FAR and DFARS › FAR Part 49: Termination of Contracts › Subpart 49.6
FAR 49.603-7 No-cost settlement agreement—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 exact wording to insert in Block 14 of SF 30 when a no-cost settlement agreement is used for a partial termination. It documents that the contractor gives up all charges tied to the terminated portion of the contract, while the government confirms no further performance is owed there. It matters because it creates a clear written record of what was terminated and what rights, if any, are reserved.
Applies to: Contractors and contracting officers executing a no-cost settlement agreement for a partial termination
What it requires
- Insert the specified language in Block 14 of SF 30 if a no-cost settlement agreement under a partial termination is to be executed
- Specify the terminated portion of the contract, including line item numbers, descriptions, quantity terminated, unit and total price of terminated items, and any other explanation necessary to avoid uncertainty or misunderstanding
- List any reserved or excepted rights and liabilities
Key terms: no-cost settlement agreement · partial termination · SF 30 · terminated portion of the contract · unconditionally waives
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 if a no-cost settlement agreement, under a partial termination, is to be executed.]
(a) This supplemental agreement modifies the contract to reflect a no-cost settlement agreement with respect to the Notice of Termination dated __________.
(b) The parties agree as follows:
(1) The terminated portion of the contract is as follows: [Specify (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 Contractor unconditionally waives any charges against the Government arising under the terminated portion of the contract or by reason of its termination, including, without limitation, all obligations of the Government to make further payments or to carry out any further undertakings under the terminated portion of the contract. The Government acknowledges that the Contractor has no obligation to perform further work or services or to make further deliveries under the terminated portion of the contract. Nothing in this paragraph affects any other covenants, terms, or conditions of the contract. Under the terminated portion of the contract, the following rights and liabilities of the parties are reserved:
[List reserved or excepted rights and liabilities. See 49.109-2 and 49.603-1(b)(7).]
(End of agreement)
← 49.603-6 No-cost settlement agreement—complete termination. · 49.603-8 Fixed-price contracts—settlements with subcontractors only. →
Rule changes for FAR Part 49
- Federal Acquisition Regulation: Revolutionary Federal Acquisition Regulation Overhaul Parts 3 and 49 ↗ · proposed 2026-06-23 · comments due 2026-07-23
- Federal Acquisition Regulation; Technical Amendments ↗ · final rule 2024-12-16 · effective 2025-01-03
Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.