52.216-5 Price Redetermination-Prospective.

As prescribed in 16.205-4 , insert the following clause:

Price Redetermination-Prospective (Jan 2022)

(a) General. The unit prices and the total price stated in this contract shall be periodically

redetermined in accordance with this clause, except that-

(1) The prices for supplies delivered and services performed before the first effective date of price

redetermination (see paragraph (c) of this clause) shall remain fixed; and

(2) In no event shall the total amount paid under this contract exceed any ceiling price included in

the contract.

(b) Definition. "Costs," as used in this clause, means allowable costs in accordance with part 31 of

the Federal Acquisition Regulation (FAR) in effect on the date of this contract.

(c) Price redetermination periods. For the purpose of price redetermination, performance of this

contract is divided into successive periods. The first period shall extend from the date of the contract

to ________, (see Note(1)) and the second and each succeeding period shall extend for ________ [insert

appropriate number] months from the end of the last preceding period, except that the parties may

agree to vary the length of the final period. The first day of the second and each succeeding period

shall be the effective date of price redetermination for that period.

(d) Data submission.

(1) Not more than _______ nor less than ______ (see Note (2)) days before the end of each

redetermination period, except the last, the Contractor shall submit-

(i) Proposed prices for supplies that may be delivered or services that may be performed in the next

succeeding period, and-

(A) An estimate and breakdown of the costs of these supplies or services in the format of Table 15-2,

FAR 15.408, or in any other form on which the parties may agree;

(B) Sufficient data to support the accuracy and reliability of this estimate; and

(C) An explanation of the differences between this estimate and the original (or last preceding)

estimate for the same supplies or services; and

(ii) A statement of all costs incurred in performing this contract through the end of the

_______________ month (see Note (3)) before the submission of proposed prices in the format of Table 

15-2, FAR 15.408 (or in any other form on which the parties may agree), with sufficient supporting

data to disclose unit costs and cost trends for-

(A) Supplies delivered and services performed; and

(B) Inventories of work in process and undelivered contract supplies on hand (estimated to the

extent necessary).
(2) The Contractor shall also submit, to the extent that it becomes available before negotiations on

redetermined prices are concluded-

(i) Supplemental statements of costs incurred after the date stated in subdivision (d)(1)(ii) of this

section for-

(A) Supplies delivered and services performed; and

(B) Inventories of work in process and undelivered contract supplies on hand (estimated to the

extent necessary); and

(ii) Any other relevant data that the Contracting Officer may reasonably require.

(3) If the Contractor fails to submit the data required by paragraphs (d)(1) and (2) of this section,

within the time specified, the Contracting Officer may suspend payments under this contract until

the data are furnished. If it is later determined that the Government has overpaid the Contractor,

the Contractor shall repay the excess to the Government immediately. Unless repaid within 30 days

after the end of the data submittal period, the amount of the excess shall bear interest, computed

from the date the data were due to the date of repayment, at the rate established in accordance with

the Interest clause.

(e) Price redetermination. Upon the Contracting Officer’s receipt of the data required by paragraph

(d) of this section, the Contracting Officer and the Contractor shall promptly negotiate to

redetermine fair and reasonable prices for supplies that may be delivered or services that may be

performed in the period following the effective date of price redetermination.

(f) Contract modifications. Each negotiated redetermination of prices shall be evidenced by a

modification to this contract, signed by the Contractor and the Contracting Officer, stating the

redetermined prices that apply during the redetermination period.

(g) Adjusting billing prices. Pending execution of the contract modification (see paragraph (f) of this

section), the Contractor shall submit invoices or vouchers in accordance with the billing prices

stated in this contract. If at any time it appears that the then-current billing prices will be

substantially greater than the estimated final prices, or if the Contractor submits data showing that

the redetermined price will be substantially greater than the current billing prices, the parties shall

negotiate an appropriate decrease or increase in billing prices. Any billing price adjustment shall be

reflected in a contract modification and shall not affect the redetermination of prices under this

clause. After the contract modification for price redetermination is executed, the total amount paid

or to be paid on all invoices or vouchers shall be adjusted to reflect the agreed-upon prices, and any

requested additional payments, refunds, or credits shall be made promptly.

(h) Quarterly limitation on payments statement. This paragraph (h) applies only during periods for

which firm prices have not been established.

(1) Within 45 days after the end of the quarter of the Contractor’s fiscal year in which a delivery is

first made (or services are first performed) and accepted by the Government under this contract,

and for each quarter thereafter, the Contractor shall submit to the contract administration office

(with a copy to the contracting office and the cognizant contract auditor) a statement, cumulative

from the beginning of the contract, showing-

(i) The total contract price of all supplies delivered (or services performed) and accepted by the

Government and for which final prices have been established;
(ii) The total costs (estimated to the extent necessary) reasonably incurred for, and properly

allocable solely to, the supplies delivered (or services performed) and accepted by the Government

and for which final prices have not been established;

(iii) The portion of the total interim profit (used in establishing the initial contract price or agreed to

for the purpose of this paragraph (h)) that is in direct proportion to the supplies delivered (or

services performed) and accepted by the Government and for which final prices have not been

established; and

(iv) The total amount of all invoices or vouchers for supplies delivered (or services performed) and

accepted by the Government (including amounts applied or to be applied to liquidate progress

payments).

(2) The statement required by paragraph (h)(1) of this section need not be submitted for any quarter

for which either no costs are to be reported under subdivision (h)(1)(ii) of this section, or revised

billing prices have been established in accordance with paragraph (g) of this section, and do not

exceed the existing contract price, the Contractor’s price-redetermination proposal, or a price based

on the most recent quarterly statement, whichever is least.

(3) Notwithstanding any provision of this contract authorizing greater payments, if on any quarterly

statement the amount under subdivision (h)(1)(iv) of this section exceeds the sum due the

Contractor, as computed in accordance with subdivisions (h)(1)(i), (ii), and (iii) of this section, the

Contractor shall immediately refund or credit to the Government the amount of this excess. The

Contractor may, when appropriate, reduce this refund or credit by the amount of previous refunds or

credits affected under this clause. If any portion of the excess has been applied to the liquidation of

progress payments, then that portion may, instead of being refunded, be added to the unliquidated

progress payment account, consistent with the Progress Payments clause. The Contractor shall

provide complete details to support any claimed reductions in refunds.

(4) If the Contractor fails to submit the quarterly statement within 45 days after the end of each

quarter and it is later determined that the Government has overpaid the Contractor, the Contractor

shall repay the excess to the Government immediately. Unless repaid within 30 days after the end of

the statement submittal period, the amount of the excess shall bear interest, computed from the date

the quarterly statement was due to the date of repayment, at the rate established in accordance with

the Interest clause.

(i) Subcontracts. No subcontract placed under this contract may provide for payment on a cost-plusa-percentage-of-cost- basis.

(j) Disagreements. If the Contractor and the Contracting Officer fail to agree upon redetermined

prices for any price redetermination period within 60 days (or within such other period as the

parties agree) after the date on which the data required by paragraph (d) of this section are to be

submitted, the Contracting Officer shall promptly issue a decision in accordance with the Disputes

clause. For the purpose of paragraphs (f), (g), and (h) of this section, and pending final settlement of

the disagreement on appeal, by failure to appeal, or by agreement, this decision shall be treated as

an executed contract modification. Pending final settlement, price redetermination for subsequent

periods, if any, shall continue to be negotiated as provided in this clause.

(k) Termination. If this contract is terminated, prices shall continue to be established in accordance

with this clause for (1) completed supplies and services accepted by the Government and (2) those

supplies and services not terminated under a partial termination. All other elements of the

termination shall be resolved in accordance with other applicable clauses of this contract.
Notes:

(1) Express in terms of units delivered, or as a date; but in either case the period should end on the

last day of a month.

(2) Insert the number of days chosen so that the Contractor’s submission will be late enough to

reflect recent cost experience (taking into account the Contractor’s accounting system), but early

enough to permit review, audit (if necessary), and negotiation before the start of the prospective

period.

(3) Insert "first," except that "second" may be inserted if necessary to achieve compatibility with the

Contractor’s accounting system.

(End of clause)

Parent topic: 52.216 [Reserved]