Can you exercise the 3d option period if you didn't exercise the 2d option period of the contract due to the contractor status having been pending suspension due to an ongoing investigation and then 10 months later the pending suspension was lifted/dismissed. Can you exercise the 3d option even though you didn't exercise the previous option or is the contract dead? I believe the contract is dead but thought it was a good question to ask. Please contact me via phone if we need to discuss in more detail. Thanks for your assistance in this matter.
This response is based on the information provided and without the knowledge of reviewing the contract for constraints that may have been placed on the exercise of the option periods by terms and conditions of the contract such notification dates to the contractor or exercise of previous option periods.
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That being said, I can find no prohibition of exercising the third option when the second options was not exercised in the FAR/DFARS/DFARS PGI/AFFARS. In fact FAR 1.102(d) below states that the acquisition team can exercise initiative and sound business judgment unless the proposed action is prohibited by law... In addition, FAR 1.602-2 states that contracting officer should be allowed wide latitude to exercise business judgment. This is a construction contract and FAR 17.200 states that the subpart does not apply to construction... except as provided in agency regulations.
The remainder of the response shall be in the form of questions:
1) Is this contract action addressed in agency regulation?
2) Can the contracting officer make the determinations required by FAR
17.204(a), FAR 17.207(d) and FAR 17.207(f)
Should you decide to exercise option three, I highly recommend that you obtain the assistance and review by a contracts attorney, a senior contract analyst, and complete the option action with a bi-lateral modification. In this manner, everyone is in agreement on the proposed action.
All of the above FAR references are provided below. Let me know if you need additional information.