Paragraph 4 Amendment of the default pricing method used for a qualifying defence contractF1F6

This paragraph applies where the proposed pricing amendment will change the F2default pricing method used for the contract to another default pricing method (the “new default pricing method”).

The price payable in respect of the pricing amendment must be determined in accordance with the following formula—

where—

1. (a)

   “CPR” is the contract profit rate for the F3pricing amendment, and

2. (b)

   “AC” means the primary contractor’s allowable costs after the time of agreement, determined in accordance with the new F4default pricing method.

The price payable under the amended contract is the total of—