stated ceiling price, the Contractor shall so notify the SCR, giving its revised estimate of the total price for the performance of this contract, together with supporting reasons and documentation. If at any time during the performance of this contract, Sandia has reason to believe that the work to be required in the performance of this contract will be substantially greater or less than the stated ceiling price, the SCR, will so advise the Contractor, giving the then-revised estimate of the total amount of effort to be required under the contract and the ceiling amount shall be revised accordingly. (d) Limitation of Obligation (LO). Sandia shall not be obligated to pay the Contractor any amount in excess of the LO ceiling price set forth in Section I and the Contractor shall not be obligated to continue performance if to do so would exceed the LO ceiling price set forth in Section I, unless and until the SCR shall have notified the Contractor in writing that such LO ceiling price has been increased and shall have specified in such notice a revised LO ceiling which shall thereupon constitute the LO ceiling price for performance under this contract. When and to the extent that the LO ceiling price set forth in Section I has been increased, any hours expended and material costs incurred by the Contractor in excess of the LO ceiling price prior to the increase shall be allowable to the same extent as if such hours expended and material costs had been incurred after such increase in the LO ceiling price. (e) Audit of Invoices or Vouchers . At any time or times, as deemed necessary by the SCR, but not later than three (3) years after final payment under this contract, Sandia may perform an audit of the invoices or vouchers submitted for labor, material, travel, and any other charges. Each payment theretofore made shall be subject to reduction to the of amounts which are found by Sandia not to have been properly payable, and shall also be subject to reduction for overpayments, or to increase for underpayments, on preceding invoices or vouchers. Prior to final payment under this contract, the Contractor shall execute and deliver to Sandia a release in form and substance satisfactory to the SCR, discharging Sandia and the government, their officers, agents, and employees from all liabilities, obligations, and claims arising out of or under this contract, other than claims in stated amounts as may be specifically excepted by the Contractor from the operation of the release. Sandia may, at its own discretion, perform an administrative close of contracts upon completion of the period of performance; such an action does not relieve either party of any rights or responsibilities with respect to final audit activities and settlements. (f) Reports. The Contractor shall furnish such progress reports and schedules, and such other reports concerning the work under this contract as the SCR may from time to time require. (g) Method of Payments. Payments shall be made by electronic funds transfer. Payment shall be deemed to have been made as of the date on which an electronic funds transfer was made. (h) Prompt Payment Discounts. Sandia may take contract or invoice prompt payment discount. Discount time will be computed from the date correct invoice or voucher is received in the office specified in the contract, or date of completion of work under this contract, whichever is later. Payment is deemed to be made, for the purpose of earning the discount, on the date on which the electronic funds transfer was made.

Control #: SF 6432-TM Title: Standard Terms and Conditions for Time and Materials Labor-Hour Contracts Owner: Procurement Policy Department Release Date: 03/17/16 Page 10 of 25 Printed copies of this document are uncontrolled. Retrieve latest version electronically.