As prescribed in 16.203-4-90(h) use the following clause.
52.216-9034 ECONOMIC PRICE ADJUSTMENT - PUBLISHED MARKET PRICE - SILVER
(FEB 2009)
(a) WARRANTIES. The Contractor warrants that-
(1) The base unit prices set forth in the Schedule do not include allowances for any portion of the contingency covered by this clause;
(2) ounces of silver are contained in each unit offered which will be the basis for price adjustment under this clause; and
(3) The prices to be invoiced shall be computed in accordance with the provisions of this clause.
(b) DEFINITIONS. As used throughout this clause:
(1) "Unit Price" means the unit price offered, as set out in the contract Schedule.
(2) "Base Market Price" means the sum of one-half the simple average of the Englehard Industrial Bullion Quotations, plus one-half the simple average of the Handy and Harman Base Price Quotations, for silver on the New York Market over the fifteen working days immediately preceding bid opening, or the date of award for negotiated contracts, as reported in the Wall Street Journal. If the quotation for silver on a particular day is set out as a range of prices, the average of these prices shall be considered the price for that day.
(3) "Adjusting Market Price" means the sum of one-half the simple average of the Englehard Industrial Bullion Quotations, plus one-half the Handy and Harman Base Price Quotations, for silver on the New York Market, as reported in the Wall Street Journal, for the fifteen working days prior to a delivery date specified in the contract schedule or delivery order. If the quotation for silver on a particular day is set out as a range of prices, the average of these prices shall be considered the price for that day.
(4) "Weight Factor" means the amount of silver contained in each unit delivered. For purposes of this definition, the amount of silver per unit will be deemed to be the number of troy ounces stated in paragraph (a)(2).
(5) "Delivery Date" means the date originally specified in the contract or delivery order plus any extension attributable solely to reasons determined by the Contracting Officer to be excusable within the meaning of the "Default" Clause. It does not include any extension of the delivery schedule, however accomplished, except for such excusable causes.
(c) ADJUSTMENTS.
(1) NOTIFICATION. The Contractor shall promptly notify the Contracting Officer in writing, with accompanying calculations, upon a net change (increase or decrease) of $500 or more in the price of the items scheduled for delivery under an order due to an increase or decrease in the price of silver, as calculated in accordance with (c)(2) below. No adjustment will be made under this clause unless the calculated price change for an individual order resulting from change in the price of silver is $500 or more.
(2) CALCULATIONS. All calculations shall be rounded to two decimal places. The price adjustment will be calculated by computing, as a dollar amount per ounce of silver, the difference (increase or decrease) between the Base Market Price and the Adjusting Market price, multiplying the result by the number of ounces of silver per unit specified in (a)(2) above, and adding or subtracting (as appropriate) that result to/from the unit price, resulting in the adjusted contract unit price applicable to that order.
(3) MODIFICATION. Price adjustments under this clause shall be effected by contract modifications showing the base market price, calculation of the adjusting market price, the base unit price, and the calculations used to arrive at the adjusted contract unit price(s).
(4) EXCEPTIONS.
(i) No adjustment is allowed based on contractor requests for a price increase that are submitted more than sixty days after the delivery date of items for which a price increase is requested.
(ii) There will be no adjustment for increases which occur after the required delivery date unless the Contractor’s failure to deliver according to the delivery schedule results from causes beyond the Contractor’s control and without its fault or negligence, within the meaning of the Default clause of this contract.
(5) INVOICES. The prices payable for a particular delivery under this contract will be the contract unit price for the items supplied plus the product of the net difference between the applicable Adjusting Market Price and the Base Market Price times the weight factor times the number of units delivered.
(d) UPWARD CEILING ON ECONOMIC PRICE ADJUSTMENT. The Contractor agrees that the total increase in any contract unit price pursuant to these economic price adjustment provisions shall not exceed ___% of the original base unit price in any applicable contract year (whether a single year or multiyear program), except as provided hereafter:
(i) If at any time the Contractor has reason to believe that within the near future a price adjustment under the provisions of this clause will be required that will exceed the current contract ceiling price for any item, the Contractor shall promptly notify the Contracting Officer in writing of the expected increase. The contract ceiling price means the unit price limitation stated in (d). The notification shall include a revised ceiling the Contractor believes is sufficient to permit completion of remaining contract performance, along with appropriate explanation and documentation as required by the Contracting Officer.
(ii) If an actual increase in the market price would raise a contract unit price for an item above the current ceiling, the Contracting Officer may issue a contract modification to raise the ceiling. If the contract ceiling will not be raised, the Contracting Officer shall so promptly notify the Contractor in writing.
(e) REVISION OF MARKET PRICE INDICATOR. In the event -
(i) A market price is discontinued or its method of derivation is altered substantially; or
(ii) The Contracting Officer determines that a market price consistently and substantially fails to reflect market conditions,
the parties shall mutually agree upon an appropriate and comparable substitute and the contract shall be modified to reflect such substitute effective on the date the price was discontinued, altered, or began to consistently and substantially fail to reflect market conditions.
(f) OPTIONS. If this contract contains a term (period) option provision which is exercised, the contract price(s) for each succeeding term shall be subject to adjustment pursuant to this EPA clause. The contract price(s) in effect on the last day of the term or period immediately preceding the period for which the option has been exercised will be the contract price(s) on the first day of the succeeding option period.
(g) DISPUTES. Any dispute arising under this clause shall be determined in accordance with the Disputes clause of the contract.
(h) FINAL INVOICE. The Contractor shall include a statement on the final invoice that the amounts invoiced hereunder have applied all decreases required by this clause.
(End of Clause)
