Sample PROS IV PWS and Data Flow.pdf

PERFORMANCE WORK STATEMENT

1. INTRODUCTION

The Air Force Security Assistance Center (AFSAC), located at Wright Patterson Air Force Base (WPAFB), Ohio, as the interface between the United States Department of Defense (DoD) logistics systems and Security Assistance (SA) customers, is responsible for ensuring comprehensive logistic support for the Foreign Military Sales (FMS) customers that own and operate weapon systems of U.S. origin.

Providing this comprehensive logistical support for the FMS customers creates some unique challenges. There are situations when the normal process of ordering does not meet our customer needs. Specifically, non-standard items that are not of a type or configuration currently active in the DoD inventory, Commercial Off-The-Shelf (COTS) items, and those

Supply (SOS) deemed to be unobtainable within a reasonable period of time may be ordered under this program. However, there may be other legitimate reasons for using this ordering system, such as when a customer has a requirement that cannot be supported through the mainstream supply or maintenance processes. Many FMS requirements for older or customer unique material do not have management data available. Some supply items are not catalogued due to low or infrequent usage and low quantities of items requested may not justify the administrative cost and time required to support a non-standard supply requirement. In other cases, when item management responsibilities do exist, high DoD demand often takes precedence over FMS supply requirements for limited resources.

Frequently, neither organic capability nor the contractual supportability exists within the DoD for maintenance of non-standard material.

Prior to addressing this issue, support was unacceptably slow and unreliable to the FMS customer, which produced a 60% cancellation rate for non-standard requirements. Some of the FMS customers have procurement offices in the United States to alleviate these difficulties;

however, most do not have the resources or volume of business to justify this option. In 1990, the United States Air Force (USAF)/AFSAC developed the Non-standard Item Parts and Repair name was changed to the Parts and Repair Ordering System (PROS). The PROS IV contract will offer Tri-Service support to the Air Force, Army and Navy FMS customers. The PROS program is intended to fill the gap in logistical support, and allow additional options for maintaining DoD support to our FMS customers.

Upon submission of a requisition to the AFSAC, the requesting customer country has agreed to accept the associated cost of filling that requirement. The customer country may have a reasonable estimate of cost to be incurred based upon recent procurements (including the contractor database) or catalog price.

However, PROS IV eligible items may experience disproportionately large costs because the items are no longer available and new production is required (i.e., start-up costs, costs associated with reverse engineering, etc.).

1.1 PURPOSE

The purpose is to implement a program known as Parts and Repair Ordering System IV (PROS IV) (five years in duration (one 3-year base period and one 2-year option period). The PROS IV program provides FMS customers (includes foreign customers supported by the USAF, Army, and Navy) with sustainment-support primarily for non-standard and difficult to support standard items, when the DoD source determines it is unable to provide support or when DoD organic capability is neither available nor timely. There will be times when the customer has a requirement that cannot be supported through the PROS mainstream supply or maintenance processes and a Task Order may be required. Task Orders may be utilized to provide the flexibility to contract for logistical, technical, and other support services.

The Contractor will be the DoD source for Supply/Maintenance/Task Orders for all eligible items under the PROS IV contract. The prime performance parameters of the contract are best value prices, timely support, quality material, and effective program management. A semi-annual Objective Performance Incentive will be available to incentivize performance.

The program will transition from PROS III to PROS IV, providing uninterrupted service to the FMS customer.

1.2 ELECTRONIC REQUISITIONS

Requisitions will be transmitted electronically via US Government Data Systems and will constitute valid orders under this contract. Electronic requisitions will contain the specific line/sub-line item against which effort is authorized, the amount considered obligated for the effort as defined in Section B, the Schedule, the delivery requirement (FOB Point), and the applicable accounting and appropriation data identifier. Task Order requisition will be transmitted electronically; contractor will not proceed until DD 1155 has been awarded.

1.3 SERVICE CATEGORIES

1. Supply Support: Buy material, provide Price and Availability (P&A) and any other associated efforts with supply contraction actions.

2. Maintenance Support: Repair (includes prior test, teardown and inspection (TTI), overhaul, upgrade, modification and calibration/testing of items.

3. Task Orders: Task Orders may be used for studies, analysis and technical services which may include material or maintenance support in conjunction with other requirements; however, this list of uses for Task Orders is not all inclusive.

To effectively support the primary services, the PROS IV contractor (henceforth know as the contractor unless otherwise stated) shall perform the following functions as a minimum: item research, purchasing, quality assurance, incoming/outgoing inspections as required, packaging/handling, transportation, custom processing of unique requirement, and automated support (communications and data interface). The service category is determined by the predominant work effort required. Determination of the service category rests solely with the USG and is not open to dispute.

2. PROCESSES COMMON TO SUPPLY/MAINTENANCE

Under the PROS IV contract the contractor shall perform the following requirements that are common to supply and maintenance in accordance with the requisition data flow.

2.1 ON-CONTRACT CATEGORIES

Category Supply BV Maintenance IV Maintenance BV Rou ne 60 75 14 Urgent 30 40 7

If the contractor cannot meet the on-contract timeframe, they will have up to 120 days to award contract but will only earn the routine level fill fee. If contractor is still unable to award contract, the contractor will CG cancel on day 121 and earn no fill fee.

If vendor cannot provide a quote within the above timeframes, contractor notifies customer via X2 and if customer agrees to wait, process customer acceptance via R2 with narrative followed by a X9 to indicate customer is willing to wait. Requisition is dropped to routine level and when vendor quote is received, contractor inputs a R9 and contractor has 14 days to award contract or cancel requisition.

2.2 DELIVERY CATEGORIES

Category Supply Maintenance Rou ne 150 225 Urgent 55 120

If the contractor fails to fill an order within the "delivery" times corresponding to the level of service initially identified in the requisition, the contractor shall earn the service level fee corresponding to the "delivery" time actually achieved. Regardless of the service level fee earned for the corresponding "delivery" time achieved, the contractor shall continue to provide the same level of communications as required at the original level of service i.e., if the "delivery" time for Maintenance, Urgent (120 days) is not reached, but the "delivery" time for

Maintenance, Routine (225 days) is achieved, then the fill fee earned corresponds to Routine, but communications will remain at the original level of service.

2.3 RECEIVE AND PROCESS REQUISITIONS

The contractor shall receive and process part number (PN) or national stock number (NSN) requisitions electronically in accordance with the appropriate Level of Service (LOS). The LOS categories are Urgent and Routine. The LOS provides the customer the opportunity to select the priority based upon their needs. As the contractor receives the requisitions and verifies that all required data elements are present, a receipt status shall be electronically transmitted to SAMIS with a MILSTRIP status code within two (2) business days in an appropriate extensible markup language (XML) format.

2.4 VALIDATE/RESEARCH ITEM ELIGIBILITY

The Contractor shall validate PROS IV eligibility for all requisitions (excluding Army "B" and Navy "P" requisitions) submitted by the customer country through SAMIS (see attachment A for Process Flow). PROS IV eligible items may consist of any P/N item or any NSN item directed to the contractor by the USG. The PMO will notify the Contractor, as required, of those items that are ineligible for PROS support without first obtaining PMO approval. The Contractor will also notify the USG when a requisition has been determined to be classified or upon receipt of a classified item at their in transit facility .

Air Force Contractor shall determine nonstandard/standard classification

Contractor validates item eligibility

Navy/Army Considered nonstandard unless item is AF managed

Navy/Army screens for eligibility prior to submission

Hazardous Restricted (as defined in Federal Standard 313C)

Contractor notifies PMO

Classified Restricted Contractor notifies PMO Night Vision Goggles Restricted Contractor notifies PMO Munitions Restricted Rejected, contractor cannot support Cartridge Actuated Devices (CAD)/Propellant Actuated Devices (PAD)

Restricted Contractor notifies PMO

Ozone Depleting Agents

Restricted Contractor notifies PMO

Military CAGE only Restricted Rejected to country

Foreign CAGE only Restricted to only those with USA associated CAGEs

Contractor can support using the USA CAGE code company

When a requisition is received from SAMIS with a NSN, the Contractor shall assume that AFSAC has decided to procure that part through PROS IV. NSN requisitions may also be received with a waiver from the AFSAC PMO authorizing procurement. All NSN requisitions that are determined to be an AF standard item must be supported by the source(s) provided by the ALC;

if more than one source provided, competition must occur.

The Contractor shall determine through the research process, including integration with HAYSTACK/FEDLOG/WebFLIS, D043, etc and review for Critical Safety Item (CSI) as necessary, if an ordered item with a P/N is eligible for processing under PROS IV. If the P/N, Contractor and Government Entity (CAGE) code cross references to an Air Force actively managed NSN, or an alternative P/N is found that cross references to an Air Force actively managed NSN, the requisition shall be forwarded to the appropriate source of supply via SAMIS for procurement as a USG managed item (exception is 2B advice code, see paragraph 2.5). AFSAC PMO may direct the Contractor to procure the item even though there is a valid NSN identified; PMO will provide SAMIS narrative explanation (i.e., off-line approval to procure, previously cancelled by ALC, etc).

The Contractor shall research all requisitions and ensure requirements do not cross-reference to an AF actively managed NSN, and determine if an interchangeable or substitute item is available to satisfy the requisition if the original part is not available. Specific instructions that may be contained in requisition narrative will be considered when processing the requirement.

Acquisition Advice Code

(AAC)

Material Management Aggregation Code (MMAC)

Expendability, Recoverability, Reparability Code

(ERRC)

Nonstandard No longer managed by the DoD

P, V, Y, L, T, X, F

EX, PU, XA,

XG, XL, XN, XT,

XU, XV, XW,

XY AND XZ

N or P (maintenance only)

Standard Actively managed by DoD

All Others All Others All others

2.4.1 NON-STANDARD ITEM.

A non-standard item is defined as an item not currently USAF managed. Non-standard procurement of supply or repair items (non-commercial) will require a CoC. Source qualification for non-standard items may be accomplished subject to the source qualification paragraph. Requisitions for nonstandard supply or repair materiel shall be controlled through application of:

(1) Federal Acquisition Regulations (FAR)

(2) Defense Federal Acquisition Regulation Supplements (DFARS)

(3) USAF FAR Supplements

(4) Air Force Materiel Command FAR Supplements

(5) Prior experience with the vendor or supplier

2.4.2 STANDARD ITEM.

A standard item is defined as an item that is currently managed by the USAF. Source qualification for standard items will not be accomplished under this contract. Additional research is required for standard items approved for PROS support. DoD will ensure the received requisition includes UID information and source approval information prior to passing to contractor. In the event the requirement does not reflect UID or source approval, the contractor shall process an X1 and request information from the applicable ALC.

(a) Unique Identification (UID): MIL-STD-130 criteria will be used for determining if UID is applicable for a supply support requirement; UID does not apply to maintenance at this time.

If the vendor cannot perform UID, requisition will be cancelled. Contractor shall review narrative input for suggested sources or specific instructions.

(b) ALC Source Approvals: For AF standard item parts or maintenance actions, the contractor shall use the current Engineering Source Authority (ESA) qualification requirements and qualified sources provided by the applicable Air Logistics Center (ALC). If an NSN (A01) or part numbered requisition (A05) is received from either the Army (B) or Navy (P) and it cross-references to an AF standard item in FEDLOG, only the AF ESA source will be used for support.

If the item cross-references to a DLA, FAA, GSA, etc source, Fedlog/Haystack sources will be used or a source with documented traceability to the Original Equipment Manufacturer will be selected. If directed sources, the Contractor shall contact (X1) the ALC FMS focal point for additional sources and assistance. DoD will ensure the received requisition includes the source approval information prior to passing to the contractor. In the event the requirement does not reflect the approved source, the contractor must contact the applicable ALC FMS focal point and request approval to support AF ESA approved sources via X1. If no response is received within thirty days from the ALC FMS focal point, the Contractor will close the X1 (R1) and contact the PMO (X4) for assistance or direction to cancel the requisition. If no response is received from the PMO within thirty days, the Contractor will close the X4 (R4) and cancel the standard item requisition using a CJ cancellation code and earn a research fee. All requisitions shall be reviewed for standard item source support, quantity discount buys, consolidation potential, nonstandard safety of flight, classified, hazardous, and items identified by USAF as restricted.

Contractor shall review narrative input for suggested sources or specific instructions. A CoC will be required.

2.5 ADVICE CODES

Certain advice codes require special attention to ensure customers receive only those items requested or carry other types of restrictions. See below table for Advice Codes applications.

Nonstandard 2B, 24, 26, 34 and 39

Only requested item will suffice, do not substitute

Standard 2B, 24, 26, 34 and 39

If NSN contains more than one part number, contractor may continue but only to FEDLOG/Haystack sources.

If NSN is AF managed and contains only one part number the contractor must CY cancel requisition to the managing AF ALC.

If the NSN is USG other than AF managed and contains only one part number the contractor may continue but only to FEDLOG/Haystack sources.

2.6 REQUISITION DISPOSITION

The Contractor shall perform various actions such as review opportunities to combine requirements, request quotes, screen potential sources, evaluate supply vendor responses, negotiate price and delivery terms with vendors, provide electronic status, and deliver material to fulfill the requisition requirement.

2.7 REQUIREMENTS FOR COMPETITION

Contractor shall obtain adequate price competition, as defined by Federal Acquisition Regulations (FAR) Subpart 6.1 and 15.403, and the Competition in Contracting Act of 1984 as guidance. In instances where adequate price competition is not obtained, contractor shall be responsible for determining and validating that the price represents best value IAW FAR part 15

The contractor will document the negotiations in accordance with FAR part 15. To ensure best value prices and contain pass-through costs, contractor's goal is to achieve an average of three competitive quotes, for all supply requisitions excluding LOA directed sole-source procurements.

The contractor shall provide the CO a monthly summary report (CDRL) detailing requisition number, source, and price after award of all orders where adequate price competition was not obtained, to include sole source acquisitions as outlined below. Sole source acquisitions as country directed on the Letter of Offer and Acceptance (LOA) is excluded.

The contractor may be the source of supply or maintenance when the following conditions apply:

a. "Contractor" means the business entity receiving the award of the PROS IV contract and does not include its parents, affiliates, division and subsidiaries.

b. The contractor's quoted price is the lowest price received, is submitted without knowledge of other quotes received, and adequate price competition exists based on sources independent of the contractor.

c. When the contractor is designated as the sole source on an LOA, the file must adequately document determination of fair and reasonable pricing, and the contractor must notify the CO of the awarded price as described in (a) above.

d. When the contractor is the only source of supply or maintenance and is not designated as sole source on the LOA, the contractor shall document the file to reflect attempts made to obtain competition.

e. When the contractor is the source of supply or maintenance, material pass-through is defined as the fair and reasonable price of the supply item or maintenance service exclusive of all direct and indirect cost associated with the acquisition of those items. Direct and indirect cost, and profit associated with the acquisition of those items shall be accounted for solely in the fill fee.

f. In those instances where adequate price competition is not obtained, the contractor is still responsible for determining that the price is best value. File documentation must contain detailed analysis supporting the award decision (price negotiation memorandum). The contractor shall retain supporting documentation for all such orders that are listed on the monthly report described in (a) above. Said documentation must be available to the CO or designated representative for surveillance review at any time during contract performance. If as a result of U.S. Government surveillance of the contract the CO determines that an inordinate number of award decisions have been based on inadequate analysis for those requisitions filled in house, the CO may unilaterally limit the number of requisitions that may be awarded to the contractor, or suspend the contractor from being a source of supply or maintenance, or require CO review of some or all such orders prior to placement. If an audit is necessary for items over $650,000, the contractor shall contact the CO for assistance in obtaining the audit.

g. The contractor shall retain evidence of all quotations on orders. These records (evidence) shall be available for examination by the CO or authorized representative during all business hours and shall be provided to USG upon completion of the contract (CDRL).

h. Unless otherwise approved by the CO, all orders awarded by the contractor shall be firm fixed price.

i. Contractor shall perform in accordance with approved subcontracting plan.

2.8 PRICE QUOTE/PRICE REVISION

a. Price Quote: The Contractor shall notify the customer of price and obtain approval IAW the customer notification of price requirements (reference paragraph 3.2). Price quotes shall be valid for 90 days. The Contractor shall notify the customer of instances when the 90 days is not achievable or a lower price is available with a shorter validity period.

b. Price Revision: The Contractor shall request customer country price approval IAW the customer notification of price requirements (reference paragraph 3.2). The Contractor shall submit a price revision whenever the price changes due to a decrease in requisition quantity or receives a late customer response to a price approval request message. As the price of the requisition is to be firm fixed price at the time of contract award, the Contractor must ensure all costs (to include estimated transportation or potential warehouse handling costs) have been included in the price to avoid any price adjustments after contract award. After requirements are on contract, the Contractor shall not transmit price revisions due to the Contractor or vendor errors for any amount of $200 or less. If it has been determined that the Contractor has made an error in excess of $200.00, the Contractor may process a price revision for review by AFSAC/PMO and customer acceptance. All relevant information will be communicated to the customer for approval or cancellation.

2.9 PRICE MATRIX

To preclude unexpected costs or price increases to the customer country, the contractor shall obtain concurrence from a representative of the customer country prior to award of contracts which fall within any one of the value ranges and criteria listed below in (b-f). When the requisition is for a NMCS requirement, identified by the NMCS indicator code in the requisition, notification is not required. When communicating with the customer, provide the full customer's price (total requisition value) and specify that a customer will have 90 days to respond or the requirement will be canceled.

Each country will provide the PROS IV contractor their price notification requirements or the PROS IV contractor will use the default price notification requirements identified below. The default price notification requirements are listed below; country unique price notification requirements will change the default information in brackets. Country unique price notification requirements over and above items will require the processing of a task order.

Total Requisition Value for And supply requisition is between [$2,500] and [$10,000] exceeds by [twenty-five percent (25%)] or more the last procurement price from [any source] (e.g., US GOVERNMENT DATA SYSTEMS, D043, contractor generated data) adjusted to reflect current year dollars.

a supply requisition is greater than [$10,000] exceeds by [ten percent (10%)] or more the last procurement price from [any source] (e.g., US GOVERNMENT DATA SYSTEMS, D043, contractor generated data) adjusted to reflect current year dollars.

greater than [$1,000]

[fifty percent (50%)] or more of the requisition's cost is comprised of one-time start-up charges.

supply or maintenance support requisition is greater than [$100,000].

supply requisition exceeds the Pricing and Availability (P&A) cost by more than $250.

greater than {$2,500} and no procurement history exists.

Supply is between (2500.00 and 10,000.)

Exceeds by (10% of more the previously approved price quote

Supply is greater than (10,000.)

(50%) or more of the previously approved requisition cost is comprised of a one-time start-up charge.

Supply is greater than (1,000)

Supply or maintenance exceeds the previously approved quote by more than ($100,000).

Results in an equal to or greater than ($250.) increase in the previously approved price quote.

Increase in quantity due to minimum buy

Supply exceeds the pricing and availability cost on a previously approved price quote by $250.00

Supply requisition is between [$2,500] and [$10,000] and a price revision exceed by [25%] or more the previously approved price quote.

Supply requisition is greater than [$10,000] and price revision exceeds by [10%] or more the previously approved price quote.

the contractor shall notify the customer specifying alternate support actions: (1) identify the repair cost for the original asset regardless if it exceeds the established BER threshold,

(2) identify the cost of a serviceable replacement if available or (3) other alternatives unique to the situation, subject to AFSAC PMO approval.

Beyond Economical Repair (BER)- If the estimated cost of a maintenance support requisition, including labor and material, is determined to be greater than, seventy-five percent (75%), of a new acquisition item cost

Before cancellation action is taken, the contractor shall notify the customer of estimated termination charges and request concurrence to pay these costs before cancellation action is finalized.

Termination of a supply or maintenance requirement

Customer provides an NTE value at time of requisition input and contractor will proceed with contract award without asking permission.

Not To Exceed

(1) If the customer country was provided message notification of the total requisition value for the previous price quote and now a price revision has been processed, notification of the new quote is required along with information as to the reason for the price revision.

(2) If the customer country was not provided message notification of the total requisition value for now the price revision causes the price to exceed the thresholds, notification of the new quote is required.

2.10 EXPEDITE OF REQUISITIONS

Customers may request the Contractor attempt to improve the ship date for the requisition.

This can be done before the Contractor awards a contract and/or after a contract is awarded.

(See Data Flow II.C.2)

2.11 SUPPORT DURING WAR EFFORTS

In the event a customer has been assigned a project code by DSCA, the customer will process an update to advise contractor. Contractor will ramp-up effort to ensure the identified requisitions are worked expeditiously but without impact to other customers and separate cost would be incurred.

2.12 OPTIMIZE PRICE/REDUCE TURN AROUND TIME (TAT)

Contractor shall continuously strive to optimize price and improve TAT while still assuring quality. For routine level of service requisitions, the Contractor shall communicate to the customer when a lower price is available for an increased TAT. the Contractor shall make every attempt to consolidate like requirements under a single contract award to a vendor. Timely communications with the customer are necessary to ensure this does not impede TAT.

Contractor will be incentivized through the Objective Performance Incentive Plan (attachment

2) to aggressively pursue and achieve the best value price.

2.13 CANCELLATIONS

2.13.1 CONTRACTOR INITIATED CANCELLATIONS

The Contractor may cancel requirements due to inability to obtain a quote, identification of an interchangeable or substitute item, or cross-reference to an NSN. When the requisition has missing/inaccurate ordering information, the Contractor shall attempt to obtain required information from the customer before canceling the requisition.

Cancellation/research charges are assessed/earned against supply and maintenance requisitions in the following situations:

a. Contractor-initiated cancellations earning a research fee:

Requirement From To Action Cost Not On Contract Routine Urgent On or after day 40 level of service upgraded and contractor earns higher level of service fee Urgent LOS

On Contract Routine Urgent Before day 40 if approved, does not change the LOS but requisition but treated as higher level of service but will only receive Routine fill fee

(1) When a part number is matched to an actively managed DOD/GSA item the contractor will pass to the source of supply or if the item is an obsolete/terminal NSN, the contractor will contact the ALC focal point to ascertain if residual stock exists. If stock exists the requisition will be passed to the source of supply. In both cases the contractor must provide the NSN identified. (In either case "CY" cancellation code applies).

(2) When an NSN is matched to a substitute NSN that is either in stock or actively managed for USG use, the contractor must provide the NSN information ("CJ" cancellation code applies).

(3) When USG maintenance capability exists for a scheduled or unscheduled repair order ("GY" cancellation code applies).

(4) For requisitions which the contractor cannot fill because of missing or inaccurate ordering information, correspondence requesting the required information will be sent to the in-CONUS or overseas foreign country focal point. (Addresses of customer-country representatives will be provided within 15 days after contract award.) If no response is received within 30 days of the last two follow-ups issued at 30-day intervals, the contractor may cancel the requisition, with a "D3" cancellation code, without influence on the performance evaluation criteria used for determination of the Objective Performance Incentive amount and earn a research fee.

b No cancellation fees are assessed in the following contractor initiated cancellations:

(1) Failure to obtain a vendor quote when all required information has been provided and the item can be identified will result in a "CG" cancellation by the contractor and will be reflected in the performance evaluation criteria used for determination of the Objective Performance Incentive amount. The contractor will cancel all requisitions not on contract (or not quoted for P&A request) within 180 contractor days (calendar days minus customer calendar delay days).

(2) If a requisition is received with the same nonstandard NSN or PN that was previously CG cancelled, the contractor must attempt to locate a qualified vendor to support the requirement. In the event a qualified vendor cannot be located, the contractor will cancel the requisition with a CU cancellation code.

(3) If a requisition is received with the same standard NSN or PN that was previously CG cancelled, the contractor must attempt to contract with the SOS approved sources to support the requirement. In the event the SOS qualified vendor will not provide a quote, the contractor will cancel the requisition with a CA cancellation code.

2.13.2 USG AUTOMATED CANCELLATIONS

There are two instances when the USG will process an automatic cancellation request:

a. X5 Request for Customer Price Approval. If the customer fails to provide a response within 60 days, SAMIS will generate an automatic AC cancellation. Contractor will respond with an R5 and either a BQ cancellation or B4 if termination costs will be incurred. Contractor has the right to reject the cancellation with a B8 status if the customer's response is received at the same time as cancellation request.

b. X6 Request for Customer Termination Charges and Disposal Instructions (Maintenance-Beyond Economical/Physical Repair). If the customer fails to provide a response within 30 days, SAMIS will generate an automatic AC cancellation. Contractor will respond with an R6 and B4 to cover termination costs and return shipment costs.

2.13.3 PMO ASSISTED CANCELLATIONS

There are instances when the Contractor may request assistance in cancelling a requisition.

Contractor will process an X4 requesting PMO assistance and provide explanation for the request. PMO will review and approve on a case-by-case basis. If approved, PMO will provide AC with narrative and contractor will respond with an R4 and BQ cancellation.

2.13.4 CUSTOMER INITIATED CANCELLATIONS

The Contractor shall honor customer cancellation requests when received before the order is placed on contract. If cancellation request is received after requisition is on contract and termination charges are applicable, the Contractor shall contact the customer for determination to proceed with the cancellation. The Contractor shall contact the customer for a final cancellation decision in accordance with the customer notification of price requirements.

The Contractor will respond to customer cancellation requests for orders without a price quote within three (3) business days of receiving the cancellation request through SAMIS.

a. Cancellation/research charges are assessed/earned against supply and maintenance requisitions in the following situations:

(1) Customer-initiated cancellations after an inspection quote, "IQ", or a price quote, "PQ", status code has been processed in the USG data system and no new requisition will be submitted.

(2) Customer-initiated cancellations:

(a) When the customer cancels the requisition due to lack of funds on the case, a price quote, "PQ", status code has been submitted in the USG data system, no work has begun on the order, and the customer is submitting a new requisition on a case with funds ("NF" cancellation code applies).

(b) When the customer cancels the requisition before an inspection quote, "IQ", or a price quote, "PQ", status code has been submitted in the USG data system.

b. Cancellation fees are assessed as follows for package buy requisitions:

(1) When the customer cancels the entire package buy requisition and a price quote, "PQ", status code has been submitted in the USG data system, the supply cancellation fee (CLIN 0002AA during the basic period and 0102AA during the option period) will be assessed based on the material value and level of service.

(2) When the customer cancels any line item within the package buy and a price, "PQ" status code has been submitted in the USG data system, there will be no cancellation fee;

however, the fill fee will be based on the initial price quote.

c. Termination charges will be assessed when the customer cancels a requisition (including task orders) that is on contract, an "IV" or"BV" status code is processed in the USG data system, and work has begun. Termination costs will be reimbursed in accordance with FAR 52.249-2 (Termination for Convenience of USG - Fixed Price) and FAR 52.249-6 (Termination - Cost Reimbursement). The contractor is responsible for taking immediate action to mitigate costs upon notification that an order is cancelled by a security assistance customer which may lead to termination costs. The contractor is further responsible for negotiating termination costs which shall be subject to Government approval.

d. Cancellation and termination charges combined shall not exceed charges for delivered material plus the cancellation fee.

3. PACKAGE BUYS

Package buys shall be treated Routine and as one buy for purposes of determining adequate price competition. The number of line items identified in the narrative of the requisition may range from two to ten; all items must be available and purchased from a single supplier and staged for a single shipment. All package buys will include a PMO narrative approval upon receipt of requisition; if approval is not included, contractor must contact PMO (X4). The Contractor shall process AF package buys for procurement of AF nonstandard multiple line items against a single requisition. AF standard items and maintenance requirements are excluded from package buys. Navy package buys will be considered as non-standard and will not include any AF standard items. If an item cannot be quoted from the identified source or if a standard item is identified, the item shall be removed and customer notified within four business days. The fill fee will be based on the sum total of line item material costs in the requisition and assessed against the supply fill fee CLIN 0001AA during the basic period, and 0101AA during the option period.

3.1 PRICE AND AVAILABILITY (P&A)

The Contractor shall provide supply P&A data no later than 90 days after receipt of request or process a no fee cancellation (AE3/NF) to complete the requisition. The P&A shall be valid for 60 calendar days and will reflect the vendor price, fill-fee, and the estimated availability date.

The Contractor shall notify the customer when the 60 day validity timeframe is not achievable or when a lower price is available for a shorter period of time. Upon acceptance of P&A, customer will provide a replacement requisition and cross reference the P&A requisition number in SAMIS narrative. The Contractor will no-fee (NF) cancel the P&A requisition after item(s) within 60 days of PA notification, the contractor will invoice for P&A fee within 30 days.

3.2 REQUIREMENTS UNIQUE TO MAINTENANCE SUPPORT

3.2.1 MILSTRIP AUTHORIZATION TO FACILITATE MAINTENANCE (APR 2003)

(a) The contractor is authorized to use the MILSTRIP system to order parts from DoD supply sources in order to facilitate maintenance in accordance with Chapter 6, MILSTRIP Manual, DoD 4000.25-1 M, in order to provide such maintenance.

(b) The contractor must provide subcontractors authority in writing for MILSTRIP authorization only upon prior approval from the USG.

(c) The contractor(s) shall submit MILSTRIP orders in accordance with Chapter 6, DoD 4000.25-1 M, ensuring Delivery Term Code of "2" is indicated in record position "34".

(d) The contractor shall submit all recommendations to use MILSTRIP authorization to the AFSAC PMO. The AFSAC PMO will approve on a case-by-case basis by project for a specific country. The contractor shall be permitted to use MILSTRIP only for parts required to fulfill repair requirements under contract.

(e) FAD and Priority Designator (urgency/need) will be provided to the contractor for each individual program by country.

(f) The contractor may find additional guidance in AFMAN 23-110 and Security Assistance Management Manual (SAMM) DoD 5105.38-M, Chapter 8.

3.2.2 MAINTENANCE ACTIVITIES

The Contractor shall provide following maintenance activities as required.

3.2.2.1 TEST, TEARDOWN AND INSPECTION (TTI)

TTI determines the scope of repair. If The Contractor is unable to obtain a quote for repair of an item, The Contractor shall provide the customer a quote for TTI. Upon completion of the TTI, The Contractor shall provide a quote for repair, overhaul, modification, upgrade, test, or calibration of an item.

3.2.2.2 SCHEDULED/UNSCHEDULED MAINTENANCE SUPPORT

The Contractor shall provide secure temporary storage for all customer assets and provide receipt notification to SAMIS. The Contractor shall establish necessary communications with the customer and provide direction to ensure the timely shipment of assets. The Contractor shall notify the PMO upon receipt of assets and track material between warehouse, vendor and shipment using. (Ref Data Flow II.B.4 and III.G)

3.2.2.3 CONDEMNATION AND REPAIR LIMITATION

The Contractor shall notify the AFSAC PMO and the customer via SAMIS with alternatives, when quoted cost exceeds the USG (Air Force, Army and Navy) IAW H-903(d) established Beyond Economical Repair (BER) and Beyond Physical Repair (BPR) limits. The Contractor shall take action IAW customer instructions within thirty (30) calendar days. The Contractor shall also identify specific failed components on BER/BPR items to the FMS customer.

3.3 TASK ORDERS

The tasks associated with CLIN 0003 and 0103 of this contract are described in general terms.

Individual task orders shall be issued against the contract in writing, dated and labeled as "TASK NUMBER XXXX" on a DD 1155, Order for Supplies or Service. Each order shall identify the specific task to be accomplished, the period of performance, and the required reports to be delivered upon completion.

The Contracting Officer (CO) will send a Request for Proposal (RFP) with an attached Performance Work Statement (PWS) to the contractor to request a proposal for a task order and concurrently a requisition will be processed through the SAMIS system requesting an electronic cost estimate for proposal preparation cost. The cost estimate shall be provided via the SAMIS system within five (5) working days after receipt of the RFP and requisition. After receipt of the RFP, CONTRACTOR shall submit the draft Statement of Work (SOW) (as specified in the RFP) to the USG task order manager. Upon USG acceptance of the SOW, CONTRACTOR will be notified by AFSAC/PK to proceed with submittal of the final SOW, the Technical Implementation Plan (TIP), Cost/Price Data (including an estimated amount for travel expenses when applicable) and a comprehensive cost or price analysis to AFSAC/PK (to be submitted as specified in the RFP).

The CO will notify CONTRACTOR per e-mail if the task order is cancelled. CONTRACTOR may submit a proposal with supporting data to the CO to recover actual costs incurred in the preparation of the RFP requirements. AFSAC/PK will enter into negotiations with CONTRACTOR to determine a fair and reasonable price. Once a fair and reasonable price for proposal preparation is established, CONTRACTOR shall invoice the Task Order Proposal Preparation Cost for CLIN 0003AC during the basic performance period, and for 0103AC during the option performance period.

Each "TASK NUMBER XXXX TECHNICAL IMPLEMENTATION PLAN" shall include the following information at a minimum:

(1) The contractor's overall plan for accomplishing the task requirements of the SOW.

(2) Milestones associated with task accomplishment.

The Cost/Price Data and a comprehensive cost or price analysis shall include at a minimum: a breakout of subcontractor labor, subcontractor cost, travel, and any material cost.

(1) AFSAC/PK will enter into negotiations with CONTRACTOR to determine a fair and reasonable price.

(2) A comprehensive (including prime and subcontractor cost) cost or price analysis shall be performed/provided by CONTRACTOR on all task orders and provided to AFSAC/PK. In the event, proprietary subcontractor data is withheld from CONTRACTOR, CONTRACTOR shall cause the proprietary data to be delivered to the

USG.

(3) For task orders in excess of $650,000, CONTRACTOR shall provide certified cost or pricing data in accordance with the instructions provided in FAR clause 15.408(m).

Task order changes shall be issued via written modification by the Contracting Officer.

CONTRACTOR is responsible for completion of each task order within the period of performance regardless of whether or not the effort was subcontracted. Therefore, when CONTRACTOR and/or their subcontractors are directly at fault and fail to perform within the contract performance period, CONTRACTOR shall submit a proposal for consideration in exchange for the task order extension. The consideration proposal shall be submitted with the request for task order extension and the amount will be negotiated prior to task order modification. The amount of the negotiated consideration will be de-obligated from the fixed price task order labor CLIN if funds are still available; otherwise funds will be withheld from payment for future task orders as consideration for extending the period of performance.

3.4 PACKING, CRATING, HANDLING, & TRANSPORTATION (PCH&T)

3.4.1 SHIPPING AND RECEIVING

The contractor shall maintain in-transit visibility of all shipments and comply with special shipping instructions contained in the requisition or directions provided by the AFSAC PMO.

Defense Transportation Service (DTS) shipments shall be IAW AFMAN 16-101, chapter 6 and DOD 4500.9-R Defense Transportation Regulation (DTR), Part II, Cargo Movement, appendix E.

The contractor shall ensure the appropriate level of material verification and inspection is accomplished upon receipt at the repair location and/or shipment to customer.

When it is deemed necessary by the contractor or the PMO, material (incoming and/or outgoing) may be shipped to a centralized facility for the purpose of confirmation of receipt, identification/verification of material shipped, accuracy of shipping documentation and performance of final visual inspection before shipment to vendor or customer.

Based on the assigned LOS, the contractor shall ship material by the most cost effective method dress and ensure that Notice of Availability and release of shipments are accomplished IAW DOD 4000.25-1-M, chapter 6, (MILSTRIP). When appropriate, and not causing a delay, the contractor will consolidate items into larger shipments as a cost saving advantage to the customer.

verify shipment point of origin and destination to support any customer submitted Supply Discrepancy Report (SDR).

PROS shipments through the Defense Transportation System (DTS) will require the contractor to report all export information on each shipment of hardware to the Bureau of Customs and Border Protection (CBP) using the Automated Export System (AES). After completing the AES entries, the PROS contractor must send this data electronically to the U.S. port before the export can be made (in accordance with Section 123.22 of the International Traffic in Arms Regulation (ITAR). Shipments of technical data or services must comply with ITAR Section 123.22(b)(3).

Note 1. All DTS shipments must use AES. These transactions take the place of the hardcopy Shipper's Export Declaration (SED) form, which is no longer accepted.

Note 2. If items from multiple FMS cases are included in the same shipment, the PROS contractor must file a separate AES entry for each individual FMS case being used.

The PROS contractor must print out the AES "SED" page and annotate as follows. This annotated printout must accompany the shipment.

a. "This shipment for [indicate whether organic or commercial] DTS is being exported pursuant to an LOA authorizing such transfer which meets the criteria of 22 CFR 126.6(a). It covers FMS CASE [insert case identification]. The U.S. Government point of contact is [insert name], commercial telephone number [insert commercial telephone number]."

b. "This Letter of Offer and Acceptance (LOA) authorizing this transfer is lodged at [insert name of primary port where LOA was lodged]."

Note: If multiple AES "SED" pages accompany the shipment (because multiple FMS cases are being cited), these statements must appear on each AES "SED" page citing the applicable FMS case and port.

Customs will only decrement a shipment after export information has been filed correctly using AES. As part of the AES filing the PROS contractor must provide the XTN (external control number) to Customs.

An export may be made through a port other than the primary port where the LOA is lodged.

The AES "SED" page must clearly indicate the name of the primary port where the LOA is lodged.

All shipments must meet established minimum timeframe requirements for these shipments in accordance with 22 CFR 123.22(b).

a. By air and truck, at least 8 hours prior to departure from the U.S.

b. By sea and rail, at least 24 hours prior to loading aboard ship at the port of exit.

Guidance regarding the above requirements can be located in DoD 5105.38-M, Security Assistance Management Manual, Table C7.T8., Export Documentation Requirements.

Effective October 18, 2003, all exports of hardware controlled by the ITAR, regardless of the type of approval (e.g., license, agreement, or exemption) require filing of export information with CBP using AES. Information about the Automated Export System (AES) is available at web site: www.pmdtc.org. Additional information about AES is available at web site:

www.cbp.gov/xp/cgov/export/aes/. Due to the continually evolving nature of AES, the contractor is cautioned to ascertain they have the most current guidance prior to implementation.

3.4.2 PACKAGING

The controlling document for packaging is MIL-STD 2073-1D, paragraphs 3.10 and 5.3, Standard Practice for Military Packaging. Unless otherwise directed by the AFSAC PMO, PROS IV material is packaged for favorable warehouse conditions (level A/B). Packaging requirements are also dictated by the mode of transportation utilized such as USPS, FEDEX, UPS, or other small package services. For hazardous materials, performance oriented packaging shall be accomplished in accordance with AFJI24-210.

3.4.3 MARKING

The contractor will implement and use procedures for "BAR Coding" of shipping labels in accordance with DOD 4500-9-R, DTR, Part II, Cargo Movement, appendix E. Marking of the container will be in accordance with MIL-STD-129P, chapter 4. Items procured under the PROS IV contract shall be marked per MIL-STD-130L, change 1. This revision implements Policy for Unique Identification (UID) of items. Item identification marking is required and the development of specific item marking requirements shall be based on criteria provided in this standard. The UID policy, with associated guidance is available at www.acq.osd.mil/uid/policy.html.

3.5 PROVIDE ELECTRONIC STATUS

The Contractor shall ensure requisition status and narrative when required is electronically transmitted to SAMIS within 2 business days unless otherwise stipulated. Transmission requires the use of the description of PROS IV unique codes, MILSTRIP codes, formats or specific reporting rules are set forth in Appendix A. The Management Information System (MIS) shall be configured to automatically transmit the appropriate status codes to SAMIS as each phase of the procurement process is completed.

and updated to accommodated USG updates as required at no cost to the USG. (See Data Flow)

3.6 PROVIDE ESTIMATED SHIP DATE (ESD)

The Contractor shall provide accurate ESDs in SAMIS and enter narrative messages explaining long lead-times (-exceeds the LOS ), new production, ESD slippage, or other significant information that may assist the customer in logistics planning.

The Contractor shall advise customers of late shipments prior to missing the ESD. The Contractor shall report late ESDs via SAMIS with a status transaction reflecting an updated ESD and SAMIS narrative, not later than two business days after the missed ESD.

3.7 COMMUNICATIONS

SAMIS narrative is the official record for all communication with the customer. All communications shall be clear and concise; English is the second language for most FMS customers. All communications should use a standardized message format and include, at a minimum, point of contact, phone number, e-mail, requisition number, NSN or P/N and CAGE code.