SETTLEMENT OF CLAIMS UNDER THE C–17 AIRCRAFT PROGRAM.

SEC. 132. SETTLEMENT OF CLAIMS UNDER THE C–17 AIRCRAFT PROGRAM. (a) Authorization for Supplemental Agreements and Contract Modifications.— (1) The Secretary of the Air Force may (subject to subsection (e)) enter into supplemental agreements and contract modifications pertaining to contracts specified in paragraph (2) in order to do any of the following: (A) Settle claims and disputes arising under those contracts as provided in the C–17 settlement agreement. (B) Revise the delivery schedules under those contracts as provided in the C–17 settlement agreement for the aircraft designated as T–1 and P–1 through P–6. (C) Revise range specifications, payload specifications, and other specifications under those contracts as provided in Attachment B to the letter (described in subsection (h)) setting forth the C–17 settlement agreement. (2) This section applies to the following contracts: (A) Air Force prime contract F33657--81–C–2108 (relating to the C–17 aircraft program). (B) Such other Air Force contracts relating to the C–17 aircraft program (entered into before, on, or after the date of the enactment of this Act) as the Secretary of the Air Force determines to be appropriate. (b) Further Consideration From Contractor Not Required.— The Secretary of the Air Force may enter into a supplemental agreement or contract modification under subsection (a) without requiring further consideration from the contractor for the benefit to be derived by the contractor under that agreement or modification only to the extent provided for in the C–17 settlement agreement. 108 STAT. 2686 (c) Release of Contractor Claims.— Any supplemental agreement or contract modification entered into under subsection (a) shall, as provided in the C–17 settlement agreement, require that the prime contractor release the Government from any contractual claim, demand, request for equitable adjustment, or other cause of action, known or unknown, that the prime contractor may have against the Government on or before January 6, 1994, arising out of the C–17 program contracts. (d) Contract Modifications Regarding Contractor Commitments.— (1) The Secretary of the Air Force shall incorporate into each appropriate C–17 contract the commitment of the prime contractor to make C–17 program changes as described in paragraph (2) on a nonreimbursable or cost-share basis. (2) Paragraph (1) applies to the commitment of the prime contractor provided in the C–17 settlement agreement to make the following C–17 program changes: (A) Extend the flight test program. (B) Redesign the wing. (C) Implement Computer Aided Design/Computer Aided Manufacturing System improvements, Management Information System improvements, and Advanced Quality System improvements. (D) Implement product improvement cost reduction projects. (E) Resolve other C–17 program issues. (e) Required Certification.— The Secretary of the Air Force may not enter into a supplemental agreement or contract modification under subsection (a) until 30 days after the date on which the Secretary of Defense submits to Congress a written certification of each of the following: (1) That the terms and conditions set forth in the C–17 settlement agreement, including the terms and conditions relating to the settlement of claims, are in the best interest of the Government for a total procurement under the C–17 program that could be as few as 40 aircraft. (2) That the membership of the Defense Science Board C–17 Task Force has advised the Secretary of Defense that, for a total procurement quantity of as few as 40 aircraft, the terms and conditions set forth in the C–17 settlement agreement, including the terms and conditions relating to settlement of claims, are in the best interest of the Government. (3) That the Secretary will establish specific not-to-exceed costs estimates for production lots VII through XI and will provide that cost information to Congress not later than March 1, 1995. (4) That during fiscal year 1995 no funds available to the Department of Defense will be used to relax performance requirements specified in the acquisition program baseline beyond the extent provided for in the C–17 settlement agreement. (5) That the Secretary will transmit to Congress milestones and exit criteria for the C–17 not later than March 1, 1995. (6) That nothing in the C–17 settlement agreement releases the contractor from any potential liability for fraud or criminal violations. (f) Restriction on Use of DOD Funds for Development of Alternative Aircraft.— No funds appropriated to the Depart-108 STAT. 2687ment of Defense for fiscal year 1995 may be used to design, develop, or produce a modified version of the C–17 aircraft that could be considered to be a nondevelopmental alternative aircraft for purposes of future Department of the Air Force competitions for intertheater airlift requirements. (g) Other Contractor Obligations.— Nothing in this section shall be construed as relieving the prime contractor for the C–17 aircraft from any obligation provided for in the C–17 settlement agreement. (h) C–17 Settlement Agreement Defined.— For purposes of this section, the term “C–17 settlement agreement” means the settlement agreement that was proposed to the prime contractor for the C–17 aircraft program by the Under Secretary of Defense for Acquisition and Technology by letter dated January 3, 1994, and that was accepted by that prime contractor on January 6, 1994. (i) Expiration of Authority.— The authority of the Secretary of the Air Force to enter into agreements and contract modifications under subsection (a) expires at the close of September 30, 1995.