(a) This supplemental agreement settles the termination settlement proposal resulting from the Notice of Termination dated _______.

(b) The parties agree as follows:

(1) The contract is amended by deleting the terminated portion as follows: [specify the terminated portion clearly as to (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 fee stated in the contract is decreased by $_____, from $_____ to $_____.

[Insert, if appropriate, “(3) The estimated cost of the contract is decreased by $_____, from $_____ to $____.”.]

(c) The Contractor's allowable costs and earned fee, if any, for the terminated portion of the contract will continue to be reimbursed on SF 1034, Public Voucher for Purchase and Services Other Than Personal, under the applicable provisions of the contract and part 31 of the Federal Acquisition Regulation.