SpendQueryBeta

FAR and DFARS › FAR Part 49: Termination of Contracts › Subpart 49.6

FAR 49.603-5 Cost-reimbursement contracts—partial termination.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This section provides the required wording for a supplemental agreement to settle a partial termination of a cost-reimbursement contract. It ensures the agreement clearly identifies the terminated portion, adjusts the fee and estimated cost, and continues reimbursement of allowable costs and earned fee for the terminated portion.

Applies to: Cost-reimbursement contracts that are partially terminated.

What it requires

  • Insert the specified language in Block 14 of SF 30 for settlement agreements.
  • Specify the terminated portion clearly, including line item numbers, descriptions, quantity terminated, unit and total price, and any other necessary explanation.
  • State the decrease in fee and the new fee amount.
  • If appropriate, state the decrease in estimated cost and the new estimated cost.

Key terms: supplemental agreement · termination settlement proposal · Notice of Termination · terminated portion · SF 1034

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

[Insert the following in Block 14 of SF 30, Amendment of Solicitation/Modification of Contract, for settlement agreements for cost-reimbursement contracts as a result of partial termination.]

(a) This supplemental agreement settles the termination settlement proposal resulting from the Notice of Termination dated ______________.

(b) The parties agree as follows:

(1) The contract is amended by deleting the terminated portion as follows: [specify the terminated portion clearly as to (i) line item numbers, (ii) descriptions, (iii) quantity terminated, (iv) unit and total price of terminated items, and (v) any other explanation necessary to avoid uncertainty or misunderstanding].

(2) The fee stated in the contract is decreased by $__________, from $__________ to $__________.

[Insert, if appropriate, “(3) The estimated cost of the contract is decreased by $__________, from $__________ to $________.”.]

(c) The Contractor's allowable costs and earned fee, if any, for the terminated portion of the contract will continue to be reimbursed on SF 1034, Public Voucher for Purchase and Services Other Than Personal, under the applicable provisions of the contract and part 31 of the Federal Acquisition Regulation.

(End of agreement)

← 49.603-4 Cost-reimbursement contracts—complete termination, with settlement limited to fee. · 49.603-6 No-cost settlement agreement—complete termination. →

Rule changes for FAR Part 49

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

FAR 49.603-5 Cost-reimbursement contracts—partial termination · SpendQuery