Page images
PDF
EPUB

was to vary 26 cents per thousand; for each variation of 1 cent in the cost of zinc the price of the ammunition was to vary 10 cents; for each variation of 1 cent in the cost of lead the price of the ammunition was to vary 15 cents; and for each variation of 1 cent in the cost of powder the price of the ammunition would vary 7 cents per thousand rounds. The profit of the contractor was to be 10 per cent of the cost, with a proviso that if the cost fell below the normal cost he should get 20 per cent of the difference in addition to his 10 per cent profit, and if the cost should go above this normal cost that he should lose 20 per cent of his 10 per cent profit.

The CHAIRMAN. He would lose what?

Gen. CROZIER. He would lose 20 per cent of the excess cost from his 10 per cent profit. The stipulation is as follows:

If this contract be completely performed through a delivery of and acceptance for the Government of the full number or substantially all of the cartridges contracted for, the contractor shall be paid as profits 10 per cent upon all sums paid or payable to the contractor upon any account under any of the provisions of the contract, excepting compensation on account of displacement or delay on work contracted for prior to the date of this contract and compensation for losses caused by strikes, flood, storm, theft, any acts of God, or death of or personal injury to employees or others; but including compensation on account of the physical losses sustained by fire, vandalism, or acts of war; and in addition thereto 10 per cent upon the cost of materials, supplies, and other personal property furnished by the Government for the purpose of contract. Now, from that 10 per cent profit there should be subtracted 20 per cent of the excess of the actual cost over the normal cost previously mentioned, and there should be added to it 20 per cent of any diminution of the actual cost below the normal cost mentioned. You were asking yesterday something about the equipments of these men, personal and horse equipments, and I have brought down a list of what these equipments consist of and several columns of the numbers of these different articles required, the first column being the number required to equip this army of approximately 1,000,000 men, which we are talking about. The principal interest in that is to glance at it and see the numbers of these articles there are, how many different articles are required, and what they are. Here are the different articles running over on two pages, and this column is the number actually required to equip about 1,000,000 men; the other columns are the numbers on hand, the numbers to be secured, the numbers to make up the wastage, etc.

Mr. SHERLEY. Would there be any objection to placing that contract for small-arms ammunition in the record? Gen. CROZIER. I know of no objection to that.

(Said contract follows:)

No. 14065. Dated July 20, 1917. Contract with the Remington Arms U. M. C. Co. (Inc.), of Bridgeport, Conn., for the manufacture of United States ball cartridges, caliber 30, model of 1906, for the United States of America. Ordnance Department, Small Arms Division.

Contract, of two parties, made and concluded this 20th day of July, A. D. 1917, by and between the Remington Arms Union Metallic Cartridge Co. (Inc.), of Bridgeport, Conn., a corporation organized under the laws of the State of Connecticut, by party of the first part (hereinafter called the Contractor), and the United States of America, represented by William Crozier, brigadier general, United States Army, Chief of Ordnance (hereinafter referred to as the contracting officer), acting by authority of the Secretary of War, party of the second part.

Whereas a national emergency exists and the United States is not able, with the facilities at its disposal, to furnish a sufficient quantity of cartridges for supplying its troops; and

Whereas the Congress having declared, by joint resolution, approved April 6, 1917, that war exists between the United States and Germany, the President hereby places with the Remington Arms Union Metallic Cartridge Co., as an order under the provisions of section 120 of an act making further and more effective provision for the national defense and for other purposes, approved June 3, 1916, the requirement that it comply with the contract hereinafter set forth, to manufacture United States ball cartridges, model of 1906, caliber 30, complete in all respects, in accordance with drawings and specifications hereto attached.

Now, therefore, this contract witnesseth, that the said parties have mutually agreed and by these presents do covenant and agree to and with each other, as follows:

66

ARTICLE I. The contractor will make the necessary outlays in advance, and manufacture and supply in conformity with the aforesaid drawings and specifications, including duly authorized changes therein, cartridges, and will supply said cartridges packed for shipment at the contractor's works. ART. II. The manufacturer of said cartridges (the word 'cartridge" as used in this contract being intended to include everything covered by the draw ings and specifications above referred to) shall conform in all respects to and with said drawings and specifications, including duly authorized changes therein, all of which are to be deemed and taken as forming a part of this contract with like operation and effect as if the same were incorporated herein. The contracting officer is expressly authorized from time to time by notice in writing to the contractor to make such changes in the drawings and specifications and such additions thereto as he may deem advisable. Wherever any provision of the specifications attached hereto or modifications thereof shall conflict with any other part of the contract proper, the wording of the contract shall govern.

ART. III. (a) The contracting officer may purchase and supply to the contractor any part of or all materials, appliances, equipment, or other personal property of whatsoever nature required for the manufacture of said cartridges. (b) The contractor will from time to time, except as otherwise provided. purchase or contract for the purchase of all materials, tools, equipment, or other personal property of whatsoever nature required for the manufacture of said cartridges, and upon such terms as appear to the contractor to be reasonable.

(c) The contractor may supply or furnish for use in such manufacture at the option of the contracting officer all materials, tools, equipment, or other personal property of whatsoever nature of a consumable character required for the manufacture of said cartridges, owned by it and not purchased for use in the manufacture of cartridges hereunder, and in case the contractor shall so furnish such material, tools, equipment, or other personal property, the book value of the same at the time furnished shall be treated as an expenditure of the contractor in the performance of this contract and considered a part of the

cost of manufacture.

(d) Immediately upon the execution of this contract the parties hereto shall confer for the purpose of determining what material will be required to complete this contract, taking into consideration the material referred to in subtitle (a), (b), and (c) of Article III of this contract, with a view to providing for and determining who shall furnish such material as may be necessary to cover the entire requirements under this contract.

ART. IV. The materials to be used in the manufacture of these cartridges shall be of quality and characteristics acceptable for the various purposes for which they may be used, and shall conform to the specifications forming a part of this contract. The materials and workmanship used and applied in the manu facture of these cartridges in details and finish, in all their parts, shall be of the prescribed quality, and shall, from the beginning to the end of the work be subject to the inspection of the contracting officer, who may appoint suitable inspectors and an officer in charge of inspectors to whom the contractor shall furnish such samples of said materials and such information as to quality thereof and the manner of using the same, as may be required, and also any assistance such inspectors may require in determining the character of workmanship applied, and the quality of the materials, either used or intended for use in the manufacture of the cartridges, and that the inspectors may, with the approval of the contracting officer, peremptorily reject any unfit workmanship

or material, or forbid the use thereof. The officer in charge of inspectors shall at all times during the progress of the work have full access thereto and the contractor shall furnish him and his assistants with full facilities for the inspection and superintendence of the same.

ART. V. When and to the extent requested by the contracting officer, the contractor will procure such liability insurance and such insurance in addition to that regularly carried by the contractor, as may be lawfully procured, against loss or damage to property.

No deduction from any payment to be made to the contractor hereunder shal be made because of depreciation or loss or destruction or damage done to the machinery, tools, equipment, appliances, materials, or supplies furnished by the Government for use in such manufacture, nor for any loss, destruction, or damage done to any raw material, manufactured material, material in process of manufacture, cartridges in process of manufacture, manufactured cartridges, or any other personal property at any time acquired by the contractor under the terms of this agreement for use in the manufacture of cartridges whether such damage, loss, or destruction be occasioned by fire, flood, storm, vandalism, theft, any acts of God, acts of war, or other casualties, and whether while such property is at the plant or in course of transportation. It is agreed, however, that the contractor shall adopt such means and take such precautions for the protection of all such property as it may be by the contracting officers in writing directed to adopt or take, in so far as the contractor shall be able so to do.

ART. VI. Unless prevented by strikes, the work under this contract shall be prosecuted at all times with the utmost vigor and dispatch, without interruption for any cause within the control of the contractor, and the number and class of men engaged on the contract and hours of work, subject to the limitations imposed by law, shall be subject to the approval and direction of the contracting officer.

ART. VII. 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 contemplated, shall be required or be permitted to work more than eight hours in any one calendar day upon such work, such prohibition being in accordance with the act approved June 19, 1912, limiting the hours of daily service of mechanics and laborers on work under contracts to which the United States is a party. For each violation of the requirementts of this article a penalty of $5 shall be imposed upon the contractor for each laborer or mechanic for every calendar day in which said employee is required or permitted to labor more than eight hours upon said work, and all penalties thus imposed shall be withheld for the use and benefit of the United States; provided, that this paragraph shall not be enforced nor shall any penalty be exacted in case such violation shall occur while there is in effect any valid executive order suspending the provisions of said act approved June 19, 1912, or waiving the provisions and stipulations thereof with respect to either this contract or any class of contracts in which this contract shall be included, or when the violation was due to any extraordinary events or conditions of manufacture or to any emergency caused by fire, famine, or flood, by danger to life or property, or by other extraordinary events or conditions on account of which, by subsequent Executive order, such past violation shall have been excused.

This contract is subject to the Executive order issued by the President on March 24, 1917, under authority contained in the naval appropriation_act approved March 4, 1917, suspending the provisions of the act approved June 19, 1916, during the pending emergency and until further orders.

ART. VIII. This contract shall not, nor shall any interest therein, be transferred by the contractor to any other person or persons, and, in the performance of this contract, no person shall be employed that is under sentence of imprisonment at hard labor.

ART. IX. No Member of, or Delegate to, Congress or Resident Commissioners nor any person belonging to or employed in the military service of the United States, is or shall be admitted to any share or part of this contract or to any benefit that may arise therefrom, but this article shall not apply to this contract so far as it may be within the operation or exception of section 116 of the act of Congress approved March 4, 1909 (35 Stats., 1109).

ART. X. The contracting officer desires and the contractor will use his best endeavors to the end that delivery of cartridges covered by this contract shall begin at the end of the second month from execution of this contract and continue thereafter at a rate not less than that shown in the following schedule.

all of the cartridges contracted for, the profits to be paid the contractor shall not be less than 5 per cent upon the estimated "normal cost" of the accepted cartridges, plus 10 per cent profit upon other items as to which profit is appliable under the provisions of this contract, nor shall such profits be more than 15 per cent of the estimated cost of such delivered cartridges, plus 10 per cent profit upon other items as to which profit is applicable under any of the provisions of this contract.

ART. XII. The contractor shall use every endeavor to obtain materials, equipment, appurtenances, supplies, etc., under this contract at the lowest possible prices and shall in no case pay higher prices than required by existing market conditions, nor higher prices than are or would be paid for similar materials purchased at the same time and under like circumstances and conditions for other work in progress in the plant.

ART. XIII. Payments and reimbursements shall be made by the Government monthly, within 15 days after the submission of bills covering approved expenditures for the previous month and other accrued charges as to which the contractor shall be entitled to reimbursement, together with a sum equal to 5 per cent thereof, which shall be regarded as an advance payment on account of sums to become due as profits under the terms of this contract.

In the event of delay in payments for any cause the contractor may apply for an advance against such payments, and the contracting officer will consider making such advances where they are reasonable and just or necessary to continue operations under the contract.

In the event that for any cause not due to the fault of the contractor the partial payments herein provided for shall cease, the contractor shall have the right to discontinue work upon said cartridges and shall be relieved of its liability for such discontinuance of work under the contract without prejudice to any of its rights hereunder.

Payments shall be made upon bills in quadruplicate, certified by proper authority in such manner as shall be directed by the contracting officer whose final approval of all bills thus certified shall be necessary before payment thereof. All payments under this contract shall be made to the contractor or its order.

Upon completion of delivery of cartridges or termination of this contract on any account payment shall be made to the contractor within 15 days after submission and approval of bills therefor of all sums payable to the contractor under any of the provisions of this agreement which shall at the time remain unpaid to which the contractor may be entitled.

ART. XIV. When a payment is to be made under this contract, as a condition precedent thereto, the contracting officer may, at his discretion, require evidence satisfactory to him to be furnished by the contractor showing what, if any, liens or rights in rem of any kind against said cartridges, machinery, equipment, or material on hand for use in the manufacture thereof have been or can be acquired for or on account of any work done, or any machinery, equipment, or material already incorporated as a part of said cartridges or on hand for that purpose; but it is hereby further stipulated, covenanted, and agreed by the contractor, for itself and on its own account and for and on account of all persons, firms, associations, and corporations furnishing labor and materials for said cartridges, and this contract is upon the express condition that no liens or rights in rem of any kind shall lie or attach upon or against said cartridges, machinery, or equipment, or the materials therefor, or any part thereof, or of either, for or on account of any work done upon or about said cartridges, machinery, equipment, or material, or of any materials furnished therefor or in connection therewith, nor for or on account of any other cause or thing or of any claim or demand of any kind, except the claims of the Government.

ART. XV. For the determining of all questions arising in respect of the amounts of reinmbursement or for payments including profits to the contractor, a compensation board composed of not more than six nor less than three officers of the Army shall be appointed by the contracting officer. The decisions of the said board, or a majority thereof, shall be binding on both parties to this contract, subject to the approval of the contracting officer. Whenever possible, it will lay down in advance methods to be followed in estimating and determining the actual cost and where this can not be done it will act within three months of the date of the receipt thereof, on any claims submitted by the contractor. It will determine methods to be followed by the contractor in preparing bills and the procedure to be followed for referring questions for its decision.

ART. XVI. Within 90 days from the termination of this contract from any cause, the contracting officer shall cause to be removed from the plant of the contractor all materials, appliances, equipment, or other personal property of whatsoever nature, belonging to the Government or for which it may be responsible, such removal to be effected without working any substantial or unnecessary damage to the buildings or premises of the contractor, and during such occupancy of its plant after the termination of this contract, the contractor shall receive compensation for the use of the premises so occupied upon the basis of compensation for such use as shall have been previously agreed upon. All or any materials, supplies, or other property purchased or acquired by the contractor for use in the manufacture of cartridges, the cost of which shall have been or must be reimbursed by the Government, as well as all materials, supplies, or other property purchased or acquired by the Government for such use which shall remain on hand unused or unconsumed at the termination of the contract, shall become the property of the Government and be removed by it under the terms of this article.

ART. XVII. The contracting officer may cancel this contract at any time in respect to further performance thereof, by notice in writing to the contractor. ART. XVIII. If any doubts or disputes arise as to the meaning of anything in the contract, drawings, or specifications, or if any discrepancy appear between said drawings and specifications and this contract, the matter shall be referred at once to the Chief of Ordnance, United States Army, for determination. If, however, the contractor shall feel aggrieved at any decision of the Chief of Ordnance he shall have the right to submit the same to the Secretary of War, whose decision shall be final.

In witness whereof the respective parties hereto have hereunto set their hands and seals the day and year first above written.

Signed and sealed in the presence of the Remington Arms Union Metallic Cartridge Co. (Inc.).

[blocks in formation]

The CHAIRMAN. The next item is: "Automatic rifles: For the purchase, manufacture, test, repair, and maintenance of automatic machine rifles, or other automatic or semiautomatic guns, including their mounts, sights, and equipments, and the machinery necessary for their manufacture, $170,277,000." There have been appropriated $73,400,000.

Gen. CROZIER. And this estimate is an additional sum to that. The CHAIRMAN. What were the appropriations based on? Gen. CROZIER. The appropriations were based on the number estimated to supply an army of about 1,000,000 men, with the allowances that had been approved at the time the estimates were made. There has been a change in both of those bases in making up this estimate— that is to say, the number that are provided for is different and the allowance is different. The difference in the number provided for is that this estimate covers one million and a half men instead of a million men, with somewhat the same idea that was in mind when

« PreviousContinue »