Contract- HDEC02-26-D-E006 (Redacted).pdf

DEFENSE COMMISSARY AGENCY DISTRIBUTOR FOB DESTINATION CONTRACT

Contract No.: HDEC2-26-D-E006

Contractor (Resaler): Coastal Pacific Food Distributors (CPFD). (“Contractor”)

Ordering/Performance: Worldwide (CONUS commissaries; OCONUS ports/points and destinations as designated)

Effective Date: September , 2026

Period of Performance: 15-day phased in period; The period of performance comprises a five-year base period, followed by up to five one-year award term extensions earned conditionally upon meeting defined performance metrics, and five one-year government option periods, for a maximum cumulative duration of fifteen (15) years.

1. PURPOSE AND SCOPE

1.1. Purpose. The principal purpose of this contract is the acquisition of commercial products for resale. This contract establishes the terms and conditions under which the Contractor shall sell and deliver resale goods to DeCA for designated commissaries at the applicable DeCA Cost of Goods (DeCA COG). All distribution, supply chain management, and data integration functions performed by the Contractor are strictly incidental and ancillary to the physical sale and delivery of these goods.

1.2. For all goods furnished under this contract, the Contractor is the sole seller to DeCA for orders placed directly with the Contractor by the covered commissaries in Attachment A for items ordered under DeCA’s Frequent Delivery System (FDS). The Contractor shall obtain such goods from Suppliers and other upstream sources under its own commercial arrangements. DeCA has no privity of contract with, and no payment obligation to, any upstream source from which the Contractor obtains goods under this contract This contract does not apply to direct store delivery (DSD) items or other items expressly excluded from contract coverage. If federal law, regulation, or Government direction restricts use of this contract, or if the Contracting Officer determines alternate sourcing is required for supply disruptions or Contractor performance failures, DeCA may acquire covered goods directly from any source, temporarily or permanently, via written Contracting Officer direction. Where alternate sourcing is due solely to Contractor performance, DeCA will, where practicable, provide written notice and up to fifteen (15) calendar days to cure before exercising this right. If the Contracting Officer determines that immediate action is necessary to protect supply continuity or

Contractor demonstrates, to the satisfaction of the Contracting Officer, reasonable, allocable, and directly attributable increased costs or schedule impacts arising from the change, net of any offsetting savings or efficiencies. The Contractor shall provide supporting documentation sufficient to validate any claimed adjustment, including any claimed negative operational impact. The Government may also modify the list of designated locations in Attachment A by written contract modification in cases where the Contractor has failed to meet the AQLs after notice of such failure and only if the Contractor is unable to cure the failure within the applicable contractual cure period.

2. DEFINITIONS

2.1. Acceptable Quality Level (AQL): The minimum, quantitative standard of performance that the Contractor must achieve and maintain to avoid the assessment of Performance Level Credits. For the purposes of this contract, the primary AQLs governing Contractor performance are explicitly defined in Section 11 (Performance Accountability Framework), including the standards applicable to Adjusted Distributor-Controlled Fill Rate, On-Time Delivery, and New Item Set Up Time. Performance falling below the established AQLs constitutes a defect in delivery performance and is subject to corrective action through the notice and cure process and through contract duration adjustment process. The Contractor is not liable for AQL failures caused solely by documented DeCA ordering errors, Force Majeure events, or manufacturer product shortages expressly approved in writing by the Contracting Officer as excused performance. Approved manufacturer product shortages are limited to the following:

Vendor late deliveries, Vendor cuts, Vendor/broker managed accounts, New Items not yet available, Vendor temporary out of stock/allocated items, Phase out items (deletes). Shortages do not include lack of availability caused by the contractor’s forecasting, ordering, payment, inventory, warehousing, transportation, systems, or other acts of omission. The contractor bears the burden of substantiating a shortage.

2.2. Accepted Goods: Goods delivered to the designated delivery point that are accepted by an authorized Government representative in accordance with the Contract, subject to the Government’s rights concerning latent defects, concealed damage, spoilage, temperature abuse, adulteration, misbranding, shortages, and other nonconformities not reasonably apparent at the time of receipt. Documentation for all such goods must be supported by DeCA receiving records and associated EDI/transaction data.

2.3. Days: All days are considered Calendar Days unless otherwise noted.

2.10. Performance Level Credit: If the parties execute a bilateral modification to this agreement to implement Section 11 of this agreement, a financial credit due to the Government when the contractor fails to meet a key performance metric as defined in the PRS in Section 11. Performance Level credits are not penalties. For the avoidance of doubt, the Parties currently plan to use the PLC’s for award term incentive evaluations but on financial credits. The Government reserves the right to introduce financial credits through a bilateral contract modification if circumstances dictate such action is warranted.

2.11. Supplier: Any manufacturer, supplier, broker, or other entity including a current DeCA Resale Ordering Agreement (ROA) holder from whom the Contractor obtains resale goods for performance under this contract. For purposes of this contract, a Supplier is part of the Contractor’s upstream supply chain and, where applicable under law or this contract, may be treated as a subcontractor or lower-tier supplier for flow-down and compliance purposes.

3. GOVERNMENT-FURNISHED ITEMS (GFI)

3.1. The Government may provide access to the following, as applicable and as necessary for contract performance:

3.1.1. Systems: Access to DeCA’s Enterprise Business Solution (EBS), Vendor Portal, and other authorized systems for designated Contractor personnel, subject to account approval, need-to-know, and applicable security requirements.

3.1.2. Information: Historical sales data, promotional calendars, initial demand forecasts, and other information necessary for performance, as determined by DeCA. Government-furnished information shall be protected in accordance with the information security requirements of this contract. Information designated or marked as Controlled Unclassified Information (CUI) shall be handled in accordance with applicable CUI safeguarding requirements. DeCA shall not provide CUI to Contractor without Contractor’s prior written consent.

4. CONTRACT STRUCTURE; ROLES AND AUTHORITY

4.1. Contracting Officer (KO) Authority. The KO is the sole Government official authorized to administer, modify, or terminate this contract, and to bind the Government on matters or contract interpretation, pricing, changes, or remedies.

4.2. Program Manager. Within 10 days of award, the Contractor shall designate a Program Manager with full authority to act on behalf of the Contractor.

4.3. Quality Control. The Contractor shall maintain a Quality Control Plan (“QCP”) that identifies how the Contractor shall monitor, measure, and correct delivery accuracy, product integrity, and fulfillment performance under this contract.

4.4. Annual Financial Information and Risk Disclosures.

5. CONTRACTOR RESPONSIBILITIES

5.1. To successfully execute the sale and delivery of resale goods to the Government, the

Contractor shall be independently responsible for managing the ancillary supply chain and logistical functions within this section. The Government does not direct the Contractor’s workforce, nor does it procure these logistical or IT functions as independent services; they are required solely to ensure the accurate, timely, and compliant delivery of the purchased commercial goods.

5.2. Supplier Data Integration, including establishing and managing the EDI 875 connections (or approved alternative technical bridges) required to receive DeCA COG transmissions from DeCA Suppliers.

5.2.1. Data Integration:

5.2.1.1. Contractor shall integrate into DeCA’s systems and interfaces as necessary to access authorized pricing, ordering, shipment, receiving, discrepancy, and related contract-administration data.

5.2.1.2. Data Exchange: The Contractor shall maintain secure Electronic Data Interchange (EDI) or API connections with DeCA for the exchange of critical data, including order information, inventory levels, shipment status, and invoice data.

5.2.2. Demand planning collaboration and replenishment execution; Order Processing and Fulfillment. The Contractor shall receive and process electronic orders generated by DeCA and subsequently execute the consolidation, routing, and physical fulfillment required to successfully deliver the ordered goods to the designated Delivery Point.

5.2.2.1. Supply Order Fulfillment: The Contractor shall receive and process all authorized orders for resale goods that are transmitted from DeCA’s ordering systems (e.g., DAX) or other authorized means.

5.2.2.2. Pick, Pack, and Staging: The Contractor shall accurately pick, pack, and stage resale products for outbound delivery to DeCA designated locations based on the received orders.

5.2.3. Commercial Warehousing and Delivery. The Contractor shall utilize its commercial warehousing infrastructure and transportation network to safely store, handle, and transport the resale goods to the Government in accordance with the established delivery schedules and food safety requirements:

5.2.3.1. The Contractor shall perform all necessary receiving operations at Contractor-controlled facilities, including scheduling deliveries from Suppliers, verifying shipment accuracy against manifests, inspecting and documenting goods for visible damage, and segregating damaged, suspect, or otherwise non-conforming goods.

5.2.3.2. Storage and Handling: The Contractor shall store all DeCA-bound products in a secure environment, segregated from commercial inventory as required, and under appropriate climate-controlled conditions (e.g., ambient, refrigerated, frozen) to ensure product integrity.

5.2.3.3. Inventory Accountability: The Contractor shall maintain accurate, real-time inventory records for all DeCA products under its control. This data shall be made available to DeCA upon request.

performance of its Suppliers and lower-tier providers except, to the extent, Contractor demonstrates that the failure was directly caused by written direction by the Contracting Officer or a DeCA-approved promotion for which sufficient product was not made available despite timely coordination by the Contractor or the failure resulted from some other contractually or legally recognized excusable conduct, action or inaction.

6.3. The Contractor shall include enforceable provisions in Supplier agreements to:

6.3.1. Provide the Contractor the applicable DeCA COG synchronized to DeCA submissions (EDI 879/Web Pricing) including item/zone/effective date;

6.3.2. Maintain records sufficient to validate DeCA COG and effective dates;

6.3.3. Comply with food safety, recall response, quality, and traceability requirements for goods supplied to DeCA;

6.4. DeCA Direction to Discontinue Use. DeCA may direct the Contractor to discontinue use of a Supplier where DeCA reasonably determines that continued use presents a material risk to supply continuity, food safety, pricing integrity, or compliance with this contract. Within ten (10) calendar days, the Contractor shall provide a mitigation plan identifying affected items, operational impacts, and any available options to reduce disruption. For DeCA-directed item deletions or Supplier discontinuance, any sell-through or inventory relief must be approved in writing by the Contracting Officer or designated representative and limited to documented, non-cancellable inventory acquired in good faith to meet DeCA orders or reasonably forecasted DeCA demand, after the Contractor uses commercially reasonable mitigation efforts. For the avoidance of doubt, Inventory sell-through responsibility for DeCA-directed item deletions items shall remain the responsibility of DeCA.

7. PRICE DATA SUBMISSION; DECA COG DATA WARRANTY

7.1. For each Accepted Good, the only payable contract unit price is the DeCA COG reflected in the DeCA EDI for the applicable item, zone, and effective date, unless otherwise expressly directed in writing by the Contracting Officer.

7.2. Suppliers shall submit their prices to DeCA via EDI 879 or DeCA Web Pricing following DeCA’s published timing rules.

7.3. Any proposed price increase for non-perishable goods requires a minimum of sixty (60) calendar days' advance written notice to the Contracting Officer. The notice must include a detailed justification for the increase, supported by relevant market data. For avoidance of doubt, the cost of goods invoiced to DeCA shall be the applicable DeCA COG established through DeCA’s pricing process with the manufacturer, supplier, or broker. Any drayage, warehousing, transportation, or ancillary charges negotiated between the Contractor and any manufacturer, supplier, or broker are matters between those parties and shall not be separately invoiced to, reimbursed by, or otherwise charged to DeCA under this contract unless expressly authorized by written contract modification.

7.4. Passthrough of Promotional Allowances and Retention of Supply Chain Incentives:

7.4.1. DeCA Allowances: The Contractor shall ensure that all Supplier-funded off-invoice discounts and allowances applicable to goods furnished under this contract are passed through to DeCA in full and are not retained, netted, offset, or recharacterized by the Contractor. Retail promotions, bill-back amounts, scan or scan-back funds, lump-sum retail promotions, and similar promotional or pricing support administered through DeCA’s Bill-Back Manager or other DeCA-direct processes shall remain between the Supplier and DeCA and are not required to be processed by the Contractor, except to the extent expressly required elsewhere in this contract.

7.4.2. Distributor Commercial Incentives: Distribution fees, drayage fees, performance incentives, and other commercial incentives or consideration negotiated strictly between the Contractor and the Supplier as part of the Contractor’s upstream supply arrangements remain between the Contractor and the Supplier and are not required to be passed through to DeCA, unless expressly incorporated into the applicable DeCA COG or otherwise required by this contract.

7.5. Simultaneous Supplier Submission to Contractor. The Contractor shall require Suppliers to provide the Contractor the same price data contemporaneously with their submission to DeCA. This can be audited anytime by DeCA.

7.6. DeCA COG Data Warranty and Invoice Conformance

7.6.1. Warranty. The Contractor warrants that each invoice line item billed to DeCA reflects the correct DeCA COG as accepted in the DeCA Pricing Environment for the applicable period and the quantities of Accepted Goods.

7.6.2. Correction Duty. If DeCA identifies an overcharge or other DeCA COG mismatch, the Contractor shall promptly investigate and provide supporting documentation reasonably necessary to resolve the discrepancy. The Parties shall then conduct a mutually agreeable, bilateral reconciliation process. If warranted at the conclusion of that process, undisputed overcharges or pricing mismatches shall be credited on the next statement cycle, or by other method directed by the Contracting Officer.

Disputed amounts shall be addressed through the contract’s reconciliation process, without limiting the Government’s rights under this contract or applicable law.

7.6.3. No DeCA Liability for Supplier-Level Fees. This warranty does not shift supplier fees to DeCA; it governs only the DeCA COG applied to DeCA’s payment.

7.7. Late/Failed Pricing Submissions; Default Pricing. If a Supplier’s price submission is late or rejected in DeCA’s pricing environment, DeCA may apply the prior effective price.

Contractor invoices must match the DeCA-accepted price status for the relevant period.

7.8. Records Retention for Pricing. The Contractor shall retain DeCA COG mapping records for at least 3 years after final payment (or longer if required by law), and make them available to DeCA for audit upon request.

8. ORDERING, FULFILLMENT, DELIVERY, AND RECEIVING

8.1. Ordering. Once implemented by DeCA and Contractor, DeCA will issue orders through its systems (e.g., 850/875 or successor). Contractor shall acknowledge receipt and confirm quantities and ship dates within 24 hours through an EDI 855.

8.2. Receiving. Contractor shall coordinate delivery appointments and comply with store receiving windows and installation access requirements. The Contractor may reject a line item without fill-rate or KPI impact only where a documented UPC, item, unit-of-measure, wrong commodity code. or DeCA COG mismatch prevents accurate fulfillment or invoicing, provided the mismatch was not caused by the Contractor, the Contractor promptly notifies DeCA, and, to extent it is feasible to do so, the Contractor delivers all unaffected line items.

8.3. OCONUS Deliveries. Contractor shall comply with OCONUS shipment documentation and marking requirements as directed by DeCA and applicable law, including cold-chain and export/health certificate needs where required.

8.4. State and Local Delivery Compliance. The Contractor shall comply with all applicable federal, state, local, and host-nation environmental, emissions, transportation, registration, reporting, labeling, and equipment-compliance requirements applicable to deliveries under this contract.

8.4.1. Jurisdiction-Specific Documentation Requirements. The Contractor shall provide documentation reasonably sufficient to demonstrate compliance with jurisdiction-specific legal requirements applicable to vehicles, trailers, transport refrigeration units, generators, and other equipment used in performance under this contract, at the time required by DeCA or applicable law.

8.4.2. Attachment for Jurisdiction-Specific Documentation. Jurisdiction-specific documentation requirements shall be identified in Attachment B, Jurisdiction- Specific Delivery Compliance Requirements, as updated in accordance with this contract. Such requirements may include applicable registration, reporting confirmation, compliance certificate, compliance label information, fleet-wide compliance affirmation, or other proof of compliance required by law.

8.4.3. Updates to Attachment B. The Contracting Officer may update Attachment B to identify or revise documentary or procedural requirements reasonably necessary to verify compliance with obligations already applicable under law or this contract.

Any such update shall not, by itself, create a new substantive performance obligation beyond those already required by law or this contract. Any material change to scope, cost, or performance obligations shall be made only by written contract modification.

8.4.4. Failure to Provide Required Documentation. Failure to provide required documentation under this Section or Attachment B may be treated as a delivery deficiency or other nonconformance under this contract.

8.5. Title and Risk of Loss. Unless otherwise expressly stated in this contract or an order, title to and risk of loss for goods remain with the Contractor until delivery to the designated Delivery Point and acceptance by DeCA. For the avoidance of doubt, the Parties agree FOB & title transfers at delivery to the applicable commissary or POE.

8.6. Initial Receipt Not Final Acceptance. Initial receipt, unloading, or signature at delivery does not constitute final acceptance for latent defects, concealed damage, spoilage, temperature abuse, adulteration, misbranding, shortages not reasonably discoverable at receipt, or other nonconformities not apparent at the time of delivery. In all cases, for OCONUS shipments, DeCA stores have no more than 59 days from point of port embarkation to claim defects or damage, and for CONUS locations, DeCA shall have no more than 48 hours but see paragraph 8.8.

8.7. Government Inspection Rights. DeCA may inspect goods at delivery and after delivery to determine compliance with this contract.

8.8. Rejection and Revocation of Acceptance. DeCA may reject Nonconforming Goods at delivery or revoke acceptance within a reasonable time after discovery of a latent nonconformity. At DeCA’s election, the Contractor shall promptly remove, replace, or credit such goods, or take other corrective action directed by the Contracting Officer. In all cases, for OCONUS shipments, DeCA stores have no more than 59 days from point of port embarkation to claim defects or damage, and for CONUS locations, DeCA shall have no more than 48 hours. Transfer of physical custody or title to DeCA or a Government-designated carrier shall not waive DeCA’s remedies for latent, concealed, or non-apparent nonconformities that existed before tender, or that are attributable to the Contractor’s acts or omissions, including improper packaging, palletizing, loading, temperature control before tender, documentation, labeling, shelf-life compliance, supplier quality, adulteration, misbranding, recall-related issues, or other food safety concerns. Such matters may be reported within a reasonable time after discovery.

8.9. Refusal of Delivery. For CONUS shipments, DeCA may refuse delivery of goods that are visibly nonconforming, unsafe, unauthorized, or otherwise not in compliance with this contract.

8.10. Incomplete or Untimely Delivery. DeCA may reject, refuse, or document as deficient any delivery that is incomplete, outside the required delivery window, or otherwise fails to comply with the contract’s delivery requirements, without waiving any other Government right or remedy. For OCONUS shipments, the Contractor is not responsible for delay or damage caused solely by Government-controlled onward transportation after Government acceptance at the designated port or handoff point.

The Contractor remains responsible for incomplete, untimely, or nonconforming delivery to that point and for any defect or nonconformity that existed before or at delivery.

9. FINANCIAL FLOW, STATEMENT BILLING, PAYMENT, AND CREDITS

9.1. Payable Amount. DeCA will pay the Contractor for Accepted Goods at the applicable DeCA COG. Payment by DeCA to the Contractor for Accepted Goods fully satisfies DeCA’s payment obligation for those goods. DeCA shall have no separate payment obligation to any Supplier or other upstream source for goods covered by this contract.

9.1.1. Interim Payment Flow Pending ARTS Implementation. Until DeCA implements direct payment to the Contractor under this contract, payments for goods furnished under the current interim process shall continue to be processed through DeCA’s legacy accounting system, which remits funds directly to the applicable product manufacturer. During this interim period, the Contractor shall receive payment from the manufacturer in accordance with the Contractor’s separate commercial arrangements with that manufacturer. Upon deployment of the Automated Resale Transaction System (ARTS), or other approved replacement capability, and upon written notice from the Contracting Officer that direct payment capability is operational, DeCA may transition to direct payment to the Contractor under this contract in accordance with applicable Government payment and disbursement requirements.

9.2. Statement Billing Mandate. Contractor shall transmit a single consolidated weekly invoice with one business day following the end of the week covering all Accepted Goods delivered during the prior week (Sunday 00:01 to Saturday 23:59). Individual per-delivery invoices are not permitted absent KO approval.

9.3. Invoice Contents (Minimum). Each statement shall include:

9.3.1. Summary totals;

9.3.2. Breakdown by store/port/location and delivery/shipment date;

9.3.3. Item-level quantities, applied DeCA COG, and extended totals;

9.3.4. Cross-references to order numbers, shipment identifiers, and receiving record identifiers;

9.3.5. A credits/adjustments section (PLCs, discrepancy credits, swell/unsaleable credits) by location.

9.4. Submission of Invoice and Payment Terms (DFAS & EDI Conformance)

9.4.1. Proper Invoice Submission via EDI: The Contractor shall submit one consolidated weekly invoice (Statement) covering all shipping locations covered by this agreement. This invoice must be transmitted electronically via Electronic Data Interchange (EDI) [insert specific EDI transaction set, e.g., EDI 810 or 880] to DeCA’s business systems.

9.4.2. Payment Trigger: Subject to the Prompt Payment Act, applicable prompt payment regulations, and the payment clause incorporated into this contract, the payment period for a proper electronic invoice shall begin only upon DeCA’s receipt of a proper and accurate electronic invoice submitted through the required EDI process for Accepted Goods. For purposes of invoice verification, DeCA will confirm that the invoiced price matches the applicable DeCA COG reflected in DeCA’s official pricing environment for the item, zone, and effective date. An invoice that contains pricing discrepancies, unauthorized charges, or other defects that prevent verification as a proper invoice may be rejected as improper. In such event, the payment period shall not begin until the Contractor submits a corrected proper invoice.

9.5. Credits and Offsets. All credits owed to DeCA (including PLCs and pricing corrections) shall be applied as credits against the next statement unless otherwise directed by the

KO.

9.6. Invoice Dispute Window. Contractor shall respond to DeCA invoice discrepancy notices within 5 business days and resolve within 15 business days unless extended by the KO.

DeCA shall respond to Contractor invoice discrepancy notices within 5 business days and resolve within 15 business days unless extended by the Contractor.

9.7. Distributor Discrepancy Rate (DDR) Process. The parties agree that inventory shrink, damage, and delivery variances shall be managed and reconciled through the Distributor Discrepancy Rate (DDR) process.

9.8. Distributor Discrepancy Rate (DDR) and Interim Reconciliation

9.8.1. Scope and Purpose. The parties agree that ordinary delivery shortages, as measured against the applicable electronic Advance Shipping Notice (ASN), and full-case damages occurring between the Contractor’s distribution center and the designated DeCA delivery point shall be managed during the interim period through the Distributor Discrepancy Rate (DDR) process described in this Section and in Attachment C, Interim DDR Procedures. The DDR is an interim estimated reconciliation mechanism intended to support operational efficiency pending transition to actuals-based receiving and reconciliation.

9.8.2. Interim Period. From the effective date of this contract until the date specified by the Contracting Officer following written determination that DeCA’s automated receiving and reconciliation system is fully implemented and capable of generating reliable case-level receiving data for the applicable locations, the parties shall use the interim DDR process set forth in this Section and Attachment C to reconcile covered discrepancies for CONUS shipments.

9.8.3. Initial DDR Rate. For each applicable distribution center, the initial DDR rate shall be the DDR rate in effect as of the effective date of this contract under the legacy DDR arrangement, unless the parties bilaterally agree in writing to a different initial rate for a specific distribution center.

9.8.4. Initial 90-Day Validation. The initial DDR rates established under 9.8.3 shall be treated as interim rates only. During the first ninety (90) calendar days of contract performance, the Government and the Contractor shall collect and validate current DDR-related performance data for each applicable distribution center using the audit, validation, and reporting procedures set forth in this Section and Attachment C. Not later than thirty (30) calendar days after the close of the initial 90-day period, the parties shall review the data and bilaterally establish updated DDR rates for each applicable distribution center.

9.8.5. Audit and Validation Protocols. The Government may conduct periodic validations of receiving locations and representative delivery truckloads, including unannounced validations, using the sampling, case-count, assignment, pallet, and documentation procedures set forth in Attachment C. Government representatives may participate in and observe Contractor or distribution-center validation activity, review supporting records, and obtain copies of validation-related documentation reasonably necessary to verify DDR accuracy. For the avoidance of doubt, audits and validations conducted under this contract are part of normal contract administration and oversight and shall not, by themselves, entitle the Contractor to any adjustment. If a particular audit or validation causes a demonstrable and material disruption to the Contractor’s operations beyond the ordinary impacts of contract administration, the parties may address any associated reasonable, directly attributable costs by mutual agreement. Unless otherwise agreed in

9.8.9.3. Contractor Cooperation. The Contractor shall cooperate with DeCA’s review, provide relevant delivery, ASN, invoice, inventory, and reconciliation records, and process any resulting credit or adjustment through a Vendor Credit Memorandum (VCM), invoice credit, or other DeCA-approved adjustment process.

9.8.9.4. No Waiver. DeCA’s decision to use or not use this procedure for a particular delivery does not waive any Government right or remedy under this

9.8.10. Exclusions. Attachment C shall identify categories excluded from DDR percentage treatment and handled at actual value or through separate procedures, including but not limited to missing assignments, shippers, pallet modules or pallet display items, random weight items, and other categories designated by the Contracting Officer.

9.8.11. Transition to Actuals-Based Reconciliation. Upon the Contracting Officer’s written determination that DeCA’s automated receiving and reconciliation system is fully implemented and capable of generating reliable case-level receiving data for the applicable locations, DeCA’s process will be documented as a separate or additional contract addendum with the Contractor.

9.8.12. Order of Precedence. In the event of a conflict between this Section and

Attachment C, this Section shall control unless the Contracting Officer approves a written exception.

9.8.13. CONUS Shipping and Concealed Damage Exceptions. For OCONUS shipments destined for overseas distribution centers or commissaries: (a) The Contractor’s liability for full-case and concealed damage under the DDR process shall terminate once the goods are successfully delivered and accepted at the designated CONUS Port of Embarkation (POE), provided the pallets are received intact and match the corresponding ASN. The Government reserves the right to assess credits against the Contractor for concealed damage or latent defects (such as adulteration or expiration) originating prior to the POE but discovered after ocean transit—from the POE.

9.9. DeCA Rebates and Incentives.

for goods furnished under this contract, whether inventory is maintained in dedicated or co-mingled facilities, the Contractor must systemically maintain and guarantee Military Pricing Integrity at all times.

10.3. Co-Mingled Inventory Controls. If the Contractor uses co-mingled inventory or shared distribution facilities to support both DeCA and non-DeCA operations, the Contractor shall maintain system controls sufficient to ensure that DeCA pricing, item eligibility, and ordering restrictions are applied only to authorized DeCA transactions and are not used for unauthorized commercial sales.

10.4. Prohibition on Diversion. The Contractor shall not divert goods furnished under DeCA

COG or under DeCA-specific item eligibility conditions to commercial grocery operations, civilian retail channels, or any other unauthorized non-DeCA channel.

10.5. Protection of DeCA Pricing and Sales Data. The Contractor shall not disclose, sell, or otherwise provide DeCA commissary pricing data, DeCA sales offtake data, or related DeCA-specific pricing structures to commercial customers or other external parties except as expressly authorized by this contract or by prior written approval of the Contracting Officer.

10.6. Military-Only or Restricted Items. The Contractor shall maintain controls, including system-based restrictions where applicable, to prevent military-only or otherwise restricted DeCA items from being ordered, released, or diverted to unauthorized commercial operations.

10.7. No Unauthorized Supplier Charges. The Contractor shall not assess Suppliers unauthorized fees, fines, penalties, or chargebacks in the name of DeCA or as a condition of access to DeCA business, except to the extent expressly authorized by this contract or approved in writing by DeCA.

10.8. Data for Supplier Trade Term Generation.

10.8.1. Data Sharing Requirement. The Contractor shall provide Suppliers with accurate

Distribution Center data reasonably necessary to support calculation, funding, and reconciliation of trade terms, promotional programs, and other DeCA-related allowances, in accordance with this contract and DeCA-approved procedures.

10.8.2. Scope of Data. Unless otherwise required by this contract or approved in writing by DeCA, such data shall be limited to the level of detail reasonably necessary to support trade term administration and shall not include store-level detail unless expressly required.

10.8.3. Co-Mingled Inventory. If the Contractor uses co-mingled inventory supporting both DeCA and non-DeCA operations, the Contractor shall maintain sufficient system capability to identify and report DeCA-related shipments separately for purposes of trade term administration and reconciliation.

11. PERFORMANCE ACCOUNTABILITY FRAMEWORK

11.1. Principal KPI Structure. For purposes of contract performance accountability and award-term evaluation under Section 16, the principal contractual performance metrics shall include: (i) Adjusted Distributor-Controlled Fill Rate, (ii) On-Time Delivery, and (iii) New Item Set Up Time. Other operational metrics in this section may be monitored for contract administration, corrective action, or scorecard purposes, but shall not constitute principal award-term metrics unless expressly identified as such. Accountability under this section starts 30 days after contract award date.

11.2. Monthly Performance Report. Contractor shall deliver a monthly performance report by the 10th of each month covering the prior month.

11.3. Metrics, Standards, Surveillance, Credits. DeCA will measure performance using EDI data, time-stamped receiving logs, and invoice audits. Credits are applied against the next month’s aggregate invoice (or next statement cycle if KO directs).

11.4. If implemented through a bilateral contract modification, Performance Level Credits (PLC) will be agreed contractual price adjustments intended to reflect reduced value of performance received by the Government when specified performance standards are not met. They are not penalties.

11.5. Assessment of a Performance Level Credit does not limit DeCA’s right to reject

Nonconforming Goods, recover overcharges, require corrective action, seek credits, terminate for cause or default, or pursue any other remedy available under this contract or law, except to the extent the same loss has already been fully compensated by the credit.

11.6. The Performance Level Credits will be assessed based on the following. DeCA reserves the right to implement PLC as discretion. Failure by DeCA to implement PLC is not a waiver of this section. For the avoidance of doubt, any PLC’s may only be

11.10. ASN / EDI 856 Scorecard Measure. ASN / EDI 856 performance shall remain a scorecard or operational management measure and not a principal KPI for award-term determination unless later modified in writing.

11.11. Corrective Action Plan (CAP). If the Contractor fails to meet a principal KPI or other material performance standard identified in this contract, the Contracting Officer may require a Corrective Action Plan within ten (10) business days, including root cause, corrective measures, responsible official, and remediation timeline.

12. FOOD SAFETY, QUALITY, AND RECALL EXECUTION

12.1. The Contractor shall maintain and implement a documented food safety program, including Hazard Analysis and Critical Control Point (HACCP) principles or equivalent controls, as applicable. Upon request, the Contractor shall provide evidence of such program and compliance. Facilities handling food furnished under this contract shall be subject to recognized third-party food safety audits.

12.2. The Contractor shall store, handle, transport, and deliver goods in a manner that preserves product safety, quality, and fitness for resale. The Contractor shall maintain traceability records sufficient to identify affected products by item, lot, batch, date code, shipment, and delivery location as required by federal, state, and local laws and regulations.

12.3. The Contractor shall notify DeCA as quickly as is reasonably possible under the circumstance, after becoming aware, of any recall, market withdrawal, product hold, suspected contamination, adulteration, misbranding, or other food safety issue affecting goods furnished or intended to be furnished under this contract.

12.4. Upon notice of a recall, withdrawal, or product hold, the Contractor shall immediately identify, segregate, and hold affected inventory and shall provide DeCA, within twenty-four (24) hours, the quantities of affected product on hand, in transit, and delivered, by location.

12.5. Cold Chain Records. The Contractor shall maintain required temperature controls during storage, handling, transportation, and delivery of temperature-sensitive goods.

The Contractor shall retain temperature records for at least one (1) year, or longer if required by law or other contract provisions, and shall provide such records to DeCA upon request.

13. SECURITY AND CUI

13.1. Contractor shall protect Government information in accordance with the information-security requirements of this contract. Information designated as CUI shall be handled in accordance with applicable safeguarding requirements. DeCA shall not provide CUI to Contractor without Contractor’s prior written consent.

13.2. The Contractor shall Report cybersecurity incidents to KO and DeCA security office within the time frame required by the reporting period in DFARS 252.204-7012 clause.

13.3. The Contractor shall be solely responsible for obtaining and maintaining all installation access, credentials, passes, background checks, vehicle registrations, escorts, and other approvals required for its personnel, vehicles, and subcontractors to enter military installations or other controlled-access locations and perform delivery and related contract requirements at DeCA sites. Upon the Contractor’s reasonable request, DeCA may provide written confirmation that the Contractor is performing under a DeCA contract for purposes of supporting the Contractor’s installation-access request. DeCA does not control installation access decisions and is not responsible for any denial, delay, condition, or revocation of access by an installation commander or other access-control authority. The Contractor shall comply with all applicable installation access, security, force protection, and credentialing requirements.

14. TRANSITION AND DELIVERABLES

14.1. Transition-In Plan (15 days after award). Include staffing, security clearances, systems integration, supplier onboarding, pricing data flow, statement billing readiness, and go-live schedule.

14.2. Transition-Out Plan (90 days prior to end). Include handoff procedures and data archival.

14.3. Deliverables Schedule (minimum).

14.3.1. Program Management Plan – 30 days post-award

14.3.2. Quality Control Plan – 30 days post-award

14.3.3. Transition-In Plan – 15 days post-award

14.3.4. Swell/Unsaleables Credit Flow Plan – 30 days post-award

14.3.5. Monthly Performance Report – monthly (by 10th)

14.3.6. JBR brief – quarterly

14.3.7. Transition-Out Plan – 90 days before end

15. RECORDS, AUDIT, AND GOVERNMENT RIGHTS

15.1. Records, Audit, and Government Rights

The Contractor shall retain all records supporting pricing, deliveries, invoices, credits, and performance metrics for a minimum of three (3) years after final payment. This includes, but is not limited to, a complete and auditable trail of all EDI transactions received from Suppliers and all consolidated weekly billing statements submitted to DeCA. The Contractor shall provide reasonable access to these records for Government audit and reconciliation purposes.

16. PERIOD OF PERFORMANCE; EARNED AWARD-TERM EXTENSIONS; OPTION PERIODS

16.1. Base Ordering Period.

The base ordering period of this contract shall begin on [insert date] and continue for five

(5) years, unless sooner terminated, partially terminated, or otherwise modified in accordance with the terms of this contract.

16.2. Annual Performance Assessment During Base Period.

For each 365-day performance assessment period during the base ordering period, the Contracting Officer shall evaluate the Contractor’s performance against the principal contractual performance metrics established under this contract and the applicable Performance Requirements Summary (PRS), KPI exhibit, or other contract attachment. The principal metrics shall include: (1) Adjusted Distributor-Controlled Fill Rate; (2) On-Time Delivery; and (3) New Item Set Up Time. New Item Set Up Time shall have the meaning set forth in Section 2 and shall be measured in accordance with the methodology stated in Section 11 and any applicable PRS or KPI exhibit. Operational scorecard measures, including ASN / EDI 856 performance and other business-review metrics, may be monitored and reviewed under this contract, but shall not constitute principal award-term metrics unless expressly identified as such by contract modification. Operational scorecard measures, including ASN / EDI 856 performance and other business-review metrics, may be monitored and reviewed under this contract, but shall not constitute principal award-term metrics unless expressly identified as such by contract modification.

16.3. Distributor-Controlled Performance Principle.

The performance metrics used for award-term evaluation are intended to measure activities and outcomes reasonably within the Contractor’s control. Where this contract or the applicable KPI methodology recognizes approved exclusions, adjustments, or documented anomalies, the Contracting Officer may consider those items in determining final KPI achievement.

16.4. Earned Award-Term Extensions.

For each 365-day performance assessment period during the base ordering period in which the Contracting Officer determines that the Contractor met the applicable principal performance metrics, the Contractor shall earn a one-year award-term extension. Each earned award-term extension shall extend the ordering period by 365 calendar days. The Contractor may earn no more than five (5) one-year award-term extensions under this paragraph.

16.5. Determination of Earned Extension.

Following each annual performance assessment period, the Contracting Officer shall issue a written determination stating whether the Contractor met the applicable principal performance metrics for that assessment period. If the Contracting Officer determines that the Contractor met the applicable metrics, the corresponding one-year award-term extension shall be added to the ordering period by written contract modification. The modification shall document the earned extension and the revised ordering-period end date.

16.6. Contracting Officer Review of Narrow Misses / Documented Anomalies.

In making the determination under paragraph 16.5, the Contracting Officer may consider documented anomalies, approved exclusions, or narrowly missed KPI results where the record demonstrates that the Contractor took appropriate actions and the circumstances were truly unusual. This review is intended to preserve reasonable Contracting Officer discretion and shall not be interpreted as creating an automatic waiver, blanket exception, or elimination of the contract’s performance requirements.

16.7. Effect of Failure to Meet Metrics.

If the Contractor fails to meet the applicable principal performance metrics for a 365-day performance assessment period, the Contractor shall not earn the award-term extension associated with that assessment period. Failure to earn an award-term extension does not affect any previously earned extension, unless otherwise provided by this contract, and does not limit any other Government right or remedy.

16.8. Failure to Earn One Year Does Not Bar Later Earned Years.

Failure to earn an award-term extension for one performance assessment period shall not, by itself, preclude the Contractor from earning an award-term extension in a subsequent performance assessment period, provided the Contractor satisfies the applicable performance metrics for that later period.

16.9. Additional Government Option Periods.

In addition to any earned award-term extensions under paragraph 16.5, the Government may extend the ordering period for up to five (5) additional one-year option periods. Each option period, if exercised, shall extend the ordering period by 365 calendar days.

16.10. Exercise of Additional Option Periods.

The additional option periods described in paragraph 16.9 are exercisable only by the Government and only by written notice or contract modification issued by the Contracting Officer. The Government has no obligation to exercise any additional option period. Before exercising an additional option period, the Contracting Officer shall determine that exercise is in accordance with the contract, applicable law and regulation, and the best interest of the Government.

16.11. Total Ordering Period.

The total ordering period of this contract, including the base ordering period, any earned award-term extensions, and any exercised option periods, shall not exceed fifteen (15) years unless otherwise authorized by applicable law and approved in writing by the appropriate official.

16.12. Relationship to Other Government Rights and Remedies.

The award-term mechanism is separate from any other Government right or remedy under this contract, including termination, partial termination, nonexercise of options, corrective-action requirements, removal of items, suppliers, categories, or locations from contract coverage, or any other relief otherwise available under this contract or applicable law.

16.13. Orders Issued Before Expiration.

Expiration of the ordering period does not affect the Contractor’s obligation to complete any orders issued before expiration, nor does it affect any obligation that by its terms survives expiration of the contract.

17. CONTRACT CLAUSES

17.1. CLAUSES INCORPORATED IN FULL TEXT The clauses set forth below are incorporated into and apply to this contract, except to the extent expressly tailored in this contract or inapplicable by their own term.

FAR 52.212-4 Contract Terms and Conditions—Commercial Products and Commercial Services (With Addendum)

The full text of FAR 52.212-4 is hereby incorporated into this contract. Pursuant to FAR 12.302(d), the terms and conditions of Sections 1 through 16 of this contract draft constitute the formal Addendum to FAR 52.212-4. To the extent of any conflict or inconsistency between the standard boilerplate terms of FAR 52.212-4 and the custom terms of the Addendum (Sections 1–16), the terms of the Addendum shall control and take precedence. The following paragraphs of FAR 52.212-4 are hereby tailored and superseded by the Addendum as follows:

Paragraph (b) Inspection/Acceptance: Tailored and superseded by Section 8 (Ordering, Fulfillment, Delivery, and Receiving) and Section 9.8 (Discrepancy and Damage Reconciliation).

Paragraph (g) Invoice: Tailored and superseded by Section 9.2 (Statement Billing Mandate) and Section 9.4 (Submission of Invoice and Payment Terms).

Paragraph (i) Payment: Tailored and superseded by Section 9.4 (Payment Terms) and Section 9.9 (Efficient Replenishment Discount).

52.212-4 Terms and Conditions—Commercial Products and Commercial Services.

As prescribed in 12.205(b)(3), insert the following clause:

Terms and Conditions—Commercial Products and Commercial Services (Deviation Date)

(a) . The clause at Federal Acquisition Regulation (FAR) 52.202-incorporated by reference.

(b) . The Contractor shall only tender for acceptance those items that conform to the requirements of this contract. The Government reserves the right to inspect or test any supplies or services that have been tendered for acceptance. The Government may require repair or replacement of nonconforming supplies or reperformance of nonconforming services at no increase in contract price. If repair/replacement or reperformance will not correct the defects or is not possible, the Government may seek an equitable price reduction or adequate consideration for acceptance of nonconforming supplies or services. The Government must exercise its post acceptance rights—

(1) Within a reasonable time after the defect was discovered or should have been discovered; and

(2) Before any substantial change occurs in the condition of the item,…