As prescribed at 16.203-4(a)(2)(98), insert the following clause:
ECONOMIC PRICE ADJUSTMENT - PUBLISHED MARKET PRICE - DOMESTIC BULK (MAY 2010)
(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; and
(2) The prices to be invoiced shall be computed in accordance with the provisions of this clause.
(b) DEFINITIONS. As used throughout this clause, the term-
(1) Base unit price means the unit price set forth opposite the item in the Schedule.
(2) Market price means the price to be used in determining an economic price adjustment of the base unit price of an individual product for the market area and time period specified in this clause. The market price is derived from quotes, assessments, or sales prices in the market place for one or several items or commodity groups as reported in a consistent manner in a publication, electronic data base, or other form, as determined by an independent trade association, governmental body, or other third party independent of the Contractor.
(i) Base market price means the price as shown in Column V of the table below, which is the market price from which economic price adjustments are calculated pursuant to this clause.
(ii) Adjusting market price means the market price for deliveries during the most recent period, as defined in the table below.
(3) Date of delivery is defined as follows:
(i) FOR TANKER OR BARGE DELIVERIES.
(ii) FOR PIPELINE DELIVERIES. The date and time product commences to move past the specified f.o.b. point.
(iii) FOR ALL OTHER TYPES OF DELIVERIES. The date product is received.
(c) ADJUSTMENTS.
(1) Subject to the provisions of this clause, the price payable shall be the base unit price in effect on the date of delivery increased or decreased by the same number of cents, or fraction thereof, that the adjusting market price applicable at date of delivery increases or decreases, per like unit of measure, from the base market price.
(2) CALCULATIONS. All calculations shall be rounded to six decimal places.
(3) MODIFICATIONS. Any resultant price changes to the base market price and base unit price shall be executed by the Contracting Officer through a weekly price adjustment modification effective each Tuesday.
(4) FAILURE TO DELIVER. Notwithstanding any other provisions of this clause, no upward adjustment shall apply to product scheduled under the contract to be delivered before the effective date of the adjustment, 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 paragraphs (f), Excusable Delays, and (m), Termination for Cause, of the CONTRACT TERMS AND CONDITIONS - COMMERCIAL ITEMS clause of this contract, in which case the contract shall be amended to make an equitable extension of the delivery schedule.
(5) 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 (Note 1) percent of the original base unit price in any applicable program 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 notification shall include a revised ceiling which 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 established market price would raise a contract unit price for an item above the current ceiling, the Contractor shall have no obligation under this contract to fill pending or future orders for such item, as of the effective date of the increase, unless the Contracting Officer issues 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.
(6) REVISION OF MARKET PRICE INDICATOR. In the event-
(i) Any applicable market price indicator is discontinued or its method of derivation is altered substantially; or
(ii) The Contracting Officer determines that the market price indicator 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 indicator was discontinued, altered, or began to consistently and substantially fail to reflect market conditions. If the parties fail to agree on an appropriate substitute, the matter shall be resolved in accordance with paragraph (d), Disputes, of the CONTRACT TERMS AND CONDITIONS - COMMERCIAL ITEMS clause of this contract.
(d) CONVERSION FACTORS. If this clause requires quantity conversions for economic price adjustment purposes, the conversion factors for applicable products, as specified in the DESC Conversion Factor Instruction, apply unless otherwise specified in the Schedule.
(e) EXAMINATION OF RECORDS. The Contractor agrees that the Contracting Officer or designated representative shall have the right to examine the Contractor's books, records, documents, or other data the Contracting Officer deems necessary to verify Contractor adherence to the provisions of this clause.
(f) 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.
(g) TABLE.
I II III IV V
Item No. Publication name of product is applicable (see note(s) below)
(Note 2- fill-in)
(NOTE 3 - fill-in):
(end of clause)
Note 1: The Contracting Officer shall complete the percentage as required in 16.203-4(a)(2)(XX)
Note 2: The Contracting Officer shall complete the table after coordinating with the DESC Market Research Division.
Note 3: method(s), and time period(s) for calculating the market price(s), as exemplified below:
For Platts Oilgram: "NOTE: The East/Gulf Coast adjusting market price will be firm for weekly periods and is defined as the average of the applicable daily Platts spot assessment quotations effective for the prior week. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices that are not published) shall be the adjusting market price effective for the following Tuesday through Monday."
For Oil Price Information Service: "NOTE: The Rocky Mountain adjusting market price will be firm for weekly periods and is defined as the Oil Price Information Service Publication applicable weekly quotations effective for the prior week. The simple average of the highs and lows of the prices effective the prior week shall be the adjusting market price effective for Tuesday through Monday."
END OF CLAUSE
