N00024-14-R-6204.pdf

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129 - 164 X H 165 - 183

RATING PAGE OF PAGES

7. ISSUED BY

(Date)

IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other authorized official written notice.

Previous Edition is Unusable 33-134 STANDARD FORM 33 (REV. 9-97)

Prescribed by GSA FAR (48 CFR) 53.214(c)

DO-A7 1 183

(If other than Item 7)

15A. NAME 16. NAME AND TITLE OF PERSON AUTHORIZED TO

AND

ADDRESS SIGN OFFER (Type or print)

OF

OFFEROR

AMENDMENT NO. DATE

15B. TELEPHONE NO (Include area code) 17. SIGNATURE15C. CHECK IF REMITTANCE ADDRESS

IS DIFFERENT FROM ABOVE - ENTER

SUCH ADDRESS IN SCHEDULE.

18. OFFER DATE

1. THIS CONTRACT IS A RATED ORDER

UNDER DPAS (15 CFR 700)

2. CONTRACT NO.

N00024 8. ADDRESS OFFER TO

See Item 7

9. Sealed offers in original and 11 copies for furnishing the supplies or services in the Schedule will be received at the place specified in Item 8, or if handcarried, in the depository located in

CAUTION - LATE Submissions, Modifications, and Withdrawals: See Section L, Provision No. 52.214-7 or 52.215-1. All offers are subject to all terms and

SEE SECTION L

conditions contained in this solicitation.

10. FOR INFORMATION

CALL:

A. NAME (NO COLLECT CALLS)

11. TABLE OF CONTENTS

SOLICITATION/ CONTRACT FORM

SUPPLIES OR SERVICES AND PRICES/ COSTS

2 - 45

X I CONTRACT CLAUSES

DESCRIPTION/ SPECS./ WORK STATEMENT X

PACKAGING AND MARKING

46 - 64 65 - 68

J LIST OF ATTACHMENTS

INSPECTION AND ACCEPTANCE

DELIVERIES OR PERFORMANCE

69 - 72

73 - 79 X K REPRESENTATIONS, CERTIFICATIONS AND

OTHER STATEMENTS OF OFFERORS

CONTRACT ADMINISTRATION DATA 80 - 83 X

SPECIAL CONTRACT REQUIREMENTS

OFFER (Must be fully completed by offeror) 84 - 92 X M

L INSTRS., CONDS., AND NOTICES TO OFFERORS

EVALUATION FACTORS FOR AWARD

NOTE: Item 12 does not apply if the solicitation includes the provisions at 52.214-16, Minimum Bid Acceptance Period.

is inserted by the offeror) from the date for receipt of offers specified above, to furnish any or all items upon which prices are offered at the price set opposite each item, delivered at the designated point(s), within the time specified in the schedule.

13. DISCOUNT FOR PROMPT PAYMENT

(See Section I, Clause No. 52.232-8)

14. ACKNOWLEDGMENT OF AMENDMENTS

(The offeror acknowledges receipt of amendments

AMENDMENT NO. DATE

to the SOLICITATION for offerors and related documents numbered and dated):

FACILITY

12. In compliance with the above, the undersigned agrees, if this offer is accepted within calendar days (60 calendar days unless a different period

SOLICITATION, OFFER AND AWARD

X

(X) SEC. DESCRIPTION (X) SEC. DESCRIPTION PAGE(S)

PART I - THE SCHEDULE

26. NAME OF CONTRACTING OFFICER (Type or print) 27. UNITED STATES OF AMERICA 28. AWARD DATE

EMAIL:TEL: (Signature of Contracting Officer)

CODE CODE

B. TELEPHONE (Include area code) C. E-MAIL ADDRESS

AWARD (To be completed by Government)

19. ACCEPTED AS TO ITEMS NUMBERED 20. AMOUNT 21. ACCOUNTING AND APPROPRIATION

22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION:

10 U.S.C. 2304(c)( ) 41 U.S.C. 253(c)( ) (4 copies unless otherwise specified)

23. SUBMIT INVOICES TO ADDRESS SHOWN IN ITEM

24. ADMINISTERED BY (If other than Item 7) CODE 25. PAYMENT WILL BE MADE BY CODE

PART IV - REPRESENTATIO NS AND INSTRUCTIO NS

PART III - LIST O F DO CUMENTS, EXHIBITS AND O THER ATTACHMENTS

93 - 112

PART II - CO NTRACT CLAUSES

NAVAL SEA SYSTEMS COMMAND (HQ)

1333 ISAAC HULL AVE SE

WASHINGTON NAVY YARD DC 20376-2050

FAX:

TEL:

FAX:

TEL:

NOTE: In sealed bid solicitations "offer" and "offeror" mean "bid" and "bidder".

SOLICITATION

6. REQUISITION/PURCHASE NO.

N0002413NR99390

5. DATE ISSUED

21 Apr 2014

4. TYPE OF SOLICITATION

SEALED BID (IFB)

NEGOTIATED (RFP)

[ X ]

3. SOLICITATION NO.

N00024-14-R-6204

Section B - Supplies or Services and Prices

ITEM NO SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT

0001 1 Lot

LPPM DESIGN AND DEVELOPMENT

CPIF

Low Profile Photonics Mast (LPPM) See Note 1 and Notes A, F and H Share Ratio Above and Below Target: 60/40 FOB: Origin

PURCHASE REQUEST NUMBER: N0002413NR99390

TARGET COST

TARGET FEE

TOTAL TGT COST + FEE

MINIMUM FEE

MAXIMUM FEE

SHARE RATIO ABOVE TARGET

SHARE RATIO BELOW TARGET

0002 LPPM FIRST ARTICLE CCM

OPTION Configuration Control Model (CCM)

NET AMT

0002AA 1 Lot

OPTION LPPM CCM FIRST ARTICLE QUALIFICATION

CPIF

First Article Qualification See Note 1 and Notes B and F Share Ratio Above and Below Target: 60/40

TOTAL TGT COST + FEE

MINIMUM FEE

MAXIMUM FEE

0002AB 1 Each

OPTION LPPM MAST FIRST ARTICLE CCM

CPIF

See Note 1 and Notes B and F

TOTAL TGT COST + FEE

MINIMUM FEE

MAXIMUM FEE

0002AC 1 Each

OPTION ELECTRONIC SUPPORT MEASURE (ESM)

CPIF

Electronic Support Measure (ESM) Subsystem First Article CCM See Note 1 and Notes B and F

TOTAL TGT COST + FEE

MINIMUM FEE

MAXIMUM FEE

0002AD 1 Each

OPTION DIPLOOP FIRST ARTICLE CCM

CPIF

See Note 1 and Notes B and F

TOTAL TGT COST + FEE

MINIMUM FEE

MAXIMUM FEE

0003 DESIGN AND DEVELOPMENT/ NRE

DATA

Exhibit A See Notes C and N Not Separately Priced Prices for Item 0003 are included in the estimated amounts for Items 0001, 0002AA, 0002AB, 0002AC, 0002AD

0004 150,000 Man

Hours

ENGINEERING AND TECHNICAL SERVICES

See Note 1 and Notes A, H and J

CPFF

ESTIMATED COST

FIXED FEE

TOTAL EST COST + FEE

0005 1 Lot

SUPPORT FOR ENGINEERING SERVICES

COST

Material, Travel & Subsistence for Item 0004 See Note 1 and Notes A, H, J and K

ESTIMATED COST

0006 ENGINEERING SERVICE DATA

Exhibit C See Note C Not Separately Priced Prices for Item 0006 are included in the estimated cost for Item 0004

0007 PIO ORDERS

FFP

Profit Percentage: OFFEROR TO PROPOSE See Note 1 and Note E

0008 DATA RIGHTS

1 Lot

OPTION Reserved for potential cost impact of contractor proposed data rights See Note 1 and Note B

0009 WARRANTY

OPTION See Note 1 and Note O

0101 LPPM NEW CONSTRUCTION SYS 1

0101AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

See Note 1 and Notes B, G and L

TARGET PROFIT

TOTAL TARGET PRICE

CEILING PRICE

0101AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G Share Ratio Above and Below Target: 70/30

TOTAL TARGET PRICE

CEILING PRICE

0101AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0102 LPPM NEW CONSTRUCTION SYS 2

0102AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

See Note 1 and Notes B, G and L

TOTAL TARGET PRICE

CEILING PRICE

0102AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0102AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0103 PRODUCTION DATA

Prices for Item 0103 are included in the target price for Items 0101AA, 0101AB, 0101AC, 0102AA, 0102AB, 0102AC, 0104AA, 0105AA, 0201AA, 0201AB, 0201AC, 0202AA, 0202AB, 0202AC, 0203AA, 0204AA, 0301AA, 0301AB, 0301AC, 0302AA, 0302AB, 0302AC, 0303AA, 0304AA, 0401AA, 0401AB, 0401AC, 0402AA, 0402AB, 0402AC, 0403AA, and 0404AA Exhibit B See Note C Not Separately Priced

0104 SPARE/MODERNIZATION MAST

0104AA Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-3) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0105 LPPM MODERNIZATION KIT

0105AA Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-6) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0106 1 Lot

OPTION SMALL BUSINESS SUBCONTRACTING INCENTIVE

Small Business Subcontracting Special Incentive Fee Earned See Notes A, B and I Fee (For Payment Purposes Only)

0201 LPPM NEW CONSTRUCTION SYS 3

0201AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

See Note 1 and Notes B, G and L

TOTAL TARGET PRICE

CEILING PRICE

0201AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0201AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0202 LPPM NEW CONSTRUCTION SYS 4

0202AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

TOTAL TARGET PRICE

CEILING PRICE

0202AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0202AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0203 SPARE/MODERNIZATION MAST

0203AA Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-3) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0204 LPPM MODERNIZATION KIT

0204AA Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-6) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0205 SMALL BUSINESS

SUBCONTRACTING INCENTIVE

OPTION See Notes A, B and I

0301 LPPM NEW CONSTRUCTION SYS 5

0301AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

TOTAL TARGET PRICE

CEILING PRICE

0301AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G Share Ratio Above and Below Target: 50/50

TOTAL TARGET PRICE

CEILING PRICE

0301AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0302 LPPM NEW CONSTRUCTION SYS 6

0302AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

TOTAL TARGET PRICE

CEILING PRICE

0302AB Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0302AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

SPARE/MODERNIZATION MAST

0303AA Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-3) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0304 LPPM MODERNIZATION KIT

0304AA Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-6) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0305 SMALL BUSINESS

0401 LPPM NEW CONSTRUCTION SYS 7

0401AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

TOTAL TARGET PRICE

CEILING PRICE

0401AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0401AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0402 LPPM NEW CONSTRUCTION SYS 8

0402AA 1 Lot

OPTION ECONOMIC ORDER QUANTITY MATERIAL

FPI

TOTAL TARGET PRICE

CEILING PRICE

0402AB 2 Each

OPTION LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0402AC 2 Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B and G

TOTAL TARGET PRICE

CEILING PRICE

0403 SPARE/MODERNIZATION MAST

0403AA Each

LOW PROFILE PHOTONICS MAST

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-3) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0404 LPPM MODERNIZATION KIT

0404AA Each

OPTION DIPLOOP

FPI

See Note 1 and Notes B, D and G Stepladder pricing for each quantity (1-6) is provided in the table below.

TOTAL TARGET PRICE

CEILING PRICE

0405 SMALL BUSINESS

Lot

NOTE 1 (TO BE REMOVED AT CONTRACT AWARD).

Applicable to ITEMs 0001, 0002AA, 0002AB, 0002AC, and 0002AD The minimum fee is zero-percent (0.00%) and the maximum fee is twelve percent (12.00%). The share ratio for the CPIF portion of the fee structure is 60/40 (60% Government/40% Contractor) for both underruns and overruns.

Applicable to ITEMs 0101AA, 0101AB, 0101AC, 0102AA, 0102AB, 0102AC, 0104AA, 0105AA, 0201AA, 0201AB, 0201AC, 0202AA, 0202AB, 0202AC, 0203AA, 0204AA, 0301AA, 0301AB, 0301AC, 0302AA, 0302AB, 0302AC, 0303AA, 0304AA, 0401AA, 0401AB, 0401AC, 0402AA, 0402AB, 0402AC, 0403AA, 0404AA The minimum fee is zero-percent (0.00%) and the maximum fee is fifteen-percent (15.00%). Ceiling price is one hundred and twenty percent (120%) of target cost. The share ratios for the FPI portion of the fee structure are displayed in the table below:

CLIN Overrun Share Ratio

Underrun Share Ratio

0101AA 60/40 60/40

0101AB 70/30 70/30

0101AC 70/30 70/30

0102AA 60/40 60/40

0102AB 70/30 70/30

0102AC 70/30 70/30

0104AA 70/30 70/30

0105AA 70/30 70/30

0201AA 60/40 60/40

0201AB 60/40 60/40

0201AC 60/40 60/40

0202AA 60/40 60/40

0202AB 60/40 60/40

0202AC 60/40 60/40

0203AA 60/40 60/40

0204AA 60/40 60/40

0301AA 60/40 60/40

0301AB 50/50 50/50

0301AC 50/50 50/50

0302AA 60/40 60/40

0302AB 50/50 50/50

0302AC 50/50 50/50

0303AA 50/50 50/50

0304AA 50/50 50/50

0401AA 60/40 60/40

0401AB 50/50 50/50

0401AC 50/50 50/50

0402AA 60/40 60/40

0402AB 50/50 50/50

0402AC 50/50 50/50

0403AA 50/50 50/50

0404AA 50/50 50/50

Applicable to ITEM 0004 Fixed fee shall not exceed ten-percent (10%) and the hours are established at 150,000.

Applicable to ITEM 0005 The estimated ceiling is hereby established to be $1,250,000 plus $1,250,000 times the Offeror’s indirect rates for costs allowable and allocable to this item.

Applicable to ITEM 0007 Offerors shall propose indirect rates for costs allowable and allocable to this item and a profit percentage against a fixed value of $30,000,000. This profit percentage shall apply to all PIO orders placed under this ITEM for the duration of the contract. The ceiling value will include $30,000,000 plus $30,000,000 times the offeror’s proposed indirect cost rates. Then multiply this product by one plus the Offeror’s total proposed profit percentage.

Applicable to ITEM 0008 Offerors shall propose a price for data rights if offered for sale to the Government.

Applicable to ITEM 0009 Offerors shall propose a price for a warranty.

NOTE A: Subline Items identifying funding appropriation and FY designation will be assigned at the time of contract award, Option exercise, and/or allotment of funds.

NOTE B: Option item to which the clause OPTION FOR INCREASED QUANTITY--SEPARATELY PRICED LINE ITEM (MAR 1989) (NAVSEA VARIATION I) (52.217-7) in SECTION I applies and which is to be supplied only if and to the extent said Option is exercised.

NOTE C: Offeror shall complete the “Price” group and “Estimated Total Price” blocks of each data item on the Contract Data Requirements List(s), attached hereto.

NOTE D: Offeror shall propose for each step-ladder quantity identified in the table below corresponding to each item.

NOTE E: See Orders clause ORDERS (FIXED-PRICE) (NAVSEA 5252.216-9110) in Section H.

NOTE F: Cost Plus Incentive Item to which the clause INCENTIVE FEE (52.216-10) in Section I is applicable..

NOTE G: Fixed Price Incentive item to which the clause INCENTIVE PRICE REVISION--FIRM TARGET (52.216-16) in Section I is applicable.

NOTE H: Incrementally funded Item(s) to which the clause ALLOTMENT OF FUNDS (NAVSEA 5252.232-9104) is applicable.

NOTE I: Item to which the clause “SMALL BUSINESS SUBCONTRACTING INCENTIVE” in Section B is applicable. SBSIF will not be paid for any aspect of this contract that is not awarded or terminated.

NOTE J: The Government will issue Technical Instructions in accordance with the Section H clause of this contract entitled “TECHNICAL INSTRUCTIONS.” The contractor shall not perform any efforts under these items until and unless tasked by the Government.

NOTE K: The Government will fund this item as needed during contract performance. Material, travel, and subsistence costs incurred by the Contractor during the performance of this contract will be reimbursed at cost only (no fee will be paid on this line item).

NOTE L: Economic Order Quantity (EOQ) material will be subsumed into production LPPM and Diploop deliveries and will be accepted as the integrated end item.

NOTE M: Reserved

NOTE N: If funding for ITEM 0002 does not become available and the Government only awards ITEM 0001, the Contractor shall only delivery those Exhibit A CDRLs specifically identified in Attachment 2 Statement of Work.

NOTE O: The Contractor shall warranty items delivered under Contract Line Item Numbers 0101AB, 0101AC, 0102AB, 0102AC, 0104AA, 0105AA, 0201AB, 0201AC, 0202AB, 0202AC, 0203AA, 0204AA, 0301AB, 0301AC, 0302AB, 0302AC, 0303AA, 0304AA, 0401AB, 0401AC, 0402AB, 0402AC 0403AA, and 0404AA in accordance with the warranty provisions of this contract as specified in Section I.

STEPLADDER PRICING FOR FIXED-PRICE INCENTIVE ITEMS: ITEMS 0104AA, 0105AA, 0203AA, 0204AA, 0303AA, 0304AA, 0403AA, and 0404AA.

FPI

ITEM

0104AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 70/30 Qty = 2 $ $ $ $ 70/30 Qty = 3 $ $ $ $ 70/30

0105AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 70/30 Qty = 2 $ $ $ $ 70/30 Qty = 3 $ $ $ $ 70/30 Qty = 4 $ $ $ $ 70/30 Qty = 5 $ $ $ $ 70/30 Qty = 6 $ $ $ $ 70/30

FPI TARGET TARGET TARGET CEILING PRICE OVER /

0203AA

COST PROFIT PRICE (120% OF

TARGET COST)

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 60/40 Qty = 2 $ $ $ $ 60/40 Qty = 3 $ $ $ $ 60/40

0204AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 60/40 Qty = 2 $ $ $ $ 60/40 Qty = 3 $ $ $ $ 60/40 Qty = 4 $ $ $ $ 60/40 Qty = 5 $ $ $ $ 60/40 Qty = 6 $ $ $ $ 60/40

0303AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 50/50 Qty = 2 $ $ $ $ 50/50 Qty = 3 $ $ $ $ 50/50

0304AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 50/50 Qty = 2 $ $ $ $ 50/50 Qty = 3 $ $ $ $ 50/50 Qty = 4 $ $ $ $ 50/50 Qty = 5 $ $ $ $ 50/50 Qty = 6 $ $ $ $ 50/50

0403AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 50/50 Qty = 2 $ $ $ $ 50/50 Qty = 3 $ $ $ $ 50/50

0404AA

TARGET

COST

TARGET

PROFIT

TARGET

PRICE

CEILING PRICE

(120% OF

TARGET COST)

OVER /

UNDER

TARGET

SHARE

RATIO

Qty = 1 $ $ $ $ 50/50 Qty = 2 $ $ $ $ 50/50 Qty = 3 $ $ $ $ 50/50 Qty = 4 $ $ $ $ 50/50 Qty = 5 $ $ $ $ 50/50 Qty = 6 $ $ $ $ 50/50

COST AND FEE SCHEDULE FOR LEVEL OF EFFORT ITEMS

(1)

HOURS

(2)

ESTIMATED

COST (EC)*

(3)

EC

HOURLY

RATE

=(2)/(1)

(4)

FIXED

FEE

(FF)*

(5)

FF

HOURLY

RATE

=(4)/(1)

(6)

HOURLY

EC+FF

=(3)+(5)

EXTENDED

EC+FF

=(2)+(4)

0004 150,000

* The Estimated Cost amount shown above includes Cost of Money; however, the Fixed Fee calculation excludes Cost of Money.

SMALL BUSINESS PARTICIPATION AND SMALL BUSINESS SUBCONTRACTING INCENTIVE

(Applicable to Items 0101AA, 0101AB, 0101AC, 0102AA, 0102AB, 0102AC, 0201AA, 0201AB, 0201AC, 0202AA, 0202AB, 0202AC, 0301AA, 0301AB, 0301AC, 0302AA, 0302AB, 0302AC, 0401AA, 0401AB, 0401AC, 0402AA, 0402AB, and 0402AC; payable under Items 0106, 0205, 0305, and 0405)

(a) Objective:

PEO Submarine is committed to increasing small business participation in submarine system and subsystem development, production and support efforts consistent with cost/benefit considerations and attainment of acquisition objectives. The Contractor may earn a Small Business Subcontracting Incentive Fee (SBSIF) under this contract for exceeding the Small Business Subcontracting Goals identified in the table below. No Small Business Subcontracting Incentive will be earned unless the contractor is making timely deliveries and is in compliance with the specifications for the software and hardware being acquired. The PCO will make the determination of whether the Contractor has met this prerequisite to be considered for the Incentive. In the event that the PCO determines that the Contractor’s performance is not satisfactory, the Contractor will not be eligible for the Special Incentive. The specifics for evaluation of the SBSIF are set forth in paragraphs that follow.

(b) Small Business Subcontracting Goals:

The following table identifies the percentages against which the Contractor’s performance for the purposes of the SBSIF will be measured for the evaluation periods.

Subcontract Category Goal*

Small Business (SB) 37.2% HUBZone Small Business (HUBZone) 3.0% Service-Disabled Veteran-Owned Small Business (SDVOSB) 3.0% Small Disadvantaged Business (SDB) 5.0% Women-Owned Small Business (WOSB) 5.0% Historically Black Colleges & Universities and Minority Institutions (HBCU/MI)** 5.0%

*Base for measurement is total subcontract dollars. SBSIF may be earned for exceeding these goals.

**HBCU/MI obligations above 3% may be counted toward the SDB goal.

(c) CLINs and SBSIF Available:

The SBSIF described in this clause is available for Items 0101AA, 0101AB, 0101AC, 0102AA, 0102AB, 0102AC, 0201AA, 0201AB, 0201AC, 0202AA, 0202AB, 0202AC, 0301AA, 0301AB, 0301AC, 0302AA, 0302AB, 0302AC, 0401AA, 0401AB, 0401AC, 0402AA, 0402AB, and 0402AC if and to the extent the option is exercised. The period of evaluation is from option exercise until delivery of all Sub-Contract Line Item Number under Items 0101, 0102, 0201, 0202, 0301, 0302, 0401, and 0402. Once delivery is made for all SLINs under each of the CLINs, The evaluations will be accomplished for the periods identified in the table below based on the value of the small business subcontracting during each period. The SBSIF pool contingency in each of these periods will be 2% of the total amount obligated against target cost for each of the items identified herein.

(d) SBSIF Earned:

Percentage of Final SBSIF Pool available by Small Business Category Percentages Apply to Each Separate CLIN

Small Business Category 0101* 0102* 0201* 0202* 0301* 0302* 0401* 0402*

SB 65% 65% 65% 65% 65% 65% 65% 65%

HUBZone 2% 2% 2% 2% 2% 2% 2% 2%

SDVOSB 6% 6% 6% 6% 6% 6% 6% 6%

SDB 9% 9% 9% 9% 9% 9% 9% 9%

WOSB 9% 9% 9% 9% 9% 9% 9% 9%

HBCU/MI 9% 9% 9% 9% 9% 9% 9% 9%

*If and to the extent options are exercised

(i) The amount of the Final SBSIF pool will be allocated to the Small Business Categories based on the percentages in the table above. The Contractor may earn the amount available under each category in each period if its subcontracting percentage for the applicable category during that period exceeds the goal established in paragraph

(b) above.

(ii) The Contractor will not earn any of the amounts available under each category if its subcontracting percentage during the period does not exceed the goal for the applicable category established in paragraph (b) above.

(iii) The incentive fee under this clause will be earned or not earned in each category in each period on an individual basis. Failure to earn the amount available under one or more of the categories does not preclude the Contractor from earning the amount available under the remaining category/categories.

(e) Procedures:

(i) Within (30) thirty working days of the end of each evaluation period identified in paragraph (c), the Contractor shall submit to the COR and PCO a Subcontracting Program Performance Report that includes the information required for the Government to determine the amount of SBSIF earned. At a minimum, the Contractor’s Report shall include the total amount obligated against target cost for applicable CLINs/SLINs, the total labor hours worked during the evaluation period by CLIN/SLIN, and any other data required for the Government to evaluate the Contractor’s Small Business Subcontracting performance.

(ii) Within fifteen (15) working days of receipt of the Contractor’s Report or revised report, the COR will review and evaluate the Contractor’s Report to determine if all required data was provided and if any SBSIF was earned. If the Contractor’s input is inadequate the COR will ask the Contractor to correct the inadequacies of their Report and to submit a revised Report.

(iii) Within thirty (30) working days of receipt of the Contractor’s Report or Revised Report, the COR will meet with the PCO to make a final determination of whether any such Special Incentive has been earned. The PCO will issue a unilateral modification providing earned Special Incentive.

(f) Finality of PCO’s Determination:

The parties agree that determinations of the PCO with respect to the amount of special incentive to be paid to the Contractor are unilateral decisions made solely at the discretion of the Government. Notwithstanding other term or condition of the contract, a payment under this incentive is not incurred or earned until the effective date of a written contract modification.

(g) Payment of Special Incentive:

The Contractor will be paid the special incentive amount(s) earned upon submittal of proper invoices to the cognizant Payment Office. The Contractor’s invoice shall show the amount of special performance incentive payable by contract line item. The Contractor’s invoice must cite the appropriate accounting data in order for payment to be effected.

(h) Single Point of Contact:

The Contractor shall establish a single point of contact to deal with the Government on its small business subcontracting activities relating to this contract. The Government encourages the Contractor to pursue activities that will support increasing the level of small business subcontracting participation under this contract including, but not limited to, internal education and training, participation in matchmaking conferences and other outreach efforts, and the use of SUB-Net to post subcontracting opportunities.

CLAUSES INCORPORATED BY FULL TEXT

EXPEDITING CONTRACT CLOSEOUT (NAVSEA) (DEC 1995)

(a) As part of the negotiated fixed price or total estimated amount of this contact, both the Government and the Contractor have agreed to waive any entitlement that otherwise might accrue to either party in any residual dollar amount of $500 or less at the time of final contract closeout. The term “residual dollar amount” shall include all money that would otherwise be owed to either party at the end of the contract, except that, amounts connected in any way with taxation, allegations of fraud and/or antitrust violations shall be excluded. For purposes of determining residual dollar amounts, offsets of money owed by one party against money that would otherwise be paid by that party may be considered to the extent permitted by law.

(b) This agreement to waive entitlement to residual dollar amounts has been considered by both parties. It is agreed that the administrative costs for either party associated with collecting such small dollar amounts could exceed the amount to be recovered.

LIMITATION OF COST/LIMITATION OF FUNDS (NAVSEA) (SEP 1990)

The clause entitled "LIMITATION OF COST" (FAR 52.232-20) or "LIMITATION OF FUNDS" (FAR 52.232-22), as appropriate, shall apply separately and independently to each separately identified estimated cost.

PAYMENTS OF FEE (S) (COMPLETION) (NAVSEA) (MAY 1993)

APPLICABLE TO ITEMS 0001 AND (IF OPTIONS ARE EXERCISED) 0002AA, 0002AB, 0002AC, 0002AD

(a) For purposes of this contract, "fee" means "target fee" in cost-plus-incentive-fee type contracts, "base fee" in cost-plus-award-fee type contracts, "fixed fee" in cost-plus-fixed-fee type contracts for completion and phase type contracts.

(b) The Government shall make payments to the Contractor, subject to and in accordance with the clause in this contract entitled "FIXED FEE" (FAR 52.216-8) or "INCENTIVE FEE", (FAR 52.216-10), as applicable. Such payments shall be equal to TBD percent (TBD) of the allowable cost of each invoice submitted by and payable to the Contractor pursuant to the clause of this contract entitled "ALLOWABLE COST AND PAYMENT" (FAR 52.216- 7), subject to the withholding terms and conditions of the "FIXED FEE" or "INCENTIVE FEE" clause, as applicable (percentage of fee is based on fee dollars divided by estimated cost dollars, including facilities capital cost of money). Total fee(s) paid to the Contractor shall not exceed the fee amount(s) set forth in this contract.

(c) In the event of discontinuance of the work under this contract, or any specified phase of the contract, in accordance with the clause of this contract entitled "LIMITATION OF FUNDS" (FAR 52.232-22) or "LIMITATION OF COST" (FAR 52.232-20), as applicable, the fee shall be equitably adjusted by mutual agreement to reflect the diminution of work. If the adjusted fee is less than the sum of all fee payments made to the Contractor under this contract, the Contractor shall repay the excess amount to the Government. If the adjusted fee exceeds all payments made to the Contractor under this contract, the Contractor shall be paid the additional amount, subject to the availability of funds. In no event shall the Government be required to pay the Contractor any amount in excess of the funds obligated under this contract at the time of the discontinuance of work.

(d) Fee(s) withheld pursuant to the terms and conditions of this contract shall not be paid until the contract has been modified to reduce the fee(s) in accordance with paragraph (c) above, or until the Procuring Contracting Officer has advised the paying office in writing that no fee adjustment is required.

PAYMENT OF FEES(S) (LEVEL OF EFFORT – ALTERNATE I) (NAVSEA) (MAY 2010)

APPLICABLE TO ITEM 0004

(a) For purposes of this contract, "fee" means "target fee" in cost-plus-incentive-fee type contracts, "base fee" in cost-plus-award-fee type contracts, or "fixed fee" in cost-plus-fixed-fee type contracts for level of effort type contracts.

(b) The Government shall make payments to the Contractor, subject to and in accordance with the clause in this contract entitled "FIXED FEE" (FAR 52.216-8) or "INCENTIVE FEE", (FAR 52.216-10), as applicable. Such payments shall be submitted by and payable to the Contractor pursuant to the clause of this contract entitled "ALLOWABLE COST AND PAYMENT" (FAR 52.216-7), subject to the withholding terms and conditions of the "FIXED FEE" or "INCENTIVE FEE" clause, as applicable, and shall be paid at the hourly rate(s) specified above per man-hour performed and invoiced. Total fee(s) paid to the Contractor shall not exceed the fee amount(s) set forth in this contract.

In no event shall the Government be required to pay the Contractor any amount in excess of the funds obligated under this contract.

REFUNDS (SPARES AND SUPPORT EQUIPMENT) (NAVSEA) (SEP 1990)

(a) In the event that the price of a spare part or item of support equipment delivered under this contract significantly exceeds its intrinsic value, the Contractor agrees to refund the difference. Refunds will only be made for the difference between the intrinsic value of the item at the time an agreement on price was reached and the contract price. Refunds will not be made to recoup the amount of cost decreases that occur over time due to productivity gains (beyond economic purchase quantity considerations) or changes in market conditions.

(b) For purposes of this requirement, the intrinsic value of an item is defined as follows:

(1) If the item is one which is sold or is substantially similar or functionally equivalent to one that is sold in substantial quantities to the general public, intrinsic value is the established catalog or market price, plus the value of any unique requirements, including delivery terms, inspection, packaging, or labeling.

(2) If there is no comparable item sold in substantial quantities to the general public, intrinsic value is defined as the price an individual would expect to pay for the item based upon an economic purchase quantity as defined in FAR 52.207-4, plus the value of any unique requirements, including delivery terms, inspection, packaging or labeling.

(c) At any time up to two years after delivery of a spare part or item of support equipment, the Contracting Officer may notify the Contractor that based on all information available at the time of the notice, the price of the part or item apparently exceeds its intrinsic value.

(d) If notified in accordance with paragraph (c) above, the Contractor agrees to enter into good faith negotiations with the Government to determine if, and in what amount, the Government is entitled to a refund.

(e) If agreement pursuant to paragraph (d) above cannot be reached, and the Navy's return of the new or unused item to the Contractor is practical, the Navy, subject to the Contractor's agreement, may elect to return the item to the Contractor. Upon return of the item to its original point of Government acceptance, the Contractor shall refund in full the price paid. If no agreement pursuant to paragraph (d) above is reached, and return of the item by the Navy is impractical, the Contracting Officer may, with the approval of the Head of the Contracting Activity, issue a Contracting Officer's final decision on the matter, subject to Contractor appeal as provided in the "DISPUTES" clause (FAR 52.233-1).

(f) The Contractor will make refunds, as required under this requirement, in accordance with instructions from the Contracting Officer.

(g) The Contractor shall not be liable for a refund if the Contractor advised the Contracting Officer in a timely manner that the price it would propose for a spare part or item of support equipment exceeded its intrinsic value, and with such advice, specified the estimated proposed price, the estimated intrinsic value and known alternative sources or item, if any, that can meet the requirement.

(h) This requirement does not apply to any spare parts or items of support equipment whose price is determined through adequate price competition. This requirement also does not apply to any spare part or item of support equipment with a unit price in excess of $100,000; or in excess of $25,000 if the Contractor submitted, and certified the currency, accuracy and completeness of, cost or pricing data applicable to the item.

TRAVEL COSTS - ALTERNATE I (NAVSEA) (DEC 2005)

(a) Except as otherwise provided herein, the Contractor shall be reimbursed for its reasonable actual travel costs in accordance with FAR 31.205-46. The costs to be reimbursed shall be those costs accepted by the cognizant DCAA.

(b) Reimbursable travel costs include only that travel performed from the Contractor's facility to the worksite, in and around the worksite, and from the worksite to the Contractor's facility.

(c) Relocation costs and travel costs incident to relocation are allowable to the extent provided in FAR 31.205-35;

however, Contracting Officer approval shall be required prior to incurring relocation expenses and travel costs incident to relocation.

(d) The Contractor shall not be reimbursed for the following daily local travel costs:

(i) travel at U.S. Military Installations where Government transportation is available,

(ii) travel performed for personal convenience/errands, including commuting to and from work, and

(iii) travel costs incurred in the replacement of personnel when such replacement is accomplished for the Contractor's or employee's convenience.

CONTRACT SUMMARY FOR PAYMENT OFFICE (COST/FIXED PRICE) (FEB 1997)

This contract includes the following mixture of cost reimbursement and fixed price line items:

ITEMS TYPE

0001, 0002AA, 0002AB, 0002AC, 0002AD CPIF

0003, 0006, 0103 NSP (DATA)

0004 CPFF

0005 COST ONLY

0007, 0008, 0009 FFP

0101AA, 0101AB, 0101AC, 0102AA, 0102AB, 0102AC, 0104AA,

0105AA, 0201AA, 0201AB, 0201AC, 0202AA, 0202AB, 0202AC,

0203AA, 0204AA, 0301AA, 0301AB, 0301AC, 0302AA, 0302AB,

0302AC, 0303AA, 0304AA, 0401AA, 0401AB 0401AC, 0402AA,

0402AB, 0402AC, 0403AA, 0404AA

0106, 0205, 0305, 0405 FEE (For Payment Purposes Only)

Section C - Descriptions and Specifications

ITEM 0001 LOW PROFILE PHOTONICS MAST DESIGN AND DEVELOPMENT

The Contractor shall provide the labor, material and perform travel necessary to complete the design and development of an LPPM and Diploop to be in accordance with Attachment 2, Statement of Work for Low Profile Photonics Mast (LPPM) Outboard Subsystem, Attachment 3, Performance / Functional Specification for the Low Profile Photonics Mast (LPPM) and Diploop drawings provided in Attachment 4.

ITEM 0002AA LOW PROFILE PHOTONICS MAST CONFIGURATION CONTROL MODEL FIRST ARTICLE

QUALIFICATION

The Contractor shall provide the labor, material and perform travel necessary to complete qualification and acceptance of an LPPM CCM First Article in accordance with Attachment 2, Statement of Work for Low Profile Photonics Mast (LPPM) Outboard Subsystem, Attachment 3, Performance / Functional Specification for the Low Profile Photonics Mast (LPPM) and Diploop drawings provided in Attachment 4.

ITEM 0002AB LOW PROFILE PHOTONICS MAST FIRST ARTICLE

The Contractor shall procure material, fabricate, assemble, check-out, test, and deliver one LPPM First Article CCM for VIRGINIA Class Submarines in accordance with Attachment 2, Statement of Work for Low Profile Photonics Mast (LPPM) Outboard Subsystem and Attachment 3, Performance / Functional Specification for the Low Profile Photonics Mast (LPPM)..

ITEM 0002AC ELECTRONIC SUPPORT MEASURES SUBSYSTEM CONFIGURATION CONTROL MODEL

The Contractor shall procure material, fabricate, assemble, check-out, test, and deliver stand-alone, bench-top ESM Subsystem CCM for VIRGINIA Class Submarines. The ESM Subsystem CCM shall provide bench-top level capabilities using production LPPM components in accordance with Attachment 2, Statement of Work for Low Profile Photonics Mast (LPPM) Outboard Subsystem, and Attachment 3, Performance / Functional Specification for the Low Profile Photonics Mast (LPPM).

ITEM 0002AD DIPLOOP FIRST ARTICLE CONFIGURATION CONTROL MODEL

The Contractor shall procure material, fabricate, assemble, check-out, test, and deliver LPPM Sensor Dip Loop Cable Assembly for VIRGINIA Class Submarines in accordance with Attachment 2, Statement of Work for Low Profile Photonics Mast (LPPM) Outboard Subsystem, Attachment 3, Performance / Functional Specification for the Low Profile Photonics Mast (LPPM) and Diploop drawing provided in Attachment 4.

Items 0003, 0006, and 0103 - The data to be furnished hereunder shall be prepared in accordance with the Contract Data Requirements List, DD Form 1423, Exhibits A, B, and C respectivelly, attached hereto.

ITEM(S) 0004- ENGINEERING SERVICES (NAVSEA) (APR 2004)

(a) The Contractor shall furnish the services of qualified engineer(s) to:

(1) Assist in planning, installation, testing, checkout, adjustment, operation, disassembly, and repair of LPPM Masts; and

(2) Perform on-the-job instruction and training of Navy personnel (military and/or civilian). (Not applicable to SCN funded items).

(b) For purposes of this requirement, the following definitions apply:

(1) "Domestic services" means services rendered within the United States (U.S.) and/or on Navy vessels in ports within the U.S. or at sea, provided the vessel does not enter port outside the U.S.

(2) "Foreign services"means services other than domestic.

(3) "United States" means the United States, its possessions, Puerto Rico, and any other place subject to its jurisdiction, but does not include leased bases or trust territories.

(4) "Man day" means the services of one engineer for one day of eight hours, Monday through Friday (excluding holidays).

(5) "Holidays" means all Federally recognized holidays.

(c) The engineering services shall be performed within the limits, if any, as to place(s)and period(s)specified therefor, as authorized by the COR in Section G.

(d) When authorized under paragraph(c) above, each engineer shall perform engineering services in accordance with supplemental instructions provided by the Contract Administration Office(CAO)cognizant of vessel construction/conversion contract, a representative of the authorizing activity or a representative of the activity where the engineering services are performed, as applicable. However, each engineer shall not be considered an employee of the Government.

(e) Travel time necessary for performance of such services shall be included in computing the man days of service.

When services are performed at sea and the engineer(s) is unable to leave the vessel when work is completed, the remaining time aboard the vessel shall be considered travel time for purposes of computing the man days of services.

However, the Contractor shall be paid for no more than one man day of service per calendar day for each engineer while in travel status.

(f) Passports, visas, inoculations and other medical requirements necessary for performance of engineering services shall be at the sole responsibility and expense of the Contractor.

(g) Each time services are performed, the engineer(s)shall obtain a certification of performance from a responsible U.S.Government official aboard the vessel or at the activity where the services were performed, citing tasks satisfactorily performed and hours worked each day.

(h) The maximum liability of the Government for each engineering services item shall not exceed the amount set forth in the Schedule, or the amount obligated whichever is less. If, at any time, the Contractor has reason to believe that the amounts it expects to incur in the performance of each engineering services item in the next succeeding sixty(60)days, when added to all amounts previously incurred, will exceed seventy-five percent(75%)of the amount then set forth in the Schedule; or if, at any time, the Contractor has reason to believe that the man days and/or amount for the full performance of each engineering services item will be greater than or substantially less than that set forth in the Schedule, the Contractor shall notify the Contracting Officer in writing, giving its revised estimate of the man days and/or amount for the performance of said item. The Contractor shall not exceed the obligated amount for each engineering services item, unless and until such amount has been increased in writing by the Contracting Officer.

(i) In the event the Government does not designate time(s)and place(s)sufficient for performance of the total quantity of engineering services set forth in the Schedule within the period(s)provided therefor, those services not furnished shall be deemed to be terminated for the convenience of the Government at no cost to the Government. Such termination shall be evidenced by a written document signed by the Contracting Officer and mailed or otherwise furnished to the contractor.

ITEM 0005 SUPPORT FOR ENGINEERING SERVICES (NAVSEA) (JUN 1992)

(a) The Contractor shall be reimbursed for its reasonable actual subsistence and transportation costs incurred in the performance of the related engineering services item(s) in accordance with FAR 31.205-46. The costs to be reimbursed shall be those costs accepted by the cognizant DCAA.

(b) Overtime shall be performed as required by the using activity and to the extent authorized by the applicable NAVSEA/DRPM/PEO code identified in Section C under Engineering Services.

(c) The maximum liability of the Government for each support item shall not exceed the estimated amount set forth in the Schedule. If, at any time, the Contractor has reason to believe that the costs it expects to incur in the performance of each support item in the next succeeding sixty (60) days, when added to all costs previously incurred, will exceed seventy-five percent (75%) of the amount then set forth in the Schedule; or if, at any time, the Contractor has reason to believe that the costs to the Government for the full performance of each support item will be greater than or substantially less than the amount set forth in the Schedule, the Contractor shall notify the Contracting Officer in writing, giving its revised estimate of such costs for the performance of said item. The Contracting Officer may, upon receipt of such notice or whenever the Contracting Officer considers it necessary, increase or further increase the total estimated amount for the performance of each support item. When and to the extent the estimated amount for a support item has been so increased, any amounts expended or incurred by the Contractor for performance in excess of the estimated amount therefor prior to the increase, shall be paid or reimbursed to the same extent as if expended or incurred after the increase.

ITEM 0007 - PROVISIONED ITEMS ORDERS (NAVSEA) (APR 1999)

(a) General. The Contractor agrees that it will furnish the supplies or services ordered by the Government in accordance with the procedures specified herein. Orders will be placed by the Contracting Officer, Provisioning Activity or Administrative Contracting Officer as unilateral or bilateral modifications to this contract on SF 30, Amendment of Solicitation/Modification of Contract. Any amounts shown in Section B at time of award of the initial contract for each provisioned line item are estimated amounts only and are subject to upward or downward adjustment by the issuing activity. If no amounts are shown, funding will be obligated before or at time of order issuance. It is understood and agreed that the Government has no obligation under this contract to issue any orders hereunder.

(b) Priced Orders. For each proposed order, the Contractor agrees that it will submit such cost or pricing data as the Contracting Officer may require. Promptly thereafter, the Contractor and the Contracting Officer shall negotiate the price and delivery schedule for the proposed order. Upon execution and receipt of the priced order, the Contractor shall promptly commence the work specified in the order.

(c) Undefinitized Orders. Whenever the Contracting Officer determines that urgent demands or requirements prevent the issuance of a priced order, he/she may issue an unpriced order. Such order may be unilateral or bilateral and shall establish a limitation of Government liability, a maximum ceiling amount, and a schedule for definitization, as described in subparagraph (e)(2) below. Upon request the Contractor shall submit a maximum ceiling amount proposal before the undefinitized order is issued. The maximum ceiling amount is the maximum price at which the order may be definitized. The Contractor shall begin performing the undefinitized order upon receipt, except as provided in paragraph (d) below. The clause entitled "CONTRACT DEFINITIZATION" (DFARS 252.217-7027) shall be included in any undefinitized order.

(d) Rejection of Unilateral Orders. The Contractor may reject any unilateral order if the Contractor determines that it cannot feasibly perform the order, or if the Contractor does not concur with the maximum ceiling amount.

However, each unilateral order shall be deemed to have been accepted by the Contractor unless within fifteen days of issuance of the order, the Contractor notifies the Contracting Officer in writing of its rejection of the order.

(e) Definitization of Undefinitized Orders. (1) The Contractor agrees that following the issuance of an undefinitized order, it will promptly begin negotiating with the Contracting Officer the price and terms of a definitive order that will include: (A) all clauses required by regulation on the date of the order; (B) all clauses required by law on the date of execution of the definitive order; and, (C) any other mutually agreeable clauses, terms and conditions. No later than sixty (60) days after the undefinitized order is issued, the Contractor agrees to submit a cost proposal with sufficient data to support the accuracy and derivation of its price; and, when required by FAR, cost or pricing data.

If additional cost information is available prior to the conclusion of negotiations, the Contractor shall provide that information to the Contracting Officer. The price agreed upon shall be set forth in a bilateral modification to the order. In no event shall the price exceed the maximum ceiling amount specified in the undefinitized order.

(2) Each undefinitized order shall contain a schedule for definitization which shall include a target date for definitization and dates for submission of a qualifying proposal, beginning of negotiations and, if appropriate, submission of make-or-buy and subcontracting plans and cost or pricing data. Submission of a qualifying proposal in accordance with the definitization schedule is a material element of the order. The schedule shall provide for definitization of the order by the earlier of:

(i) a specified target date which is not more than 180 days after the issuance of the undefinitized order.

However, that target date may be extended by the Contracting Officer for up to 180 days after the Contractor submits a qualifying proposal as defined in DFARS 217.7401; or

(ii) the date on which the amount of funds expended by the Contractor under the undefinitized order exceed fifty percent (50%) of the order's maximum ceiling amount, except as provided in subparagraph (f)(3) below.

(3) If agreement on a definitive order is not reached within the time provided pursuant to subparagraph (e)(2) above, the Contracting Officer may, with the approval of the Head of the Contracting Activity, determine a reasonable price in accordance with Subpart 15.8 and Part 31 of the FAR, and issue a unilateral order subject to Contractor appeal as provided in the "DISPUTES" clause (FAR 52.233-1). In any event, the Contractor shall proceed with completion of the order, subject to the "LIMITATION OF GOVERNMENT LIABILITY" clause

(FAR 52.216-24).

(f) Limitation of Government Liability. (1) Each undefinitized order shall set forth the limitation of Government liability, which shall be the maximum amount that the Government will be obligated to pay the Contractor for performance of the order until the order is definitized. The Contractor is not authorized to make expenditures or incur obligations exceeding the limitation of Government liability set forth in the order. If such expenditures are made, or if such obligations are incurred, they will be at the Contractor's sole risk and expense. Further, the limitation of Government liability shall be the maximum Government liability if the order is terminated. The "LIMITATION OF GOVERNMENT LIABILITY" clause shall be included in any undefinitized order.

(2) Except for undefinitized orders for Foreign Military Sales; purchases of less than $25,000; special access programs; and Congressionally-mandated long-lead procurements; and except as otherwise provided in subparagraph (f)(3) below, the limitation of Government liability shall not exceed fifty percent (50%) of the ceiling amount of an undefinitized order. In the case of orders within these excepted categories, however, the procedures set forth herein shall be followed to the maximum extent practical.

(3) If the Contractor submits a qualifying proposal (as defined in DFARS 217.7401) to definitize an order before the Government has obligated fifty percent (50%) of the ceiling amount, the Contracting Officer may increase the limitation of Government liability to up to seventy-five percent (75%) of the maximum ceiling amount or up to seventy-five percent (75%) of the price proposed by the Contractor, whichever is less.

(4) If at any time the Contractor believes that its expenditure under an undefinitized order…