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Tool Name: AI-Powered FAR Navigator Tool by CLEATUS AI
Purpose: To simplify and accelerate the process of understanding the Federal Acquisition Regulation (FAR) for government contractors.
Key Features:
- Provides AI-generated, plain-English summaries for all FAR clauses.
- Highlights relationships and dependencies between different FAR sections and clauses.
- Offers a searchable, browsable, and interactive interface for the entire FAR document.
- Includes a free-to-use search and navigation tool.
Target Audience: Small-to-mid-sized government contractors, proposal writers, and compliance officers who need to quickly understand FAR requirements.
Primary Benefit: Reduces the time and effort required to interpret complex legal and regulatory language, improving efficiency and compliance.

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49.109-4 - No-cost settlement | FAR Navigator

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

FAR 49.109-4 addresses the process for executing a no-cost settlement agreement in the event of contract termination. A no-cost settlement is appropriate when the contractor has not incurred any costs for the terminated portion of the contract, or is willing to waive any costs incurred, and there are no amounts owed to the Government. In such cases, the Termination Contracting Officer (TCO) is required to formalize the termination through a no-cost settlement agreement, using the prescribed formats in FAR 49.603-6 or 49.603-7, as applicable. This process streamlines contract closeout when neither party has outstanding financial obligations, reducing administrative burden for both the contractor and the Government.

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

Contracts with No Outstanding Costs

General Contracts

Terminated Contracts

Confirm no costs have been incurred for the terminated portion, or agree to waive any incurred costs.

Ensure no amounts are due to the Government under the contract.

Execute the no-cost settlement agreement using the format in FAR 49.603-6 or 49.603-7.

Obtain all necessary signatures and documentation for the settlement agreement.

References done in this subsection

49.603-6No-cost settlement agreement-complete termination

49.603-7No-cost settlement agreement-partial termination

49.109Settlement agreements

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

Contracts with No Outstanding Costs

General Contracts

Terminated Contracts

Confirm no costs have been incurred for the terminated portion, or agree to waive any incurred costs.

Ensure no amounts are due to the Government under the contract.

Execute the no-cost settlement agreement using the format in FAR 49.603-6 or 49.603-7.

Obtain all necessary signatures and documentation for the settlement agreement.

References done in this subsection

49.603-6No-cost settlement agreement-complete termination

49.603-7No-cost settlement agreement-partial termination

49.109Settlement agreements

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

49.109-4

No-cost settlement

A no-cost settlement allows for quick contract termination when neither party has outstanding financial obligations, streamlining the closeout process.

Overview

Key Rules

No Incurred Costs or Waiver
- A no-cost settlement is used if the contractor has not incurred costs for the terminated portion, or agrees to waive any costs incurred.
No Amounts Due to Government
- The agreement is only executed if the contractor does not owe any amounts to the Government under the contract.
Use of Prescribed Agreement Formats
- The TCO must use the appropriate no-cost settlement agreement format as specified in FAR 49.603-6 or 49.603-7.

Responsibilities

Contracting Officers: Must determine eligibility for no-cost settlement and execute the agreement using the correct format.
Contractors: Must confirm no costs incurred or agree to waive costs, and ensure no amounts are owed to the Government.
Agencies: Oversee proper execution and documentation of no-cost settlements.

Practical Implications

This provision allows for efficient contract closeout when there are no financial claims by either party.
It minimizes paperwork and expedites the termination process.
Contractors should ensure all costs are accounted for and be prepared to formally waive any claims if seeking a no-cost settlement.

Features

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