Attachment_3_Incentive Plan_ Rev 1.pdf

FA8106‐23‐R‐0001

Attachment 3 21 Oct 2022

T-6A AVIONICS REPLACEMENT PROGRAM (ARP)

TECHNOLOGY MATURATION & RISK REDUCTION,

ENGINEERING & MANUFACTURING DEVELOPMENT

AND PRODUCTION PHASES

DELIVERY INCENTIVE PLAN

21 October 2022

Rev 1 – 18 January 2023

Revision Log

Date Revision Number

Reason for Update

Paragraph Page

Number Description of

Change

January

Rev 1 Change to

Calendar Days

6.2. - Aircraft System - Critical

Design Review (CDR)

Sub paragraph

6.2.1 changed from 172 to 163 calendar days

January

Rev 1

Change to Calendar Days

6.3 - Aircraft System - Test Readiness Review (TRR)

Sub paragraph

6.3.1 changed from 90 to 78 calendar days

1. General

1.1. This Incentive Plan for the T-6A Avionics Replacement Program (ARP) Technology Maturation & Risk Reduction (TMRR), Engineering & Manufacturing Development (EMD) and the Production Phases, Contract FA8106-XX-D-XXXX (CLINs 0005, 0008, 0014, 0018, 0021, 0024, 1024), is the basis for evaluation of the contractor’s performance; and furthermore, the assessment of that performance for the application of incentive determination. It describes the specific criteria, incentive and disincentive distribution, and procedures used to determine the amount of incentive earned or forfeited.

1.2. This incentive arrangement will incentivize outstanding contractor performance based on the incentive pool and criteria. Incentive determinations outlined in this plan utilize objective criteria established at contract award. The process is based on review of the contractor’s performance against the criteria set forth in this plan.

2. Incentive/Disincentive Pool

2.1. The Total Delivery Incentive Pool are listed in Table 1 and Table 3 on the following page. The incentivized objectives were developed to achieve desired contractor performance outcomes.

2.2. The Aircraft Modification Delivery (disincentive) penalty in Table 2 will be administered for aircraft deliveries considered late from scheduled delivery date.

2.3. The incentive/disincentive for each of the areas shall be calculated on an independent or stand-alone basis and are listed in Table 4, Table 5, and Table 6.

Table 1

Aircraft System Total Delivery Incentive

Pool $3.5M

Area

Objective Maximum Earnable

Incentive Associated

CLIN

Delivery Incentive for

Preliminary Design Review

$1.25M CLIN 0005

Delivery Incentive for Critical

Design Review

$2.0M CLIN 0014

Delivery Incentive for Test

Readiness Review

$0.25M CLIN 0018

Table 2

Aircraft System

Delivery Disincentive

Disincentive

Per Aircraft

Associated

CLIN

1 Delivery Disincentive for Late Aircraft Modification Delivery /Installations

-$25K/ Aircraft

CLIN 0024 & 1024

Table 3

ATD

Total Delivery Incentive

Pool $1.25M

Maximum Earnable Incentive

Associated

CLIN

1 Delivery Incentive for Preliminary Design Review

$0.70M

CLIN 0008

2 Delivery Incentive for Critical Design Review

$0.55M

CLIN 0021

3. Incentive Process

3.1. Objective performance incentives have been designed to relate the incentive to the results achieved by the contractor based on specified objectives as stated in this plan. The critical aspects to exceed the contracted effort have been chosen to incentivize performance above minimum contract requirements.

3.2. The contractor’s performance for Delivery Incentive areas one (1) through three (3) in Table 1 and incentive areas one (1) and two (2) Table 3 will be assessed against the established completion criteria as set forth in Section 6.

3.3. The contractor’s performance for Delivery Disincentive areas one (1) in Table 2 will be assessed against the established completion criteria as set forth in Section 6.

4. Organization Responsibilities

4.1. The Government Contracting Officer will provide the contractor notification of the incentive earned as determined by application of the completion criteria and methodology set forth herein.

4.2. Any requirement completion delays attributable to the contractor’s performance will not warrant adjustments for incentive purposes. Any Government caused delays that effect requirement completion will be a basis for the contractor to submit a request for a day for day adjustment to the scheduled delivery date.

5. Delivery Incentive

5.1. The Contractor may earn schedule/performance incentive (Section 6.1-6.5) not exceeding a total of $4.750M or in Section 6.6 the contractor may be accessed a penalty to payment for schedule/performance disincentive in accordance with criteria specified in Section 6 below.

6. Completion Criteria

6.1. Aircraft System - Preliminary Design Review (PDR)

6.1.1. Scheduled delivery date: 128 calendar days after receipt of funded task order or completion of SFR, whichever is later.

6.1.2. Incentive Target Date: 45 days (or more) prior to scheduled delivery date

6.1.3. Completion Criteria

6.1.3.1. Aircraft System PDR is completed in accordance with the SOW

3.14.3 and Airworthiness Certification Criteria (ACC) reviewed with Government IAW CDRL A052, DI-SESS-81768/T, Airworthiness Certification Criteria Report.

6.2. Aircraft System - Critical Design Review (CDR)

6.2.1. Scheduled delivery date: 163 calendar days after receipt of funded task order or completion of PDR whichever is later.

6.2.2. Target Date: 45 days (or more) prior to scheduled delivery date

6.2.3. Completion Criteria

6.2.3.1. Aircraft System CDR is completed in accordance with the SOW 3.14.4 and Government acceptance of the Airworthiness Certification Criteria (ACC) IAW CDRL A052, DI-SESS-81768/T, Airworthiness Certification Criteria Report.

6.3. Aircraft System - Test Readiness Review (TRR)

6.3.1. Scheduled delivery date: 78 calendar days after receipt of funded task order or completion of CDR whichever is later.

6.3.2. Incentive Target Date: 30 days (or more) prior to scheduled delivery date

6.3.3. Completion Criteria

6.3.3.1. Aircraft System TRR is completed in accordance with the SOW

3.14.5 and ACC Report A052 is submitted to support First Flight approval.

6.3.3.2. Aircraft System TRR entry criteria in accordance with SOW 3.14.5

6.4. ATD System - Preliminary Design Review (PDR)

6.4.1. Scheduled delivery date: 408 calendar days after receipt of funded task order or completion of Aircraft SFR whichever is later.

6.4.2. Incentive Target Date: 45 days (or more) prior to scheduled delivery date

6.4.3. Completion Criteria

6.4.3.1. ATD PDR is completed in in accordance with SOW 3.14.3

6.5. ATD System - Critical Design Review (CDR)

6.5.1. Scheduled delivery date: 90 calendar days after receipt of funded task order or completion of ATD PDR whichever is later.

6.5.2. Incentive Target Date: 45 days (or more) prior to scheduled delivery date

6.5.3. Completion Criteria

6.5.3.1. ATD CDR is completed in accordance with SOW 3.14.4

6.6. Aircraft Modification Delivery/Installations

6.6.1. Scheduled delivery date: First installation to complete 30 calendar days after receipt of funded task order or kit delivery whichever is later, continuing at a rate of up to aircraft 10 per month thereafter. See SOW Appendix B for notional installation schedule.

6.6.2. Incentive Target Date: On scheduled delivery date for each installation

6.6.3. Completion Criteria

6.6.3.1. Aircraft Modification Delivery is completed IAW SOW 6.6

6.6.4. Aircraft modification delivery (disincentive) will not be effective for the first five (5) months of ARP installations (Approximately 45-50 ARP installations). This will allow the Contract Field Teams a learning curve for improved efficiencies and procedures.

7. Delivery Incentive/Disincentive Validation Procedures

7.1. Incentive: At the time the associated CLIN listed in Table 1 or 3 above is ordered, its corresponding incentive CLIN will also be ordered at the maximum earnable performance incentive; however, the contractor shall not invoice until the validation process outlined in 7.3, 7.4, and 7.5 below has determined the appropriate incentive earned and a contract modification outlining the appropriate amount has been signed and distributed by the CO.

7.2. Disincentive: At the time CLIN 0024 and 1024 (listed in Table 2) is ordered, the full amount will be placed on contract. A withhold of $25,000.00 per aircraft will be placed upon the CLIN. In the event contractor performance against CLIN 0024 and 1024 is timely or less than three (3) calendar days overdue, the CO will issue a modification removing the withhold within thirty (30) calendar days of the delivery validation. After the withhold is removed, the contractor may invoice the remaining amount. If the Contractor is more than three (3) calendar days late, the CO will issue a modification reducing the price of CLIN 0024 and 1024 by $25,000.00.

7.3. The Contractor will set the base dates for the aircraft system PDR, CDR, and TRR and ATD system PDR and CDR in the Integrated Master Schedule (IMS) delivered after contract award. The IMS dates will be developed to meet the USG required schedules for the ARP program and approved by the USG.

7.4. In preparation for aircraft system PDR, CDR, and TRR or ATD system PDR and CDR, the contractor shall deliver submittal(s), covering the complete list of Validation /Entry Criteria to the Program Office (PO), Chief Engineer (CE), and staff. Fourteen (14) calendar days are allowed for the PO CE and staff to review, approve, or disapprove the submittal(s), covering the complete list of Validation/Entry Criteria for aircraft system PDR, CDR and TRR and ATD system PDR and CDR.

Fourteen (14) calendar days are allowed for the contractor after receipt of questions from CE and staff and/or comments (if required) to review and respond (or correct).

Seven (7) calendar days are then allowed for the CE and staff to review the newly submitted documentation for further comments or acceptance. Any further questions or comments will then require the Contractor and the CE and staff to respond in a Seven (7) calendar day cycle until accepted.

Once all Validation/Entry Criteria are complete, delivered, and approved, the Contractor shall schedule the required PDR, CDR, or TRR no earlier than seven (7) calendar days to allow PO and the contractor to prepare for the meeting and required travel. The completion date for the event will be the date of successful completion and approval of the PDR, CDR or TRR Exit criteria.

7.5. A DD250 shall be submitted via WAWF with inspection/acceptance at destination (contracting officer) for review and payment authorization or denial. The PO and CE and staff will review the applicable validation criteria and the ARP PM will approve (via e-mail) that all criteria have been met prior to payment authorization, of an otherwise proper invoice by the CO. Fourteen (14) calendar days are then allowed from PO approval for the CO to authorize payment.

8. Delivery Incentives/Disincentives

8.1. Delivery Incentives/Disincentives are earned/accessed as listed in Table 4, 5, & 6, below.

8.1.1. Table 4 – Aircraft System Delivery Incentives - Page 8 of 9

8.1.2. Table 5 – Aircraft System Delivery Disincentive – Page 9 of 9

8.1.3. Table 6- ATD Delivery Incentives – Page 9 of 9

Table 4

AIRCRAFT SYSTEM DELIVERY INCENTIVES

Event Measure % Incentive

Earned $ Earned

Early completion of

PDR

45 days prior to scheduled delivery date

30-44 days prior to scheduled delivery date

15-29 days prior to scheduled delivery date

1-14 days prior to scheduled delivery date on time or late

100%

75%

40%

20%

0%

$1.250M

$0.938M

$0.500M

$0.250M

$0

CDR

45 days prior to scheduled delivery date

30-44 days prior to scheduled delivery date

15-29 days prior to scheduled delivery date

1-14 days prior to scheduled delivery date

$2.000M

$1.500M

$0.800M

$0.400M

TRR

30 days prior to scheduled delivery date

15-29 days prior to scheduled delivery date

1-14 days prior to scheduled delivery date

70%

30%

$0.250M

$0.175M

$0.075M

Table 5

Table 6

ATD DELIVERY INCENTIVES

Event Measure % Incentive Earned

$ Earned

ATD –

Early completion of PDR

45 days prior to scheduled delivery date

30-44 days prior to scheduled delivery date

15-29 days prior to scheduled delivery date

1-14 days prior to scheduled delivery date

$0.700M

$0.525M

$0.280M

$0.140M

ATD –

Early completion of CDR

45 days prior to scheduled delivery date

30-44 days prior to scheduled delivery date

15-29 days prior to scheduled delivery date

1-14 days prior to scheduled delivery date

$0.550M

$0.4125

$0.220M

$0.110M

AIRCRAFT SYSTEM DELIVERY DISINCENTIVE

Event Measure $ Earned

Aircraft modification delivery (disincentive)

3 days or later from scheduled delivery date

-$25K/ Aircraft