48 CFR §517.202

1. (a)Options may be used when they meet one or more of the following objectives:
   1. (1)Reduce procurement lead time and associated costs.
   2. (2)Ensure continuity of contract support.
   3. (3)Improve overall contractor performance.
   4. (4)Facilitate longer term contractual relationships with those contractors that continually meet or exceed quality performance expectations.
2. (b)An option is normally in the Government's interest in the following circumstances:
   1. (1)There is an anticipated need for additional supplies or services during the contract term.
   2. (2)When there is both a need for additional supplies or services beyond the basic contract period and the use of multi-year contracting authority is inappropriate.
   3. (3)There is a need for continuity of supply or service support.
3. (c)An option shall not be used if the market price is likely to change substantially and an economic price adjustment clause inadequately protects the Government's interest.