# 49.109-2 Reservations.

1. (a) The TCO shall-

   1. (1) Reserve in the settlement agreement any rights or demands of the parties that are excepted from the settlement;

   2. (2) Ensure that the wording of the reservation does not create any rights for the parties beyond those in existence before execution of the settlement agreement;

   3. (3) Mark each applicable settlement agreement with “This settlement agreement contains a reservation” and retain the contract file until the reservation is removed;

   4. (4) Ensure that sufficient funds are retained to cover complete settlement of the reserved items; and

   5. (5) At the appropriate time, prepare a separate settlement of reserved items and include it in a separate settlement agreement.

2. (b) A recommended format for settlement of reservations appears in 49.603-9.