> project labor agreements, that apply to construction project(s)
> relating to this Contract; or
>
> \(2\) Otherwise discriminate against bidders, offerors, contractors,
> or subcontractors for refusing to become or to remain signatories or
> to otherwise adhere to project labor agreements for construction
> project(s) relating to this Contract.
>
> \(b\) When the Contractor is acting in the capacity of a constructor,
> i.e., performing a substantial portion of the construction with its
> own forces, it may use its discretion to require bidders, offerors,
> contractors, or subcontractors to enter into a project labor agreement
> that the Contractor has negotiated for that individual project.
>
> \(c\) Nothing in this clause shall limit the right of bidders,
> offerors, contractors, or subcontractors to voluntarily enter into a
> project labor agreements.

### THIRD PARTIES

> Nothing contained in this Contract or its modifications shall be
> construed to grant, vest, or create any rights in any person not a
> party to this Contract. This clause is not intended to limit or impair
> the rights which any person may have under applicable Federal
> Statutes.

### ADVANCE UNDERSTANDING REGARDING ADDITIONAL ITEMS OF ALLOWABLE AND UNALLOWABLE COSTS AND OTHER MATTERS

> Allowable costs under this Contract shall be determined according to
> the requirements of the Contract's Section I clause entitled "Payments
> and Advances." For purposes of effective Contract implementation,
> certain items of cost are being specifically identified below as
> allowable and/or unallowable under this Contract to the extent
> indicated:
>
> \(a\) ITEMS OF ALLOWABLE COSTS:
>
> \(1\) Personnel costs in accordance with Appendix A attached to this
> Contract.
>
> \(2\) Expenditures by the Contractor to reimburse other employers for
> payments (including, but not limited to, salaries) to or for the
> benefit of their employees loaned to the Contractor for and engaged in
> the performance of the Contractor's undertaking hereunder.
>
> \(3\) Costs incurred or expenditures made by the Contractor, as
> directed, approved or ratified by the Contracting Officer and not
> unallowable under any other provisions of this Contract.
>
> \(b\) ITEMS OF UNALLOWABLE COSTS:
>
> \(1\) Premium Pay for wearing radiation-measuring devices for
> Laboratory and all-tier cost-type subcontract employees.
>
> \(2\) Home office expenses, whether direct or indirect, relating to
> activities of the Contractor, except as otherwise specifically
> provided in the Contract or specifically agreed to in writing by the
> Contracting Officer.
>
> \(3\) Facilities capital cost of money.

### SERVICE CONTRACT ACT OF 1965 (41 U.S.C. 351)

> The Service Contract Act of 1965 is not applicable to this contract.
> However, in accordance with the Contract's Section I Clause entitled
> "Contractor Purchasing System", subcontracts awarded by the Contractor
> are subject to the Act to the same extent and under the same
> conditions as contracts awarded by NNSA. The Contractor and the
> Contracting Officer shall develop a procedure whereby NNSA will
> determine if the Service Contract Act is applicable to particular
> subcontracts. In cases determined to be covered by the Service
> Contract Act, the Contractor shall prepare SF-98 and 98A "Notice of
> Intention to Make a Service Contract" and forward it to the
> Contracting Officer or his designee to obtain a wage determination.

### WALSH-HEALY PUBLIC CONTRACTS ACT

> Except as otherwise may be approved in writing by the Contracting
> Officer, the Contractor agrees to insert the following provision in
> noncommercial Purchase Orders and subcontracts under this Contract.
>
> \"If this contract is for the manufacture or furnishing of materials,
> supplies, articles, or equipment in an amount which exceeds or may
> exceed \$10,000.00 and is otherwise subject to the Walsh-Healy Public
> Contracts Act, as amended (41 U.S.C. 35), there are hereby
> incorporated by reference all representations and stipulations
> required by said Act and regulations issued thereunder by the
> Secretary of Labor, such representations and stipulations being
> subject to all applicable rulings and interpretations of the Secretary
> of Labor which are now or may hereafter be in effect.\"

### CONTRACTOR ACCEPTANCE OF NOTICES OF VIOLATIONS OR ALLEGED VIOLATIONS, FINES, AND PENALTIES

> \(a\) The Contractor shall accept, in its own name, service of notices
> of violations or alleged violations (NOVs/NOAVs) issued by Federal or
> State regulators to the Contractor resulting from the Contractor's
> performance of work under this contract, without regard to liability.
> The allowability of the costs associated with fines and penalties
> shall be subject to the other provisions of this Contract.
>
> \(b\) The Contractor shall notify the Contracting Officer promptly
> when it receives service from the regulators of NOVs/NOAVs and fines
> and penalties.

### WORKERS' COMPENSATION

> \(a\) The Contractor shall maintain workers compensation insurance
> coverage pursuant to the requirements of FAR 28.307-2, FAR 28.308 and
> DEAR 970.2803-1. The insurance program must be approved by the
> Contracting Officer and cover all eligible employees of the Contractor
> and comply with applicable Federal and State workers' compensation and
> occupational disease statutes.
>
> \(b\) The Contractor shall obtain a service-type insurance policy that
> endorses the Department of Energy Incurred Loss Retrospective Rating
> Insurance Plan unless the Contracting Officer approves a different
> arrangement.
>
> \(c\) The Contractor shall submit to the Contracting Officer an annual
> evaluation and analysis of workers' compensation cost as a percent of
> payroll in comparison with the percentage of payroll cost reported by
> a nationally recognized Cost of Risk Survey that has been pre-approved
> by the Contracting Officer. The Contractor's self evaluation shall
> discuss:
>
> \(1\) periodic audits of claims servicing units; and,
>
> \(2\) the reasonableness of self-insurance reserves and methods and
> assumptions used to closeout claims or losses to present value.
>
> \(d\) The Contractor shall obtain approval from the Contracting
> Officer before making any significant change to its workers
> compensation coverage and will furnish reports as may be required from
> time to time by the Contracting Officer.

### ADDITIONAL LABOR REQUIREMENTS

> \(a\) The Contractor and the Contracting Officer will develop a
> procedure whereby NNSA will determine if the Davis Bacon Act is
> applicable to particular subcontracts. The Contractor shall conduct
> payroll and job-site audits and conduct investigations of complaints
> as authorized by NNSA on all Davis Bacon activity, including any
> subcontracts, as may be necessary to determine compliance with the
> Davis-Bacon Act. Where violations are found, the Contractor shall
> report them to the Contracting Officer. The Contracting Officer may
> require that the Contractor assist in the determination of the amount
> of restitution and withholding of funds from a subcontractor so that
> sufficient funds are withheld to provide restitution for back wages
> due for workers inappropriately classified and paid, fringe benefits
> owed, overtime payments due, and liquidated damages assessed. The
> Contractor shall furnish a Davis-Bacon Semi-Annual Enforcement Report
> to NNSA by April 21^st^ and October 21^st^ each year.
>
> \(b\) The Contractor shall notify the Contracting Officer of any
> complaints and significant labor standards violations whether caused
> by the Contractor or subcontractors. The Contractor shall assist NNSA
> and or/the Department of Labor in the investigation of any alleged
> violations or disputes involving Federal labor standards.

### WORKFORCE TRANSITION, CONTRACTOR COMPENSATION, BENEFITS AND PENSION

> \(a\) [Personnel Appendix]{.underline}
>
> \(1\) This Clause and the Contract Section J Appendix entitled
> "Personnel Appendix" are adopted for the exclusive benefit and
> convenience of the Parties hereto; nothing contained herein shall be
> construed as conferring any right of action or any other right or
> benefit upon past, present, or future employees of the Contractor, or
> upon any other third party. The Personnel Appendix reflects NNSA's
> minimum Contractor human resources requirements. Changes, if any, will
> be made to the Personnel Appendix through a Reimbursement
> Authorization. Personnel costs and related expenses incurred in
> accordance with the Personnel Appendix shall be allowable to the
> extent indicated therein.
>
> \(2\) Definitions
>
> \(i\) "Transferring Employees" are those employees who transfer from
> employment with the predecessor contractor to employment with the
> Contractor [[on June 1, 2006]{.underline}]{.mark}.
>
> \(ii\) "Inactive Vested Transferring Employees" are transferring
> employees who do not elect to retire under the University of
> California Retirement Plan (UCRP) prior to June 1, 2006 and who remain
> vested participants as "inactive members" of the UCRP.
>
> \(iii\) "UCRP Retiring Employees" are employees of the predecessor
> contractor who elect to retire under the UCRP prior to June 1, 2006.
>
> \(iv\) "New Employees" are those employees hired by the Contractor on
> or after June 1, 2006, who are not Transferring Employees.
>
> \(b\) [Employee Retention]{.underline}
>
> \(1\) Subject to the availability of funds, the Contractor shall offer
> employment to all employees of the predecessor contractor who as of
> June 1, 2006 are in good standing and have LANL "Career" or "Term"
> appointments as described in the LANL Human Resources Administrative
> Manual, except as set forth in subparagraph (b)(2) below.
> Subsequently, the Contractor shall exercise appropriate managerial
> judgment regarding employee retention and job assignments.
>
> \(2\) The Contractor is not required to offer employment to those
> employees assigned to the predecessor contractor's key personnel
> positions or to other senior management positions that report directly
> to the predecessor contractor's laboratory director as reflected in
> the Contract's Section J Appendix entitled "Listing of Predecessor
> Contractor Senior Management Positions." In addition, the Contractor
> is not required to offer employment to UCRP Retiring Employees. The
> Contractor may offer employment to these categories of employees at
> its sole discretion.
>
> \(c\) [Labor Relations]{.underline}
>
> \(1\) The Contractor shall respect the right of employees to organize
> and to form, join, or assist labor organizations, to bargain
> collectively through their chosen labor representatives, to engage in
> other concerted activities for the purpose of collective bargaining or
> other mutual aid or protection, and to refrain from any or all of
> these activities.
>
> \(2\) The Contractor is authorized to enter into labor agreements and
> administer such agreements in accordance with their negotiated terms
> subject to the following requirements:
>
> \(i\) The Contractor shall seek to maintain harmonious bargaining
> relationships that reflect a judicious expenditure of public funds,
> equitable resolution of disputes and effective and efficient
> bargaining relationships consistent with the requirements of FAR
> Subpart 22.1 as supplemented by DEAR Subpart 970.2201 and all
> applicable Federal and State labor laws.
>
> \(ii\) The Contractor shall meet with the Contracting Officer or
> designee(s) for the purpose of reviewing the Contractor's bargaining
> objectives prior to negotiation of any collective bargaining agreement
> or revision thereto. During the collective bargaining process, the
> Contractor shall notify the Contracting Officer before submitting or
> agreeing to any collective bargaining proposal which could change
> costs under this Contract or which could involve other items of
> special interest to the Government. During the collective bargaining
> process, the Contractor shall obtain the approval of the Contracting
> Officer before proposing or agreeing to changes in any pension or
> other benefit plans.
>
> \(iii\) The Contractor shall notify the Contracting Officer in a
> timely fashion of all labor relations issues and matters of local
> interest including organizing initiatives, unfair labor practices,
> work stoppages, picketing, labor arbitrations and settlement
> agreements, and will discuss economic parameters for negotiations
> before the start of any labor negotiations.
>
> \(3\) The Contractor will furnish reports concerning labor relations
> and collective bargaining as may be required from time to time by the
> Contracting Officer.
>
> \(d\) [Salary and Benefits]{.underline}
>
> \(1\) Compensation Packages
>
> \(i\) Transferring Employees (Not including Inactive Vested
> Transferring Employees)
>
> \(I\) The Contractor shall provide a total compensation package for
> Transferring Employees that is substantially equivalent to that
> provided by the predecessor contractor as of June 1, 2006. The
> Contracting Officer in his/her sole discretion will determine
> substantial equivalency by comparing the Contractor's total
> compensation package with the benefits provided by the predecessor
> contractor; provided, however, that the Contractor's total
> compensation package must include UCRP age factors as a basis for
> determining compensation, substantially equivalent pension and other
> benefits, must maintain the base salaries of the Transferring
> Employees, and shall comply with the requirements of paragraph (e),
> pensions, set forth below.
>
> \(II\) Transferring Employees shall carry over the length of service
> credit and vacation and sick leave balances accrued under the
> predecessor contract as of the date of transfer to the Contractor.
> Paragraphs (d) (6) (ii) - (iv) below do not apply to evaluating the
> reasonableness of benefits for Transferring Employees.
>
> \(III\) The retiree medical benefit plan for Transferring Employees
> must include service based eligibility requirements that specify at a
> minimum, the service credit that all participants must have in order
> to qualify for retiree medical benefit coverage.
>
> \(ii\) New Employees, Inactive Vested Transferring Employees and UCRP
> Retiring Employees.
>
> \(I\) For New Employees, Inactive Vested Transferring Employees and
> UCRP Retiring Employees, the Contractor shall develop and provide a
> total compensation package that is market-driven and that will allow
> the Laboratory to recruit and retain critical scientific, technical,
> and engineering skills to develop the next generation of scientific
> personnel necessary to successfully carry out its mission. In
> addition, any total compensation package shall comply with the
> requirements of paragraph (e), pensions, as set forth below. Cost
> reimbursement of benefit plans will be consistent with the approved
> "Employee Benefits Value Study" and "Employee Benefits Cost Survey
> Comparison" as described below in paragraphs (d)(6)(i-iv).
>
> \(II\) Inactive Vested Transferring Employees shall carry over
> vacation and sick leave balances accrued under the predecessor
> contract as of the date of transfer to the Contractor, but shall not
> receive service credit for calculation of benefits under the
> Contractor's Pension Plan Two, as identified and discussed below, for
> service credited under the UCRP.
>
> \(iii\) The total compensation packages described in subparagraphs (i)
> and (ii) above are subject to the Contracting Officer's review and
> approval.
>
> [(iv) Notwithstanding any other term or condition set forth in the
> Contract, the compensation for each of the Contractor's Key Personnel,
> shall not exceed (i) \$473,318 benchmark in effect at the time of
> Contract award (i.e., the Contract's effective date) or (ii) the
> revised benchmark amount, in any subsequent government fiscal year, as
> determined by the applicable Determination of Executive Compensation
> Benchmark Amount Pursuant to Section 39 of the Office of Federal
> Procurement Policy (OFPP) Act (41 U.S.C. 435), as Amended, as required
> in FAR Subpart 31.205-6 "Compensation for Personal Services",
> paragraph (p) "Limitation on allowability of compensation for certain
> contractor personnel."]{.mark}
>
> \(2\) Wages and Salaries
>
> \(i\) The Contractor shall develop, implement and maintain formal
> policies, practices and procedures to be used in the administration of
> its compensation system including a compensation system
> self-assessment plan consistent with 48 CFR 31.205-6 as supplemented
> by DEAR 970.3102-05-6, "Compensation for personal services," as
> applied to the NNSA-approved standards in the Personnel Appendix. The
> Contractor's compensation system and methods shall be in accordance
> with 48 CFR 31.205-6 as supplemented by DEAR 970.3102-05-6, fully
> documented, consistently applied, and acceptable to the Contracting
> Officer.
>
> \(ii\) The Contractor shall submit the following to the Contracting
> Officer:
>
> \(I\) Any additional compensation system self-assessment data
> requested by the Contracting Officer that may be needed to validate
> and approve the Contractor's compensation system.
>
> \(II\) Any proposed major compensation program design changes prior to
> implementation.
>
> \(III\) An Annual Compensation Increase Plan (CIP) 90 days prior to
> the beginning of each succeeding fiscal year.
>
> \(IV\) Individual compensation changes for the Laboratory Director,
> Deputy Directors (if any), and Senior Managers that report directly to
> the Laboratory Director/Deputy Directors, including initial and
> proposed changes to base salary and or payments under an Executive
> Incentive Compensation Plan.
>
> \(V\) Any proposed establishment of an incentive compensation plan
> (variable pay plan/pay-at-risk).
>
> \(iii\) NNSA will conduct periodic appraisals of Contractor
> performance with respect to compensation system implementation. Such
> appraisals, may be conducted by NNSA, by validation of Contractor self
> assessments of compensation system performance, a third party expert,
> or any other method directed by the Contracting Officer.
>
> \(3\) Severance Pay
>
> \(i\) Severance pay benefits are not payable to an employee under this
> Contract if the employee:
>
> \(I\) Voluntarily separates, resigns or retires from employment,
>
> \(II\) Is offered employment with a successor/replacement contractor,
>
> \(III\) Is offered employment with the parent or an affiliated company
> of the Contractor, or
>
> \(IV\) Is discharged for cause.
>
> \(ii\) For all Transferring Employees the Contractor shall carry over
> the length of service credit accrued for eligibility for severance pay
> under service for the predecessor contractor as of the date of
> transfer to the Contractor. Service credit does not include any period
> of prior service at a DOE/NNSA facility for which severance pay has
> been previously paid.
>
> \(4\) Reporting Requirements
>
> The Contractor shall provide the following reports with respect to
> salary and benefits for all employees to the Contracting Officer:
>
> \(i\) Annual Contractor Salary-Wage Increase Expenditure Reports to
> include, at a minimum, breakouts for merit, promotion, variable pay,
> special adjustments, and structure movements for each pay structure
> showing actual against approved amounts.
>
> \(ii\) Annual Reports of Contractor Expenditures for Employee
> Supplemental Compensation through the Department Workforce Information
> System (WFIS), compensation and benefits module.
>
> \(iii\) Annual Self-Assessments of its total compensation packages.
>
> \(5\) Allowability of Pension and Other Benefits Costs
>
> Prior to changing any employee benefit, the Contractor shall obtain
> Contracting Officer approval of the changes. No presumption of
> allowability associated with a change will exist unless the
> Contracting Officer approves the change.
>
> \(6\) Benefits Evaluations
>
> \(i\) Within twelve months of Contract award and annually thereafter,
> unless specified elsewhere in the Contract, or as directed by the
> Contracting Officer, the Contractor shall submit for approval an
> evaluation of the Contractor's employee benefits based on two
> professionally recognized performance measures:
>
> \(I\) An Employee Benefits Value Study (ben-val) Measure, every two
> years, commencing June 2006, which is an actuarial study of the
> relative value (RV) of the benefits programs offered by the Contractor
> measured against the RV of benefit programs offered by a comparator
> group of companies and institutions approved by the Contracting
> Officer. To the extent that the value study does not address Post
> Retirement Benefits (PRBs), other than pensions, the Contractor shall
> provide separate PRB cost and plan design data comparisons with
> external benchmarks for nationally recognized and Contracting Officer
> approved survey sources.

(II) An Employee Benefits Cost Survey Comparison (cost survey) Method
     every year that analyzes the Contractor's employee benefits cost on
     a per capita basis per full time equivalent employee and compares
     it with the cost reported by the U.S. Chamber of Commerce (CoC)
     Annual Employee Benefits Cost Survey or other Contracting Officer
     approved broad based national survey.

> \(ii\) When the total RV and/or per capita cost exceed the comparator
> group by more than 5 percent, as required by the Contracting Officer,
> the Contractor shall submit for approval corrective action plans,
> including a timeline, to achieve a net benefit value and per capita
> cost not to exceed the comparator group by more than 5 percent.
>
> \(iii\) When required by the Contracting Officer, the Contractor shall
> submit an analysis of any specific plan costs that are above the per
> capita cost range and a corrective action plan to achieve conformance
> with the per capita cost range required by the Contracting Officer.
>
> \(iv\) The Contractor shall implement corrective action plans
> determined to be reimbursable by the Contracting Officer to align
> employee benefit programs with the target in subparagraph (d)(6)(ii)
> above.
>
> \(v\) The Contractor shall annually submit a Report of Contractor
> Expenditures for Employee Supplemental Compensation.
>
> \(e\) [Pension Plans]{.underline}
>
> \(1\) The Contractor shall sponsor at least two site-specific separate
> pension plans that cover site employees, including any pension plan
> spun off by the predecessor contractor. The pension plans sponsored by
> the Contractor shall include: "Pension Plan One," which shall cover
> Transferring Employees (not including Inactive Vested Transferring
> Employees), and "Pension Plan Two," which shall cover New Employees,
> Inactive Vested Transferring Employees, and UCRP Retiring Employees
> hired by the Contractor.
>
> \(2\) All Pension Plans shall meet the requirements of the Internal
> Revenue Code (IRC) and Employee Retirement Income Security Act of 1974
> (ERISA), as applicable, and shall be distinct from any corporate or
> other pension plan. Each pension plan shall cover only Contractor
> employees working at the Laboratory under this Contract.
>
> \(3\) (i) Pension Plan One. The Contractor shall consider amending
> Pension Plan One to be consistent with any changes made by the Board
> of Regents of the University of California to the UCRP during the term
> of this Contract. For Transferring Employees (not including Inactive
> Vested Transferring Employees), Pension Plan One shall include UCRP
> age factors, preserve accrued benefits and recognize service credit
> earned under the predecessor contractor's retirement plans including
> the UCRP.
>
> \(ii\) Pension Plan Two. For New Employees, Inactive Vested
> Transferring Employees, and UCRP Retiring Employees hired under this
> Contract, the Contractor shall develop a pension benefit package that
> is market-driven and competitive for the industry and which will allow
> the Contractor to recruit and retain the appropriate personnel to
> assure that LANL continues to successfully carry out its mission.

(I) For Inactive Vested Transferring Employees, Pension Plan Two shall
    recognize service earned under the UCRP for purposes of determining
    eligibility and vesting under Pension Plan Two, but shall not
    recognize their prior service for calculation of benefits.

(II) UCRP Retiring Employees hired under this Contract shall not receive
     credit under Pension Plan Two for service under the predecessor
     contract.

> \(4\) Contractor policies, practices, and procedures used in the
> administration of pension plans shall be consistent with law and
> regulation.
>
> \(5\) The Contractor shall obtain an independent audit annually of
> each pension plan, which provides the accounting details specified by
> ERISA Sections 103 and 104.
>
> \(6\) In addition to the information required under paragraph (d) (6)
> above, prior to making any changes to a pension plan the Contractor
> shall submit the information required under subparagraphs (i) and (ii)
> below for advance approval that the costs proposed to be incurred are
> consistent with the Contractor\'s pension plans and will be deemed
> allowable.
>
> \(i\) For proposed changes to pension plans and pension plan funding,
> an analysis of the impact of any proposed changes on actuarial accrued
> liabilities and an analysis of relative benefit value.
>
> \(ii\) For any proposed special programs (including, but not limited
> to, early retirement programs, window benefit programs, disability
> programs, plan-loan features, employee contribution refunds, asset
> reversions, or ancillary benefits), an analysis of the impact of
> special programs on the actuarial accrued liability of the pension
> plan, and on relative benefit value, if applicable.
>
> \(7\) For each pension plan, the Contractor shall provide the
> Contracting Officer with the following when filed with the IRS or
> within nine months of the last day of the current pension plan year,
> which ever occurs first:
>
> \(i\) The actuarial valuation.
>
> \(ii\) Copies of IRS forms 5500 with schedules.
>
> \(iii\) Copies of all forms in the 5300 series that document the
> establishment, amendment, termination, spin-off, or merger of a plan.
>
> \(8\) The Contractor shall perform an annual assessment to evaluate
> the effectiveness of its pension plan investment management. The
> assessment shall include at a minimum: a review and analysis of
> pension plan investment objectives; the strategies employed to achieve
> those objectives; the methods used to monitor execution of those
> strategies and the achievement of the investment objectives; and a
> comparative analysis of the objectives and performance of other
> comparable pension plans. The Contractor shall also identify its
> plans, if any, for revising any aspect of its pension plan management
> based on the results of the review. A copy of the pension plan
> performance assessment identified in this paragraph shall be provided
> to the Contracting Officer within 30 days of the completion of the
> assessment.
>
> \(9\) The Contractor shall provide (1) written notice to the
> Contracting Officer of individuals transferring from non-LANL
> operations (including but not limited to operations of parent or
> affiliated entities of the Contractor) to LANL operations, and
> vice-versa, on a quarterly basis, and (2) any additional information
> as directed by the Contracting Officer.
>
> \(10\) Pension Plan Terminations
>
> \(i\) The Contractor shall not terminate any pension plan covering any
> site employee without at least 60 days notice to and the approval of
> the Contracting Officer prior to the scheduled date of plan
> termination.
>
> \(ii\) After all liabilities of the plan are satisfied, the Contractor
> shall return to NNSA an amount equaling the asset reversion from the
> plan termination and interest as determined pursuant to the Contract's
> Section I Clause entitled "Interest" that has accrued on that amount
> because of a delay in the payment to NNSA. The Contracting Officer and
> the Contractor will agree to a schedule of payments. The Contracting
> Officer shall determine the method of payment.
>
> \(iii\) The amount of asset reversion and interest is subject to audit
> consistent with Contracting Officer direction.
>
> \(f\) [Contract Expiration or Termination With a Follow-on Management
> and Operating Contract]{.underline}
>
> If the Contract expires, or is terminated and an award is made to a
> follow-on management and operating contractor, as a part of the
> transition to another entity and in accordance with Contracting
> Officer direction and applicable law the Contractor shall transfer
> sponsorship of site-specific pension and other benefit plans covering
> employees at the Laboratory to the follow-on management and operating
> contractor.
>
> \(g\) [Contract Expiration or Termination Without a Follow-on
> Management and Operating Contract]{.underline}
>
> If this Contract expires or terminates without a follow-on management
> and operating contract, notwithstanding any other obligations and
> requirements concerning expiration or termination under any other
> clause of this Contract, including but not limited to the Contract's
> Section I Clause entitled "Termination," the following actions shall
> occur:
>
> \(1\) The Contractor shall continue as plan sponsor of all existing
> pension and welfare benefit plans covering site personnel, with
> continuing responsibility for management and administration of the
> plans, as directed by the Contracting Officer in his/her sole
> discretion.
>
> \(2\) The Contract may be extended as appropriate for purposes deemed
> necessary by the Contracting Officer for benefit continuation.
>
> \(3\) Pension plan contributions, plan asset management and
> administration costs, PRB costs and other applicable costs will
> continue to be allowable and fully reimbursable consistent with the
> terms of this Contract and in accordance with the applicable law and
> otherwise as acceptable to the Contracting Officer.
>
> \(4\) The Contracting Officer shall provide written direction
> regarding the provision of post-contract pension and other benefits as
> he/she deems necessary.
>
> \(h\) [Work Force Planning]{.underline}
>
> The Contractor will conduct work force planning which identifies the
> current and future status of critical-skills and the strategy for the
> recruitment and/or retention of those skills. This shall be documented
> in the form of a plan, to be submitted to the Contracting Officer no
> later than two (2) months after Contract award, for review and
> approval, with subsequent annual updates thereafter. The plan shall
> specifically address the issues set forth below:
>
> \(1\) Development of appropriate incentives, including an incentive
> compensation strategy for "Key Personnel," other management personnel,
> and other employees, as appropriate.
>
> \(2\) Documentation of a strategy for meeting the requirements
> identified in paragraph (e) "Pension Plans" above.
>
> \(3\) A framework for providing pension and other benefits applicable
> to the transferring workforce, relative to those provided under the
> predecessor contract, and an investment strategy for the management of
> transferred assets.
>
> \(4\) A plan to provide the opportunity for predecessor contractor
> employees, who are considering retirement, to discuss employment with
> the Contractor during the transition period to enable the employees to
> decide whether to retire under the UCRP.
>
> \(i\) [Post Retirement Benefits]{.underline}
>
> \(1\) The Contractor shall become the sponsor and be responsible for
> management and administration of a retiree medical benefit plan that
> will provide medical insurance benefits (including dental)
> substantially equivalent to those provided by the predecessor
> contractor to individuals who meet eligibility requirements under the
> plan and who retired from employment at LANL with the predecessor
> contractor prior to June 1, 2006. The Contracting Officer will
> determine substantial equivalency by comparing the Contractor's
> retiree medical benefit plan with the benefits provided by the
> predecessor contractor.
>
> \(2\) Unless required by Federal or State law, advance funding of
> PRBs, other than pensions, is not allowable.

### INTELLECTUAL AND SCIENTIFIC FREEDOM

> \(a\) The Parties recognize the importance of fostering an atmosphere
> at the Laboratory conducive to scientific inquiry and the development
> of new knowledge and creative and innovative ideas related to
> important national interests.
>
> \(b\) The Parties further recognize that the free exchange of ideas
> among scientists and engineers at the Laboratory and colleagues at
> universities, colleges, and other laboratories or scientific
> facilities is vital to the success of the scientific, engineering, and
> technical work performed by Laboratory personnel.
>
> \(c\) In order to further the goals of the Laboratory and the national
> interest, it is agreed by the Parties that the scientific and
> engineering personnel at the Laboratory shall be accorded the rights
> of publication or other dissemination of research, and participation
> in open debate and in scientific, educational, or professional
> meetings or conferences, subject to the limitations included in
> technology transfer agreements and such other limitations as may be
> required by the terms of this Contract. Nothing in this clause is
> intended to alter the obligations of the Parties to protect classified
> or unclassified controlled nuclear information as provided by law.
>
> \(d\) Nothing in the Section I clause entitled \"DEAR 952.204-75
> Public Affairs\" is intended to limit the rights of the Contractor or
> its employees to publicize and to accurately state the results of its
> scientific research.

### CONFLICTS OF INTEREST COMPLIANCE PLAN

The Contractor shall submit a Conflicts of Interest (COI) Compliance
Plan to the Contracting Officer for approval within 90 days after the
award date of this Contract. The COI Compliance Plan shall address the
Contractor\'s approach for adhering to the Section I Clause entitled
"Organizational Conflicts of Interest -- Alternate I" and Section J
Appendix entitled "Technology Commercialization" and describe its
procedures for aggressively self-identifying and resolving both
organizational and employee conflicts of interest. The overall purpose
of the COI Compliance Plan is to demonstrate how the Contractor will
assure that its operations meet the highest standards of ethical
conduct, and how its assistance and advice are impartial and objective.
The COI Compliance Plan shall specifically address:

> \(a\) How actual or potential COI issues will be identified and either
> mitigated, resolved, or avoided during contract performance;
>
> \(b\) How the Contractor will ensure its work force is aware of and
> complies with Organizational Conflicts of Interest and COI Compliance
> Plan requirements;
>
> \(c\) How the Contractor will ensure that the activities of the
> Contractor's Parent Organization(s) and affiliated companies are
> consistent with its COI Compliance Plan; and
>
> \(d\) How the Contractor will protect confidential, proprietary, or
> sensitive information.

### LOBBYING RESTRICTIONS

> []{.mark}
>
> \(a\) The Contractor agrees that none of the Contract's incremental
> funding shall be expended, directly or indirectly, to influence
> congressional action on any legislation or appropriation matters
> pending before Congress, other than to communicate to Members of
> Congress as described in 18 U.S.C. 1913. This restriction is in
> addition to those prescribed elsewhere in statute and regulation.
>
> \(b\) The Contractor agrees that none of the Contract's incremental
> funding shall be made available for any activity or the publication or
> distribution of literature that in any way tends to promote public
> support or opposition to any legislative proposal on which
> Congressional action is not complete. This restriction is in addition
> to those prescribed elsewhere in statute and regulation.