USC-7 Amend 7

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

II. CONTRA~TID CODE I PAGE OF PAGES

1 1 2

2. AMENDMENT/MOD !FICA TION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ. NO. ·1 S. PROJECTNO.(Ifapplicable)

0007 24-Feb-2012

6.ISSUEDBY CODE HTC711 7. ADMINISTERED BY (If other than item6) CODE I USTRANSCOM-AQ- HTC711 See Item 6 508SCOTIDR

SCOTI AFB IL 62225-5357

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, Comty, State and Zip Code) X 9A. AMENDMENT OF SOLICITATION NO.

HTC711-11-R-V'vU04

X 9B. DATED (SEE ITEM 11)

29-Nov-2011

1 OA. MOD. OF CONTRACT /ORDER NO.

. lOB. DATED (SEE ITEM 13)

CODE I FACILITY CODE

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[2SJ The above nuni>ered solicitation is anrnded as set fOrth in Item 14. The hour and date specified i>r receipt ofOfi:r D is extended, [RJ is not extended.

Ofi:r nust acknowledge receipt ofthis anrndrn:nt prior to the hour and date specified in the solicitation or as anrnded by one ofthe i>llowing rn:thods:

(a) By colll'leting Items 8 and 15, and returning 1 copies ofthe anrndrn:nt; (b) By acknowledging receipt ofthis arn:ndrn:nt on each copy ofthe ofi:r subnitted;

or (c) By separate letter or telegram which includ~nce to the solicitation and anrndrn:nt nuni>ers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT1liE PLACE DESIGN A TED FOR 1liE RECEIPT OF OFFERS PRIOR TO 1liE HOUR AND DATE SPECIFIED MAY RESULT IN

REJECTION OF YOUR OFFER Ifhy virtue ofthis anrndrn:nt you desire to change an ofi:r already subnitted, such change may be made by telegram or letter, prpvided each telegram or letter makes rei>rence to the solicitation and this anrndrn:nt, and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS'ORDERS.

IT MODIFIES THE CONTRACT/ORDERNO. AS DESCRIBED IN ITEM 14.

A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE

CONTRACT ORDER NO. IN ITEM 1 OA.

B. THE ABOVE NUMBERED CONTRACT /ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(B).

C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

D. OTHER (Specify type of modification and authority)

E. IMPORT ANT: Contractor D is not, D is required to sign this docwnent and return copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter \\here feasible.)

The purpose of this amendment is to accofll)lish the following:

1) IVIake revisions to Exhibit 2, Additional aauses. 2) IVIake revisions to Exhibit 3, Performance Work Statement. 3) Replace Exhibit 5, Wage Deterrrinations Under the Service Contract Act in its entirety with the attached Exhibit 5, Wage Deterrrinations Under the Service Contract Act. Note: a) The Regional Wage Deterrrination No. 2011-0217, Revision No.2 Dated 1/18/2012 is hereby incorporated in its entirety. All other attached Wage Deterrrinations for the following occupation codes apply: 29010, 29020, 29030, 29041 and 29042. b) aause 52.222-42, Statement of Equivalent Rates for Federal tires, will be updated with the Stevedoring/Longshoreman Occupational Services rates in the next amendment. c) Access to the Wage Deterrrinations can be found at http://www .wdol.gov/.

The primary point of contact for this action is llf6. Lisa cahill at (618) 220-7081/ E-mail: Lisa.Gahill@ustranscomrril.

Except as provided herein, all term; and conditions ofthe docurn:nt rei>renced in ltem9A or lOA, as heretoi>re changed, retmins unchanged and in filll i>rce and efi:ct.

15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

WIC •• .&.IA,._. L. L-1 /lltJil&AS"T

TEL EMAIL:

15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED Sf ATES OF AMERICA 16C. DATE SIGNED

BY Wtt~ 24-Feb-2012 (Signature of person authorized to sign) (Signature of Contracting Officer)

EXCEPTION TO SF 30

APPROVED BY OIRM 11-84

30-105-04 Sf ANDARD FORM 3 0 (Rev. 1 0-83) Prescribed by GSA

FAR (48 CFR) 53.243

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

SUMMARY OF CHANGES

SECTION SF 1449- CONTINUATION SHEET

The following have been added by reference:

52.222-43 Fair Labor Standards Act And Service Contract Act - Price SEP 2009 Adjustment (Multiple Year And Option)

(End of Summary of Changes)

HTC711-11-R-W004

Page 2 of2

HTC711-11-R-W004

Exhibit 2, Additional Clauses

1. Contractor Protection from Competition

1.1 Contractor Protection

A Contractor receiving an initial base period award or an option period award for this contract shall, during the respective base or option period of this contract, be protected from the subsequent competition of other Contractors after that initial award within the limitations of the Cargo Preference Act of 1904. This Contractor protection encourages initial full and open competition, protects the integrity of the contracting process, facilitates a streamlined acquisition process, promotes DOD’s sealift readiness goals implemented in the VISA priorities, and complies with applicable law. The Cargo Preference Act of 1904 also has the effect of establishing a ceiling price; it states that charges to the U.S. Government may not be higher than the charges for transporting like goods for private persons.

1.2 Cargo Preference

The availability of U.S. flag service shall be evaluated up to the date for responses to the RFP that resulted in this contract. While initial awardees may be subject to contractual remedies for failure to provide promised U.S. flag service, an initial award for foreign flag service that complies with law at the time of award shall be displaced during the period of the contract by another Contractor’s subsequent offer of U.S. flag service for the same requirement only in accordance with the following procedures. Initial award(s) shall not be displaced until the minimum cargo guaranteed to the initial awardee(s) has been offered to the awardee(s). Initial awardees displaced by a “late” offeror remain eligible to receive future orders for transportation when the “late” offeror is unavailable or as otherwise authorized by this contract and applicable law.

1.3 VISA Status

In that VISA status relates to a Contractor’s VISA commitment and whereas VISA Priority relates to both VISA commitment of the Contractor and flag status of a particular service, the VISA status of an offeror shall be evaluated up to the date for responses to the RFP that resulted in this contract, or the date for responses to the option period. A contract awardee may be subject to contractual remedies for failure to maintain at least the same VISA status throughout the respective base or option period of this contract. However, minimum cargo commitments awarded that properly reflect all offerors’ VISA status at the time of responses to the RFP or option period shall not be negated during the respective base or option period as a result of one or more contract awardees subsequently attaining a higher VISA status.

1.4 Late Rates

1.4.1 USTRANSCOM shall not accept proposals of service and rates from Contractors that were not awarded any contracts as a result of this solicitation unless the Contractor is offering U.S. flag service or combination U.S.

flag service that cannot otherwise be obtained from Contractors that were awarded contracts. In such case, paragraph

1.2 applies.

1.4.2 The Contracting Officer shall negotiate rates when capacity from Contractors with initially awarded rates is not available to meet requirements or a new service will provide a higher VISA priority service than otherwise available to the U.S. Government under initially awarded rates. Rates for ocean and single factor service accepted after initial award will be marked as late and used only when the late rates involve a service with a higher VISA priority than the servcie otherwise available to the U.S. Government under initially awarded rates; or capacity from Contractors with initally awarded rates is not available to meet the requirment.

1.5 Option Years Rate Additions

1.5.1 Contractors awarded a contract during the basic contract period may offer rates on additional routes during the option year rate refresh on routes they do not have accepted rates on for the basic contract period. Contractors who had accepted rates on these routes during the basic contract period are not protected from this new competition on those routes during any option period; the protection described in subparagraph 1.4 above does not apply to this situation. All Contractors with accepted rates on the same routes for an option period and any extension shall compete equally for all cargo volumes based on a contemporaneous best value analysis. A similar ability to offer new service on a route shall not exist at the time of contract extension, if any; the offer of new rate at time of contract extension would be processed under paragraph 1.4.2.

2. Maritime Clauses

2.1 Application of COGSA

For containers, the United States Carriage of Goods by Sea Act 46 U.S.C. 1300 et seq. (hereinafter“COGSA” or “the Act”) is incorporated and shall apply to the ocean transportation of all goods, including goods in containers stowed on deck, under any Shipping Order with the same force and effect as if the Act applied to such carriage by express provision therein; For the purpose of interpreting Section 4 of the Act, "Limitation of Liability", the act of loading cargo into, or upon, a container shall not transform such containerized cargo into a single COGSA “package” (as defined herein). For example, the act of loading multiple boxes, bundles, or pieces of cargo into a container does not convert all boxes, bundles, or pieces of cargo into a single COGSA “package.” The limitation of liability set out in Section 4 of the Act shall apply to each package in a container and the government packing list itemizing the cargo in the container is prima facie the controlling document for determining how many “packages” are in a container. The Government packing list is the document completed by the origin shipper listing the items in a container.

For breakbulk, COGSA is incorporated and shall apply to the ocean transportation of all goods, under any Shipping Order with the same force and effect as if the Act applied to such carriage by express provision therein. The COGSA limitation of liability for cargo not in packages is to each measurement ton of cargo. If the Government through its booking system (currently IBS) indicates an order is being shipped “breakbulk,” the COGSA limitation of liability will be valued by the measurement ton of breakbulk cargo regardless of whether other shipping documents (i.e.

shipping manifest, etc) refer to the breakbulk cargo as a single “piece,” “unit,” or other single item. The IBS booking document indicating “breakbulk” is the controlling document between the parties.

For all cargo, container and breakbulk, the carriage of cargo under any Shipping Order issued pursuant to this contract shall not be deemed or construed to be the carriage of cargo pursuant to special terms and conditions as provided for in Section 6 of the Act; and nothing in this solicitation is intended to relieve the contractor or the vessel from liability for loss or damage to or in connection with the goods arising from negligence, fault or failure in the duties and obligations provided by the Act or to lessen such liability otherwise than as provided therein. COGSA shall apply from the point of delivery to the Contractor to the point of delivery to the Consignee whether in connection with intermodal or ocean-only transportation under this Contract. Accordingly, COGSA shall apply in determining the limits of a Contractor’s liability, as set forth above, for loss or damage to cargo booked under this Contract arising at any time in the custody of the Contractor.

When the application of COGSA would not result in a limitation on liability, this contract also excludes any limitation on liability.

Upon U.S. Senate ratification of the United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) or entry into force of the Convention (whichever event occurs first), the package limitation provisions of the Convention shall substitute for or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor .

2.2 Application of COGSA for Non-Government Owned Cargo

For containers, the United States Carriage of Goods by Sea Act 46 U.S.C. 30701 et seq.(hereinafter "COGSA" or "the Act") is incorporated and shall apply to the ocean transportation by the Contractor of all goods, including goods in containers stowed on deck, owned by a non-government cargo owner under any Shipping Order with the same force and effect as if the Act applied to such carriage by express provision therein. For the purpose of interpreting

Section 4 of the Act, "Limitation of Liability", the act of loading cargo into, or upon, a container shall not transform such containerized cargo into a single COGSA “package” (as defined herein) For example, act of loading multiple boxes, bundles, or pieces of cargo into a container does not convert all boxes, bundles, or pieces of cargo into a single COGSA “package.” The limitation of liability set out in Section 4 of the Act shall apply to each package in a container and the shipper or government packing list itemizing the cargo in the container is prima facie the controlling document for determining how many “packages” are in a container. The shipper packing list is the document completed by the origin shipper listing the items in a container. For breakbulk, COGSA is incorporated and shall apply to the ocean transportation of all goods, under any Shipping Order with the same force and effect as if the Act applied to such carriage by express provision therein. The COGSA limitation of liability for cargo not in packages is to each measurement ton of cargo. If the shipper through its booking system indicates an order is being shipped “breakbulk,” the COGSA limitation of liability will be valued by the measurement ton of breakbulk cargo regardless of whether other shipping documents (i.e. shipping manifest, etc) refer to the breakbulk cargo as a single “piece,” “unit,” or other single item. The shipper booking document indicating “breakbulk” is the controlling document between the parties and will determine whether cargo is valued as a “package” or by the measurement ton.

For all cargo, container and breakbulk, the carriage of cargo under any Shipping Order issued pursuant to this contract shall not be deemed or construed to be the carriage of cargo pursuant to special terms and conditions as provided for in Section 6 of the Act; and nothing in this solicitation is intended to relieve the contractor or the vessel from liability to the non-government cargo owner for loss or damage to or in connection with the goods arising from negligence, fault or failure in the duties and obligations provided by the Act or to lessen such liability otherwise than as provided therein. COGSA shall apply from the point of delivery to the Contractor to the point of delivery to the Consignee whether in connection with intermodal or ocean-only transportation under this Contract. Accordingly, COGSA shall apply in determining the limits of a Contractor’s liability, as set forth above, for loss or damage to cargo booked under this Contract arising at any time in the custody of the Contractor.

When the application of COGSA would not result in a limitation on liability, this contract also excludes any limitation on liability.

Upon U.S. Senate ratification of the United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) or entry into force of the Convention (whichever event occurs first), the package limitation provisions of the Convention shall substitute for or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to non-government cargo arising at any time in the custody of the Contractor .

2.3 Scope of Voyage (Liberties). U.S. Government cargo, by its very nature, may require special diligence in the prosecution of a voyage at sea. In some cases, the highly sensitive nature of military cargo may require extraordinary handling to ensure the safety and security of the cargo as well as that of our warfighters in the field.

Accordingly, the diversion of U.S. Government cargo at sea requires the unique conditions set forth below.

2.3.1 Diversion of Cargo. In any situation, whatsoever or wheresoever occurring and whether existing or anticipated before commencement of or during the voyage, which in the judgment of the contractor or master of the vessel is likely to give rise to capture, seizure, detention, damage, delay or disadvantage to or loss of the vessel or any part of her cargo, or to make it unsafe, imprudent, or unlawful for any reason to begin or continue the voyage or to enter or discharge the goods at the port of discharge, or to give rise to delay or difficulty in arriving, discharging at or leaving the port of discharge or the usual place of discharge in such port, the master, whether or not proceeding toward or entering or attempting to enter the port of discharge or reaching or attempting to reach the usual place of discharge therein or attempting to discharge U.S. Government Cargo (the Cargo) may, upon notification to the Contracting Officer (CO) as described at Section 2.3.1.1 below, discharge the Cargo into another port, depot, lazarette, craft, or other place, or retain the goods on board until the return trip or until such other time as would be prudent in the ordinary course of the Contractor’s business.

2.3.1.1 Notice of Diversion. The Notice described at Section 2.3.1 above shall include, at a minimum, a description of the cargo to be diverted (container number, Transportation Control Number, etc.), the conditions giving rise to the Contractor’s planned diversion of the Cargo, the diversion planned and any other measures deemed necessary by the Contractor to protect the Cargo. The Contractor or his designated representative shall provide such

Notice in a manner and place consistent with the provisions of this agreement (eg., electronic mail), but it is understood that such notice may be delayed if it would put the vessel, her crew or cargo at risk of loss, damage or injury.

2.3.1.2 Equitable Adjustment, Carrier Proposed Course of Action. After notification to the CO and approval by the CO of the contractor’s proposed course of action, the contractor may submit a request for an equitable adjustment to the contract for the reasonable, allocable, incurred costs to implement the approved course of action.

It is understood that the contractor may be required to act before CO approval to prevent risk of loss, damage or injury to the vessel, her crew or cargo. If the contractor acts before notice to and approval by the CO, the contractor shall nonetheless be entitled to reasonable, allocable, incurred costs if the CO finds that the actions were prudent and necessary for the security and protection of government cargo. In no case shall an equitable adjustment duplicate compensation provided in a USC-7 rate, accessorial charge or similar charge or otherwise reimburse the Contractor for costs chargeable (by the Contractor) to or otherwise allocable to a non-USC-7 shipper. If the contractor has been paid for delivery to destination, the CO will consider this fact in evaluating any request for an equitable adjustment or potential government claim for a windfall to the contractor.

2.3.1.3 Mutual Agreement. Where the CO determines that the Contractor’s planned diversion of the Cargo is not in the best interest of the U.S. Government, the CO shall so advise the Contractor as soon as practicable. Thereafter, the CO and the Contractor shall, with all due diligence and good faith, endeavor to mutually agree upon the prudent disposition of the Cargo.

2.3.1.4 Responsibility for the Cargo. Where the Contracting Officer determines that the contractor's planned diversion of the Cargo is not in the best interest of the U.S. Government and the Contracting Officer and the Contractor cannot timely agree upon the disposition of the Cargo, the Contractor shall comply with the CO's direction to the contractor to diver the cargo to a port of the U.S. Government's choice and to make any other arrangements for the cargo the Contracting Officer deems necessary to protect the Government's interest.

2.3.1.5 Equitable Adjustment for US Government Directed Course of Action. The contractor may submit a request for an equitable adjustment to the contract for reasonable, allocable costs incurred to carry out the CO’s direction if such costs are caused by the need to respond to the special situation and would not have been incurred in performing the contract of carriage except for the special situation. This equitable adjustment includes costs associated with cargo on the vessel that is not transported under this contract to the extent these costs exceed costs allocable to any non-USC-7 shipper under any Scope of Voyage (Liberties) or similar clause in any contract between the contractor and a non-USC-7 shipper. In no case shall an equitable adjustment duplicate compensation provided in a USC-7 freight rate, accessorial charge or similar charge or otherwise reimburse the Contractor for costs chargeable (by the Contractor) to or otherwise allocable to a non-USC-7 shipper. If the contractor has been paid for delivery to destination, the CO will consider this fact in evaluating any request for an equitable adjustment or any government claim for a windfall to the contractor.

2.3.1.6 In any event, the contractor shall at all times be responsible to assure the security and protection of the cargo until relieved of such responsibility by the U.S. Government or its designated agent.

2.3.2 Liberties. The Contractor, the master and the vessel shall have liberty to comply with any orders or directions as to loading, departure, arrival, routes, ports of call, stoppages, discharge, destination, delivery or otherwise howsoever given by the government of any nation or department thereof or any person acting or purporting to act with the authority of such government or of any department thereof (or by any committee or person having, under the terms of the war risk insurance on the vessel, the right to give such orders or directions). Delivery or other disposition of the goods in accordance with such orders or directions shall excuse delay in performance to the extent that such order or direction persists in prevention of performance. (See compensable Delay Clause below in Para 6.) The vessel may carry seized contraband, explosives, munitions, warlike stores, hazardous cargo, and may sail armed or unarmed and with or without convoy.

2.3.3 The vessel shall have the liberty to deviate for the purpose of saving life and property, to tow or to be towed, to sail with or without pilots, or to go into dry dock or into ways with or without cargo on board. However, in no case shall the contractor be entitled to extra compensation for such a deviation and the contractor shall not be relieved of responsibility for delivery of cargo to the destination named in the Shipping Order.

2.4 Strikes

2.4.1 Loading Port—In the event the vessel or the loading of the vessel is delayed by reason of strikes or stoppage of work, the contractor may, at the loading port dispatch the vessel with such portion of the cargo as may then be on board.

2.4.2 Discharge Port—In the event the vessel or discharge of the vessel is delayed by reason of strikes or stoppage of work, the contractor at the discharge port may discharge the cargo still on board or with the approval of the U.S. Government dispose of the cargo or any part of it at the U.S. Government’s risk and expense.

2.5 Amended Jason Clause

In the event of accident, danger, damage, or disaster, before or after commencement of the voyage resulting from any cause whatsoever, whether due to negligence or not, for which, or for the consequence of which, the contractor is not responsible, by statute, contract, or otherwise, the goods, Shippers, consignees, or owners of the goods shall contribute with the contractor in general average to the payment of any sacrifices, losses or expenses of a general average nature that may be made or incurred, and shall pay salvage and special charges incurred in respect of the goods. If a salvaging vessel is owned or operated by the contractor, salvage shall be paid for as fully as if such salvaging vessel or vessels belonged to strangers.

2.6 General Average

General average shall be adjusted, stated and settled, according to York-Antwerp Rules 2004 and subsequent Amendments, if any, thereto at such port or place in the United States as may be selected by the contractor, and as to matters not provided for by those Rules, according to the laws and usages at the Port of New York. In such adjustment, disbursements in foreign currencies shall be exchanged into United States money at the rate prevailing on the dates made and allowances for damage to cargo claimed in foreign currency shall be converted at the rate prevailing on the last day of discharge at the port or place of final discharge of such damaged cargo from the ship.

2.7 Liens

2.7.1 Seizure of Cargo: The contractor agrees that it will not assert any type of lien, including a maritime lien, on any cargo shipped by the U.S. Government under this Contract. The contractor further agrees that it will not take any action to seize, arrest, hold, or otherwise detain such cargo through any judicial process in the U.S. or any foreign country. The contractor agrees to insert this clause in all subcontracts at any level and to expend any resources necessary to expeditiously enforce the provisions of this clause against such subcontractors.

2.7.2 Freight: There shall be no liens, including maritime liens, asserted on any freights payable by the U.S.

Government under this contract. The Contractor agrees to insert this clause in all subcontracts at any level and to expend any resources necessary to expeditiously enforce the provisions of this clause against such subcontractors.

2.8 Force Majeure

The acts of God, enemies, fire, restraint of princes, rulers of people, and all dangers and accidents of the seas, rivers, machinery, boilers and steam navigation, and errors of navigation throughout this Contract are mutually excepted.

In other words, such situations excuse delay in performance (similar to paragraph (f) of FAR 52.212-4) by either party to this contract to the extent that the situation persists in preventing performance. This clause does not address liability for loss/damage to cargo (see, instead, the applicable “Application of COGSA clause”), liability for costs/damages resulting from delay in performance, or matters other than excusable delay.

3. War Risk

3.1 Compensation

In the event it is necessary for the Contractor to pay additional premiums to extend the coverage of crew, hull and machinery, protection and indemnity insurance and insurance covering the loss and damage of cargo while aboard the vessel at sea (not applicable to inland cargo) to include war risks, or to pay crew war risk bonuses as a result of the vessel entering the war risk area, the US Government will reimburse the Contractor in the amount of the surcharge (by whatever name) set forth in the Contractor's commercial tariff relating to war risk when the normal routing of one or more of the vessels carrying the shipment involves transiting a Listed Area designated by Lloyd' Market Association's Joint War Committee.

For Contractors that do not have filed commercial tariffs for such War Risk charges, the US Government shall reimburse the Contractor for a percentage of such extra premium and bonus payments based on the ratio existing between the cargo carried for the account of SDDC and the total cargo aboard the vessel which is loaded or discharged at ports within the War Risk area.

The intent of this clause is that War risk will only be paid if the vessel actually enters or travels through war risk areas. War risk is not paid by destination regardless of whether a contractor’s tariffs include war risk insurance premiums based on destination. Contractors will provide copies of relevant War Risk Insurance policies or the applicable tariffs to the Contracting Officer within 10 days of award. The Contractor will notify the Government 30 days in advance of any change to an applicable tariff.

3.2 Alternatives

If Commercial Marine, War Risk, and Liability Insurance is not available or if Marine, War Risk, and Liability Insurance through the Secretary of Transportation under Sections 1202-1205 of the Merchant Marine Act of 1936, 46 App. U.S.C. 1282-1285, is available at a lesser rate, the Contracting Officer (CO) reserves the right to require contractors to obtain the necessary Marine, War Risk, and Liability Insurance from the Secretary of Transportation.

Further, in the event that the Secretary of Defense, or his/her authorized designee, is authorized to provide and does provide indemnification to the Secretary of Transportation under Section 1205 of the Merchant Marine Act, 1936, 46 App. U.S.C. 1285, for Marine, War Risk, and Liability coverage without premium, the Contracting Officer reserves the right to require the contractor to obtain such insurance from the Department of Transportation and no premiums as set forth in Paragraph 3.1 above will be paid to the contractor by the U.S. Government.

3.3 Limitation of U.S. Government Liability

No payments shall be made until the contractor also assess such charges against commercial cargo loaded or discharged in the war risk area.

4. Cargo Claims

The Government will process cargo claims in accordance with the Defense Transportation Regulation, Volume II, Chapter 210, and the Contractor agrees to cooperate with Government efforts to resolve claims for loss or damage to Government cargo.

5. Rejection and Price Reduction for Non-Conforming Transportation Services

5.1 The Contractor recognizes that the Contracting Officer ordinarily must reject services that are non-conforming in a major or critical aspect or are otherwise incomplete. To the extent the transportation of cargo results in loss or damage of cargo, the purpose of the transportation is frustrated and the non-conformance in the transportation service is major/critical.

5.2 The Contracting Officer may evaluate the conformity of transportation to contract requirements in addition to evaluating whether lost/damaged cargo complies with contract requirements. If cargo is found to be lost or damaged, either before or after acceptance by the Government of the cargo, and the loss/damage is due to fault or liability of the contractor under the contract, the Contracting Officer may - in addition to any action related to the lost/damaged cargo - take any of the following actions related to non-conforming transportation:

a) Notify the contractor of the non-conforming transportation;

b) Request the contractor to address fault or liability for loss or damage to cargo and corresponding non-conforming transportation;

c) Reject the non-conforming transportation in whole or in part, as may be warranted;

d) Seek a price reduction or other consideration in whole or in part, to the extent the transportation is non-conforming.

5.3 The Contracting Officer shall not revoke acceptance of transportation services, reject transportation services, or implement a price reduction until the contractor has been provided notice and an opportunity to demonstrate that the transportation services conformed to the contract of carriage as booked.

6. Compensable Delays

6.1 Other clauses in this contract (such as FAR 52.212-4 paragraph f; 2.8 force majeure; 2.3.2 Scope of Voyage (Liberties); etc.) cover delay in performance or frustration of performance in certain situations. Section 2.3.1 Scope of Voyage (Liberties) provides for monetary equitable adjustment, but only in the case of maritime (not in-land) transportation where attempted delivery to the destination port has been abandoned.

6.2 Situations where the U.S. Government Causes a Delay. This clause addresses compensation/financial liability in other situations. Specifically, to the extent action or inaction by the U.S. Government in either its contractual or sovereign capacity, causes a delay in Contractor performance, the Contractor shall be entitled to an equitable adjustment for costs incurred directly related to the safety and security of U.S. Government cargo or related to efforts to deliver the cargo as contracted. Such cost shall be reasonable, supported by appropriate documentation and subject to audit. The Contractor shall be entitled to such equitable adjustment under this contract to the extent that:

a) The U.S. Government action or inaction is otherwise not compensable under other provisions of this contract; and

b) The U.S. Government action or inaction interferes with or prevents performance of a contractual obligation by a reasonable Contractor; and

c) The Contractor’s actions or inactions have not contributed to the Government caused delay; and

d) The Contractor has exercised due diligence to mitigate the delay or the financial consequences of such delay.

6.2.1 In no case shall an equitable adjustment duplicate compensation provided in a USC-7 freight rate, accessorial charge or similar charge or otherwise reimburse the Contractor for costs chargeable (by the Contractor) to or otherwise allocable to a non-USC-7 shipper.

6.3 Situations where neither the Contractor nor the U.S.Government Cause Delay. To the extent delays in Contractor performance are caused by third parties, natural causes, or any cause other than those within the control of either the Contractor or the U.S. Government, this clause apportions risk. In such situations, the Contractor may be entitled to an equitable adjustment for costs incurred directly related to the safety and security of U.S.

Government cargo or related to efforts to deliver the cargo as contracted. Such cost shall be reasonable, supported by appropriate documentation and subject to audit. The Contractor shall be entitled to an equitable adjustment to the extent that:

a) The subject delay is caused by an extraordinary event not within the control of either the U.S.

Government or the Contractor. An extraordinary event is uncommon or unusual and beyond the control of a reasonable Contractor exercising customary foresight and sound business practices; and

b) The extraordinary event is otherwise not compensable under other provisions of this contract; and

c) The extraordinary event interferes with or prevents performance of a contractual obligation by a reasonable Contractor; and

d) The Contractor has exercised due diligence to mitigate the delay or the financial consequences of such delay.

6.4 Exigency Areas. With respect to declared Exigency Areas (See Section 6 of the PWS), the scope of equitable adjustment is hereby broadened to the extent that action or inaction by any government, not just the U.S.

Government, delays Contractor performance in a declared Exigency Area or at the border of a declared Exigency Areas. In all other respects, the terms of Paragraph 6.2 above shall apply to Exigency Areas.

6.4.1 In no case shall an equitable adjustment duplicate compensation provided in a USC-7 freight rate, accessorial charge or similar charge or otherwise reimburse the Contractor for costs chargeable (by the Contractor) to or otherwise allocable to a non-USC-7 shipper.

6.5 Notice. The Contractor shall, as soon as practicable, provide notice to the cognizant SDDC Group Operations Center and the cognizant COR of the events giving rise to a potential request for compensation under this clause.

7. Contractor Performance Assessment Reporting

7.1 Good performance by Department of Defense (DOD) contractors is essential. FAR 42.1502 directs all Federal Agencies to collect past performance information on contracts, which will benefit source selection teams.

TCAQ will be conducting an evaluation of your company’s performance for the duration of the contract using a web-enabled application called the Contractor Performance Assessment Reporting System (CPARS).

7.2 As of 01 November 2006, all DoD contractors were required to obtain a Public Key Infrastructure (PKI) certificate to access the CPARS/ACASS/CCASS applications. DoD contractors are required to purchase a certificate from an External Certificate Authority (ECA). We recommend that you begin the process in the very near future to obtain the PKI Certificate before the CPARs becomes available for review. If you have questions on obtaining PKI certificates, please visit http://www.cpars.csd.disa.mil/cparsmain.htm. Questions should be directed to the Customer Support Desk at (207) 438-1690, or via e-mail: webptsmh@navy.mil.

7.2.1 You may purchase a DoD PKI certificate from one of three External Certificate Authorities (ECAs). The ECAs are vendors who provide digital certificates to DoD's industry partners who are using their own equipment or working in non-government facilities. A list of ECAs is available at http://www.cpars.disa.mil/pki_info.htm. Each contractor employee accessing CPARS, ACASS, or CCASS will need an Identity Certificate; an Encryption Certificate is not required.

7.3 Following a contract award, the contracting officer will request the contractor furnish the name of the Defense Contractor Representative who will have program management oversight on the awarded contract and is qualified to participate in the performance assessment process. This individual will receive a CPARS Userid and Temporary Password from the Government CPARS Focal Point by telephone or E-mail.

7.4 Contractors should log on to the Navy CPARS website (http://www.cpars.csd.disa.mil/cparsmain.htm). At this site, you will find helpful information regarding the CPARS process under “Reference Material.”

8. Pass-through Charges

8.1 The Contractor shall pay valid pass-through charges incurred on behalf of the U.S. Government. Pass-through charges shall not include any cost or charge that is included in priced services or is paid directly by the U.S.

Government or the consignee. The Government shall pay the Contractor on a cost reimbursement basis for valid direct pass-through charges, incurred by the Contractor on behalf of the U.S. Government, not included in priced services or covered by the Compensable Delays clause at “Additional Clauses” paragraph 6. The pass-through charges shall be allowable, reasonable, and allocable, supported by an invoice, and subject to audit. The Government reserves the right to reject any pass-through charge that is not allowable, reasonable, and allocable, or is not supported by a proper invoice. Pass-through charges shall include only direct reimbursable pass-through costs and shall exclude overhead, general and administrative expenses, and profit.

8.1.1 Examples of the type of additional charges that shall be paid include, but are not limited to, port storage, custom inspection charges, rework of improper blocking and bracing, and dry run.

8.1.2 Pass-through charges shall be invoiced in accordance with Attachment 6.

8.2 Priced Services

8.2.1 Pursuant to Attachment 11, Rate Rules, all rates shall include all costs for normal services from gate to gate. Priced services include Section 1.1. Ocean Freight Rates--Containers, Section 1.2 Ocean Freight Rates— Breakbulk/RORO, Section 1.3 Ocean Rates—Container and Breakbulk, Section 3.H Accessorials, Section 3.J Additional Services, Section 3.K Linehaul for Breakbulk and Out-of-Gauge (OOG) Cargo, Section 3.K.2 Carload Service, Section 4.A Shipments by Authorized Agents of the U.S. Government, and Section 4.B Shipments of Cargo Not Owned by the U.S. Government, and Section 2.A.1 Excepted Cargo and Routes. Costs or charges included in priced service shall not be invoiced as a pass-through charge.

8.3 Equitable Adjustments

8.3.1 Where the Government causes delay, or where neither the Contractor nor the U.S. Government cause the delay, and the Contractor accrues costs due to the delay, pursuant the Compensable Delays clause at “Additional Clauses” paragraph 6, these costs shall not be invoiced under Attachment 6 as pass-through charges. These alleged additional costs, charges, or third-party reimbursement costs shall be submitted in accordance with FAR 52.212-4(c) and (d).

8.3.2 Examples of costs that shall be submitted in accordance with FAR 52.212-4(c) and (d) include, but are not limited to, Government-caused delay costs, customs delay costs, border delay costs, destination delay costs, gate delay costs, and costs relating to a requested Contract modification and/or costs relating to an alleged Contract change.

9. Government Furnished Contractor Support Services for Afghanistan

The following is a summary of the type of support the Government will provide the contractor on an ‘as-available’ basis at FOB/HUB locations in Afghanistan when designated by the Contracting Officer in writing.

In the event of any discrepancy between this summary and the description of services in the Performance Work Statement, this clause will take precedence.

US Citizens/Third Country Nationals/Local Nationals

Biometric Billeting (See Note 1) Commissary (See Note 2) Military Exchange (See Note 2)

DFAC (See Note 3) Transportation (See Note 4)

NOTE:

(1) Billeting. As a general rule, billeting is not available for contractors in Afghanistan. On an exception basis, contractors may be permitted US Government Billeting if a critical need by the US Government exists and approval is granted by the Base Commander as recommended by the Base Mayor’s Cell.

(2) Commissary and Military Exchange facilities are available and authorized for contractor use. Contractor employees choosing to utilize these services may do so at their own expense and at no cost to the Government for goods purchased.

(3) Dining facilities (DFACs) are available and authorized for contractor use. Contractor employees choosing to consume their meals at the DFAC’s shall be required to pay the established meal rates for all meals consumed.

(4) Transportation. Base transportation (bus or shuttle) may not be available. Subject to US Government security inspection, contactors are entitled to use contractor provided transportation to facilitate movement within Afghanistan FOBs as well as movement on and off FOBs.

10. Subcontractor Responsibility.

10.1 The contractor has a duty to determine the responsibility of its prospective subcontractors. Special factors related to performance of this contract compel the contracting officer to assist in that determination of subcontractor responsibility. These factors include critical requirements, substantial subcontracting, safety concerns, risk of terrorism and hostilities, and rapidly changing organizational forms of subcontractors that mask prior performance records and relationships with affiliated concerns. Periodically, the contracting officer will make available to the contractor the name of potential subcontractors with questioned responsibility. These names will be periodically updated to reflect more recent information and changing evaluations. The contractor shall not allow named entities to perform any role in performance of a task order (booking) under this contract unless it first provides written evidence to the contracting officer that affirmatively demonstrates to the contracting officer's satisfaction the responsibility of the proposed subcontractor.

11. Fuel Surcharge, FAR 252.247-7003 Exception

11.1 This contract contains the clause 252.247-7003, Pass-Through of Motor Carrier Fuel Surcharge Adjustment to the Cost Bearer. Carriers are excepted from the requirements of 252.247-7003 if its subcontracts with motor carriers effectively pass the equivalent Fuel Adjustment Factor provided in this contract, regarding fuel-related surcharge adjustments, to the person, corporation, or entity that directly bears the cost of fuel for shipments transported under this contract. Carriers shall provide, upon request, copies of subcontracts demonstrating a fuel surcharge clause is included in the subcontract.

USC-7, Exhibit 3, Performance Work Statement (24 Feb 2012)

TABLE OF CONTENTS

SECTION 1 - BACKGROUNDSECTION 1 – BACKGROUND 4

1.A History 4

1.B Purpose 4

1.C Period of Performance 4 1.C.1 Base Period ______________________________________________________________ 4 1.C.2 Option Periods ____________________________________________________________ 4

SECTION 2 – SCOPE 5

2.A Scope 5 2.A.1 Overview ________________________________________________________________ 5 2.A.2 Excepted Cargo and Routes __________________________________________________ 5

2.B Aggregate Government Volume Estimates 5

SECTION 3 – GENERAL REQUIREMENTS 6

3.A General/Administrative 6 3.A.1 Use of English Language ____________________________________________________ 6 3.A.2 Hazardous Cargo __________________________________________________________ 6 3.A.3 Quality Control, Reporting, and Records _______________________________________ 6 3.A.4 Invoicing and Payment _____________________________________________________ 7 3.A.5 Responsibility for Charges and Taxes __________________________________________ 7 3.A.6 Space Commitment ________________________________________________________ 8 3.A.7 Schedule Maintenance ______________________________________________________ 8 3.A.8 Service Changes __________________________________________________________ 9 3.A.9 Customer Service Assistance _________________________________________________ 9 3.A.10 Electronic Commerce / Electronic Data Interchange (EDI) _________________________ 9 3.A.11 Manual Operational Reports ________________________________________________ 12 3.A.12 Daily Intransit Visibility (ITV) Reports _______________________________________ 12 3.A.13 Vessel Cutoffs, Late Gates, and Expedited Origin Linehaul ________________________ 13 3.A.14 Required Delivery Date (RDD) ______________________________________________ 13 3.A.15 Less-Than-Container-Load (LCL) Container Services ____________________________ 14 3.A.16 Equipment ______________________________________________________________ 14 3.A.17 Chassis Requirements _____________________________________________________ 14 3.A.18 Equipment Pools (container only) ____________________________________________ 15 3.A.20 Flatrack Containers _______________________________________________________ 15 3.A.21 Bulk Liquids ____________________________________________________________ 15

3.B Shipment Booking and Scheduling 16 3.B.1 Shipment Booking ________________________________________________________ 16 3.B.2 Booking Acceptance ______________________________________________________ 16 3.B.3 Response to Booking Requests ______________________________________________ 16 3.B.4 Automated Booking (This paragraph does not apply to Breakbulk Carriers) ___________ 16 3.B.5 Direct Booking Procedures _________________________________________________ 16

3.C Origin Services 17 3.C.1 Providing Empty Containers to Shippers _______________________________________ 17 3.C.2 Live load _______________________________________________________________ 17

3.D Ocean Transportation 18 3.D.1 Cargo Lift and Advancement ________________________________________________ 18 3.D.2 Services During Hazardous Cargo Handling ____________________________________ 18

3.E Cargo Clearance Service 19 3.E.1 Responsibilities __________________________________________________________ 19

3.F Destination Services 20 3.F.1 Delivery Notification and Receipt ____________________________________________ 20

TABLE OF CONTENTS

3.F.2 Expedited Delivery _______________________________________________________ 21 3.F.3 Live Unload _____________________________________________________________ 22 3.F.4 Container Pick Up/Return __________________________________________________ 22

3.G Exceptions to Normal Service 22 3.G.1 Alternate Service _________________________________________________________ 22 3.G.2 Recurring Service Failure __________________________________________________ 22 3.G.3 Canceled Shipments/No Shows ______________________________________________ 23 3.G.4 Free Time _______________________________________________________________ 23 3.G.5 Rerouting of Cargo _______________________________________________________ 26 3.G.6 Staging _________________________________________________________________ 27 3.G.7 Notice of Transfer of Cargo _________________________________________________ 27 3.G.8 Damage to Contractor Equipment ____________________________________________ 27 3.G.9 Theft or Disappearance ____________________________________________________ 28 3.G.10 Port Storage _____________________________________________________________ 28 3.G.11 Futile Trip ______________________________________________________________ 29

3.H Accessorials 29 3.H.1 Stop-off Service In Transit _________________________________________________ 29 3.H.2 CONUS Linehaul for Containerized Ammunition Shipments _______________________ 30 3.H.3 Cargo Concealment _______________________________________________________ 30 3.H.4 Supercargo ______________________________________________________________ 30 3.H.5 Flatrack Tie-Down Equipment Surcharge ______________________________________ 30 3.H.6 Exterior Cargo Rinsing Service ______________________________________________ 30 3.H.7 Exterior Cargo Washing Service _____________________________________________ 31 3.