Attach 0_SOW for Kwaj FFV.pdf

Statement of Work For Kwajalein FF&V

CAUTION NOTICE

The awardee will be required to have a computer system capable of accepting delivery orders and processing Electronic Data Interchange (EDI) transactions. This contract will require the contractor to have electronic commerce/electronic data interchange EC/EDI capabilities.

All contractors who choose to conduct business with the Department of Defense must now be registered in the System of Award Management (SAM) database. In addition, we encourage all Contractors who receive contract awards as a result of this solicitation to access the “Dynamic Small Business Search” feature of SAM to identify potential suppliers and teaming partners for this initiative. You may go to the System of Award Management at www.sam.gov and click on the “Dynamic Small Business Search” button. When making your procurement decisions we encourage one’s consideration of local business as a means to nurture small business and local economies.

All contractors who receive awards as a result of this initiative are encouraged to utilize the SBA SUBNet database to assist them in further identifying additional small business sources of supply. Contractors may post notices of sources sought for teaming partners and subcontractors on future contracts. Small business can review this web site to identify opportunities in their area of expertise. You may access the SBA PRONet database through the SBA Website at www.sba.gov.

CONTRACTOR CODE OF BUSINESS ETHICS (Nov 2021) FAR Part 3.1002(a) requires all government contractors to conduct themselves with the highest degree of integrity and honesty. Contractors should have a written code of business ethics and conduct within thirty days of award. To promote compliance with such code of business ethics and conduct, contractors should have an employee business ethics and compliance training program that facilitates timely discovery and disclosure of improper conduct in connection with government contracts and ensures corrective measures are promptly instituted and carried out. A contractor may be suspended and/or debarred for knowing failure by a principal to timely disclose to the government, in connection with the award, performance, or closeout of a government contract performed by the contractor or a subcontract awarded there under, credible evidence of a violation of federal criminal law involving fraud, conflict of interest, bribery, or gratuity violations found in title 18 of the United States Code or a violation of the False Claims Act. (31 U.S.C. 3729-3733).

If this solicitation or contract includes FAR clause 52.203-13 - CONTRACTOR CODE OF BUSINESS ETHICS AND CONDUCT; the contractor shall comply with the terms of the clause and have a written code of business ethics and conduct; exercise due diligence to prevent and detect criminal conduct; promote ethical conduct and a commitment to compliance with the law within their organization; and timely report any violations of federal criminal law involving fraud, conflict of interest, bribery or gratuity violations found in title 18 of the United States Code or any violations of the False Claims Act. (31 U.S.C. 3729-3733). When FAR 52.203-13 is included in the contract, contractors must provide a copy of its written code of business ethics and conduct to the contracting officer upon request by the contracting officer.

RAPID GATE, DEFENSE BIOMETERIC IDENTIFICATION SYSTEM (DBIDS)

REQUIREMENT and/or OTHER SECURITY PROGRAMS

Many bases may require enrollment in a particular system for base security such as RapidGate, the Defense Biometric Identification System (DBIDS), or other similar system(s). Such systems manage access to Department of Defense (DoD) installations, and will not allow entry without clearance. During the contract start-up/ implementation period, the Contractor must contact all customer locations to determine whether enrollment in RapidGate, DBIDS, or another security program is required for access to each location. If RapidGate, DBIDS, or other security enrollment is required, the Contractor must take all necessary steps to obtain this in time for the start of performance under this contract. Failure to have clearance may result in a Contractor being turned away from the base and being unable to complete delivery. The Contractor is responsible for any costs associated with RapidGate, DBIDS, and/or other security program enrollment and must ensure that a properly enrolled driver is available for all deliveries. We currently estimate that RapidGate or DBIDS enrollment will cost about $250 per company and $200 per enrolled employee for 1 year of access to multiple locations, but the cost of RapidGate, DBIDS or other security enrollment may vary, so the Contractor should contact the specific security system contractor to determine its own costs. If more than one driver is required, enrollment must be obtained for each driver. Note that enrollment can take several weeks, so an awardee that is not already enrolled must begin enrollment at the time of award notification at the latest. If difficulty or delay in enrollment is encountered during the start-up/implementation period, the Contractor MUST contact the specific security system contractor and/or the Security Officer at the applicable customer locations to resolve any issues with processing enrollment so that the Contractor will be able to deliver as required.

For additional information on current base security systems including RapidGate and DBIDS, including enrollment instructions, please visit their websites at https://omnivee.com/and https://dbids-global.dmdc.mil/home/

TABLE OF CONTENTS

CAUTION NOTICE

I. SOLICITATION OVERVIEW

II. EFFECTIVE PERIOD OF CONTRACT / OPTIONS

III. ESTIMATED DOLLAR VALUE / GUARANTEED MINIMUM/MAXIMUM

IV. CONTRACT START-UP PERIOD

V. ELECTRONIC ORDERING CATALOGS

VI. ECONOMIC PRICE ADJUSTMENT (“EPA”) – ACTUAL MATERIAL COSTS FOR

SUBSISTENCE

VII. REBATES/DISCOUNTS AND PRICE-RELATED PROVISIONS (COMPONENT PRICE

MODEL FOR PRODUCE)

VIII. DOMESTIC NON-AVAILABILITY DETERMINATION – FRESH FRUITS AND

VEGETABLES

IX. ADDITION OF NEW CUSTOMERS

X. CUSTOMER SERVICE

XI. ORDERING SYSTEMS

XII. ORDER PLACEMENT, LEAD TIME, AND CANCELLATION

XIII. REPACKAGING & SPLITTING OF CASES

XIV. PACKAGING, PACKING, LABELING, AND MARKINGS

XV. DELIVERY INSTRUCTIONS

XVI. INSPECTION AND ACCEPTANCE

XVII. AUTHORIZED RETURNS

XVIII. REJECTION/RETURN PROCEDURES

XIX. INVOICING

XX. PRICE AUDITS

XXI. HOLIDAYS

XXII. EMERGENCY AND SURGE ORDERS

XXIII. POST AWARD DISCUSSION & MONITORING ............... Error! Bookmark not defined.

XXIV. FOOD DEFENSE

XXV. PRODUCT QUALITY

XXVI. QUALITY PROGRAM

XXVII. WAREHOUSING AND SANITATION PROGRAM/STORED PRODUCT PEST

MANAGEMENT

XXVIII. CONTRACTOR QUALITY ASSURANCE VISITS (QAV)

XXIX. QUALITY SYSTEMS MANAGEMENT VISITS & PRODUCE QUALITY AUDITS

XXX. RECALL PROCEDURES REQUIREMENTS

XXXI. PERISHABLE AGRICULTURAL COMMODITIES ACT (“PACA”) LICENSE

XXXII. NON-COMPETE PROVISION

XXXIII. CONTRACT ADMINISTRATION INFORMATION

XXXIV. INSTRUCTIONS, CONDITIONS, AND NOTICES TO OFFERORS

XXXV. EVALUATION FACTORS FOR AWARD

I. SOLICITATION OVERVIEW

A. Contract Scope and Objectives: The Defense Logistics Agency (DLA) Troop Support Indo- Pacific seeks to establish a five-year IDIQ contract for the supply of fresh fruits and vegetables (FF&V) to DoD and Non-DoD Troop Support customers on the Kwajalein Atoll.

The contract will support recurring orders dispatched according to the Schedule of Items (Attachment 1).

B. Offeror Eligibility and Performance Expectations: A successful offeror must demonstrate the ability to source USDA Grade No. 1 or better FF&V, maintain sufficient inventory, ensure on-time deliveries, and adhere to quality and freshness requirements. Offerors must operate as fully functional commercial distributors, not merely third-party logistics (3PL) providers that subcontract essential functions.

While the prime offeror may partner with on-island distribution providers, it remains solely responsible for the complete performance of the contract. If the prime offeror does not directly manage on-island distribution, it must include a detailed Delivery and Re-Delivery Plan as part of Attachment 9 – Contractor Overview Report, which must clearly outline:

• The subcontractor’s role in delivery and re-delivery logistics

• Communication protocols and escalation procedures

• Contingency plans to address failed or delayed deliveries

Escalation procedures typically involve a defined chain of command or decision-making structure that outlines how issues are reported, prioritized, and resolved. For example, if a delivery is delayed or rejected, the contractor might have to escalate the issue to a manager, then possibly to senior management, in order to find a solution, ensure customer satisfaction, and keep the contract on track.

The Government and customers will communicate only with the prime offeror — no subcontractor correspondence is permitted. Any failure in service or delivery, irrespective of subcontractor involvement, is the full responsibility of the prime offeror. Failure to provide a sufficiently detailed delivery plan will result in a proposal being deemed technically unacceptable.

When seasonally available, of USDA No. 1 quality or better, and offered at a competitive price, the Government prefers the use of locally grown produce. The successful contractor shall maximize the use of local produce to the greatest extent practicable. The contractor is responsible for identifying what constitutes local produce within the designated geographic area and must ensure that all local items are recorded and updated in the ordering catalog on a weekly basis.

By submitting a proposal, offerors certify their status as capable distributors ready to execute all contract tasks—including catalog maintenance, surge fulfillment, and event-driven orders—without reliance on off-island subcontractors.

C. Mandatory Proposal Requirements: This solicitation supports DoD customers and Non- DoD Customers. Offerors are required to submit proposals for all items in the Schedule of Items. Partial submissions will be deemed non-responsive and may result in exclusion from award consideration.

Item-specific requirements are outlined in the Schedule of Items (Attachment 1). Offerors may propose alternate packaging sizes to accommodate supply availability; however, any changes must be approved by the Contracting Officer prior to implementation to ensure compliance with contract requirements.

D. Acquisition Authority: This procurement is conducted under FAR Part 12 and FAR Part 15, using LPTA source-selection methodologies that focus on minimum technical acceptability and lowest evaluated price without trade-offs. FAR Part 13.5 does not apply.

E. Contract Award and Performance Obligations: The contract will cover FF&V deliveries across all listed DoD and Non-DoD Troop Support sites on Kwajalein Atoll (see Attachment 2 – Customer List). A single award is anticipated.

Offerors must submit fully responsive and competitive proposals at the outset, as negotiations may not be conducted. Failure to meet the requirements may result in disqualification as technically unacceptable.

F. Small Business Set-Aside Requirements: This solicitation is issued as a 100% small business set-aside under NAICS Code 311999 (All Other Miscellaneous Food Manufacturing), with a size standard of 700 employees.

A waiver of the Non-Manufacturer Rule has not been requested, as this acquisition encompasses multiple items. Pursuant to 13 CFR 121.406(e), at least 50% of the total contract value must be fulfilled by small business manufacturers. Offerors must immediately notify the Contracting Officer if they anticipate noncompliance with this requirement.

G. Source Selection Methodology and Contract Duration: This procurement follows the Lowest Price Technically Acceptable (LPTA) Source Selection Process. The contract will have a five-year (60-month) duration, inclusive of all option periods.

Contract Type and Pricing Structure: The resulting contract will be an IDIQ with fixed pricing, subject to the Economic Price Adjustment (EPA) provision. Offerors should refer to Section VI for additional details on the EPA clause.

In accordance with FAR 16.504(a), IDIQ allows for indefinite deliveries within specified limits over a fixed period. Individual deliveries shall be scheduled through orders placed with the contractor as needed.

II. EFFECTIVE PERIOD OF CONTRACT / OPTIONS

The resulting Indefinite-Delivery/Indefinite Quantity Contract (IDIQ) may have a total duration of five (5) years, consisting of a 12-month base period, followed by four (4) 12-month option periods. The base period will include a start-up period, with specific requirements and timelines outlined in Section IV – Contract Start-Up Period.

Performance Period: March 5, 2026 – March 4, 2031 (5 Year Total)

Base – 03/05/2026 – 03/04/2027 (12-month period)

Option 1 – 03/05/2027 – 03/04/2028 (12-month period)

Option 2 – 03/05/2028 – 03/04/2029 (12-month period)

Option 3 – 03/05/2029 – 03/04/2030 (12-month period)

Option 4 – 03/05/2030 – 03/04/2031 (12-month period)

For evaluation purposes only, Base period of the resulting IDIQ will have a duration of 12 months, with each subsequent option, if exercised, also limited to 12 months. The total duration of the IDIQ, including all base and option periods, will not exceed 60 months.

The exercise of any option is not automatic and is contingent upon factors such as satisfactory Contractor performance in meeting contract specifications and the continued verification of demand for the requirement.

This solicitation uses a firm Delivered Price for all FF&V items, accompanied by a separate firm Distribution Price, both of which collectively establish the Contract Unit Price per item.

• Delivered Price must encompass the supplier’s cost-plus standard freight to the contractor’s primary facility (i.e., from the manufacturer’s warehouse to the contractor’s designated prime warehouse).

• Distribution Price must cover all costs incurred to deliver products from the contractor’s facility to the specified customer delivery points. This includes local transportation, handling, packaging, insurance, and any applicable profit margin or fees associated with contract fulfillment.

Offerors must submit both Delivered Price for each item in the Schedule and Distribution Price for each option. Pricing will be reviewed per option period, and any adjustments will only be allowed before the commencement of a new option, in accordance with the Economic Price Adjustment (EPA) provisions.

III. ESTIMATED DOLLAR VALUE / GUARANTEED

MINIMUM/MAXIMUM

A. This acquisition is conducted under the authority of FAR Part 12 – Acquisition of Commercial Products and Commercial Services, which establishes streamlined, market-oriented procedures when procuring commercial items, in conjunction with FAR Part 15 – Contracting by Negotiation, which governs competitive negotiated procedures. This approach allows the Government to solicit proposals, evaluate them based on established criteria, and negotiate terms to obtain the best value for the Kwajalein FF&V contract, ensuring efficiency and fairness in the procurement process.

B. This solicitation is for a five-year contract, consisting of a 12-month base performance period and four additional 12-month performance option periods. Each period, including the base and subsequent option period, is expected to have its own pricing structure for the respective 12-month performance period. The estimated dollar value for each period is $2,100,000.00, based on the Agency’s good faith estimate of requirements for the specified period. The guaranteed minimum obligation for the entire contract duration is $210,000.00. This guaranteed minimum may be fulfilled through a single delivery order or multiple orders, issued during any option period. The maximum contract value, representing the highest amount the Government can obligate over the contract’s five-year duration, is $31,500,000.00.

C. This solicitation encompasses multiple ordering facilities as detailed in the Attachment 2 – Customer List. Ordering facilities within the region may be added or removed as needed, without incurring additional costs to the Government, as previously stipulated.

IV. CONTRACT START-UP PERIOD

A. Implementation Phase: The implementation phase begins immediately upon contract award and concludes when all supported customer locations have successfully submitted and received their initial orders under the new contract. This phase may include ramp-up and/or ramp-down activities to ensure uninterrupted service and a seamless transition from any preceding contract.

1. Incumbent Contractor Awarded the Contract: If the incumbent contractor is awarded the follow-on contract:

A fully operational electronic catalog shall be established no later than 30 calendar days from the date of award or the start of the initial contract term, whichever occurs first.

The contractor may initially use existing inventory stored at its facility or already in the pipeline, provided the products meet all quality, storage, and shelf-life requirements.

These items, if included in the new catalog, must be priced using the delivered price from the previous contract and the distribution fee from the new contract.

Any new FF&V items ordered during this phase must be for inventory replenishment or the introduction of newly approved items. These products shall be priced according to the delivered price methodology outlined in the new contract.

2. New Contractor Awarded the Contract If a new contractor is selected:

Within 15 calendar days of notification that it was not selected for award, the incumbent contractor must submit a ramp-down schedule to the Contracting Officer. Historical demand data may be shared with the new contractor for informational purposes only;

however, the new contractor remains solely responsible for forecasting and supply planning.

A compliant catalog must be established within 30 calendar days from date of award or start of the initial contract term, whichever occurs first. All items must meet the contract’s quality, freshness, and traceability standards.

The incumbent contractor shall continue fulfilling orders during the early implementation period until the new electronic catalog is fully operational and the incoming contractor is prepared to begin performance, not to exceed end of current contract term.

The new contractor shall source, procure, store, and distribute all items exclusively through its own supply chain. Use of incumbent inventory is prohibited.

The new contractor shall not procure, accept, or distribute any product from the incumbent contractor. All FF&V items delivered under the new contract must be sourced, stored, and distributed exclusively through the new contractor’s supply chain.

The new contractor must perform bi-weekly catalog updates throughout the implementation period. All items must be available through the contractor’s procurement and logistics operations.

The new contractor must build a compliant catalog using only its own sources of supply.

Delivered prices must reflect actual material costs in accordance with the Economic Price Adjustment (EPA) clause and the contract's FF&V pricing model.

3. Implementation Timeline and Stop Work Orders:

The implementation timeline begins on the award date and runs for 30 calendar days from the date of award or the start of the initial contract term, whichever occurs first.

If a Stop Work Order is issued, all implementation activities must cease immediately.

Upon rescission, the timeline resumes from the date of issuance—the 30-day period does not restart.

B. Transition-Out Phase (Ramp-Down):

1. Ramp-Down Requirements: The contractor must participate in a transition-out process.

A ramp-down schedule must be submitted upon request and coordinated with the Contracting Officer.

2. Ramp-Down Period Expectations:

The contractor shall continue to supply all contract items without disruption.

Reports (e.g., Total Asset Visibility) may be required for planning purposes and may be shared with the new contractor.

No inventory will be transferred between contractors.

No product disposal is anticipated at contract close-out.

3. Catalog Transition Timing

If a new contractor is awarded the follow-on contract, the Contracting Officer will notify both the incumbent and new contractor in writing of the official transition date. This date will be set no fewer than 15 calendar days from the notification. On the transition date:

• The new contractor’s catalog will become active

• The incumbent contractor’s catalog will be closed

All orders placed after this date shall be under the new contract.

4. Government Transition Goal

The government’s intent is for all customer activities to complete their transition and begin ordering exclusively from the new contractor within 30 calendar days of award.

However, phased customer transitions may be implemented as needed to ensure operational stability.

V. ELECTRONIC ORDERING CATALOGS

An awardee under this solicitation is required to maintain an electronic catalog listing all items available to customers covered under this contract. The catalog will be managed within the Subsistence Total Order and Receipt Electronic System (STORES). Each catalog entry must include the corresponding national or local stock number (as applicable), Government item description, packaging specifications, unit of issue, and unit price.

STORES manuals are available electronically.

A. Catalog Maintenance

1. New Items:

In accordance with FAR Part 12 – Acquisition of Commercial Products and Commercial Services, DLA Troop Support Indo-Pacific utilizes commercial procurement procedures to the maximum extent practicable when acquiring subsistence items. Prior to the commencement of the first order, DLA Troop Support Indo-Pacific, in collaboration with the customer and the contractor, will identify any required items not listed in the Schedule of Items that need to be added to the ordering catalog. This process ensures catalog updates for items previously unlisted due to seasonality or other contingencies unknown to the Contracting Officer at the time of solicitation. Neither the contractor nor the customer may add an item to the catalog without submitting a formal new item request to the Contracting Officer, who must conduct a separate fair and reasonable price analysis in accordance with FAR 12.209 and FAR 15.404 for each requested item.

After ordering has commenced, if a customer requests an item not currently listed in the catalog, the contractor will have a maximum of fifteen (15) calendar days to source the item, obtain a stock number from DLA Troop Support Indo-Pacific (if required), and add the item to the catalog through an 832-catalog transaction in STORES. Upon the Contracting Officer’s determination of fair and reasonable pricing, the item should become a permanent part of the contractor’s inventory, subject to availability. The contractor must use the Contracting Officer-provided Market Ready Request Form (Attachment 8) for all item approval requests, including additions and modifications.

Contractors must consistently demonstrate the ability to source, stock, and deliver the full range of Fresh Fruits and Vegetables (FF&V) specified in the Schedule of Items. While emphasis is placed on the core FF&V items listed, the Government may request additions throughout the contract term — including but not limited to new produce varieties, nuts, or other commercially available items. The contractor must exhibit both responsiveness and operational flexibility in sourcing and integrating these items, ensuring uninterrupted supply and fully meeting the evolving operational requirements of supported locations.

B. Catalog Pricing and Additions:

2. Schedule of Items Pricing: Upon contract award, items listed in the Schedule of Items will be included in the ordering catalog. The final proposed prices, determined fair and reasonable prior to award, will serve as the fixed catalog prices and remain in effect for a minimum of two weeks of customer ordering until the first EPA adjustment period is available. These prices will be available to customers beginning with the first order cycle following contract implementation. The EPA clause, as specified in FAR 52.216-2, allows for upward and downward revisions of the contract unit price upon the occurrence of specified contingencies, subject to certain limitations and conditions .

Economic Price Adjustment Limits: The total allowable increase in the Delivered Price of an item throughout the entire contract period shall not exceed 80% for FF&V items.

Any increase above the limit, may be approved by the contracting officer on a case-by-case basis.

Contractor-Requested Catalog Price Changes: All prices proposed in the Schedule of Items and incorporated into the ordering catalog at the time of award are considered fair and reasonable and shall remain fixed for the first four weeks of the ordering period.

This contract includes an Economic Price Adjustment (EPA) clause, which permits price adjustment requests to be submitted monthly, no later than 9:00 a.m. Hawaii Standard Time (HST) on the first Tuesday of each month, with approved changes taking effect in the following week’s ordering catalog. Please note that submitting a request by this deadline does not guarantee the item's price will be deemed “fair and reasonable,” nor does it ensure the Contracting Officer will complete their review in time to include the adjustment in the upcoming ordering period’s catalog. Please refer to the EPA section for further details.

Price increases or decreases submitted outside of this EPA request window will not be accepted or processed. All proposed price changes will be reviewed for fairness and reasonableness and, if approved, will be adjusted accordingly.

Contractors must input all proposed price changes into the STORES system prior to submitting a written request to the Contracting Officer. Under no circumstances will the Contracting Officer input or update prices in STORES on behalf of the contractor. It is the contractor’s sole responsibility to ensure pricing data is entered accurately and in a timely manner, in full compliance with contract requirements.

In the written request, the contractor must provide complete supporting documentation to justify each proposed price change. This may include, but is not limited to, supplier invoices, manufacturer price lists, market indices, or other verifiable evidence demonstrating the necessity for adjustment in accordance with the contract terms. Failure to comply with these requirements may result in delays, rejection of the requested adjustment, or impact future contract performance evaluations.

Catalog Additions: Before an item is added to the catalog, the contractor must submit a proposed catalog addition request (Attachment 8) to the Contracting Officer, including:

Stock number

Government item description

Proposed unit price

Supporting supplier invoice or quote

Requests must be submitted by 9:00 AM HST on Monday to be considered for inclusion in the following Sunday catalog update. Submission does not guarantee approval. The Contracting Officer will review the request for fair and reasonable pricing and notify the contractor of acceptance. If the price cannot be justified after negotiations, the item will not be added to the catalog.

Please note that some catalog additions may require longer evaluation times and may not become available in the next scheduled catalog update. In such cases, the Contracting Officer will notify the contractor if additional time is needed to gather information or conduct a thorough evaluation before approval and inclusion.

VI. ECONOMIC PRICE ADJUSTMENT (“EPA”) –

ACTUAL MATERIAL COSTS FOR SUBSISTENCE

A. Definitions. As used throughout this language the term:

1. Contract Unit Price/Vendor Price means the total price per unit of a particular item charged to the Government for a product delivered to customers under this contract. The Contract Unit Price consists of two separate and distinct components: 1) Delivered Price, less Rebates/Discounts, and 2) Distribution Price. The unit price sum of these two components shall be rounded up or down to the nearest cent, to determine the Contract Unit Price.

2. Delivered Price/Product Price refers to the per-unit price charged to the Contractor by the commercial manufacturer, grower, or private label holder for the purchase of a representative quantity of an item under conditions comparable to those of this contract.

This price must include standard freight to the Contractor’s primary facility but shall exclude any costs associated with distribution, overhead, profit, or other financial arrangements not directly reflected in the base supplier price. The Delivered Price represents the amount entered into the Contractor’s purchasing system as the baseline cost before applying or deducting any additional charges, discounts, or rebates.

The Delivered Price must be substantiated by an actual paid invoice. In limited cases, supplier quotations may be accepted as evidence of Delivered Price, but only with prior written approval from the Contracting Officer. Under no circumstances shall costs intended to be recovered through the Distribution Price be included in the Delivered Price.

3. Distribution Price refers to the firm-fixed portion of the Contract Unit Price, expressed as a dollar amount per unit of issue and rounded to the nearest cent. This price component is FOB Destination and encompasses all costs incurred by the Contractor in performing contract requirements that are not included in the Delivered Price. Such costs include, but are not limited to: labor, employee benefits, insurance, overhead, profit, subcontractor costs, transportation from the Contractor’s facility or place of performance to the Government’s designated delivery points, transportation delays, rejected or returned goods, split-case handling fees, special packaging (including temperature-controlled packaging for perishable items), and any ancillary in-house processing fees.

The Distribution Price is firm and fixed for the Base Period and all subsequent Option Periods and is not subject to adjustment under the Economic Price Adjustment (EPA) clause. Accordingly, the Contractor must factor in projected inflation, rising operational costs, and other financial considerations over the life of the contract when proposing Distribution Prices for each option. Once the contract is awarded, the Contractor may not revise the proposed Distribution Prices.

4. National Allowance Agreements: If the contractor procures products from a manufacturer or supplier participating in the DLA Troop Support National Allowance Program (NAPA), the contractor shall pass along the full benefit of any applicable allowances or discounts to the Government in the form of reduced catalog pricing.

Participation in NAPA does not alter the contractor’s distribution price. The contractor remains solely responsible for billing and reconciling allowances with the agreement holder. Disputes between the contractor and allowance providers will not involve the Government, although DLA Troop Support Indo-Pacific may assist in facilitating resolution if needed.

5. Standard Freight refers to the published list price or prevailing market rate for transporting items ordered under this contract from the manufacturer, grower, private label holder, or redistributor (when the Redistributor Exception applies) to the Contractor’s primary facility. Standard Freight must be substantiated with a paid invoice;

however, in limited circumstances, quotations may be accepted as valid documentation if specifically authorized by the Contracting Officer. Standard Freight may also include commercially customary ancillary transportation-related costs in the produce industry, such as pallets, temperature monitoring devices, Tectrol, and similar materials.

In cases where the Contractor picks up its own product on an F.O.B. Origin basis or arranges third-party transportation not provided by the manufacturer, grower, private label holder, or redistributor, the Standard Freight cost shall reflect fair market tariffs and prevailing industry rates. Under no circumstances shall this cost exceed the typical freight rate that the manufacturer, grower, private label holder, or redistributor—or their contracted carrier—would normally charge the Contractor for similar inbound shipments to the Contractor’s facility

B. Price Adjustments

1. General:

(i) All Contract Unit Prices shall remain fixed unless changed pursuant to this section or another applicable provision of the contract. Only the Delivered Price component of the Contract Unit Price is subject to monthly adjustment under this clause. After the initial four-week ordering period, Delivered Prices may be adjusted on a monthly basis through the contract’s Economic Price Adjustment (EPA) process, subject to Contracting Officer approval.

To be effective in the following week’s ordering catalog, requests must be submitted no later than 9:00 a.m. Hawaii Standard Time (HST) on the first Tuesday of each month.

The Delivered Price in effect at the time an order is placed shall remain unchanged through delivery. The Government will be invoiced at the Delivered Price in effect at the time of order placement, regardless of subsequent changes. Please note that submitting a request by this deadline does not guarantee the item's price will be deemed “fair and reasonable,” nor does it ensure the Contracting Officer will complete their review in time to include the adjustment in the upcoming ordering period’s catalog.

(ii) Delivered Prices must be substantiated by the Contractor’s most recent actual paid invoice for a representative quantity of the item. In limited cases, where no recent purchases exist or seasonal volatility affects pricing, a current supplier quote may be accepted upon prior approval by the Contracting Officer. All documentation must clearly reflect item details and associated costs.

(iii) Contractors must input proposed price adjustments into the Subsistence Total Order and Receipt Electronic System (STORES) before submitting the written EPA request to the Contracting Officer. Failure to do so will be interpreted as no change requested for that item. The Contracting Officer will not enter prices into STORES on behalf of the Contractor under any circumstances.

To assist with proper STORES data entry, the Contracting Officer will provide an 832 Excel pricing form at the start of each option period. This form will automatically calculate:

• The Delivered Price (“Product Price” in STORES),

• The Distribution Price, and

• The combined Contract Unit Price (“Vendor Price” in STORES).

The Contractor is responsible for ensuring these calculated prices are accurately entered into the correct fields in STORES. The following mapping applies:

• Product Price = Delivered Price

• Distribution Fee = Distribution Price

• Vendor Price = Contract Unit Price

(iv) Each monthly EPA request must be submitted in writing and include itemized supporting documentation justifying all proposed Delivered Price changes. Supporting documentation may include current invoices, supplier/manufacturer price lists, or other verifiable cost data. The Contractor shall submit price change notifications electronically via EDI 832 transaction sets when using STORES. Upon approval by the Contracting Officer, changes will be incorporated into the following week’s ordering catalog.

(v) The Government reserves the right to verify all price adjustments. The Contracting Officer may request additional documentation from any level of the supply chain, including rebates, discounts, or pricing agreements used to determine the proposed Delivered Price.

(vi) Questionable, unsupported, or erroneous price change requests will not be implemented without the explicit approval of the Contracting Officer. Price changes are effective only upon written approval.

(vii) If a proposed price is deemed not fair and reasonable, the Contracting Officer will notify the Contractor and request revised justification or documentation. If agreement on a fair price cannot be reached, the item shall remain at its last approved price or may be removed from the contract.

(viii) If a price posts incorrectly in STORES, resulting in an inaccurate increase or decrease, the Contractor shall immediately notify the Contracting Officer. Erroneous increases shall be refunded to the Government with applicable interest. If the Contractor is underpaid through no fault of their own, the Contracting Officer may authorize an equitable adjustment, provided the Contractor submits a signed customer invoice reflecting the correct price as documentation to support the adjustment.

2. Limitations:

Price adjustments shall be limited to actual changes in the Delivered Price. No upward adjustments shall be made for:

(i) Supplies for which the Delivered Price is unaffected by such changes;

(ii) Variations in material quantities;

(iii) Increases in Delivered Prices that are miscalculated or determined by the Contracting Officer to be not fair and reasonable.

C. Upward Ceiling on Economic Price Adjustments

The aggregate increase in Delivered Price for each item shall not exceed 80% for FF&V items of the initial contract Delivered Price, except as follows:

3. If the Contractor anticipates a necessary price adjustment exceeding these limits, the Contracting Officer must be notified in writing. The notice must include a revised ceiling sufficient for continued contract performance, along with supporting documentation.

4. If an approved Delivered Price increase exceeds the current ceiling, and the Contracting Officer and Contractor cannot agree on a fair price below the ceiling, the Contracting Officer may either:

a. Reject the price change and retain the item at the last approved price, requiring continued performance at that price;

b. Authorize removal of the item from the contract.

The Contracting Officer holds sole discretion in deciding whether to modify the contract, retain an item, or remove it.

D. Downward Limitation on Economic Price Adjustments

There is no limit on the aggregated percentage of price decreases under this section.

E. Price Audits

The Government may conduct price audits up to twice annually, or as required, to verify Delivered Prices and compliance with contract terms. The Contractor must provide invoices and supporting documentation from all option periods of the supply chain, including manufacturers, growers, and redistributors. Audits may occur until three years after final contract payment or as specified by FAR Subpart 4.7. The Government reserves the right to examine all relevant records, including commercial sales data.

F. Final Invoice

The final invoice for each order must include a statement confirming that all required or authorized price decreases have been applied.

G. Disputes

Any disputes under this section shall be resolved in accordance with the contract’s "Disputes" clause.

VII. REBATES/DISCOUNTS AND PRICE-RELATED

PROVISIONS (COMPONENT PRICE MODEL FOR PRODUCE)

A. Rebates/Discounts

1. All National Allowance Program Agreement ("NAPA") discounts, food show discounts, early payment discounts (except Qualifying Early Payment discounts as defined below), and any other discounts, rebates, allowances, economic incentives, financial arrangements, or other benefits that reduce the Contractor’s price paid for products supplied under this contract, or that are otherwise attributable to products sold under this contract, shall be passed to the Government through a reduced catalog price.

2. Any rebates or discounts that cannot be applied as an up-front price reduction must be remitted via check payable to the U.S. Treasury. The check must be accompanied by an itemized listing of all customer purchases by line item, including the contract number, call number, purchase order number, and contract line-item number ("CLIN").

Instructions for identifying and reporting such rebates, discounts, allowances, or other economic incentives are detailed in the submission requirements of the Business Proposal/Pricing section and the Reports section of the Statement of Work.

3. The Contractor shall employ prevailing commercial methods in the pursuit of discounts, rebates, allowances, and other economic incentives or benefits for the Government throughout the period of performance of this contract.

4. The Government reserves the right to require the Contractor to submit invoices and supporting documentation from all subcontractors (as defined in FAR 44.101) and any other entities in the delivered price supply chain to verify the proper application of rebates and discounts. If the Contracting Officer determines, after reviewing invoices or other documentation, that a rebate or discount should have been but was not passed on to the Government, the Government shall be entitled to a refund in the amount of the overcharges, including applicable interest.

5. If the Contractor believes it has erroneously credited a rebate or discount to the Government, it may submit a request for an equitable adjustment for the amount of the undercharge. Such a request may be considered if the Contractor can demonstrate to the satisfaction of the Contracting Officer that the error did not result from the Contractor’s fault or negligence. The Contractor shall not be entitled to reimbursement if the undercharge was due to its own fault or negligence.

6. The Contracting Officer, or authorized representatives, shall have the right to examine and audit the Contractor’s records related to pricing under this contract, including but not limited to the existence and proper accounting of rebates, discounts, allowances, and other economic incentives. The Government may also conduct a review or audit of the Contractor’s electronic purchasing system to ensure the accuracy of the Delivered Price of products sold to the Government.

7. Failure of the Contracting Officer to identify non-compliance with this provision or to challenge the Contractor’s erroneous interpretation of this provision shall not constitute a waiver of the Government’s entitlement to any rebates, discounts, or other remedies available under this contract or applicable laws and regulations.

VIII. DOMESTIC NON-AVAILABILITY DETERMINATION

– FRESH FRUITS AND VEGETABLES

A. A Class Domestic Non-Availability Determination (DNAD) for Federal Supply Class 8915, Fresh Fruits and Vegetables (FF&V), dated 16 May 2008, is currently in effect for DLA Troop Support/DLA Produce Long-Term Contracts. This DNAD provides a limited waiver to the Berry Amendment requirements outlined in DFARS 252.225-7012, Preference for Certain Domestic Commodities, applicable to this solicitation. Under this DNAD, non-domestic FF&V may be supplied when domestic FF&V of satisfactory quality and sufficient quantity cannot be procured timely and at reasonable U.S. market prices. This determination remains valid until formally rescinded.

B. This DNAD applies specifically to Department of Defense troop and ship customers supported under this contract. It does not affect any requirements for domestic sourcing that may apply to other Government programs outside of DoD, including but not limited to contracts supporting non-DoD customers.

IX. ADDITION OF NEW CUSTOMERS

A. Adding Customers within the Contract’s Geographic Distribution Region (Kwajalein)

1. Following contract award, additional customers may request support for Fresh Fruits and Vegetables (FF&V) requirements. New Department of Defense (DoD) and non-DoD federal agencies may be added to the contract without the need for a separate acquisition or competitive process, provided they fall within the geographic distribution area covered by this contract and are eligible for support through DLA Troop Support Indo-Pacific.

2. The determination of whether a new customer falls within the contract’s geographic region and can be added without further competition at the existing contract prices is at the sole discretion of the DLA Troop Support Indo-Pacific Contracting Officer.

3. Upon such determination, the Contracting Officer will instruct the Contractor to include the customer(s) at the applicable contract prices for that distribution region.

B. Adding Customers Outside the Contract’s Geographic Distribution Region:

1. This provision applies to the following customers:

A new DoD or Non-DoD federal customer deemed by the Contracting Officer to be outside the contract’s geographic distribution region.

An existing DoD or Non-DoD federal customer previously supported under a separate contract for a different geographic distribution region but now determined to be outside the awarded contract’s region.

2. Customers described above may be added to the contract as follows:

If, in the judgment of the Contracting Officer, the customer is in an area adjacent or proximal to the contract’s geographic distribution region, they may be added. If multiple existing contracts serve the area, the Contracting Officer will determine which contract best meets the Government’s needs, considering factors such as logistics, cost-effectiveness, and operational efficiency. The Contracting Officer will also decide which contractors in the region will be solicited to support the customer.

• The Contracting Officer will request complete price proposal(s) to support the new customer(s). Before a customer is added, the Contracting Officer must determine that all proposed prices are fair and reasonable. This may require negotiations following the procedures outlined in the solicitation.

If the Contracting Officer determines that the customer is not in an adjacent or proximal area, or if the anticipated requirement is insubstantial, the customer will not be added to the contract.

Under no circumstances may the contract’s maximum dollar value be exceeded due to the addition of any customer(s) and their respective Non-FF&V requirements.

X. CUSTOMER SERVICE

1. The Contractor may be required to attend periodic food menu board meetings and similar forums conducted by the Department of Defense (DoD) and other customers. These meetings provide an opportunity for customers to review internal business practices, while also allowing the Contractor to introduce new products, demonstrate product preparation, and provide nutritional information.

2. The Contractor shall designate at least one full-time Customer Service Representative (CSR) to maintain continuous contact with all ordering customers, along with at least one designated back-up representative. The names and contact information, including phone numbers, mobile numbers, email addresses, and any other available communication methods—shall be provided to both the customers and the Contracting Officer after award.

3. As an industry expert, the Contractor shall assume the responsibility of introducing new FF&V items to the customers, as well as to show cost-effective alternatives to their current choices, if the customer so desires. However, the final determination of items included in the Ordering Catalog remains at the discretion of the customer(s) and the Contracting Officer.

XI. ORDERING SYSTEMS

A. Subsistence Total Order & Receipt Electronic System (STORES):

DoD customers shall place orders using the Subsistence Total Order and Receipt Electronic System (STORES) catalog. The Contractor is responsible for establishing and maintaining an accurate and up-to-date STORES catalog.

1. STORES is a Government-managed, internet-based translator and ordering system capable of receiving orders from various military service branches, including the Army, Air Force, Navy, Space Force, and Marine Corps. The system translates these orders into an Electronic Data Interchange (EDI) format and transmits the information to DLA Troop Support Indo-Pacific for contractor payment processing and customer billing.

2. Customers will place all FF&V orders through STORES, which will transmit the orders directly to both the Contractor and DLA Troop Support Indo-Pacific.

3. The Contractor shall integrate with STORES and support the following EDI transactions:

• 810 – Electronic Invoice

• 820 – Payment Voucher Information

• 832 – Catalog (Outbound - Contractor to DLA Troop Support Indo-Pacific)

• 850 – Purchase Order

• 861 – Receipt

• 997 – Functional Acknowledgment

Note: A complete description of these transaction sets is provided in the “EDI Implementation Guidelines,” which can be found in the attachment or at DLA Troop Support STORES Site under STORES Customers and Vendors > STORES & EDI Requirements.

4. The Contractor shall maintain internet access and the capability to send and receive electronic mail (email) to facilitate communication.

https://www.dla.mil/Working-With-DLA/Applications/Details/Article/2923157/stores-subsistence-total-order-and-receipt-electronic-system/ https://www.dla.mil/Working-With-DLA/Applications/Details/Article/2923157/stores-subsistence-total-order-and-receipt-electronic-system/

5. The contractor shall maintain uninterrupted access to the Subsistence Total Order and Receipt Electronic System (STORES) for the entire duration of the contract. The contractor is responsible for ensuring that the system is fully functional and that designated personnel are properly trained to utilize it. Furthermore, the contractor shall be capable of inputting and updating all contract pricing in STORES in accordance with the established timelines for each contract term period. Failure to maintain system access or comply with price update requirements may be considered a performance deficiency.

6. All unit prices in the ordering catalogs must be formatted to no more than two (2) decimal places. Prices shall be rounded as follows:

• Prices of $2.215 or higher shall be rounded up to $2.22.

• Prices of $2.214 or lower shall be rounded down to $2.21.

7. The Contractor shall use the Government’s item descriptions in all electronic ordering catalogs…