Exceed Resources, Inc.
Docket: ASBCA 61652
Decision date: 2020-06-11

ARMED SERVICES BOARD OF CONTRACT APPEALS 
 
Appeal of - )  
 )  
Exceed Resources, Inc. ) ASBCA No.  61652 
 )   
Under Contract No. NNJ15RA22B )  
    
APPEARANCE FOR THE APPELLANT: Mr. Celsius Rebello 
    Director Government Services 
 
APPEARANCES FOR THE GOVERNMENT: Scott W. Barber, Esq. 
    NASA Chief Trial Attorney 
 Warnecke Miller, Esq. 
Vincent A. Salgado, Esq. 
    Trial Attorneys 
    NASA Headquarters 
    Washington, DC 
 
OPINION BY ADMINISTRATIVE JUDGE O’CONNELL ON THE 
GOVERNMENT’S MOTION FOR PARTIAL SUMARY JUDGMENT 
 
 Respondent, the National Aeronautics and Space Administration (NASA), 
moves for summary judgment on claims accruing on or before July 28, 2015, the date 
on which the parties signed a bilateral modification terminating the contract for the 
convenience of the government and in which appellant released its claims against 
NASA.  We grant the motion. 
 
STATEMENT OF FACTS FOR PURPOSES OF THE MOTION 
 
 This is a dispute that, at first blush, seems enormously complicated judging by 
the 82-page, single-spaced, complaint filed by appellant Exceed Resources, Inc. 
(Exceed).  However, at its core, the dispute involves two issues:  1) whether Exceed 
can pursue a claim for about $2.5 million in breach of contract damages 
notwithstanding a bilateral contract modification terminating the contract in which the 
parties agreed that it would receive no money other than phase-in costs; and 2) whether 
Exceed can challenge the contracting officer’s post-July 28, 2015, rating of its 
performance in the government’s Contractor Performance Assessment Reporting 
System (CPARS).  Only the former issue is before us in the pending motion.  
 

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 The following facts are undisputed for purposes of the motion unless otherwise 
noted. 
 
 This appeal involves a five-year, indefinite-delivery, indefinite-quantity 
contract for secretarial and administrative support to NASA at hourly rates specified in 
the contract (R4, tab 1 at 1, 5, 7; app. opp’n at 1).   
 
 Exceed submitted a proposal and model contract to NASA on March 10, 2015.  
The proposal included three Standard Form (SF) 1449s (a form that serves as a 
solicitation, contract and order for Commercial Items) signed by Mr. Celsius Rebello 
for Exceed.  The SF 1449s stated, among other things, that the contract included 
193 pages.  The model contract stated that the minimum contract value would be 
$750,000 and the maximum $73 million, and included NASA FAR Supp. Clause 
1852.232-77, LIMITATION OF FUNDS (FIXED–PRICE CONTRACT) (MAR 
1989).  (App. supp. R4, tab 4 at 400,000-02, 400,023-24; app. opp’n at 16, 18-19)  The 
model contract also contained FAR 52.212-4, CONTRACT TERMS AND 
CONDITIONS – COMMERCIAL ITEMS (SEPT 2013), which allows the government 
to terminate the contract at its convenience (app. supp. R4, tab 4 at 400,006). 
 
 The contracting officer (CO) signed the contract on June 2, 2015 and provided a 
copy of the first two pages (including SF 1449) to Exceed on June 22, 2015.  When the 
contracting officer provided the SF 1449 she had signed to Exceed, she had made 
some changes to the form, including the insertion of a total award amount of $800,000 
in box 26, and increasing the number of contract pages from 193 to 221 pages.  
(Compare R4, tab 1 at 1 and tab 4 at 1026, 1028)   
 
 In its filings, Exceed places a great deal of emphasis on the CO’s changes to the 
SF 1449; but there is no evidence that Exceed expressed any objections to these 
changes and it apparently began performance upon the contract as executed by the CO.  
 
 The contract provided for a phase-in period for which Exceed would be paid 
$47,013.38 (R4, tab 1 at 5).  During this period, a dispute arose between the parties 
involving the number of “productive hours” that the contract employees would work 
and the application of health and welfare benefits to those hours, as described in a 
letter from Mr. Rebello to NASA on July 26, 2015.  He ended this letter by requesting 
relief under FAR 14.407-4.  (R4, tab 4 at 1220-22; app. opp’n at 13)  FAR 14.407-4 
governs mistakes in bids that are discovered after award.  
 
 On July 27, 2015, the CO informed Mr. Rebello that she would not alter the 
contract terms and requested that Exceed confirm that it was willing and able to 
perform the contract (R4, tab 4 at 1223; app. opp’n at 13).  Mr. Rebello wrote back  
  

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later that day as follows: 
 
1. Exceed Resources, Inc. is willing and able to perform 
the contract in accordance with all applicable terms and 
conditions, including the Changes clause and Disputes 
clause. Exceed believes that it is entitled to an equitable 
adjustment, based upon certain mistakes, and the 
Government’s actions and inactions to date. As such, 
Exceed will file the requisite Claim for bid mistake, 
equitable adjustment, and if necessary, rescission of the 
contract . . .  
 
2. Exceed would also be willing to entertain either a 
minimum amount for a termination for convenience or 
a no-cost termination for convenience. 
 
(Id. at 1224 (emphasis added))  Exceed does not challenge NASA’s assertion that it 
sent this letter and, in fact, it referenced the letter in its claim (R4, tab 4 at 862). 
 
 The CO wrote back to Exceed on July 28, 2015, stating in relevant part, 
“NASA accepts your offer for a no-cost termination for convenience.”  She also stated 
that NASA would pay the full amount of the phase-in costs.  (R4, tab 4 at 922; see 
Rebello decl. (Dec. 14, 2018) at ¶ 12) 
 
 Mr. Rebello provides a curious version of these facts in a declaration submitted 
to the Board.  He does not mention that a no-cost termination for convenience had 
been his idea.  But according to him, when the CO specified in her July 28 letter that 
NASA would pay the phase-in costs upon execution of the modification, this was 
actually a threat that NASA would not pay unless Exceed executed the modification.  
(Rebello decl. (Dec. 14, 2018) at ¶ 12) 
 
 Later that day, the parties signed a contract modification, terminating the 
contract for the government’s convenience.  The modification provided in relevant 
part:  “[t]his supplemental agreement terminates the contract in its entirety, with the 
exception of Phase-In, and reflects a no-cost settlement agreement . . . .”  (R4, tab 4 
at 920-21) 
 
 The modification contained the following release language: 
 
The Contractor unconditionally waives any charges against 
the Government because of the termination of the contract 
and, except as set forth below, releases the Government 
from all obligations under the contract due to its 

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termination. The Government agrees that all obligations 
under the contract are concluded.  
 
 - Phase-In price will be paid in accordance with   
   Section 1.5 of the contract 
 
(R4, tab 4 at 921) 
 
 More than two years later, on September 6, 2017, Exceed submitted a 72-page, 
single-spaced, claim to the CO, seeking, among other things, $2,576,370 in breach of 
contract damages.  The largest portion of this amount is $2,490,251 in lost profits over 
the five-year term of the contract, with the balance related to efforts by Exceed and its 
attorneys to contest the CPARS rating.  Exceed admitted in the claim that NASA paid 
the full $47,013.38 for phase-in costs.  (R4, tab 4 at 842, 869, 911-12) 
 
 The CO denied the claim on March 16, 2018 (R4, tab 5).  Exceed filed a timely 
appeal on June 15, 2018. 
 
DECISION 
 
 Summary judgment is appropriate when there is no genuine issue of material 
fact and the moving party is entitled to judgment as a matter of law.  Anderson v. 
Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).  The party opposing summary 
judgment must show an evidentiary conflict on the record; mere denials or conclusory 
statements are not sufficient to avoid entry of judgment.  Mingus Constructors, Inc. v. 
United States, 812 F.2d 1387, 1390-91 (Fed. Cir. 1987). 
 
 Lost Profits after Termination for Convenience 
 
 To begin, it is worth considering the steep hill Exceed would have to climb to 
obtain lost profits even if it had not signed a release.  This is because termination for 
convenience clauses allow the government to end a contract without paying common 
law damages such as anticipatory profits.  Nexagen Networks, Inc., ASBCA No. 60641, 
19-1 BCA ¶ 37,258 at 181,328 (citing SWR, Inc., ASBCA No. 56708, 15-1 BCA 
¶ 35,832 at 175,222; William Green Constr. Co. v. United States, 477 F.2d 930, 936 
(Ct. Cl. 1973)).  A termination for convenience “is conclusive unless the contractor can 
show a clear abuse of discretion or that the government acted in bad faith.”  Id. (citing 
T&M Distributors, Inc. v. United States, 185 F.3d 1279, 1283 (Fed. Cir. 1999).  “To 
prove bad faith, there must be clear and convincing (or ‘well-nigh irrefragable’) 
evidence of some specific intent to harm the contractor.”  Id. (citing Am-Pro Protective 
Agency, Inc. v. United States, 281 F.3d 1234, 1239-40 (Fed. Cir. 2002)).  “Due to the 
heavy burden of proof, contractors have rarely been successful in demonstrating the 
government’s bad faith.”  Id. (citing Krygoski Constr. Co. v. United States, 94 F.3d 

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1537, 1541 (Fed. Cir. 1996)).  One prominent commentator has described a bad faith 
termination for convenience as “almost impossible to prove.”  33 Nash & Cibinic Rep. 
NL ¶ 32, Contract Disputes Act Claims: Minimal Requirement, (June 2019).  
 
 The Release 
 
 Exceed’s burden only grows because it signed a release.  A release is 
contractual in nature and is interpreted in the same manner as other contract terms.  If 
the terms of the release are plain and unambiguous they must be given their plain and 
ordinary meaning.  Bell BCI Co. v. United States, 570 F.3d 1337, 1341 (Fed. Cir. 
2009); J.C. Equipment Corp. v. England, 360 F.3d 1311, 1316 (Fed. Cir. 2004).  
Claims may be considered after the execution of a release only in special and limited 
circumstances, such as where the release contains a specific exception for the claim or 
the release was entered under economic duress.  Mingus, 812 F.2d at 1395 (citing J.G. 
Watts Construction Co. v. United States, 161 Ct. Cl. 801, 806-07 (1963)).  Exceptions 
to releases are construed narrowly because the purpose of a release is to put an end to 
the matter in dispute.  Id. at 1394.   
 
 We hold that the release in the bilateral modification is plain and unambiguous.  
It contains no exception that allows Exceed to pursue a claim for lost profits.  Nor is 
there anything in the record indicating that Exceed proposed an exception for lost 
profits.  Exceed “unconditionally waive[d] any charges against the Government” and 
“release[d] the Government from all obligations under the contract...”  Exceed does 
not contend that the release states otherwise. 
 
 Exceed’s Arguments of Bad Faith and Duress Rest Upon a Misunderstanding of 
the Contract  
 
 The Board has reviewed Exceed’s complaint, its opposition to NASA’s motion 
for summary judgment, motion to file a sur-reply, the sur-reply and multiple 
declarations of Celsius Rebello.1  It is difficult to characterize the meandering 
arguments that Exceed makes, but they basically fall into three categories:  1) because 
of the changes that the contracting officer made to the SF 1449, there were multiple 
versions of the contract; 2) economic duress; and 3) Exceed’s position concerning the 
disputes pending before the parties executed the termination modification were 
correct.  
 
                                              
1 The Rebello declarations reviewed by the Board are those dated May 26, 2017 and 
March 15, 2018 that are attached to the complaint, and those submitted after 
NASA moved for summary judgment, which include two declarations dated 
October 14, 2018, and one each on October 15, 2018, and December 14, 2018. 

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 As described above, the SF 1449 signed by the CO was somewhat different 
than that signed by Exceed when it submitted the model contract.  While we agree 
with Exceed that it would be problematic if the CO included new or different terms in 
the contract without its knowledge or agreement, Exceed has not identified any 
alteration that changed the nature of the bargain.2  Exceed does not present the changes 
to the SF 1449 as facts that, when considered in connection with other facts, are 
meaningful as a matter of law.  With one exception, Exceed presents these facts as 
meaningful in and of themselves.  Thus, it seems to contend that changes, such as the 
increase in the number of contract pages (a fact Exceed clearly knew about before 
signing the termination), in and of themselves give Exceed the right to avoid the 
release in the termination agreement.  However, without a showing that the contracting 
officer actually changed the terms of the bargain – and Exceed has not identified any 
substantive changes, with the exception of the (contractually necessary) completion of 
the Total Award Amount discussed immediately below –  we do not see the point of 
Exceed’s argument.  
 
 The one change for which Exceed presents any kind of argument is the 
contracting officer’s insertion of $800,000 in the Total Award Amount box of the 
SF 1449, which had been blank in the ones it submitted with its bid.  It does not pause 
to consider, however, that the CO had to insert some number here and that the amount 
is, on its face, proper because it falls within the $750,000 to $73 million range 
identified in the model contract.  Exceed relies upon this difference to segue into a 
duress argument.  
 
 While difficult to understand, Exceed’s argument seems to be that the CO’s 
insertion of “$800,000” under the heading “Total Award Amount” on page 1 of the 
SF 1449, was a ploy that obligated Exceed to perform the maximum amount of work 
for an amount that was almost negligible.  It contends that it would have incurred a 
loss of over $45 million and as a result it had no choice but to sign the modification3 
(app. opp’n at 24-29).   
 
 As described above, the model contract contained the Limitation of Funds 
(LOF) clause.  This standard clause has blank spaces in which the CO can insert an  
  
                                              
2 For example, the CO stated in her final decision that the reason for the increase in the 
number of pages was due to her inclusion of documents identified as 
attachments in the model contract (R4, tab 5 at 1697).   
3 The Board believes that there are reasons for doubting the sincerity of this argument.  
Beyond the inherent implausibility of the contention, the record contains an 
email from the CO to Exceed on June 22, 2015, in which she explained that the 
$800,000 simply represented the phase-in costs plus the first month of work 
(R4, tab 2 at 313).  Nevertheless, we will consider Exceed’s argument. 

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amount for incremental funding and the date through which the funding applies.  
NASA FAR Supp. 1852.232-77(a).  In this case, the CO adapted it so that it stated:  
“Of the total price of items through August 29, 2015, the sum of $800,000.00 is 
presently available for payment and allotted to this contract.”  (R4, tab 1 at 30)   
 
 Despite Exceed’s contentions, the clause does not allow a CO to force an 
unwitting contractor to perform 98% of the contract work for free by inserting a 
minimal number.  While not a model of succinct wording, the clause states: 
 
The Contractor agrees to perform or have performed work 
on the items specified in paragraph (a) of this clause up to 
the point at which, if this contract is terminated pursuant to 
the Termination for Convenience of the Government 
clause of this contract, the total amount payable by the 
Government . . . would, in the exercise of reasonable 
judgment by the Contractor, approximate the total amount 
at the time allotted to the contract. The Contractor is not 
obligated to continue performance of the work beyond that 
point.  
 
NASA FAR Supp. 1852.232-77(b).   
 
Precedent from cases involving similar LOF clauses unsurprisingly confirm that 
contractors cannot be forced to work for free beyond the amount allotted to the 
contract.  Textron Defense Systems v. Widnall, 143 F.3d 1465, 1469 (Fed. Cir. 1998) 
(the “LOF clause puts a duty on the contractor to contain its costs below the amount 
allotted to the contract . . .”); American Electronic Laboratories, Inc. v. United States, 
774 F.2d 1110, 1111 (Fed. Cir. 1985) (“The contract included the LOF clause which 
provided that . . . (3) absent the CO’s written notice, AEL was not obligated to 
continue performance under the contract or otherwise to incur costs in excess of the 
amount allotted to the contract.”)    
 
 Exceed contends that it did not have the completed version of the LOF clause 
until after the termination (app. opp’n at 24).  But, in addition to the email referenced 
in footnote 3 above, Exceed would have known from reading the LOF clause that it 
could not be forced to work beyond the amount allotted and, per the SF 1449 signed 
by the CO, that this amount was $800,000.  Exceed has identified no other contract 
language that allowed the contracting officer to force it to perform the contract almost 
entirely for free.   
 

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 Exceed Has Not Shown That the Duress Issue Merits a Hearing  
 
 “To render a contract unenforceable for duress, a party must establish (1) that it 
involuntarily accepted the other party’s terms[;] (2) that circumstances permitted no 
other alternative[;] and (3) that such circumstances were the result of the other party’s 
coercive acts.”  N. Star Steel Co. v. United States, 477 F.3d 1324, 1334 (Fed. Cir. 
2007) (citation omitted).  “Economic pressure and ‘even the threat of considerable 
financial loss’ are not duress.”  Johnson, Drake & Piper, Inc. v. United States, 531 
F.2d 1037, 1042 (Ct. Cl. 1976) (quoting International Tel. & Tel. Corp. v. United 
States, 509 F.2d 541, 549, n. 11 (Ct. Cl. 1975)); see J.C. Equipment, 360 F.3d at 1316 
(contractor’s contention that it signed release under duress “rings hollow” where the 
modifications involved payment of additional money). 
 
 Under the test articulated in North Star Steel, Exceed must show that it 
involuntarily accepted NASA’s terms.  Exceed cannot meet this requirement because 
the undisputed facts show that it proposed the no cost termination, not NASA. 
    
 The Federal Circuit’s decision in Am-Pro Protective Agency involved facts 
comparable to this appeal and is instructive.  In that case, the contractor executed a 
release and then years later contended in an uncorroborated affidavit that the contracting 
officer used threats to force it to sign.  The Federal Circuit affirmed the entry of 
summary judgment in favor of the government, despite an affidavit from the contractor 
stating that the CO had obtained the release through threats.  While this would have been 
enough in an ordinary case to create a dispute of facts, the court held it was not in that 
situation due to the high standard of proof necessary to show that the CO acted in bad 
faith, the uncorroborated nature of an allegation made six years later, the inherent 
implausibility of the allegations, and the lack of contemporaneous documents recording 
the threat.  Am-Pro, 281 F.3d at 1238-39, 1241-43. 
 
 Similar considerations are present here.  While it is true that Mr. Rebello has 
submitted a declaration in which he testified that the contracting officer threatened to 
withhold the payment for phase-in costs unless he signed the termination, the various 
deficiencies in Exceed’s presentation compel the conclusion that no rational fact finder 
could believe the representations it has made to the Board.  
 
 First, Mr. Rebello neglects to mention that he was the one who proposed a no 
cost termination.  This leads to the rather obvious question as to why the contracting 
officer would have felt it necessary to make a threat.  Moreover, because the 
undisputed facts show that the CO responded to Exceed’s no cost termination proposal 
by stating, in essence, ‘OK, but we’ll pay you over $47,000’, we do not believe that 
any rational business person would have construed this as a threat.  Am-Pro, 281 F.3d 
at 1242 (rejecting as implausible contractor’s perception of CO’s explanation as a 
threat). 

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 Second, the more than three year gap between the events in question and 
Mr. Rebello’s declaration is also reason for doubting the allegation.  While not as long 
as the six-year gap in Am-Pro, 281 F.3d at 1242, it is almost exactly the same as the 
gap found to be a “telling indication that no duress was practiced” in Johnson, Drake 
& Piper, 531 F.2d at 1043.  Further, we also observe that in Exceed’s 72-page 
September 2017 claim it failed to allege that the CO forced it to sign the termination 
by threatening to withhold payment of phase-in costs, nor did it raise this in either of 
the two affidavits Mr. Rebello submitted in support of the claim (R4, tab 4 at 842-915).  
 
 Third, as we have already explained, the CO’s alleged effort to force Exceed to 
perform all of the contract work for $800,000 is refuted by the LOF clause and has no 
support in the language of the contract.  No rational business person could have read 
the contract in this manner.     
 
 In summary, the Board finds that Exceed’s contention that the contracting 
officer obtained Mr. Rebello’s signature on the termination modification through 
duress to be inherently improbable.  We find that it lacks support in contemporaneous 
documents, and is contradicted by the contract and the correspondence leading to the 
termination.  Accordingly, Exceed has not created a genuine factual issue of duress for 
trial. 
 
 Exceed is not Entitled to Relitigate its Pre-Release Position 
 
 Exceed spends considerable effort going through all of the issues that were 
pending between the parties prior to the termination.  We have no doubt that Exceed 
may have been under a great deal of financial pressure, but it is also undisputed that it 
asked for relief from the CO for a mistake in bid on July 26, 2015, and that it cited its 
own mistakes in the July 27, 2015, letter in which it proposed the termination for 
convenience.  But as we have already explained, unless Exceed can avoid the effect of 
the release by proving duress or that the claim at issue was excepted from the release, 
the fact that there may also have been some validity to its position is irrelevant.  As the 
Court of Claims explained in Johnson, Drake & Piper:  “[i]t does not follow that 
because a claim is by hindsight seen to be even entirely meritorious, an agreement to 
compromise it was in any wise improper.  A party who settles his claim may not avoid 
it by proof that his claim was just.”  Johnson, Drake & Piper, 531 F.2d at 1044 (Ct. Cl. 
1976).  Accordingly, Exceed is not entitled to a hearing on these issues. 
 
  

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CONCLUSION 
 
 We grant NASA’s motion for partial summary judgment and enter judgement 
against Exceed on the portion of its appeal related to its lost profits, both because there 
is an insufficient factual basis to find that termination of the contract was done in bad 
faith, which is a necessary predicate for such a cause of action, and because Exceed 
executed a valid release, which would preclude such a recovery in any event.4 
 
 Dated:  June 11, 2020
 
 
 
 
 
 
 
 
MICHAEL N. O’CONNELL 
Administrative Judge 
Armed Services Board 
of Contract Appeals 
I concur 
 
RICHAED SHACKLEFORD 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
 I concur 
 
 J. REID PROUTY 
Administrative Judge 
Vice Chairman 
Armed Services Board 
of Contract Appeals 
 
 I certify that the foregoing is a true copy of the Order of Dismissal of the Armed 
Services Board of Contract Appeals in ASBCA No. 61652, Appeal of Exceed Resources, 
Inc., rendered in conformance with the Board’s Charter. 
 
 Dated:  June 12, 2020 
 
 
 
 
 
                                              
4 Exceed’s motion to file a sur-reply is granted.  Exceed’s motion for sanctions on 
government counsel for including the contract at tab 1 of the Rule 4 file is 
denied. 
 
PAULLA K. GATES-LEWIS 
Recorder, Armed Services 
Board of Contract Appeals