Termination for Convenience (T4C)

The Government’s contractual right to terminate a contract, in whole or in part, when it is in the Government’s best interest, even if the contractor has fully complied with all contractual obligations. A Termination for Convenience may occur because of changes in funding, programme priorities, mission requirements, or other circumstances that make continued contract performance unnecessary. Unlike a Termination for Default, it does not imply contractor fault. Contractors are generally entitled to recover allowable costs incurred, reasonable settlement expenses, and, where permitted, profit on work performed up to the date of termination. Proposal and contract professionals should understand the implications of a Termination for Convenience, as it affects contract close-out, settlement negotiations, and financial recovery under the Federal Acquisition Regulation (FAR).