RFP_Attachment_12_TRIM_Incentive_Plan_05Nov18.pdf

Solicitation Number: FA8220-19-R-0001

Delivery Incentive Agreement

For Accelerated Delivery of

T-38 Talon Repair Inspection and Maintenance (TRIM)

Aircraft Structural Parts Kits

05 November 2018

Table of Contents

I. Overview

II. Definitions

III. Maximum Incentive Amounts:

IV. Calculation of Earned Incentive Amounts:

V. Incentive Payment Schedule

VI. Adjustments to Incentive Completion Dates

Enclosure 1 – TRIM Aircraft Parts Kit for T-38A/B Aircraft

Enclosure 2 – Government Incentive Table

Enclosure 3 – Government Kit Buy

I. Overview

The Government requires designated T-38 aircraft to receive structural component replacements as specified in the Talon Repair, Inspection, and Maintenance (TRIM) T-

38A/B/C Structural Retrofit program. The Government intends to offer the incentive described herein upon the issuance of the initial delivery order (DO 0001) to accelerate the schedule for the production and delivery of the First Article Test (FAT) Kit and, in turn, the initial lot of TRIM aircraft parts kit(s) and TRIM Fastener kit(s).

The incentive agreement described herein does not alter the contractually required delivery dates; it only adds an incentive to deliver conforming parts of the specified

TRIM kit(s) earlier than contractually required. Initially, the Government is interested in early delivery of the following: the FAT items, the complete set #1 of the T-38A/B

TRIM aircraft parts kit (CLIN 0030 and 0031) for the prototype installation/validation, and complete set of T-38A/B Fasteners kit(s) (CLIN 0042 through 0045). Although not offered in DO 0001, the complete set #2 of the TRIM aircraft parts kit for the verification installation will fall under DO 0002. If an incentive is to be offered in DO

0002, the Government will communicate the applicable incentive along with the issuance of DO 0002. Qualification for delivery incentive is subject to passage of any required FAT and delivery of 100% complete and conforming aircraft parts kit and fastener kit, subject to Inspection of Supplies (FAR 52.246-2). The contractor will not be penalized for failing to deliver earlier than the contractual delivery dates for DO

0001. Please refer to Enclosure 2 of this document for the Incentive table and Enclosure

3 for Delivery Schedule and anticipated initial delivery orders. All requirements stated in the Statement of Work (SOW) and Contract Data Requirements List (CDRL) continue to apply in this agreement.

II. Definitions

For purposes of this agreement, the following terms are described as follows:

2.1 “TRIM aircraft parts kit” for T-38A/B aircraft is equivalent to the line items for the kit NSN 1560K0104791AXE and 1560K0104791BXE, as well as

1560K0104791HXE and 1560K0104791KXE.

2.2 Line Item means the basic structural element in a procurement instrument that describes and organizes the required product or service for pricing, delivery, inspection, acceptance, invoicing, and payment. The use of the term “line item” includes “subline item,” as applicable.

2.3 FAT: Coordinate and comply with FAT requirements as described in SOW paragraph 3.4. First Article (FA) Forms are located in the Technical Data Package

(TDP).

2.4 Conforming Parts: parts are considered conforming when built to specifications utilizing all applicable drawing views and information; for example, a part is in conformance when dimensions are measured/determined to be within allowed tolerance; additionally, the part is trimmed correctly and has sufficient edge distance per the drawing and Attachment A, as applicable.

2.5 Delivery is said to occur at FOB Origin (DCMA final inspection, DCMA acceptance and the point of time at which the entire set of TRIM Parts, 1560K0104791AXE, -BXE, -HXE, -KXE, is ready for DCMA transportation).

2.6 Latent Defects means a defect that exists at the time of acceptance but cannot be discovered by a reasonable inspection (FAR, Part 2, Subpart 2.1). Responsibility of the Contractor is further described in FAR 52.246-2.

2.7 “Prototype Installation” refers to the first-time installation of the TRIM aircraft parts kit (1560K0104791AXE and 1560K0104791BXE) and fasteners on the

“validation” or prototype T-38 aircraft. The second TRIM aircraft parts kit installation is considered the verification aircraft installation. Collectively, validation/verification is performed on the TRIM aircraft parts kit, including fasteners, and the installation process.

2.8 The term “initial lot” is defined as follows: the quantity of TRIM Aircraft Parts

Kits stated in the delivery order(s) placed upon contract award.

III. Maximum Incentive Amounts:

The Government intends to establish this optional Contract Line Item Number (CLIN

X053) with DO 0001, in order to provide an incentive to the contractor to accelerate the manufacturing/parts production process to deliver TRIM aircraft parts kit(s) and fasteners kit(s) earlier than contractually required.

For the final RFP, the Incentive Table has been populated with a Government example of the base kit cost and reflects the potential of a 100% premium on kit 1 to the eligible contractor. The incentive structure is intended to motivate the contractor to perform in a manner that rewards them for delivering kit #1 several weeks sooner than June 2021.

The contractor can also use the spreadsheet to calculate/complete the TRIM Incentive

Table for an alternate scenario, as follows:

3.1) Enter a projected Base Kit Cost in Column C, cell C6; column AB will duplicate column C (upon contract award, the base kit cost would later be adjusted to the negotiated per kit cost);

3.2) Click into the cell (i.e. D6) to display formula then enter the percent of base kit as the multiplier to calculate incentive (change “=+AB6*2” to “=+AB6*2.05” to result in

105% premium for delivering 26 weeks early);

3.3) Adjust the rest of the bi-weekly formulas on a downward sliding scale 24 weeks, 22 weeks, 20 weeks, etc.

Please be advised the Government values early delivery of kits 1 & 2 significantly more than early delivery of kits 3 & 4; also, early delivery of only 4 weeks is of little value to the Government, but early delivery by 12 to 14 weeks or more is highly-valued.

Enclosure #2 reflects the Incentive Table for this example; the maximum TRIM Early

Delivery Incentive that can be earned during DO 0001 is:

Kit #1 $200,000 (if delivered 26 weeks ahead of schedule)

Kit #2 $ N/A (if delivered 26 weeks ahead of schedule)

Lot $200,000 (if DO 0001 was for 1 kit and it was delivered early as shown)

IV. Sample Calculation of Earned Incentive Amounts:

An example scenario of the potential incentive that may be earned by the contractor has been provided and includes the following assumptions:

4.1 March 29, 2019: Basic Contract Award occurs with DO 0001 issued for a lot of 1 kit as identified by kit NSNs: AXE, BXE, HXE, and KXE.

4.2 March 29, 2020: required FA submittals to the Government FAT lab begin NLT

March 29, 2020; FA submittals will be in aggregate at the sub-kit level.

4.3 September 1, 2020: the final FA sub-kit submitted NLT September 1, 2020.

4.4 June 1, 2021: required delivery of Kit #1.

Example: Basic Contract Award occurs March 29, 2019 with DO 0001 issued for a lot of 1 kit per each kit NSN, required FAs are submitted in a timely manner, and all components pass FAT the first time around. Contractor applies the resources needed to accelerate the delivery of TRIM aircraft parts kits and fastener kits to support an earlier delivery and aircraft induction for the Prototype Installation #1. Calculation of incentive amount earned in this example at the dates shown below is as follows:

March 1, 2021: Kit #1 delivered 14 weeks early; earn incentive of $140,000

V. Incentive Payment Schedule

Any incentive earned will be paid out in one lump sum after completion of all of the following:

5.1 All parts requiring first article pass FAT. Contractor shall allow up to 120 days for Government FAT process and return of FAs.

5.2 All parts listed in kit NSN 1560K0104791-AXE, -BXE, -HXE, and -KXE for kit

#1 are accepted by DCMA at FOB Origin and the entire kit is packaged for shipment/ready for DCMA transportation, with no short shipments.

5.3 TRIM kit quality is subject to Inspection of Supplies (FAR 52.246-2).

5.4 TRIM incentive period and incentive earned amount is documented via contract modification. Such contract modification and lump sum payment to the contractor shall occur within 60 days after completion of delivery as shown above.

VI. Adjustments to Incentive Completion Dates

No adjustments to incentive completion dates in Section IV of this agreement will be granted unless a single Government-caused delay induces a schedule delay of at least

15 business days beyond the dates identified in the attached baseline incentive schedule. The contractor shall provide written notice to immediately inform the

Government when they believe there is a Government-caused delay.

Enclosure 1 – TRIM Aircraft Parts Kit for T-38A/B Aircraft – Page 1

Continued next page

DATE

KIT NSN TCTO MOD NO.

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

1 1560-01-464-0088 2-11402-9 1

2 1560-01-464-0095 2-11402-10 1

3 1560-01-423-7351 2-11755-19 1

4 1560-01-423-7352 2-11755-20 1

5 1560-01-665-5010 200610158-10 1

6 1560-01-665-5012 200610158-20 1

REQUEST FOR TCTO KIT ASSEMBLY

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

20180501

ITEM NO.

ITEM

STOCK NO. PART NO.

SOURCE OF

SUPPLY U/I

1T-38A-998

NOUN

1560K0104791BXE

Bulkhead, Nacelle at FS 332.50

Bulkhead, Nacelle at FS 332.50

QUP UNIT COST

Bulkhead, Nacelle at FS 362.00

Lower Cockpit Longeron Splice Repair

Lower Cockpit Longeron Splice Repair

Bulkhead, Nacelle at FS 362.00

DATE

KIT NSN TCTO MOD NO.

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

1 1560-01-623-1279 2-11308-13 1

2 1560-01-623-1273 2-11308-14 1

3 1560-01-586-6083 2-11309-1 1

4 1560-01-586-6077 2-11309-2 1

5 1560-01-631-8574 2-11412-13 1

6 1560-01-631-7445 2-11412-14 1

7 1560-01-631-5596 2-11325-1 1

8 1560-01-631-5081 2-11325-2 1

9 1560-01-631-6388 2-11326-1 1

10 1560-01-631-6387 2-11326-2 1

11 1560-01-631-5083 2-11327-1 1

12 1560-01-631-5085 2-11327-2 1

13 1560-01-631-5595 2-11328-1 1

14 1560-01-631-5597 2-11328-2 1

15 1560-01-631-6170 2-11330-1 1

16 1560-01-631-5084 2-11330-2 1

17 1560-01-631-4787 2-11331-1 1

18 1560-01-631-4781 2-11331-2 1

19 1560-01-631-5600 2-11332-1 1

20 1560-01-631-5080 2-11332-2 1

21 1560-01-631-5930 2-11333-1 1

22 1560-01-631-6205 2-11333-2 1

23 1560-01-631-6229 2-11335-1 1

24 1560-01-631-6230 2-11335-2 1

25 1560-01-631-6239 2-11336-1 1

26 1560-01-631-6254 2-11336-2 1

27 1560-01-631-4763 2-11337-1 2

28 1560-01-631-7027 2-11337-2 2

29 1560-01-631-7016 2-11339-1 1

30 1560-01-631-6281 2-11339-2 1

REQUEST FOR TCTO KIT ASSEMBLY

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

20180501

ITEM NO.

ITEM

STOCK NO. PART NO.

SOURCE OF

SUPPLY U/I

1T-38A-998

NOUN

1560K0104791CXE

Lower Center Longeron (FS 284 to FS 325)

Lower Center Longeron (FS 284 to FS 325)

QUP UNIT COST

Clip

Clip

Clip

Clip

Clip

Clip

Bulkhead Upper Cap at FS 325

Upper Center Longeron (FS 284 to FS 325)

Upper Center Longeron (FS 284 to FS 325)

Clip

Clip

Clip

Bulkhead Upper Cap at FS 325

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Clip

Enclosure 1 – TRIM Aircraft Parts Kit for T-38A/B Aircraft – Page 2

Continued next page

KIT NSN TCTO MOD NO.

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

1 1560-00-101-9298 2-31435-501 1

2 1560-00-101-9299 2-31435-502 1

3 1560-01-024-6735 3-11227-11 1

4 1560-01-024-6736 3-11227-12 1

5 1560-01-631-6394 3-11606-17 1

6 1560-01-624-5710 3-11608-503 1

7 1560-00-920-8714 3-11611-503 1

REQUEST FOR TCTO KIT ASSEMBLY

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

20180427

ITEM NO.

ITEM

STOCK NO. PART NO.

SOURCE OF

SUPPLY U/I

1T-38A-998

NOUN

1560K0104791EXE

Angle, Vertical Stabilizer Attach

Angle, Vertical Stabilizer Attach

QUP UNIT COST

Support, Attach Lower Aft CFS 487.223 to FS 508.316

Former at FS 486

Former at CFS 487.223

Former at CFS 505.075

Support, Attach Lower Aft CFS 487.223 to FS 508.316

DATE

KIT NSN TCTO MOD NO.

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

1 1560-01-602-2365 3-11617-5 1

2 1560-01-631-7836 3-11781-101 1

3 1560-01-631-7837 3-11781-102 1

4 1560-01-631-5451 3-11781-104 1

5 1560-01-631-7167 3-11781-127 1

6 1560-01-631-7170 3-11781-128 1

7 1560-01-631-7248 3-11781-129 1

8 1560-01-631-4840 3-11781-131 1

9 1560-01-631-4849 3-11781-132 1

10 1560-01-631-7844 3-11781-133 1

11 1560-01-631-4862 3-11781-135 1

12 1560-01-631-4870 3-11781-136 1

13 1560-01-631-4813 3-11781-139 1

14 1560-01-631-7252 3-11781-33 6

15 1560-01-632-3433 3-11781-77 2

16 1560-01-631-4809 3-11781-87 3

17 1560-01-632-5474 3-11781-93 1

18 1560-01-631-7843 3-11781-94 1

19 1560-01-631-7250 3-11781-97 1

20 4710-01-632-2528 3-52597-1 1

21 4710-01-632-2526 3-52597-2 1

22 NSL 51B108-06 4

23 1560-00-768-3053 70C410 2

24 1560-00-785-5792 70C421-1 2

25 5306-00-292-5517 AN42B-3A 2

26 5340-00-721-8182 AN743-13 2

27 5310-01-400-3787 AN960D10L 2

28 5320-00-781-0485 BA6A3H 2

29 5320-00-759-3367 HL18-5-3 36

30 5320-00-498-3589 HL18-5-4 6

REQUEST FOR TCTO KIT ASSEMBLY

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

20180427

ITEM NO.

ITEM

STOCK NO. PART NO.

SOURCE OF

SUPPLY U/I

1T-38A-998

NOUN

1560K0104791FXE

Tunnel Control Cover, FS 388.75 - . FS 445.00

Angle

QUP UNIT COST

Tube Assembly

Angle

Panel

Panel

Doubler

Clip

Angle

Pan

Pan

Pan

Stiffener

Stiffener

Angle

Strip

Doubler

Angle

Angle

Pan

Tube Assembly

Bracket Assembly, Nutplate

Support, Fuel Cell Lacing

Support, Fuel Cell Lacing

Pin-Rivet, Threaded

Bolt, Eye

Bracket, Support Clamp

Pin-Rivet, Threaded

Washer, Flat

Rivet, Blind

Enclosure 1 – TRIM Aircraft Parts Kit for T-38A/B Aircraft – Page 3

Enclosure 1 Continued – TRIM Fastener Kit contents

1. Kit NSN 1560K0104791HXE TRIM BASE HARDWARE (as itemized on AFMC IMT 185)

2. Kit NSN 1560K0104791KXE T-38 AB HARDWARE (as itemized on AFMC IMT 185)

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

31 5320-01-006-3987 HL18-6-3 8

32 5320-01-013-9691 HL18-6-4 4

33 5320-00-999-9407 HL18PB-6-4 18

34 5320-00-076-4071 HL70-5 42

35 5320-00-631-3429 HL70-6 12

36 5320-00-968-9212 HL79-6 18

37 5320-00-117-6953 MS20426AD4-8 52

38 5320-00-117-6885 MS20426AD5-8 54

39 5320-00-808-7822 MS20470AD3-8 24

40 5320-00-117-6830 MS20470AD4-8 116

41 5320-00-117-6841 MS20470AD5-8 1115

42 5320-01-247-9034 MS20470E6-8 192

43 5320-00-685-0821 MS20615-5M5 12

44 5310-00-807-1474 MS21042L3 2

45 5310-00-740-5096 NA2132D62 2

46 5320-00-005-8310 NAS1398D4A4 4

47 5310-00-777-5791 NAS686-A3 1

48 5310-00-778-9480 NAS687-A3 2

Rivet, Solid

Nut, Self-Locking

Nut, Self-Locking

Nutplate, Self-Locking

Nutplate, Self-Locking

CONTINUATION

UNIT COST TOTAL COST

ITEM

NO.

ITEM

STOCK NO. PART NO. NOUN

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

Pin-Rivet, Threaded

Pin-Rivet, Threaded

Pin-Rivet, Threaded

Collar, Pin-Rivet

Rivet, Blind

Collar, Pin-Rivet

Collar, Pin-Rivet

Rivet, Solid

Rivet, Solid

Rivet, Solid

Rivet, Solid

Rivet, Solid

Rivet, Solid

DATE

KIT NSN TCTO MOD NO.

A B C

CONFIG KIT QTY CONFIG KIT QTY CONFIG KIT QTY

1 1560-01-003-7244 3-11613 -19 1

2 1560-01-665-7666 3-11322-502 1

Aft Fuselage Upper Skin (FS 445 to canted FS 505/FS 531)

Skin, Side, (FS 284 to FS 325)

QUP UNIT COST

REQUEST FOR TCTO KIT ASSEMBLY

NUMBER OF KITS REQUIRED FOR THESE CONFIGURATIONS

DATES REQUIRED BY

20180501

ITEM NO.

ITEM

STOCK NO. PART NO.

SOURCE OF

SUPPLY U/I

1T-38A-998

NOUN

1560K0104791GXE

Enclosure 2 – Draft Incentive Table (Tailored to 1 kit in DO 0001)

Enclosure 3 – Draft Kit Buy Schedule

(Subject to change until contract award)

T-38 Talon Repair Inspection and Maintenance (TRIM) Program: Incentive for Early Delivery of First Delivery Order ~~~DRAFT for RFP/Subject to change until contract award or bilateral contract modification~~~

Base Kit Cost =

(AXE+BXE+HXE+KXE+LXE

T-26 wks

Payment

Incentive

T-26 wks

T-24 wks

Payment

Incentive

T-24 wks

T-22 wks

Payment

Incentive

T-22 wks

T-20 wks

Payment

Incentive

T-20 wks

T-18 wks

Payment

Incentive

T-18 wks

T-16 wks

Payment

Incentive

T-16 wks

1/FA 200,000$ 400,000 200,000 390,000 190,000 380,000 180,000 370,000 170,000 360,000 160,000 350,000 150,000

2 - - - - - - - - - - - -

3 - - - - - - - - - - - -

4 - - - - - - - - - - - -

5 - - - - - -

6 - - - - - -

7 - - - - - -

Total 200,000$ 400,000 390,000 380,000 370,000 360,000 350,000

Incentive >>>>>>>> 200,000$ 190,000$ 180,000$ 170,000$ 160,000$ 150,000$

DO 0001

& Kit No.

T-14 wks

Payment

Incentive

T-14 wks

T-12 wks

Payment

Incentive

T-12 wks

T-10 wks

Payment

Incentive

T-10 wks

T-8 wks

Payment

Incentive

T-8 wks

T-6 wks

Payment

Incentive

T-6 wks

T-4 wks

Payment

Incentive

T-4 wks On-Time

340,000 140,000 330,000 130,000 320,000 120,000 300,000 100,000 260,000 60,000 230,000 30,000 200,000$

340,000 330,000 320,000 300,000 260,000 230,000 200,000$

140,000$ 130,000$ 120,000$ 100,000$ 60,000$ 30,000$

TRIM D.O. Issued FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 Sub-Total

TRIM T-38A/B/C Kits 1 13 16 23 26 26 27 27 159

USAF Sub-total 1 13 0 16 23 26 26 27 27 0 0 159

TRIM T-38Cs *Navy* Kits 1 2 2 2 2 1 10

TRIM Kit Buys 1 13 0 17 25 28 28 29 28 0 0 169

TRIM FAT in FY20

(A/B models) 1 *2 additional TRIM A/B kits may be ordered in FY22 to have on-hand, but would not coincide with an aircraft induction in FY22-FY23.

T-38 TRIM Projected Buy Schedule >> as of 11 Sep 18

Anticipated delivery order(s) upon contract award:

DO 0001* issued on or near 29 Mar 19

Kit # Delivery Date Aircraft MDS

001 01 Jun 21 T-38B val/ver *1 kit in DO 0001

DO 0002** issued 1 Oct 19 (FY22 inductions)

Kit # Delivery Date Aircraft MDS

002 01 Sep 21 T-38A val/ver

003 13 Jun 22 T-38A

004 13 Jun 22 T-38A **3 kits in DO 0002

DO 0003** issued 1 Oct 19 (FY23 inductions)

Kit # Delivery Date Aircraft MDS

005 ## Aug 22 T-38A

006 ## Aug 22 T-38A

007 ## Aug 22 T-38A

008 ## Dec 22 T-38A

009 ## Dec 22 T-38A

010 ## Dec 22 T-38A

011 ## Mar 23 T-38A

012 ## Mar 23 T-38A

013 ## Mar 23 T-38A

014 ## May 23 T-38A **10 kits in DO 0003

**DO 0002 and DO 0003 are being provided for informational purposes only.

At this time, these DOs are not subject to the Early

Delivery incentive CLIN.