HO2-Contract_Metric_Price_Adjustment.pdf

H02. CONTRACT METRIC PRICE ADJUSTMENTS

In accordance with the Statement of Work (SOW), the contractor shall produce Constant Speed Drive (CSD) availability at a specified Requisition Objective (RO). Contractor performance (RO achievement) shall be evaluated at intervals stated in Table 1. Each metric evaluation is independent per semi-annual period. In order to achieve support for the entire suite of CSDs, each metric evaluation is cumulative for all CLIN/ SubCLINs subject to this price adjustment per the contract schedule. If the contractor fails to meet an established performance metric on any Contract Line Item Number (CLIN) / Sub Contract Line Item Number (SubCLIN) the contract metric price adjustment shall apply to all CLIN / SubCLINs awarded on that order.

The Contractor shall be considered as fully meeting availability requirements only when all NSN RO requirements have been achieved within each performance period. Performance relief for the Contractor may be granted at the discretion of the Contracting Officer in the event of an occurrence beyond the reasonable control of the Contractor and without its fault or negligence. Additionally, an exclusion may be granted for, fires, floods, or other unusually severe conditions or occurrences where, notwithstanding the Contractor’s reasonable actions and precautions, adverse impact on contract performance has occurred.

A flying hour price adjustment shall be assessed if performance falls below the availability requirements set forth in the Statement of Work. Flying hour price adjustments will be assessed as described in Table 2 or

3. Table 2 is applicable during the RO Transition Period. Table 3 is applicable during the RO Sustainment Phase.

Failure to agree with such change in the contract price shall be resolved in accordance with the disputes clause of this contract.

Table 1. Metric Performance Periods.

Table 2. RO Transition Performance Requirements / Adjustment Schedule

Transition Period RO% Target Payment Decrement if RO% Not Achieved

Period 1 40% 0.025%

Period 2 60% 0.050%

Period 3 85% 0.050%

Months

1 thru 12

Transition

Period 1

Contract Months of Performance

RO

40%

12 Month Measurement

(end of order 1)

18 Month Measurement

(midpoint of order 2)

24 Month Measurement

(end of order 2)

Sustainment (midpoint and end of each order)

Transition

Period 2

Transition

Period 3

Sustainment

RO

60%

RO

85%

RO

85%

Months

13 thru 18

Months

19 thru 24

Months

25 - Exit

Table 3. RO Sustainment Performance Requirements / Adjustment Schedule

RO AVAILABILITY

% of RO Payment Decrement if RO% Not Achieved

≥85% No Decrement

80% - 84.9% 0.05%

75% - 79.9% 0.10%

70% - 74.9% 0.15%

65% - 69.9% 0.20%

60% - 64.9% 0.30%

55% - 59.9% 0.40%

50% - 54.9% 0.50%

45% - 49.9% 0.75%

40% - 44.9% 1.00%

35% - 39.9% 1.25%

30% - 34.9% 1.50%

25% - 29.9% 2.00%

20% - 24.9% 2.25%

15% - 19.9% 2.50%

10% - 14.9% 2.75%

5% - 9.9% 3.00%

0% - 4.9% 3.25%

If the Contractor fails to meet the performance metrics established in the SOW, the Contractor will be assessed a contract metric price adjustment for each CLIN / SubCLIN. The price adjustment shall be applied to the final invoice of each order per contract clause at H01. Contract metric price adjustments shall be assessed per the example below.

Example using Sustainment Phase (Table 3). Contract Metric Price Adjustment for CLIN / SubCLINs

This example demonstrates how the Power By the Flying Hour (PBFH) Rate will be adjusted if the contractor does not meet the performance metrics per this clause, tables 2 or 3. This methodology will be used for all applicable CLINs / SubCLINs subject to the clause as indicated in the contract schedule.

This example only uses an abbreviated number of SubCLINs for example purposes only.

SubCLIN RO Achieved (midpoint) Decrement %

1001AA 52.0% 0.50

1002AA 26.0% 2.00

1003AA 88.0% 0.00

1004AA 53.0% 0.50

Total Midpoint Adjustment 3.00

The Total Midpoint Adjustment of 3% will be applied to clause at H01, Step 1A for all CLINs / SubCLINs subject to clause H01 and H02. Note, step 1A does not apply to Transition Period 1. Applicable CLINs and / or SubCLINs are denoted in the contract schedule.

SubCLIN RO Achieved (end of period) Decrement %

1001AA 88.0% 0.00

1002AA 87.0% 0.00

1003AA 91.0% 0.00

1004AA 42.3.0% 1.00

Total End of Period Adjustment 1.00

The Total End of Period Adjustment of 1% will be applied to clause at H01, Step 1B for all CLINs / SubCLINs subject to clause H01 and H02. Applicable CLINs and / or SubCLINs are denoted in the contract schedule.

(end of clause)