Terms and Conditions HSCG38-12-Q-200001.pdf

TERMS AND CONDITIONS

HSCG38-12-Q-200001

Statement of Requirement This Acquisition is a Total (100%) Set-Aside for Small Business Concerns. Any concern that does not meet the Small Business size standards will not be evaluated for award. The contract awarded by the Government shall be for the repair of Firewalls as specified in the Statement of Work. All quantities shown in the schedule are estimated. Therefore, there is no guarantee, stated or implied, as to the actual quantities that will be purchased under this contract.

The following clauses and provisions are included:

52.212-1 Instructions to Offerors - Commercial Items Jun 2008

Period of Acceptance of Offers

(c) Prices must remain effective for 90 days after solicitation closes.

Cost or Pricing Data It is DHS policy that pricing for competitive negotiations should be based on adequate price competition. However, in the event only one responsible offeror is obtained as a result of this solicitation, that offeror may be required to submit either Certified Cost or Pricing Data (FAR 15.403-4) or Data Other Than Certified Cost or Pricing Data (FAR 15.403-3) to support price negotiations.

Notice of Pre-award Survey

(a) Offerors are advised that the Government may contact potential contractors to ascertain their capabilities to perform the work specified in this solicitation. In addition to financial statements and credit rating checks, the Government may visit a prospective contractor's facility(s). Areas of interest on this survey may include, but are not limited to the following:

(1) Performance plans

(2) Quality assurance and control plans

(3) Personnel recruitment and training plans

(4) Workload factor for manpower utilization

(5) Management plan for handling peak workloads

(6) Production capability.

(i) Plant facilities, equipment, and labor resources

(ii) Purchasing and subcontracting

(iii) Performance record and ability to meet delivery schedules

(b) Offerors are advised that accomplishment of this survey is a part of the evaluation process and is not to be construed as an indication that an offeror will receive or is in the best position to receive the resultant award. However, any offeror that fails to meet the requirements of the site survey will no longer be considered for award.

Service Contract Act The Service Contract Act will apply to any contracts awarded through this solicitation. IAW FAR 22.1009-4, the place of performance for this contract is currently unknown. The

Contracting Officer has determined three possible places of performance and has included Wage Determinations for all three as an attachment to this solicitation. The Contracting Officer will obtain wage determinations for additional possible places of performance if asked to do so in writing at Crystal.G.Taber@uscg.mil. Offerors must request additional wage determinations no later than (date and time will be 2 days before solicitation close). Offerors who intend to perform in a place or area of performance for which a wage determination has not been attached or requested may nevertheless submit quotations. However, a wage determination shall be requested and incorporated in the resultant contract retroactive to the date of contract award, and there shall be no adjustment in the contract price.

52.212-2 Evaluation-Commercial Items Jan 1999

(a) The Government will award a contract resulting from this solicitation to the responsible offeror whose offer conforming to the solicitation is most advantageous to the Government, price and other factors considered. The following factors shall be used to evaluate offers:

1. Technical

2. Price

3. Past Performance (recent and relevant)

4. Delivery

Technical is the most important evaluation factor, with Price being the second most important evaluation factor. Technical and Price, when combined, are more important than Past Performance and Delivery. The closer the offers are to equality, price becomes the most important.

Technical: Technical criteria will be rated on the ability of the offeror to meet all requirements listed in the Statement of Work. Quotations shall address at a minimum the criteria listed in the attached spreadsheet titled HSCG38-12-Q-200001 – Technical Factors”. These factors will be used to rate the technical acceptability and quality of an offer. Offerors are encouraged to provide any additional information they feel will better demonstrate their company’s ability to meet the USCG’s needs. The USCG will evaluate the minimum criteria listed in the specification and all additional information provided by the offeror. The criteria in this section are pass/fail criteria. All offers that pass the initial technical evaluation will be further rated for their strengths and weaknesses. Each quotation will be given one of the following color ratings for its technical evaluation:

BLUE - Outstanding in essentially all aspects. No deficiencies or weaknesses.

GREEN - Acceptable in all aspects. Meets evaluation standards and has a good probability of satisfying the requirements. Weaknesses, if any, are readily correctable and are not serious enough to prevent successful contract performance.

YELLOW - Marginally satisfactory, or less than Satisfactory for one or more of the following reasons:

mailto:Crystal.G.Taber@uscg.mil�

• Weakness significantly outweighs strengths and impact contract performance.

• One or more correctable deficiencies.

• Not acceptable as is, but is susceptible to being made acceptable.

*NOTE: Correction of deficiencies or weaknesses could result in an upgrade to any of the above ratings.

RED - Unacceptable as is. Significant deficiencies and/or weaknesses that would threaten successful contract performance. Offeror would have to make major revisions to the quotation to make it other than acceptable.

Definitions:

Strength – Exceeding a requirement in a positive manner by such a margin that contract performance will be notably enhanced.

Weakness – Displaying numerous borderline responses to requirements or one of major importance.

Deficiency – Fails to meet minimum requirement but is correctable without a major redirection of quotation effort.

Unacceptable – Failure to meet quotation requirements.

A performance risk assessment will also be performed for each offeror. The levels of risk to be evaluated are as follows:

HIGH – Significant doubt exists that the offeror can perform the proposed effort.

MODERATE – Some doubt exists that the offeror can perform the proposed effort.

LOW – Little doubt exists that the offeror can perform the proposed effort.

The color ratings and performance risk assessment will be used to develop an overall technical ranking of the offers. This ranking, along with the evaluation criteria listed below, will help determine which offer presents the best value to the Government.

Price: The contractor shall provide pricing as requested in the attached spreadsheet titled “HSCG38-12-Q-200001 Quote Sheet”. Offerors are asked to provide pricing for completing repairs without the use of Government Furnished Material and pricing for repairs if the Government supplies all replacement parts IAW paragraphs 2.2.3 and 4.1 of the Statement of Work. After evaluation of quotes, the Government will choose the option that provides the best value. Any quantity price discounts and discounts for prompt payment should be included in this section. Total price evaluation will be for the base and all four option periods. Failure to quote pricing for the base year and all respective option years on individual line items may result in a quotation being excluded from further consideration.

NOTE: The Government retains the right to award without discussions. Therefore offerors are encouraged to provide their best quotations with the materials requested for evaluation.

However, in the event that discussions are considered necessary, the Government retains the right to limit the number of offerors included in the competitive range for purposes of efficiency.

Past Performance: In accordance with FAR 15.304(c)(3)(i), past performance will be evaluated and the elements listed below are considered subfactors of the complete past performance evaluation. Relevance is determined by efforts that more closely match the size and complexity to the work being acquired under this solicitation. In order to adequately evaluate an offeror’s past performance, all offerors shall submit a list of three (3) contracts (references) completed within the preceding 36 month period. If an offeror has no relevant past performance history, offeror must affirmatively state that is possesses no relevant past performance history.

Offerors shall include the following information for each contract listed:

(1) Name of Agency/Company providing Past Performance Information

(2) Contract Number

(5) Brief description of contract and relevance to this requirement

(6) Total Contract Value

(7) Period of Performance

(8) Agency Contact, telephone number and e-mail address

Offerors may provide information on problems encountered and corrective actions taken on identified contracts. Verification of information will address, but is not limited to the subfactors listed below.

• Quality of Work

• Personnel

• Subcontractor Management

• Business Relations

• Timeliness of Performance

• Customer Satisfaction

• Cost/Budget Control

In the case of an offeror without a record of relevant past performance or for whom information on past performance is not available, the offeror will be given a neutral past performance rating.

The Government may also use information available from past contracts/purchase orders with the USCG, delivery information found in the USCG’s AMMIS system, and any information found using sources such as Federal Government sources, Past Performance Information Retrieval System (PPIRS)/Contractor Performance Assessment Reporting System (CPARS).

The Government reserves the right to limit or expand the number of references it decides to contact and to contact references other than those provided by the offeror.

Delivery: The Government’s desired delivery date for the repaired firewalls is 60 days after receipt of order. The required date for delivery of repaired firewalls is no later than 90 days after receipt of order. Offerors that can meet the Government’s desired delivery dates will be rated higher than offers that are unable to deliver on time. Offerors that can deliver sooner than the Government’s desired delivery dates will be rated the highest.

(b) Options. The Government will evaluate offers for award purposes by adding total price for all options to the total price for the basic requirement. The Government may determine that an offer is unacceptable if the option prices are significantly unbalanced. Evaluation of options shall not obligate the Government to exercise the option(s).

(c) A written notice of award or acceptance of an offer mailed or otherwise furnished to the successful offeror within the time for acceptance specified in the offer, shall result in a binding contract without further action by either party. Before the offer's specified expiration time, the Government may accept an offer (or part of an offer), whether or not there are negotiations after its receipt, unless a written notice of withdrawal is received before award.

(End of Provision)

52.212-3 Offeror Representations and Certifications-Commercial Items Nov 2011

X Alternate I of 52.212-3. Apr 2011 An offeror shall complete only paragraph (b) of this provision if the offeror has completed the annual representations and certifications electronically at http://orca.bpn.gov. If an offeror has not completed the annual representations and certifications electronically at the ORCA website, the offeror shall complete only paragraphs (c) through (o) of this provision.

(End of Provision)

52.212-5 Contract Terms and Conditions Required to Implement Nov 2011 Statutes or Executive Orders-Commercial Items.

(a) The Contractor shall comply with the following Federal Acquisition Regulation (FAR) clauses, which are incorporated in this contract by reference, to implement provisions of law or Executive orders applicable to acquisitions of commercial items:

(1) 52.222-50, Combating Trafficking in Persons (Feb 2009) (22 U.S.C. 7104(g)).

__ Alternate I (Aug 2007) of 52.222-50 (22 U.S.C. 7104(g)).

(2) 52.233-3, Protest After Award (AUG 1996) (31 U.S.C. 3553).

(3) 52.233-4, Applicable Law for Breach of Contract Claim (OCT 2004) (Pub. L. 108-77, 108- 78).

(b) The Contractor shall comply with the FAR clauses in this paragraph (b) that the contracting officer has indicated as being incorporated in this contract by reference to implement provisions of law or Executive orders applicable to acquisitions of commercial items:

(1) 52.203-6, Restrictions on Subcontractor Sales to the Government (Sept 2006), with Alternate I (Oct 1995) (41 U.S.C. 253g and 10 U.S.C. 2402).

(4) 52.204-10, Reporting Executive Compensation and First-Tier Subcontract Awards (Jul 2010) (Pub. L. 109-282) (31 U.S.C. 6101note).

(6) 52-209-6, Protecting the Government’s Interest When Subcontracting with Contractors Debarred, Suspended, or Proposed for Debarment (Dec 2010) (31 U.S.C. 6101 note).

(11) 52.219-6, Notice of Total Small Business Set-Aside (Nov 2011) (15 U.S.C. 644).

(13) 52.219-8, Utilization of Small Business Concerns (Jan 2011) (15 U.S.C. 637(d)(2) and (3)).

(16) 52.219-14, Limitations on Subcontracting (Dec 1996) (15 U.S.C. 637 (a) (14)).

(22) 52.219-28, Post Award Small Business Program Rerepresentation (Apr 2009) (15 U.S.C.

632(a)(2)).

(25) 52.222-3, Convict Labor (June 2003) (E.O. 11755).

(26) 52.222-19, Child Labor-Cooperation with Authorities and Remedies (Jul 2010) (E.O.

13126).

(27) 52.222-21, Prohibition of Segregated Facilities (Feb 1999).

(28) 52.222-26, Equal Opportunity (Mar 2007) (E.O. 11246).

(29) 52.222-35, Equal Opportunity for Special Disabled Veterans, Veterans of the Vietnam Era, and Other Eligible Veterans (Sept 2010) (38 U.S.C. 4212).

(30) 52.222-36, Affirmative Action for Workers with Disabilities (Oct 2010) (29 U.S.C. 793).

(31) 52.222-37, Employment Reports on Special Disabled Veterans, Veterans of the Vietnam Era, and Other Eligible Veterans (Sept 2010) (38 U.S.C. 4212).

(32) 52.222-40, Notification of Employee Rights Under the National Labor Relations Act (Dec 2010) (E.O. 13496).

(33) 52.222-54, Employment Eligibility Verification (Jan 2009). (Executive Order 12989).

(37) 52.223-18, Encouraging Contractor Policies to Ban Text Messaging While Driving (Aug 2011) (E.O. 13513).

(38) 52.225-1, Buy American Act-Supplies (Feb 2009) (41 U.S.C. 10a-10d).

(41) 52.225-13, Restrictions on Certain Foreign Purchases (June 2008) (E.O.'s, proclamations, and statutes administered by the Office of Foreign Assets Control of the Department of the Treasury).

(46) 52.232-33, Payment by Electronic Funds Transfer-Central Contractor Registration (Oct 2003) (31 U.S.C. 3332).

(1) 52.222-41, Service Contract Act of 1965, as Amended (Nov 2007) (41 U.S.C. 351, et seq.).

(2) 52.222-42, Statement of Equivalent Rates for Federal Hires (May 1989) (29 U.S.C. 206 and 41 U.S.C. 351, et seq.).

This clause identifies the classes of service employees expected to be employed under the contract and states the wages and fringe benefits payable to each if they were employed by the contracting agency subject to the provisions of 5 U.S.C. 5341 or 5332.

This Statement is for Information Only:

It is not a Wage Determination

Employee Class Monetary Wage -- Fringe Benefits Aircraft Mechanic I (WG-8) $19.00

Aircraft Mechanic II (WG-10) $21.09

Welder, Combination, Maintenance (WG-9) $20.00

(3) 52.222-43, Fair Labor Standards Act and Service Contract Act—Price Adjustment (Multiple Year and Option Contracts) (Sep 2009) (29 U.S.C. 206 and 41 U.S.C. 351, et seq.).

Contract Clauses

52.252-2 Clauses Incorporated by Reference FEB 1998 This solicitation incorporates one or more clauses by reference, with the same force and effect as if they were given in full text. Upon request, the Contracting Officer will make their full text available. Also the full text of the clause may be accessed electronically at Internet address http://acquisition.gov/far/index.html.

52.212-4 Contract Terms and Conditions – Commercial Items Jun 2010 52.222-49 Service Contract Act – Place of Performance Unknown May 1989 52.246-15 Certificate of Conformance April 1984 52.247-34 F.O.B. Destination Nov 1991

FULL TEXT CLAUSES

52.209-9 Updates of Publicly Available Information Regarding Jan 2011

Responsibility Matters

(a) The Contractor shall update the information in the Federal Awardee Performance and Integrity Information System (FAPIIS) on a semi-annual basis, throughout the life of the contract, by posting the required information in the Central Contractor Registration database at http://www.ccr.gov .

(b)

(1) The Contractor will receive notification when the Government posts new information to the Contractor’s record.

(2) The Contractor will have an opportunity to post comments regarding information that has been posted by the Government. The comments will be retained as long as the associated information is retained, i.e., for a total period of 6 years. Contractor comments will remain a part of the record unless the Contractor revises them.

(3)

(i) Public requests for system information posted prior to April 15, 2011, will be handled under Freedom of Information Act procedures, including, where appropriate, procedures promulgated under E.O. 12600.

(ii) As required by section 3010 of Public Law 111-212, all information posted in FAPIIS on or after April 15, 2011, except past performance reviews, will be publicly available.

(End of clause) http://acquisition.gov/far/index.html.� http://www.ccr.gov/�

52.216-18 Ordering Oct 1995

(a) Any supplies and services to be furnished under this contract shall be ordered by issuance of delivery orders or task orders by the individuals or activities designated in the Schedule. Such orders may be issued from date of contract award through one-year from date of contract award for the basic period and for options, effective date of option exercise through one-year from effective date of option exercise.

(b) All delivery orders or task orders are subject to the terms and conditions of this contract. In the event of conflict between a delivery order or task order and this contract, the contract shall control.

(c) If mailed, a delivery order or task order is considered “issued” when the Government deposits the order in the mail. Orders may be issued orally, by facsimile, or by electronic commerce methods only if authorized in the Schedule.

(End of Clause)

52.216-19 Delivery – Order Limitations Oct 1995

(a) Minimum order. When the Government requires supplies or services covered by this contract in an amount of less than one (1), the Government is not obligated to purchase, nor is the Contractor obligated to furnish, those supplies or services under the contract.

(b) Maximum order. The Contractor is not obligated to honor --

(1) Any order for a single item in excess of the total estimated contract line item quantity;

(2) Any order for a combination of items in excess of 50% of estimated contract quantities; or

(3) A series of orders from the same ordering office within 30 Calendar days that together call for quantities exceeding the limitation in subparagraph (b)(1) or (2) of this section.

(c) If this is a requirements contract (i.e., includes the Requirements clause at subsection 52.216- 21 of the Federal Acquisition Regulation (FAR)), the Government is not required to order a part of any one requirement from the Contractor if that requirement exceeds the maximum-order limitations in paragraph (b) of this section.

(d) Notwithstanding paragraphs (b) and (c) of this section, the Contractor shall honor any order exceeding the maximum order limitations in paragraph (b), unless that order (or orders) is returned to the ordering office within 15 Calendar days after issuance, with written notice stating the Contractor’s intent not to ship the item (or items) called for and the reasons. Upon receiving this notice, the Government may acquire the supplies or services from another source.

(End of Clause)

52.216-21 Requirements Oct 1995 Alternate I Apr 1984

(a) This is a requirements contract for the supplies or services specified, and effective for the period stated, in the Schedule. The quantities of supplies or services specified in the Schedule are estimates only and are not purchased by this contract. Except as this contract may otherwise provide, if the Government’s requirements do not result in orders in the quantities described as “estimated’’ or “maximum” in the Schedule, that fact shall not constitute the basis for an equitable price adjustment.

(b) Delivery or performance shall be made only as authorized by orders issued in accordance with the Ordering clause. Subject to any limitations in the Order Limitations clause or elsewhere in this contract, the Contractor shall furnish to the Government all supplies or services specified in the Schedule and called for by orders issued in accordance with the Ordering clause. The Government may issue orders requiring delivery to multiple destinations or performance at multiple locations.

(c) Except as this contract otherwise provides, the Government shall order from the Contractor all the supplies or services specified in the Schedule that are required to be purchased by the Government activity or activities specified in the Schedule.

(d) The Government is not required to purchase from the Contractor requirements in excess of any limit on total orders under this contract.

(e) If the Government urgently requires delivery of any quantity of an item before the earliest date that delivery may be specified under this contract, and if the Contractor will not accept an order providing for the accelerated delivery, the Government may acquire the urgently required goods or services from another source.

(f) Any order issued during the effective period of this contract and not completed within that period shall be completed by the Contractor within the time specified in the order. The contract shall govern the Contractor’s and Government’s rights and obligations with respect to that order to the same extent as if the order were completed during the contract’s effective period;

provided, that the Contractor shall not be required to make any deliveries under this contract after determined at time of award based on six (6) months after expiration date of ordering period.

Alternate I (Apr 1984). If the requirements contract is for nonpersonal services and related supplies and covers estimated requirements that exceed a specific Government activity’s internal capability to produce or perform, substitute the following paragraph (c) for paragraph (c) of the basic clause:

(c) The estimated quantities are not the total requirements of the Government activity specified in the Schedule, but are estimates of requirements in excess of the quantities that the activity may itself furnish within its own capabilities. Except as this contract otherwise provides, the Government shall order from the Contractor all of that activity’s requirements for supplies and services specified in the Schedule that exceed the quantities that the activity may furnish within its own capabilities.

(End of Clause)

52.217-9 Option to Extend the Term of the Contract Mar 2000

(a) The Government may extend the term of this contract by written notice to the Contractor within 30 Calendar days prior to contract expiration; provided that the Government gives the Contractor a preliminary written notice of its intent to extend at least 60 days before the contract expires. The preliminary notice does not commit the Government to an extension.

(b) If the Government exercises this option, the extended contract shall be considered to include this option clause.

(c) The total duration of this contract, including the exercise of any options under this clause, shall not exceed five (5) years.

(End of Clause)

52.232-19 Availability of Funds for the Next Fiscal Year Apr 1984

Funds are not presently available for performance under this contract beyond 30 September 2012. The Government’s obligation for performance of this contract beyond that date is contingent upon the availability of appropriated funds from which payment for contract purposes can be made. No legal liability on the part of the Government for any payment may arise for performance under this contract beyond 30 September 2012, until funds are made available to the Contracting Officer for performance and until the Contractor receives notice of availability, to be confirmed in writing by the Contracting Officer.

(End of Clause)

SOLICITATION PROVISIONS (Incorporated by Reference)

52.217-5 Evaluation of Options Jul 1990 52.222-22 Previous Contracts and Compliance Reports Feb 1999 52.222-25 Affirmative Action Compliance Apr 1984 52.233-2 Service of Protest Sept 2006

FULL TEXT PROVISIONS

52.209-7 Information Regarding Responsibility Matters Jan 2011

(a) Definitions. As used in this provision— “Administrative proceeding” means a non-judicial process that is adjudicatory in nature in order to make a determination of fault or liability (e.g., Securities and Exchange Commission Administrative Proceedings, Civilian Board of Contract Appeals Proceedings, and Armed Services Board of Contract Appeals Proceedings). This includes administrative proceedings at the Federal and State level but only in connection with performance of a Federal contract or grant. It does not include agency actions such as contract audits, site visits, corrective plans, or inspection of deliverables.

“Federal contracts and grants with total value greater than $10,000,000” means—

(1) The total value of all current, active contracts and grants, including all priced options; and

(2) The total value of all current, active orders including all priced options under indefinite-delivery, indefinite-quantity, 8(a), or requirements contracts (including task and delivery and multiple-award Schedules).

(b) The offeror [ ] has [ ] does not have current active Federal contracts and grants with total value greater than $10,000,000.

(c) If the offeror checked “has” in paragraph (b) of this provision, the offeror represents, by submission of this offer, that the information it has entered in the Federal Awardee Performance and Integrity Information System (FAPIIS) is current, accurate, and complete as of the date of submission of this offer with regard to the following information:

(1) Whether the offeror, and/or any of its principals, has or has not, within the last five years, in connection with the award to or performance by the offeror of a Federal contract or grant, been the subject of a proceeding, at the Federal or State level that resulted in any of the following dispositions:

(i) In a criminal proceeding, a conviction.

(ii) In a civil proceeding, a finding of fault and liability that results in the payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more.

(iii) In an administrative proceeding, a finding of fault and liability that results in—

(A) The payment of a monetary fine or penalty of $5,000 or more; or

(B) The payment of a reimbursement, restitution, or damages in excess of $100,000.

(iv) In a criminal, civil, or administrative proceeding, a disposition of the matter by consent or compromise with an acknowledgment of fault by the Contractor if the proceeding could have led to any of the outcomes specified in paragraphs (c)(1)(i), (c)(1)(ii), or (c)(1)(iii) of this provision.

(2) If the offeror has been involved in the last five years in any of the occurrences listed in (c)(1) of this provision, whether the offeror has provided the requested information with regard to each occurrence.

(d) The offeror shall enter the information in paragraphs (c)(1)(i) through (c)(1)(iv) of this provision in FAPIIS as required through maintaining an active registration in the Central Contractor Registration database at http://www.ccr.gov (see 52.204-7).

“Principal” means an officer, director, owner, partner, or a person having primary management or supervisory responsibilities within a business entity (e.g., general manager; plant manager;

head of a division or business segment; and similar positions).

(End of provision)

52.211-14 Notice of Priority Rating for National Defense, Apr 2008 Emergency Preparedness and Energy Program Use Any contract awarded as a result of this solicitation will be [ ] DX rated order; [X] DO rated order certified for national defense, emergency preparedness, and energy program use under the Defense Priorities and Allocations System (DPAS) (15 CFR 700), and the Contractor will be required to follow all of the requirements of this regulation. [Contracting Officer check appropriate box.](End of Provision)

HOMELAND SECURITY CLAUSES

HSAR 3052.222-90 Local Hire (USCG) Jun 2006

(a) When performing a contract in whole or in part in a State with an unemployment rate in excess of the national average determined by the Secretary of Labor, the Contractor shall employ, for the purpose of performing the portion of the contract in that State, individuals who are local residents and who, in the case of any craft or trade, possess or would be able to acquire promptly, the necessary skills.

(b) Local resident defined. As used in this section, “local resident” means a resident of, or an individual who commutes daily to, a State described in subsection (a). (c) The Secretary of Homeland Security may waive the requirements of paragraph (a) the interest of national security or economic efficiency.

(End of clause)

HOMELAND SECURITY PROVISIONS

HSAR 3052.209-70 Prohibition on Contracts With Corporate Expatriates Jun 2006

(a) Prohibitions.

http://www.ccr.gov/� https://www.acquisition.gov/far/current/html/52_200_206.html#wp1137850�

Section 835 of the Homeland Security Act, 6 U.S.C. 395, prohibits the Department of Homeland Security from entering into any contract with a foreign incorporated entity which is treated as an inverted domestic corporation as defined in this clause, or with any subsidiary of such an entity.

The Secretary shall waive the prohibition with respect to any specific contract if the Secretary determines that the waiver is required in the interest of national security.

(b) Definitions. As used in this clause:

Expanded Affiliated Group means an affiliated group as defined in section 1504(a) of the Internal Revenue Code of 1986 (without regard to section 1504(b) of such Code), except that section 1504 of such Code shall be applied by substituting ‘more than 50 percent’ for ‘at least 80 percent’ each place it appears.

Foreign Incorporated Entity means any entity which is, or but for subsection (b) of section 835 of the Homeland Security Act, 6 U.S.C. 395, would be, treated as a foreign corporation for purposes of the Internal Revenue Code of 1986.

Inverted Domestic Corporation. A foreign incorporated entity shall be treated as an inverted domestic corporation if, pursuant to a plan (or a series of related transactions)—

(1) The entity completes the direct or indirect acquisition of substantially all of the properties held directly or indirectly by a domestic corporation or substantially all of the properties constituting a trade or business of a domestic partnership;

(2) After the acquisition at least 80 percent of the stock (by vote or value) of the entity is held—

(i) In the case of an acquisition with respect to a domestic corporation, by former shareholders of the domestic corporation by reason of holding stock in the domestic corporation; or

(ii) In the case of an acquisition with respect to a domestic partnership, by former partners of the domestic partnership by reason of holding a capital or profits interest in the domestic partnership;

and

(3) The expanded affiliated group which after the acquisition includes the entity does not have substantial business activities in the foreign country in which or under the law of which the entity is created or organized when compared to the total business activities of such expanded affiliated group.

Person, domestic, and foreign have the meanings given such terms by paragraphs (1), (4), and

(5) of section 7701(a) of the Internal Revenue Code of 1986, respectively.

(c) Special rules. The following definitions and special rules shall apply when determining whether a foreign incorporated entity should be treated as an inverted domestic corporation.

(1) Certain stock disregarded. For the purpose of treating a foreign incorporated entity as an inverted domestic corporation these shall not be taken into account in determining ownership:

(i) stock held by members of the expanded affiliated group which includes the foreign incorporated entity; or

(ii) Stock of such entity which is sold in a public offering related to an acquisition described in section 835(b)(1) of the Homeland Security Act, 6 U.S.C. 395(b)(1).

(2) Plan deemed in certain cases. If a foreign incorporated entity acquires directly or indirectly substantially all of the properties of a domestic corporation or partnership during the 4-year period beginning on the date which is 2 years before the ownership requirements of subsection (b)(2) are met, such actions shall be treated as pursuant to a plan.

(3) Certain transfers disregarded. The transfer of properties or liabilities (including by contribution or distribution) shall be disregarded if such transfers are part of a plan a principal purpose of which is to avoid the purposes of this section.

(d) Special rule for related partnerships. For purposes of applying section 835(b) of the Homeland Security Act, 6 U.S.C. 395(b) to the acquisition of a domestic partnership, except as provided in regulations, all domestic partnerships which are under common control (within the meaning of section 482 of the Internal Revenue Code of 1986) shall be treated as a partnership.

(e) Treatment of Certain Rights.

(1) Certain rights shall be treated as stocks to the extent necessary to reflect the present value of all equitable interests incident to the transaction, as follows:

(i) Warrants;

(ii) Options;

(iii) Contracts to acquire stock;

(iv) Convertible debt instruments;

(v) Others similar interests.

(2) Rights labeled as stocks shall not be treated as stocks whenever it is deemed appropriate to do so to reflect the present value of the transaction or to disregard transactions whose recognition would defeat the purpose of section 835.

(f) Disclosure. The offeror under this solicitation represents that [Check one]:

_it is not a foreign incorporated entity that should be treated as an inverted domestic corporation pursuant to the criteria of (HSAR) 48 CFR 3009.104–70 through 3009.104–73;

_it is a foreign incorporated entity that should be treated as an inverted domestic corporation pursuant to the criteria of (HSAR) 48 CFR 3009.104–70 through 3009.104–73, but it has submitted a request for waiver pursuant to 3009.104–74, which has not been denied; or _it is a foreign incorporated entity that should be treated as an inverted domestic corporation pursuant to the criteria of (HSAR) 48 CFR 3009.104–70 through 3009.104–73, but it plans to submit a request for waiver pursuant to 3009.104–74.

(g) A copy of the approved waiver, if a waiver has already been granted, or the waiver request, if a waiver has been applied for, shall be attached to the bid or proposal.

(End of provision)