If (1) after the date of this offer (A) the Congress shall impose any tax, (B) it shall increase any then existing tax, or (C) the Bureau of Interna. Revenue shall rule that a tax theretofore imposed is applicable and the con tractor at the time of making his offer reasonably believed that the tax was not applicable, with respect to the production, processing, manufacturing, holding, importation, or sale of any materials, supplies, or services, or components thereol covered by this offer; and (2) the contractor is required by operation of law or by specific contractural obligation to pay such tax or bear its burden, the upon proper application and proof thereof by the contractor, the quoted prices 6. the materials, supplies, or services concerned shall be correspondingly increased If by operation of law or otherwise, including any action by the Secretary of the Treasury under Section 307 (c) of the Revenue Act of 1943, the contractor is relieved in whole or in part from the payment of any tax deemed included in the quoted prices, or from bearing its burden, the quoted prices shall be correspondingly reduced. Invoices or vouchers covering any increase or reduc tion in price in accordance with this subparagraph (a) shall state the amouE thereof as a separate added or deducted item.

(b) As to any Federal tax included in the quoted prices or otherwise authoriz to be added to those prices in accordance with subparagraph (a) hereof, ta contractor waives, releases, and assigns to the United States any and all right title, and interest of the contractor in and to any refund of or credit for suð tax upon or by reason of the exportation of any materials or supplies furnishd under this contract and agrees to assist the Government, if requested to do s in obtaining refund, credit, or exemption as to such tax.

12. Defaults.-If the contractor refuses or fails to make deliveries of materiais supplies, or services conforming to the specifications within the time specified or any extension thereof, or to perform faithfully any conditions of the contract, the contracting officer, without prejudice to other rights resulting from breach of the contract conditions, may by written notice terminate the right of the contractor to proceed with any or all remaining deliveries under the contrast or, in the event public necessity requires the acceptance of materials, supplies or services not conforming to the specifications, payment therefor may be made at a proper reduction in price.

In the event of any such termination, the Government may obtain similar ma terials, supplies or services elsewhere and the contractor and his sureties of any) shall be liable to the Government for any excess costs occasioned the Go ernment thereby; provided, that the contractor shall not be charges with any excess costs occasioned the Government thereby (1) when the failure of the contractor in making suitable deliveries is due to unforseeable causes beyoud his control and without his fault or negligence, including but not restricted to acts of God or of the public enemy, acts of the Government, fires, floods, epidemies quarantine restrictions, strikes, freight embargoes, unusually severe weather and delays and failures of a subcontractor due to any such cause unless the contracting officer shall determine that the materials, supplies or services to be furnished under the subcontract are procurable in the open market and (2) if the contractor shall notify the contracting officer in writing of the cause of any such failure within ten days from the beginning thereof or within such further period as the contracting officer may grant prior to the date of final settlement of the contract. The contracting officer shall then ascertain the facts and extent of failure and his findings of fact shall be furnished the co tractor and shall be final and conclusive on the parties hereto subject only to appeal within thirty (30) days by the contractor to the Secretary of the Treasury or his duly authorized representative, whose decision on such appeal as to the facts of failure shall be final and conclusive on the parties hereto.

13. Covenant against contingent fees.-The contractor warrants that he has not employed any person to solicit or secure this contract upon any agreement for a commission, percentage, brokerage or contingent fee. Breach of this warranty shall give the Government the right to annual the contract or, in its dis cretion, for deduct from the contract price or consideration the amount of such commission, percentage, brokerage or contingent fee. This warranty shall not apply to commissions payable by contractors upon contracts or sales secured or made through bona fide established commercial or selling agencies maintained by the contractor for the purpose of securing business.

14. Benefit to congressional officials.-No member of or delegate to Congress of resident commissioner shall be admitted to any share or part of this contract or to any benefit that may arise therefrom unless it be with a corporation for its general benefit.

15. Disputes.-Except as otherwise specifically provided in this contract all questions of fact involved in disputes arising under the contract shall be decided by the contracting officer, subject to written appeal by the contractor within thirty (30) days to the Secretary of the Treasury or his duly authorized representative, whose decision shall be final and conclusive upon the parties hereto. In the meantime the contractor shall diligently proceed with performance.

16. Domestic origin.-Unless otherwise specified by the offer or, it is understood and agreed that only such unmanufactured articles, materials, and supplies as have been mined or produced in the United States, and only such manufactured articles, materials and supplies as have been manufactured in the United States substantially all from articles, materials or supplies mined, produced or manufactured, as the case may be, in the United States, shall be delivered pursuant to the contract.

17. definitions.-(a) The term "Government" as used herein shall mean the United States of America. (b) The term "Secretary of the Treasury" as used herein shall include any Under or Assistant Secretary of the Treasury, and the term "his duly authorized representative" shall mean any person authorized to act for him other than the contracting officer. (c) The term "contracting officer" as used herein shall mean the official of the Bureau of Federal Supply executing this contract in behalf of the United States of America and shall include his duly appointed successor or his authorized representative.

(The following Conditions 18 through 22 shall not apply to any work or services performed under the contract outside the United States or in connection with the mining, producing, processing, manufacturing or acquisition outside of the United States of any materials or supplies to be delivered under this contract.) 18. Offers of former Government property.-There is no law against selling back to the Government former Government surplus property, but the Bureau of Federal Supply wants to know if it is buying such surplus. Accordingly, in submission of the offer herein, the offeror warrants, to the best of his knowledge, information and belief, that, except as otherwise expressly stated in the offer, none of the items or their components covered by the offer have been or will be acquired either directly or indirectly from any activity or agency of the United States Government or from any Government-owned corporation. Breach of this warranty shall give the Government the right to terminate the right of the contractor to proceed with any or all further deliveries under the contract.

19. Patents.-The contractor shall hold and save the Government, its officers, agents and employees, harmless from liability of any kind, including costs and expenses, on account of any patented or unpatented invention, article, device or appliance manufactured or used in the performance of the contract, including use by the Government.

20. Antidiscrimination.—The contractor, in performing the work required by this contract, shall not discriminate against any employee or applicant for employment because of race, creed, color or national origin. The contractor shall, include in all subcontracts a provision imposing a like obligation on subcontraetors.

21. Walsh-Healey Public Contracts Act.-The representations and stipulations pursuant to the Walsh-Healey Public Contracts Act (49 Stat. 2036, as amended, 41 U. S. C. 35-45) as set forth in Regulation No. 504, as amended, of the Secretary of Labor under that Act, are hereby made a part of this contract unless the contract is for a definite amount not in excess of $10,000 or is not one for the manufacture or furnishing of materials, supplies, articles or equipment. (Note: The contractor's attention is directed to the possibility that wage determinations may have been made under the Walsh-Healey Public Contracts Act providing minimum wages for employees engaged in the manufacture for sale to the Gov ernment of the materials or supplies covered by this contract. Information in this connection as well as general requirements of the Act concerning overtime payment, child labor, safety and health provisions, etc., may be obtained from the Wage and Hour Public Contracts Division, Department of Labor, Washington 25, D. C.)

22. Eight-hour law; convict labor.-If the contract is for services, the following conditions apply: (a) No laborer or mechanic doing any part of the work contemplated by this contract, in the employ of the contractor or any subcontractor contracting for any part of said work, shall be required or permitted to work more than eight hours in any one calendar day upon such work at the site thereof, except upon the condition that compensation is paid to such laborer or mechanic

in accordance with the provisions of this article. The wages of every laborer and mechanic employed by the contractor or any subcontractor engaged in the performance of this contract shall be computed on a basic day rate of eight hours per day and work in excess of eight hours per day is permitted only upon the condition that every such laborer and mechanic shall be compensated for a hours worked in excess of eight hours per day at not less than one and one-half times the basic rate of pay. For each violation of requirements of this article a penalty of $5.00 shall be imposed upon the contractor for each laborer or mechanie for every calendar day which such employee is required or permitted to labor more than eight hours upon said work without receiving compensation computed in accordance with this article, and all penalties thus imposed shall be withheld for the use and benefit of the Government: provided, that this stipulation shall be subject in all respects to the exceptions and provisions of United States Code Title 40, sections 321, 324, 325, 325 (a) and 326, relating to hours of labor and compensation for overtime.

(b) In the performance of this contract the contractor shall not employ any person undergoing sentence of imprisonment at hard labor.

EXHIBIT 42

STANDARD CLAUSES USED BY THE BUREAU OF FEDERAL SUPPLY IN CONTRACTS COVERING THE PURCHASE OF CERTAIN METALS FOR THE STOCK PILE

LETTER OF TRANSMITTAL TO THE SUBCOMMITTEE

TREASURY DEPARTMENT, BUREAU OF FEDERAL SUPPLY, Washington 25, September 13, 1948.

Mr. GEORGE H. SOULE, Jr.,

% Public Lands Committee, Room 1324, House Office Building,

Washington, D. C.

The head

DEAR MR. SOULE: In response to your request made to Mr. Eberly over the telephone, there are enclosed herewith copies of standard clauses used in con nection with contracts covering the purchase of minerals and metals. ing of each group indicates to which contracts the clauses apply. In the case of mica and diamonds no escalation or sliding scale clause has been used up to this time.

Very truly yours,

A. J. WALSH,

Assistant Director, Strategic and Critical Materials. [SUBCOMMITTEE NOTE.-The Bureau of Federal Supply reports that purchases of minerals other than mica and industrial diamonds have not been sufficient to justify the standardization of contracts. It also is reported that contracts for ores, such as manganese and chromite, are negotiated in such manner as to preclude the standardization of such contracts as has been feasible with certain metals.]

METALS (ANTIMONY, BISMUTH, CADMIUM, COBALT, COPPER, LEAD, NICKEL, AND ZINC)

1. Quantity

SPECIAL TERMS, CONDITIONS, AND SPECIFICATIONS

2. The quantity of Type “A” antimony to be furnished shall be (quantity) pounds, ( short tons) avoirdupois, dry basis.

3. The quantity of Type "B" antimony sulphide ore to be furnished shall be (quantity) short tons of 2,000 pounds avoirdupois each, at the price of per short ton unit of contained antimony.

4.

5.

$

The cost shown on page 1 hereof is based upon a minimum antimony (Sb) content of 60% per each short ton, and it shall be increased $0.0? per unit for each 1% or fraction thereof in excess of 60%.

The quantity of Type "C" antimony shall be (quantity) pounds, avoirdupois ( short tons).

The quantity of metallic bismuth to be furnished shall be (amount) pounds, avoirdupois.

6.

7.

8.

9.

10.

11.

12.

13.

The quantity of cadmium to be delivered under this contract shall weigh (amount) pounds, dry basis.

The quantity of cobalt metal to be delivered under this contract shall weigh (amount) pounds, dry basis.

The quantity of copper to be furnished shall be (amount) pounds ( short tons) avoirdupois, dry basis.

The quantity of lead to be furnished shall be (amount) pounds ( short tons) avoirdupois, dry basis.

The quantity of nickel to be furnished shall be (amount) pounds ( short tons) avoirdupois, dry basis.

a. Pursuant to this contract, the contractor shall, by (insert date) furnish not less than (quantity) pounds of nickel, plus any amount up to an additional (quantity) pounds, by which his production of nickel refined at the plant of ( ) for the period ( ), exceeds pounds. b. He shall, by (day following last date mentioned above) furnish not less than the amount fixed by paragraph "a" hereof, plus (quantity) pounds, plus any amount up to an additional (quantity) pounds, by which the production of nickel by the contractor for the period ( ,) exceeds

pounds;

Provided, however, that the contractor is not restricted to the shipment of the above mentioned minimum quantities, but may exceed such quantities at his option and provided further, that the maximum quantity of pounds shall be subject to adjustment in accordance with the following schedule: 14. 1. If the total shipments by (two years from initial date) should be less than pounds, the said maximum quantity shall be reduced by an amount equal to the deficiency below (said) pounds;

15. 2. If the total shipments by (12 months subsequent to preceding date), should be less than pounds, the said maximum quantity shall be re

16.

17.

duced by an amount equal to the deficiency below be reduced by an amount equal to the deficiency below 3. If the total shipments by (12 months subsequent to preceding date), should be less than pounds, the said maximum quantity shall be reduced by an amount equal to the deficiency below The quantity of zinc to be furnished shall be tons) avoirdupois, dry basis.

pounds;

pounds.

pounds.

pounds (

short

18. Quality

The antimony to be furnished under this contract shall be Type "A" metal, suitable for the production of commercial blends of antimony lead and battery metal, and it shall conform to the following chemical and physical requirements:

a. Chemical Requirements:

Antimony (SB).

Arsenic (As) --

Minimum__ 99.00%
Maximum-- .25%

b. Physical Requirements: All material shall be in pig form. Pigs may be of any size and shape usual with the producer, but all pigs in any given lot shall be of the same nominal size and shape. Pigs shall have a clean surface, free from dirt, slag, or foreign material.

19.

The antimony to be furnished under this contract shall be Type "B" material chemical grade antimony sulphide ore, suitable for the production of antimony oxide, and it shall conform to the following chemical and physical requirements:

b. Physical Requirements: Ore shall be in its natural state and shall be lumpy in character. Not more than 10% by weight shall pass a " screen, on the average of the total quantity delivered under this contract.

The antimony to be furnished under this contract shall be Type "C" material, liquated antimony suitable for the production of primers in small arms ammunition, and it shall conform to the following chemical and physical requirements:

1 May be 3.0% maximum provided lead is 0.01% maximum and iron 0.10% maximum. b. Physical Requirements: Material shall be in lump form, free from loose or adherent foreign material.

21.

22.

The refined bismuth metal to be furnished under this contract shall be suitable for the production of bismuth-bearing alloys and bismuth salts, and it shall conform to the following chemical and physical requirements: a. Chemical Requirements: All material shall have a minimum bismut, content of 99.99 percent and the contractor shall certify that the metal is suitable for the manufacture of bismuth salts conforming to the require ments of the United States Pharmacopoeia, latest revision.

b. Physical Requirements: The metal shall be supplied in bar form of any size and shape normal with the producer, but all bars in any given lot shall be in the same nominal size and shape. Bars shall have clean, smooth surface, free from dirt, slag, or other foreign material.

The cadmium to be furnished under this contract shall conform to the following chemical and physical requirements: a. Chemical Requirements:

23.

24.

25.

b. Physical Requirements: All material shall be in the form of ingots. Ingots may be of any standard trade size, but all material in each lot shall be of the same nominal size and shape. Material shall be of uniform texture, having a clean surface, free from dirt, slag, or other foreign material. b. NOTE: (If offer is for slabs, substitute that word for ingots and use the foregoing paragraph.)

b. All material shall be in the form of balls. Balls shall be two inches in diameter. Material shall be of uniform texture, having a clean surface, free from dirt, slag, or other foreign material.

The refined cobalt metal to be furnished under this contract shall be suitable for the production of ferrous and nonferrous alloys, and it shall conform to the following chemical and physical requirements: a. Chemical Requirements:

26.

b. Physical Requirements: Material shall be supplied in rondelles or other small lump or granular form. All material shall pass a two-inch screen and none shall pass a 6 mesh Tyler Standard Screen. All material in any one lot shall be of the same approximate size.

The electrolytic wire bar copper to be furnished under this contract shall conform to the chemical and physical requirements of the American Society for Testing Materials Specification B-5, latest revision in effect on the date of the contract. All material shall be in the form of 250-pound wire bars.