RFP_-_Fixed_Income_12-3-14_rev_6_Post.pdf

REQUEST FOR PROPOSAL (RFP)

Fixed Income

PBGC01-RP-15-0008

1. RFP ISSUE DATE: December 4, 2014

2. ISSUED BY: Pension Benefit Guaranty Corporation (PBGC)

Procurement Department, 1200 K Street NW

Suite 1090, Washington, DC 20005-4026.

3. FOR INFORMATION CONTACT:

NAME: Patrick McFarlane, Contracting Officer

PHONE: (202) 326-4000 Ext. 3334

FAX: (202) 326-4162

E-MAIL: mcfarlane.patrick@pbgc.gov

4. QUESTIONS: Any questions regarding this RFP or the Statement of Work shall be submitted to Mr. Patrick McFarlane no later than January 5, 2015 by 9:00 AM EST.

5. PROPOSAL DUE DATE/TIME: March 5, 2015 by 9:00 AM EST.

6. SUBMISSION OF PROPOSAL: Submit One (1) electronic copy of your mandatory, technical and price proposal no later than the specified time listed in paragraph 5 above.

Proposals shall reference PBGC01-RP-15-0008. *See Section L

7. STATEMENT OF WORK, SEE SECTION C.

mailto:mcfarlane.patrick@pbgc.gov

SECTION B

SUPPLIES OR SERVICES AND PRICE/COSTS

B.1 PBGC-11-002 DESCRIPTION OF SERVICES (AT CONTRACTOR SITE) (Sept

2015)

The Contractor shall provide the personnel, facilities, equipment, and other materials and services necessary to perform the effort described in Section C, the Statement of Work resulting from this

Request for Proposal No. PBGC01-RP-15-0008. A Firm Fixed Price contract will be awarded for this effort. (Note: The services provided under this commercial services contract are offered at a fixed rate based on a variable quantity). The contractor’s proposal shall be incorporated by reference.

B.2 GENERAL DESCRIPTION

PBGC is seeking to obtain qualified, experienced, and highly competent contractors to provide active investment management services for fixed income portfolios that will, over a full market cycle, provide a total rate of return which exceeds the benchmark of the respective portfolio, consistent with appropriate levels of risk.

B.3. PERIOD OF PERFORMANCE

PBGC anticipates the period of performance to be a twelve month base year plus (9) nine option years. The Contractor shall commence work immediately upon notice of award. *Note: The actual dates of the Period of Performance will be entered at the time of award.

B.4 FEE SCHEDULE – Multiple Mandate Core Fixed Income Fund Manager

BASE YEAR

Asset Based Fees _____% on first $____ million

_____% on next $____ million

_____% on balance

OPTION YEAR 1

OPTION YEAR 2

OPTION YEAR 3

OPTION YEAR 4

OPTION YEAR 5

OPTION YEAR 6

OPTION YEAR 7

OPTION YEAR 8

OPTION YEAR 9

B.5 FEE SCHEDULE – Multiple Mandate Global Fixed Income Fund Manager

B.6 FEE SCHEDULE – Multiple Mandate Long Duration Fixed Income Fund Manager

B.7 FEE SCHEDULE – Multiple Mandate Emerging Markets Debt Fixed Income Fund Manager

B.8 FEE SCHEDULE – Multiple Mandate High Yield Fixed Income Fund Manager

B.9 FEE SCHEDULE – Multiple Mandate Revolving Fund TIPS Fund Manager

B.10 FEE SCHEDULE – Multiple Mandate Revolving Fund – Treasuries Fund Manager

B.11 FEE SCHEDULE – Specialist Global and/or EMD - Emerging Markets Debt Fixed Income

Fund Manager

OPTION YEAR

OPTION YEAR

B.12 FEE SCHEDULE – Specialist Global and/or EMD - Global Fixed Income Fund Manager

NOTE: The above fees for the Trust Funds and Revolving Fund are at annualized rates, but shall be calculated and payable on a quarterly basis and are based on PBGC’s custodian bank’s market value pro-rated for any period less than a quarter. The quarterly fee will be based on an average of the month end values within the quarter.

Multiple Mandate

Global AUM or all asset fee quotes may also be submitted in addition to the individual product fee quotes. Global AUM, or all asset fee quotes for Multiple Mandate Managers will be evaluated based on a minimum of three products and a minimum AUM of $2.5 billion and a maximum AUM of $6 billion.

NOTE: This level of AUM is provided to allow consistency in the evaluation of price proposals. Actual investment amounts will vary at the discretion of the PBGC.

Specialist Global and/or EMD

Global AUM or all asset fee quotes may also be submitted in addition to the individual product fee quotes. Global AUM, or all asset fee quotes for Specialist Global and/or EMD Managers will be evaluated based on two products and a minimum AUM of $1 billion and a maximum AUM of $3 billion.

NOTE: This level of AUM is provided to allow consistency in the evaluation of price proposals. Actual investment amounts will vary at the discretion of the PBGC.

SECTION C

STATEMENT OF WORK

I. INTRODUCTION

The Employee Retirement Income Security Act of 1974 (ERISA) established Pension Benefit

Guaranty Corporation (PBGC) as a federal corporation to encourage the growth of defined benefit pension plans, provide timely and uninterrupted payment of pension benefits, and keep pension insurance premiums at a minimum. Defined benefit pension plans promise to pay a specified monthly benefit at retirement, commonly based on salary and years on the job. PBGC, a wholly owned United States Government corporation, administers the insurance program and termination process for most private-sector defined benefit pension plans that are tax-qualified under the Internal Revenue Code. PBGC is headed by a Director who reports to a board of directors consisting of the Secretaries of Labor, Commerce, and Treasury, with the Secretary of

Labor as Chairman. General tax revenues do not fund PBGC. PBGC collects insurance premiums from employers that sponsor insured pension plans, earns money from investments and receives the assets of the pension plans it terminates.

PBGC maintains two separate investment funds. The Revolving Fund (valued at approximately

$18 billion as of 06/30/2014) receives all premium payments and is invested solely in “book-entry” U.S. Government securities held at the U.S. Treasury.

The Trust Fund (valued at approximately $62 billion) receives assets from terminated plans.

Trust Fund assets can be more flexibly invested than Revolving Fund assets, such that possible asset classes include equities and investment grade debt obligation. However, both have the same investment objectives.

Investment Mandate

The investment manager (hereinafter referred to as contractor) shall provide active investment management services for fixed income portfolios that will, over a full market cycle, provide a total rate of return which exceeds the benchmark of the respective portfolio, consistent with appropriate levels of risk.

Investments for the Revolving Fund assets shall be invested solely in “book-entry” U.S.

Government securities. U.S. Treasury bills, notes, bonds, strips, and TIPS are permitted.

Derivatives are not permitted. PBGC seeks to hire an investment firm(s) to fill the role of advisor of the fixed income assets in the Revolving Fund (awards may be made for one or two firms for the Revolving Fund). Portfolio changes (buys and sells) are communicated to and effected by PBGC’s Corporate Investment Department (CID). The market price is fixed and no custodian is involved. The combined limitations of Treasury-only issues and their book-entry transaction mechanism apply only to the PBGC Revolving Fund.

Unlike the Revolving Fund, where trades are implemented through PBGC’s Corporate

Investment Department, the assets in the Trust Fund shall be actively managed by the investment firm. PBGC intends to add to its roster of fixed income mangers in the Trust Fund. PBGC anticipates hiring multiple managers capable of managing fixed income assets across multiple fixed income mandates or strategies. Award allocations will vary based on the investment skill and ability of the managers to meet the needs of this contract. PBGC expects the award allocations to range from a minimum of US $250 million to a maximum of $7 billion for each manager selected, but makes no guarantees as to the size of any award. These allocations may change over time due to the investment results generated by the contractor and the needs of

PBGC.

Investments of Trust Fund assets for this mandate may include fixed income and derivative products that are obligations of both domestic (U.S.) and non-U.S. issuers. The contractor shall exercise best efforts to select securities suitable and appropriate to the PBGC's mission. Diligent effort shall be exercised to avoid the purchase of a security where the PBGC is likely to terminate the issuer’s underfunded pension plan.

II. SCOPE OF WORK

The contractor shall be responsible for providing active investment management and related services for fixed income portfolios. The portfolios shall be invested in one or more of the five

Trust Fund fixed income strategies and two Revolving Fund fixed income strategies listed below:

Trust Fund Strategies:

1. Core Fixed Income

2. Global Fixed Income

3. Long Duration Fixed Income

4. Emerging Markets Debt

5. High Yield

Revolving Fund Strategies:

6. Treasuries

7. TIPS

Objective

The investment objective is to construct portfolios of fixed income assets to earn superior returns which exceed the portfolio benchmarks of these strategies, consistent with the risk parameters outlined in the investment guidelines for the respective portfolios.

Activities

The contractor shall use a highly structured investment process which may incorporate, but is not limited to, the following elements in the investment decision making process:

• Establishing an interest rate forecast for short term and long term time periods

• Conducting yield curve analysis

• Determining the proper maturity and duration allocations

• Performing sector analysis and making sector investment decisions

• Conducting credit analysis of issuers

• Selecting securities within the realm of permissible investments described in the PBGC investment guidelines

The contractor shall evaluate potential investments using disciplined, thorough investment analysis and due diligence. Assets shall be managed with full discretion, in accordance with the policies, of PBGC, and the strategies and objectives mutually agreed upon between the contractor and PBGC. Investment guidelines will be negotiated between PBGC and the contractor subsequent to contract award. After the guidelines are negotiated, PBGC shall deliver them in final form to the contractor.

The contractor shall employ the investment philosophy, styles and strategies for which it was retained, unless otherwise directed by the PBGC. PBGC, under this contract and not separately priced, shall receive and have access to any of the contractor's internal or external investment, market and economic research training materials and support capabilities and services in the performance of PBGC's investment responsibilities. These materials and services do not include proprietary models or information unique to the contractor's investment process.

The contractor shall maintain close contact with PBGC’s Corporate Investments Department and serve as a resource of economic and investment information and research. The contractor shall keep PBGC fully informed of the rationale for investment decisions and changes in the portfolio under its management. Under this contract, PBGC, at its discretion, may utilize other investment advisory services offered by the contractor.

The contractor shall be responsible for immediate notification to the PBGC of significant changes in personnel, ownership, resources, or firm direction. The contractor shall discharge its duties under this contract solely in the interest of the PBGC with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims. Moreover, the contractor shall utilize best practices of the investment industry, such practices to include but not limited to the standards issued by the Chartered Financial Analyst

Institute.

The contractor shall provide PBGC with immediate notification of any potential issue that could hinder the contractor’s ability to trade with full discretion on behalf of PBGC. The contractor shall maintain appropriate operational separation (i.e. a Chinese Wall) between trading and investment duties on behalf of PBGC portfolios and any engagement such as creditor committee representation which could affect the contractor’s full discretion to buy or sell in the marketplace.

The contractor shall work closely with PBGC’s custodian bank to facilitate the efficient and timely recording of purchases, sales and other activity, reconcile securities and cash balances and provide information necessary to calculate performance results. PBGC will delegate its proxy voting authority to the investment manager. The investment manager shall maintain records of its votes and report the results, at least annually, to PBGC.

Educational Conferences

Contractor shall provide up to six (6) slots in any educational conferences it may offer to clients as part of the normal contract cost. This opportunity would include the cost of related meals offered as part of the formal conference program. Non-training or non-educational activities offered at the conference including, but not limited to, golf, fishing, tours, entertainment, etc., would not be included, as PBGC can neither pay for nor may individual employees accept these items. PBGC will pay the travel, lodging, per-diem, and other subsistence expenses (e.g., if meals are not offered to all attendees as part of the conference) for its employees who participate at such conferences. PBGC will advise the contractor of its acceptance or declination of slots offered at educational conferences.

Fidelity Bond and Insurance Coverage

The contractor shall have or acquire within 6 months of contract award a fidelity bond, with the

PBGC as a loss payee, in the minimum amount of $5,000,000.00 with maximum deductible of

$1,000,000.00. The bond shall cover, at a minimum, losses due to dishonest or fraudulent acts or omissions by the contractor. Proof of the existence of such fidelity bond shall be provided to

PBGC immediately upon its acquisition and then annually thereafter.

The contractor shall have SEC-required (17g-1) fidelity bonds, or acquire within 6 months of contract award, errors and omissions coverage, and any other fiduciary coverage in the minimum amount of $10,000,000.00 with a maximum deductible of $1,000,000.00 per claim.

The policy shall cover, at a minimum, losses caused by errors, omissions, or negligent acts of the contractor. Proof of the existence of such policy shall be provided annually by the contractor.

Disaster Recovery

The Contractor shall have or develop and maintain a disaster recovery plan, which includes critical business operations, computer systems, and telecommunications. Such plan shall be tested and/or updated annually, as necessary. The contractor shall provide a copy of the annual test report to the PBGC within 30 calendar days of the completion of the test. A copy of the current and/or revised plan must be provided to PBGC within 60 calendar days of the completion of the revised plan.

The disaster recovery plan shall include, but not be limited to, the following:

1. Emergency response procedures, including:

a. Step-by step instructions identifying explicit techniques to be used for responding to various emergency situations;

b. Identification of disaster recovery teams; and

c. An organizational chart and list of key personnel responsible for performing the disaster recovery actions as well as the priority of duties and lines of authority.

2. Backup site activation procedures which identify:

a. Backup site location; and

b. Backup site activation processes.

(If the backup site is operated by an organization other than by the Contractor, a copy of the

Alternative Site Processing Agreement must be provided to the PBGC within 30 days after being added to the plan or at the same time as the contractor’s disaster recovery plan is revised, whichever is earlier. Backup site activation procedures must contain a list of key personnel and the recovery team(s) they support.)

3. Primary site recovery procedures, including:

a. Instructions for accomplishing salvage operations;

b. A replacement acquisition strategy for hardware, software, telecommunications, etc.;

c. Facility reconstruction plans; and

d. Identification of personnel supporting the primary site recovery and the team(s) they support.

4. Primary site reactivation/normalization, including:

a. Procedures to ensure a smooth transition from the alternative processing site to the primary site; and

b. A list of teams performing the various functions and the personnel assigned to those teams.

Deliverables/Reports

The contractor shall provide:

1. Preliminary monthly statements and reports, on or before the seventh business day following month end, which detail the following information:

a. Portfolio Comparison vs. the Benchmark Index – Results must include, but not be limited to, returns for the month, latest three months, calendar year to date, PBGC’s fiscal year to date (the fiscal year runs from October 1 through September 30), and since inception. As the performance history expands, returns for one year, two year, three, five, and ten year should be provided, when applicable.

b. Holdings Report

c. Investment Summary

d. Portfolio-level Characteristics

e. Performance Attribution

f. Economic and Market Commentary

g. Derivatives Report - If the fund or separate account utilizes derivatives in the portfolio, provide a detailed report.

2. Monthly holdings data, electronic copy format to be determined, as required for PBGC risk system, including detailed characteristics of securities. Provide details, as required, of OTC derivatives contracts to the Risk Management System vendor.

3. Quarterly statements and reports that detail the following information (due within thirty calendar days after quarter end):

a. Portfolio Comparison vs. the Benchmark Index – See 1a above.

b. Investment Summary

c. Portfolio-level Characteristics

d. Performance Attribution

e. Economic and Market Commentary

f. Contract Compliance Certification Report – detailing all non-compliance events throughout the quarter which violated the investment guidelines. If there are internal constraints that are not stipulated in the investment guidelines and were violated during the quarter, please provide those as well.

g. Guideline Compliance Status Report – detailing the status of all guideline risk parameters being monitored for compliance.

4. Annual statements and reports that detail the following information:

a. Evidence of fidelity bond and errors and omissions professional liability coverage, within 60 calendar days of renewal.

b. Revised Securities and Exchange Commission Form ADV Parts I and II, within 30 calendar days of revision, if an ADV is filed.

c. Policy on Creditors Committee participation and a record of those personnel who served on such committees where securities held in the PBGC portfolio were involved

d. Revised Ethics Policy (within 30 calendar days of revision).

5. Other reports, research and publications as required by PBGC from time to time.

6. Copies of all PBGC reports noted above must be provided to PBGC’s investment consultant

The contractor shall provide other reports, research and publications as required by PBGC from time to time. The contractor may provide the above reports electronically and through secure online access to its website.

SECTION D

PACKAGING AND MARKING

D.1 PBGC-11-004 PACKAGING AND MARKING (OCT 2004)

The Contractor is responsible for the cost of all packing, packaging and mailing in accordance with the best commercial practices. All information submitted to the Contracting Officer or the

COR must be clearly marked with the company name, the PBGC contract number of the item.

SECTION E

INSPECTION AND ACCEPTANCE

E.1 PBGC-46-001 INSPECTION AND ACCEPTANCE OF DELIVERABLES (JAN 2012)

All deliverable items are to be furnished to the Contracting Officer's Representative (COR) or to

PBGC personnel designated by the COR to receive a specific deliverable. PBGC's receipt of a deliverable does not constitute acceptance by the Government. Final acceptance of any reports or other deliverable items required under this contract will be made in writing and may only be made by the COR or Contracting Officer.

SECTION F

DELIVERIES OR PERFORMANCE

F.1 PBGC-11-006 Place of Performance (Oct 2006)

The primary place of performance under this contract shall be at the Contractor’s site.

F.2 Place of Delivery

All contract deliverables must be delivered to the Contracting Officers Representative (COR) as identified in Section G of the Contract.

F.3 Period of Performance

PBGC anticipates the period of performance to be a twelve month base year plus (9) nine option years. It shall be effective on the date of the cognizant Contracting Officer’s signature, unless otherwise so noted. The Contractor shall commence work immediately upon notice of award

Base/Option Year Period-of-Performance

Base Year: May 1, 2016 – April 30, 2017

Option Period One May 1, 2017 – April 30, 2018

Option Period Two May 1, 2018 – April 30, 2019

Option Period Three May 1, 2019 – April 30, 2020

Option Year Four May 1, 2020 – April 30, 2021

Option Period Five May 1, 2021 – April 30, 2022

Option Period Six May 1, 2022 – April 30, 2023

Option Period Seven May 1, 2023 – April 30, 2024

Option Year Eight May 1, 2024 – April 30, 2025

Option Year Nine May 1, 2025 – April 30, 2026

F.4 Contract Type

The Government anticipates the award of a firm fixed price contract. Please note that services provided under this commercial services contract are offered at a fixed rate based on a variable quantity.

SECTION G

CONTRACT ADMINISTRATION

G.1 PBGC-32-004 Submission of Invoices (JAN 2012) (Firm-Fixed-Price)

The Contractor shall submit invoices for items and/or services rendered by e-mail to:

InvoiceManager@pbgc.gov

All inquiries concerning payment should be directed to the General Accounting Branch at

(202)326-4062 #0 or by e-mail:

InvoiceManager@pbgc.gov

The Contractor must include the following information and/or attached documentation for the invoice to be considered proper. Invoices, which do not contain all the required information, may be returned to the vendor unpaid for correction and resubmission.

- Name and address of Contractor

- Invoice date and invoice number

- Purchase/Delivery Order Number

- Shipping and payment terms

- Name and address for Contractor official to whom payment is to be sent (must be same as that in the order or in a proper notice of assignment)

- Name, title, phone number and mailing and email address of person to notify in the event of an improper invoice

- Taxpayer Identification Number (TIN)

- Description, quantity, unit of measure, unit price and extended price of supplies delivered or services performed

- Expenditures and hours of effort expended by individual during the reporting period (if applicable).

- If applicable, for each invoice covering travel expenses incurred, mileage records and copies of receipts from actual transportation costs and accommodations shall be included as supportive material for each invoice.

NOTE: PBGC authorization must be obtained prior to incurring any travel expenses for which the Contractor requests reimbursement. (End of Clause)

G.2 PBGC-04-001 Final Payment (OCT 2004)

Before final payment is made, the Contractor shall furnish the Contracting Officer with a release of all claims against the Government relating to this contract, other than claims in stated amounts that are specifically accepted by the Contractor from the release. If the Contractor's claim to mailto:InvoiceManager@pbgc.gov mailto:InvoiceManager@pbgc.gov amounts payable under the contract has been assigned under Assignment of Claims Act of 1940, as amended (31 U.S. 3727, 41 U.S.C. 15), a release may also be required of the assignee.

G.3 PBGC-42-001 CONTRACTING OFFICER’S REPRESENTATIVE (JAN 2012)

The Contracting Officer's Representative (COR) is TBD who may be reached at TBD. The COR is authorized to assist in monitoring the work under this contract. The COR is responsible for the technical administration of the contract and technical liaison with the contractor. The COR IS

NOT authorized to change the scope of work or specifications as stated in the contract, to make any commitments or otherwise obligate the Government or authorize any changes which affect the contract price, delivery schedule, period of performance or other terms or conditions.

The Contracting Officer is the only individual who can legally commit or obligate the

Government for the expenditure of public funds. The technical administration of this contract shall not be construed to authorize the revision of the terms and conditions of this contract. Any such revision shall be authorized in writing by the Contracting Officer.

The COR is authorized to review and recommend approval of:

(a) Technical matters not involving a change in scope, price, terms and conditions of the contract

(b) Progress reports

(c) Inspection and acceptance of services and deliverable products and

(d) Invoices.

The COR is not authorized to sign any contractual instruments or to direct any action that results in a change in the scope, price, terms or condition of the contract.

G.4 PBGC-42-002 OBSERVANCE OF LEGAL HOLIDAYS (JAN 2012)

The Contractor shall not be required to establish a holiday schedule for personnel performing under this contract that exactly coincides with the Government's schedule. Holidays peculiar to or dynamically declared by the Government shall not be required to be considered as holidays for Contractor personnel and may be billable if work is actually performed on these days. Work may be performed by Contractor personnel on Government holidays without prior approval of the Contracting Officer's Representative. Work performed on holidays shall be billable at the regular rate. Contractor may not have access to the Contracting

Officer Representative during Government holidays, which are: (1) New Year's Day, (2) Martin

Luther King, Jr. Day, (3) President's Day, (4) Memorial Day,

(5) 4th of July, (6) Labor Day, (7) Columbus Day, (8) Veteran's Day, (9 Thanksgiving Day, (10)

Christmas Day (11)

Any other day designated by Federal Statute, (12) Any other day designated by Executive Order,

(13) Any other day designated by the President's Proclamation.

SECTION H

SPECIAL CONTRACT CLAUSES

H.1 PBGC-03-001 Confidentiality of Information (OCT 2004)

(a) To the extent that the work under this contract requires that the Contractor be given access to confidential or proprietary business, technical, or financial information belonging to the

Government or private companies, the Contractor shall, after receipt thereof, treat such information as confidential and agree not to appropriate such information to its own use or to disclose such information to third parties unless specifically authorized by the Contracting

Officer in writing. The foregoing obligations, however, shall not apply to:

(1) Information which, at the time of receipt by the Contractor, is in the public domain;

(2) Information which is published after receipt thereof by the Contractor or otherwise becomes part of the public domain through no fault of the Contractor;

(3) Information which the Contractor can demonstrate was already in his possession at the time of receipt from PBGC and was not acquired directly or indirectly from the

Government or other companies;

(4) Information which the Contractor can demonstrate was received by it from a third party that did not require the Contractor to hold it in confidence.

(b) The Contractor shall obtain the written agreement, in a form satisfactory to the Contracting

Officer or his designee, of each employee permitted access to confidential information, whereby the employee agrees that he will not discuss, divulge or disclose any such information or data to any person or entity except on a need-to-know basis to those persons within the Contractor's organization directly concerned with the performance of the contract.

(c) The Contractor agrees, if requested by the Government, to sign an agreement identical, in all material respects, to the provisions of this clause, with each company supplying information to the Contractor under this contract, and to supply a copy of such agreement to the Contracting Officer. From time to time upon request of the Contracting Officer, the Contractor shall supply the Government with reports itemizing information received as confidential or proprietary and setting forth the company or companies from which the Contractor received such information.

(d) The Contractor agrees that upon request by PBGC it will execute a PBGC-approved agreement with any party whose proprietary data it is given access to or is furnished, restricting use and disclosure of the data.

Upon request by PBGC, such an agreement shall also be signed by Contractor personnel.

(e) This clause shall flow down to all subcontracts.

H.2 PBGC-03-002 Organizational Conflicts Of Interest (OCT 2004)

(a) Purpose. The purpose of this clause is to ensure that the contractor

(1) Is not biased because of its financial, contractual, organizational, or other interests which relate to the work under this contract, and (2) does not obtain any unfair competitive advantage over other parties by virtue of its performance of this contract.

(b) Scope. The restrictions described herein shall apply to performance or participation by the contractor and any of its partners, affiliates or their successors in interest (after this collectively referred to as the "contractor") in the activities covered by this clause as a prime contractor, subcontractor, cosponsor, joint venture, consultant, or in any similar capacity. For the purpose of this clause, affiliation occurs when a business concern is controlled by or has the power to control another or when a third party has the power to control both.

(1) Use of Contractor's Work Product. (i) The contractor shall be ineligible to participate in any capacity in PBGC contracts, subcontracts, or proposals (solicited and unsolicited) which stem directly from the contractor's performance of work under this contract. Furthermore, unless so directed in writing by the Contracting Officer, the contractor shall not perform any advisory and assistance services work under this contract on any of its products or services or the products or services of another firm if the contractor is or has been substantially involved in its development or marketing. Nothing in this subparagraph shall preclude the contractor from competing for follow-on contracts for advisory and assistance services.

(ii) If, under this contract, the contractor prepares a complete or essentially complete statement of work or specifications to be used in competitive acquisitions, the contractor is ineligible to perform or participate in any capacity in any contractual effort which is based on such statement of work or specifications. The contractor shall not incorporate its products or services in such statement of work or specifications unless so directed in writing by the Contracting Officer, in which case the restriction in this subparagraph shall not apply.

(iii) Nothing in this clause precludes the contractor from offering or selling its standard commercial items to the Government.

(2) Access to and use of information.

(i) If the contractor, in the performance of this contract, obtains access to information, such as

Corporate plans, policies, reports, studies, financial plans, internal data protected by the Privacy

Act of 1974 (5 U.S.C. 552a), or data which has not been released or otherwise made available to the public, the contractor agrees that without prior written approval of the Contracting Officer it shall not:

(A) use such information for any private purpose unless the information has been released or otherwise made available to the public;

(B) compete for work for PBGC based on such information for a period of six months after either the completion of this contract or until such information is released or otherwise made available to the public, whichever is first;

(C) submit an unsolicited proposal to the Government which is based on such information until one year after such information is released or otherwise made available to the public; and

(D) release such information unless such information has previously been released or otherwise made available to the public by PBGC. (ii) In addition, the contractor agrees that to the extent it receives or is given access to proprietary data, data protected by the Privacy Act of 1974 or other confidential or privileged technical, business, or financial information under this contract, it shall treat such information in accordance with all restrictions imposed on disclosure and use of such protected, confidential, or privileged information.

(c) Disclosure after award.

(1) The contractor agrees that if changes, including additions, to the facts disclosed by it prior to award of this contract, occur during the performance of this contract, it shall make an immediate and full disclosure of such changes in writing to the Contracting Officer. Such disclosure may include a description of any action which the contractor has taken or proposes to take to avoid, neutralize, or mitigate any resulting conflict of interest. PBGC may, however, terminate the contract for convenience if it deems such termination to be in the best interest of the

Government.

(2) In the event that the contractor was aware of facts required to be disclosed or the existence of an actual or potential organizational conflict of interest and did not disclose such facts or such conflict of interest to the Contracting Officer, PBGC may terminate this contract for default.

(d) Remedies. For breach of any of the above restrictions or for nondisclosure or misrepresentation of any facts required to be disclosed concerning this contract, including the existence of an actual or potential organizational conflict of interest at the time of or after award, the Government may terminate the contract for default, disqualify the contractor from subsequent related contractual efforts, and pursue such other remedies as may be permitted by law or this contract.

(e) Waiver. Requests for waiver under this clause shall be directed in writing to the PBGC Office of General Counsel with a copy provided to the Contracting Officer, and shall include a full description of the requested waiver and the reasons in support of the request. If it is determined to be in the best interests of the Government, the Contracting Officer may grant such a waiver in writing.

(f) Subcontracts.

(1) The contractor shall include a clause, substantially similar to this clause, including this paragraph (f), in subcontracts expected to exceed the simplified acquisition threshold in FAR

Part 13. The terms "contract," "contractor," and "Contracting Officer" shall be appropriately modified to preserve the Government's rights.

(2) Prior to the award under this contract of any such subcontracts for advisory and assistance services, the contractor shall obtain from the proposed subcontractor or consultant a disclosure of all existing or potential organizational conflicts of interest and shall determine in writing whether the interests disclosed present a significant potential for an organizational conflict of interest.

Where an actual or significant potential organizational conflict of interest is identified, the contractor shall take actions to avoid, neutralize, or mitigate the organizational conflict to the satisfaction of the contractor. If the conflict cannot be avoided or neutralized, the contractor must obtain the approval of the PBGC Contracting Officer prior to entering into the subcontract.

H.3 PBGC-03-003 Suitability Determination Requirements (JAN 2012)

The Pension Benefit Guaranty Corporation will investigate and adjudicate the suitability of contractors for employment or continued employment. PBGC will employ and/or retain only those persons found suitable for employment. (1) The Contractor employees governed by this contract may need to access sensitive information. PBGC reserves the right to determine suitability for contractor personnel at the project site and deny access to any sensitive information or project specific area to any personnel for any cause. (2) The Contractor shall notify the Contracting Officer in writing providing the name and the nationality of non-U.S.

citizens who are legal residents, providing a copy of their VISA (work permit) or an alien who has been lawfully admitted for permanent residence as evidenced by Alien Registration Receipt

Card Form I-151, or who presents other evidence from the U.S. Citizenship and Immigration

Services that employment will not affect his/her immigration status. PBGC reserves the right to refuse any foreign national participation on this contract and to refuse them permission to enter

PBGC premises. (3) The Contracting Officer or the Contracting Officer’s Representative (COR) will provide the appropriate background investigation forms to the contractor and give the contractor instructions for completing the background investigation process. These responsibilities may be delegated to the Contract Manager or the Contract Security

Representative with the understanding that the COR holds ultimate responsibility. Completed background investigation forms shall be submitted within two (2) weeks from the Entrance on

Duty date to: Pension Benefit Guaranty Corporation, PBGC Security Officer, Facilities and

Services Department, 1200 K Street, NW, Mail Stop: FASD, Washington, DC 20005-4026. (4)

PBGC will exercise full and complete control over granting, denying, withholding, or terminating clearances for employees. The PBGC may, as it deems appropriate, authorize and grant temporary clearance to employees of the contractor. However, the granting of a temporary clearance to any such employee shall not be considered as assurance that full clearance will follow as a result or condition thereof and the granting of either a temporary or full clearance shall in no way prevent, preclude or bar the withdrawal or termination of any such clearance by the PBGC. (5) If the adjudication is unfavorable on a contract employee, or if PBGC finds a contractor to be unsuitable or unfit for his or her assigned duties, the Personnel Security Officer will contact the Contractor to effect the immediate removal of the contract employee from the

PBGC contract and premises. (6) PBGC may waive suitability determinations for contractor personnel who have had recent background investigations at the appropriate suitability determination risk level established by either the COR or the Personnel Security Officer. PBGC will inform the contractors where such is the case. The Contractor will be provided a copy of the

PBGC Directive PM 05- "Personnel Security and Suitability Program" and PBGC Directive PM

05-1, "PBGC Entrance on Duty and Separation Procedures for Federal and Contract Employees" and facilitate the Suitability Determination process. Failure to comply with PM 05-1 may result in: (a) corrective action, up to and including contract termination for continued non-compliance after counseling, or (b) documented non-compliance on the contractors past performance evaluation. (End of Clause)

H.4 PBGC-04-004 PBGC Information Security (FEB 2011)

The provider of information technology shall adhere to: 1)Federal statutes, 2)Office of

Management and Budget (OMB) guidance, 3)National Institute of Standards and Technology

Federal Information Processing Standards and PBGC implementation of Security Guidelines

(800 Series), (See 5a -- IM 05-2 below.) 4)Federal Information Systems Controls and Audit

Manual (FISCAM), and 5)PBGC Orders relating to information security including: a)IM 05-2

Information Technology Security Policies, http://www.pbgc.gov/docs/im_05_2.pdf b)IM 05-7

Information Technology Solutions Life Cycle Methodology (ITSLCM), http://www.pbgc.gov/docs/im_05_7.pdf and c)IM 05-4 Use of Information Technology

Resources. http://www.pbgc.gov/docs/Im_05_4.pdf The provider of information technology shall comply with PBGCs implementation of the following control frameworks including the:

1)Capability Maturity Model - Integrated (CMMI), 2)Control Objectives for Information and

Related Technologies (COBIT), and 3)Information Technology Infrastructure Library (ITIL);

and in addition, the provider of information technology shall certify the following:

a)Applications are fully functional and operate correctly as intended on systems using the

Federal Desktop Core Configuration (FDCC). Once PBGC approves for implementation, this also includes Internet Explorer 7 configured to operate on Windows XP. For the Windows XP settings, see: http://csrc.nist.gov/itsec/guidance_WinXP.html. b) The standard installation, operation, maintenance, updates, and/or patching of software shall not alter the configuration settings from the approved FDCC configuration. The information technology should also use the Windows Installer Service for installation to the default program files directory and should be able to silently install and uninstall. Applications designed for normal end users shall run in the standard user context without elevated system administration privileges. (End of Clause)

H.5 PBGC-04-005 PROTECTION OF PERSONALLY IDENTIFIABLE

INFORMATION (PII) (FEB 2013). (a) To the extent that the work under this contract requires the Contractor be given access to personally identifiable information about an individual gathered and/or maintained by the Government or the Contractor (hereinafter referred to as PII), the Contractor shall after receipt thereof, treat such PII as confidential and safeguard such information from unauthorized use and disclosure. (b) The Contractor agrees to allow access only to those employees who need the PII to perform services under this contract and agrees that

PII will be used solely for the purpose of performing services under this contract. The Contractor shall ensure that its employees will not discuss, divulge or disclose any such PII to any person or entity except those persons within the Contractors organization directly concerned with the performance of the contract. (c) The Contractor shall administer a monitoring process to ensure compliance with the provisions of this clause, promptly report any breaches to the Contracting

Officers Representative (COR), and implement immediate, appropriate corrective actions to contain and prevent recurrence. (d) The Contractor shall report to the COR immediately upon discovery of a real or suspected loss of PII. Protected PII is an individuals first name or first initial and last name in combination with any one or more of the following data elements including, but not limited to, social security number, passport number, credit card numbers, clearances, bank numbers, biometrics, date and place of birth, mothers maiden name, criminal, medical and financial records, educational transcripts, pension and participant plan, etc. (e) The

Contractor and employees shall adhere to PBGC Orders relating to the protection of sensitive and personally identifiable information including: 1. IM 10-2 Safeguarding Tax Return

Information, http://www.pbgc.gov/documents/IM_10_2.pdf 2. IM 10-3 Protecting Sensitive

Information, http://www.pbgc.gov/docs/IM_10_3.pdf 3. IM 05-9 Privacy Program, http://www.pbgc.gov/docs/IM_05_9.pdf (Note: If unable to access these orders, the Contracting

Officer will provide copies upon request.) (f)The Government may terminate this contract for default or cause if the Contractor or an employee of the Contractor fails to comply with the provisions of this clause. The Government may also exercise any other rights and remedies provided by law or this contract, including criminal and civil penalties. In addition, the

Contracting Officer or COR may direct the Contractor to remove from performance of the contract, any Contractor or subcontractor personnel who have improperly disclosed PII. (g) The

Contractor shall include this clause in all subcontracts. However, such provision in the subcontracts shall not relieve Contractor of its obligation to assure compliance with the provisions of this clause. (End of Clause)

H.6 PBGC-09-001 Restriction Against Disclosure of Information (JAN 2012)

(a) The Contractor agrees that it will take such measures as are necessary to restrict access to pension plan and participant records as well as any other information related to work pursuant to this contract (including, but not limited to, any information relating to legal, policy, program, operational or other issues, whether concerning existing, proposed or contemplated legislation, regulations, policy issuances or similar matters or otherwise) to those employees and/or subcontractors of the Contractor needing such information to perform the work required there under, i.e., on a "need-to-know" basis. This Clause does not apply to information which has been released

(b) to the public by PBGC or which is available to the public other than by the Contractor's breach of this Agreement.

(c) The Contractor agrees to keep the restricted information in the strictest confidence. The

Contractor also agrees not to publish, reproduce or otherwise divulge the information in whole or in part, in any manner or form, nor to authorize or permit others to do so, taking such reasonable measures as are necessary to restrict access to the information, to those employees and/or subcontractors needing such information to perform the work required under the contract, i.e., on a "need-to-know" basis. The obligation to maintain confidentiality continues after completion, termination, or expiration of this contract. The information shall be made available only at the discretion of the PBGC and subject to the Freedom of

Information Act (5 U.S.C. Sec. 552), as amended, The Privacy Act, (5 U.S.C. Sec. 552a), as amended, The Trade Secrets Act, (18 U.S.C. Sec. 1905, as amended), and any other applicable laws or regulations. Further, the Contractor shall notify the PBGC of the transfer to subcontractors of any information prior to any such transfer. Upon completion of the

Contractor's obligations, the Contractor shall return or destroy all copies of restricted information, whether furnished by PBGC or created by the Contractor and any subcontractor.

(d) The Contractor agrees to immediately notify the PBGC, in writing, in the event that the

Contractor determines or has reason to suspect a breach of any part of this clause.

(e) The Contractor agrees to immediately notify the PBGC in writing, of any request received from any individual who is not a party to this contract, for access to information related to this contract. Those requests will be directed to PBGC's Disclosure Officer for processing under the provision of the Freedom of Information Act. This paragraph does not apply to a request by an individual for access to information contained in records pertaining to that particular individual. However, if the individual wants copies of the actual records pertaining to him, he first must contact PBGC's Disclosure Officer.

(f) The Contractor agrees that it will not knowingly violate any statutory or regulatory restrictions against the disclosure of government records, including 5 U.S.C. Sec. 552a, as amended, 5 U.S.C. Sec. 552, as amended, 18 U.S.C. Sec. 1905, as amended, and implementing regulations. The Contractor also agrees that it will take steps to ensure that any subcontractor will also adhere to these restrictions.

(g) The Contractor is bound by Section (m) of the Privacy Act, 5 U.S.C. Sec. 552a(m) and as such is considered under the act to be an employee of the agency. Accordingly, the

Contractor and any of its employees are subject to the criminal penalties of the Privacy Act, 5

U.S.C. Sec.552a(i).

(h) The Contractor will designate and identify an individual who shall be responsible for the notifications required under sections b, c and d of this agreement and who shall receive all appropriate responses from the Contracting Officer's Representative (COR) or from PBGC's

Disclosure Officer. The Contractor shall take those steps necessary to ensure that the provisions of paragraphs a-g, inclusive, are adhered to by all directors, officers, agents and employees of the Contractor.

(i) The Contractor shall place the provisions contained at Paragraphs a-g, above, in all subcontracts entered into pursuant to the contract where the subcontractor will have or may gain access to PBGC information and, further, the Contractor agrees to enforce the provisions of this Clause against any and all subcontractors under this contract.

H.7 PBGC-39-001 ELECTRONIC AND INFORMATION TECHNOLOGY (OCT 2004)

The contractor shall ensure that all electronic and information technology (EIT) procured, developed, maintained, used or delivered under this contract shall meet the applicable accessibility standards at 36 CFR 1194, unless an agency exception to this requirement exists. 36

CFR 1194 implements Section 508 of the Rehabilitation Act of 1973, as amended, and is viewable at http://www.section508.gov and http://www.access-board.gov/508.htm

H.8 PBGC-04-007 MANAGEMENT AND RETENTION OF PBGC RECORDS (SEP

2014)

1. Records defined: Records include all books, papers, maps, photographs, machine readable materials, or other documentary materials, regardless of physical form or characteristics, made or received by an agency of the United States Government under Federal law or in connection with the transaction of public business and preserved or appropriate for preservation by that agency or its legitimate successor as evidence of the organization, functions, policies, decisions, procedures, operations, or other activities of the Government or because of the informational value of data in them. 44 U.S.C. Section 3301. The contractor’s retention and management of records relating to the negotiation, management, and administration of this contract shall be governed by FAR Subpart 4.7, notwithstanding the requirements of this clause. 2. The

Contractor shall treat all records as the property of PBGC for which PBGC shall have unlimited rights to…