Executive Compensation through Total Shareholder Return Found Unallowable; ASBCA No. 58966, Appeal of Exelis Inc.

Appeal of the agency’s determination that appellant’s final indirect cost rate proposal included unallowable costs is denied, where the appellant’s executive compensation model included total shareholder returns calculated using unallowable variables and were therefore expressly unallowable, and where the contracting officer properly applied a penalty for submitting a final indirect cost rate proposal including expressly unallowable costs.