What is a Foreign Military Sales payment schedule?

List of dollar amounts and when they are due from the foreign customer. The payment schedule is included in the Letter of Offer and Acceptance (LOA) presented to the customer. After acceptance of the LOA, the payment schedule generally serves as the basis for billing to the customer. Changes in the estimated costs of an Foreign Military Sales case may require changes in the accompanying payment schedule.

The legal instrument used by the USG to transfer itemized defense articles, defense services, and design and construction services to foreign partners.

When used under the authorities provided in the Arms Export Control Act for Foreign Military Sales, the LOA is a binding agreement signed by the USG and the foreign partner to transfer such articles and services.

When used under Building Partnership Capacity (BPC) authorities, the BPC LOA is not signed by the Benefitting Partner.

Funds that are required to cover outlays and/or deliveries that are anticipated to occur before the receipt of the first quarterly payment. These funds must accompany the accepted Letter of Offer and Acceptance.

The military department or defense agency responsible for the execution of military assistance programs. With respect to FMS, the military department or defense agency assigned responsibility by the Defense Security Cooperation Agency to prepare an LOA and to implement an FMS case. The implementing agency is responsible for the overall management of the actions that will result in delivery of the materials or services set forth in the LOA that was accepted by a foreign country or international organization.

A process, authorized by the Arms Export Control Act, through which eligible foreign governments and international organizations may purchase defense articles, services, and training from the United States Government.

An excepted term and condition within the Foreign Military Sales case (or Letter of Offer and Acceptance). A firm commitment by a foreign government or international organization to pay the full amount of a contract for new production or for the performance of defense services which will assure the U.S. against any loss on such contract and to make funds available in such amounts and at such times as may be required by the contract, or for any damages and costs that may accrue from the cancellation of such a contract, provided that in the judgment of the DoD there is sufficient likelihood that the foreign government or international organization will have the economic resources to fulfill the commitment.

A term of sale in which U.S. dollar currency, check, or other negotiable instrument is submitted by the customer concurrent with acceptance of an Foreign Military Sales sales offer for the full amount shown as the estimated total cost on the Letter of Offer and Acceptance.

That portion of the United States Security Assistance program authorized by the Foreign Assistance Act of 1961, as amended, which once provided defense articles and services to recipients on a nonreimbursable (grant) basis. Funding for MAP was consolidated under the Foreign Military Financing program beginning in Fiscal Year 1990.

A worksheet prepared through Defense Security Assistance Management System that shows the amount of Termination Liability included in quarterly payments for each Foreign Military Sales case.

The potential cost for which the U.S. Government would be liable if a particular Foreign Military Sales case that includes procurement contracts is terminated prior to completion.

Payments made to a prime contractor during the life of a fixed-price type contract on the basis of a percentage of incurred total costs or total direct labor and material costs.

This occurs when a contracting officer has signed and distributed a contract to a contractor.