[Code of Federal Regulations] [Title 48, Volume 3] [Revised as of October 1, 2002] From the U.S. Government Printing Office via GPO Access [CITE: 48CFR216.405-1] [Page 110] TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM CHAPTER 2--DEPARTMENT OF DEFENSE PART 216--TYPES OF CONTRACTS--Table of Contents Subpart 216.4--Incentive Contracts Sec. 216.405-1 Cost-plus-incentive-fee contracts. (b) Application. (3) Give appropriate weight to basic acquisition objectives in negotiating the range of fee and the fee adjustment formula. For example-- (A) In an initial product development contract, it may be appropriate to provide for relatively small adjustments in fee tied to the cost incentive feature, but provide for significant adjustments if the contractor meets or surpasses performance targets. (B) In subsequent development and test contracts, it may be appropriate to negotiate an incentive formula tied primarily to the contractor's success in controlling costs. [56 FR 36340, July 31, 1991. Redesignated at 63 FR 11529, Mar. 9, 1998]