(1) For cost-plus-fixed-fee contracts, negotiate the fee for a prime contractor using departmental procedures approved by the Assistant Secretary of Defense (Production and Logistics).
(2) For cost-plus-incentive-fee contracts, negotiate the target fee for a prime contractor using the criteria and fee schedule in departmental procedures to determine-
(i) The reasonableness of the target cost;
(ii) The maximum and minimum fees to be established; and
(iii) The fee adjustment formula.