[Code of Federal Regulations] [Title 48, Volume 1] [Revised as of October 1, 2002] From the U.S. Government Printing Office via GPO Access [CITE: 48CFR16.402-3] [Page 304] TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM CHAPTER 1--FEDERAL ACQUISITION REGULATION PART 16--TYPES OF CONTRACTS--Table of Contents Subpart 16.4--Incentive Contracts Sec. 16.402-3 Delivery incentives. (a) Delivery incentives should be considered when improvement from a required delivery schedule is a significant Government objective. It is important to determine the Government's primary objectives in a given contract (e.g., earliest possible delivery or earliest quantity production). (b) Incentive arrangements on delivery should specify the application of the reward-penalty structure in the event of Government- caused delays or other delays beyond the control, and without the fault or negligence, of the contractor or subcontractor.