SPE300-15-R-0042_Attachment_1_SOW_Published_18_DEC_2015.pdf

SPE300-15-R-0042 Subsistence Prime Vendor Kuwait, Iraq, and Jordan – Attachment 1

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SF1449 - CONTINUATION SHEET

ADMINISTRATIVE DATA/DELIVERY SCHEDULE

CONTINUATION OF THE BLOCKS ON PAGE 1 (SF 1449)

BLOCK 8 (continued)

OFFER DUE DATE/LOCAL TIME: January 11, 2016, 3:00 P.M. PHILADELPHIA TIME

All offers are required to be mailed to the Defense Logistics Agency (DLA) Troop Support Post Office Box 56667 or hand carried to the DLA Troop Support Business Opportunities Office as described in Block 9 below.

BLOCK 9 (continued):

All offers/modifications/withdrawals must be plainly marked on the OUTERMOST ENVELOPE with the solicitation number, closing date, and time set for the receipt of offers. Send your offer to one of the following addresses:

POST OFFICE BOX ADDRESS:

DEFENSE LOGISTICS AGENCY

DLA TROOP SUPPORT

POST OFFICE BOX 56667

PHILADELPHIA, PA 19111-6667

STREET ADDRESS:

DLA TROOP SUPPORT

BUSINESS OPPORTUNITIES OFFICE

BLDG. 36, SECOND FLOOR

700 ROBBINS AVENUE

PHILADELPHIA, PA 19111-5092

All hand carried offers are to be delivered to the Business Opportunities Office between 8:00 AM and 5:00 PM, Monday through Friday, except for legal federal holidays as set forth in 5 USC 6103.

Contractors intending to deliver offers in-person should be advised that the Business Opportunities Office (Bid Room) is located within a secure military installation. In order to gain access to the facility, an escort may be required. The escort will be an employee from the Bid Room. The following are telephone numbers for the Bid Room: (215)737-8511, (215)737-9044, (215)737-8556, (215)737-0317. It is the offeror’s responsibility to ensure that offers are received at the correct location at the correct time.

Please allow sufficient time to complete delivery of hand carried offers. Since the length of time necessary to gain access to the facility varies based on a number of circumstances, it is recommended that

Page 2 201 you arrive at the installation at least one hour prior to the time the solicitation closes to allow for security processing and to secure an escort. NOTE: THIS IS A SUGGESTION AND NOT A GUARANTEE

THAT YOU WILL GAIN ACCESS TO THE BASE IF YOU ARRIVE ONE HOUR BEFORE THE

OFFER IS DUE.

Offerors that respond to this solicitation using a commercial carrier service must ensure that the commercial carrier service “hand carries” the package to the Business Opportunities Office prior to the scheduled closing time.

NOTE: Facsimile and E-mail Offers are not acceptable forms of transmission for submission of initial proposals or revisions to initial proposals submitted in response to this solicitation. As directed by the Contracting Officer, facsimile and e-mail may be used during discussions/negotiations, if discussions/negotiations are held, for proposal revision(s), including Final Proposal revision(s).

BLOCK 17A. (Continued):

OFFERORS: SPECIFY

CAGE CODE:__________________________________________________________________

TYPE OF OFFEROR: (circle one) Individual doing business as a firm, Partnership, Corporation, Joint Venture, or Other (please explain)______________________________________________

FOREIGN BUSINESS (Circle…….YES – OR – NO)

PRIMARY COMPANY POC/NEGOTIATOR:________________________________________

PHONE #:_____________________________________________________________________

E-MAIL ADDRESS:_____________________________________________________________

BLOCK 17B. (CONTINUED)

REMITTANCE WILL BE MADE TO THE ADDRESS THAT THE CONTRACTOR HAS LISTED IN

THE SYSTEM FOR AWARD MANAGEMENT (SAM).

Offeror’s assigned DUNS Number: ______________________________________________________

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AUTHORIZED NEGOTIATORS:

The offeror represents that the following persons are authorized to negotiate on its behalf with the Government in connection with this request for proposal. Please list names, titles, e-mail addresses, and telephone numbers for each authorized negotiator.

BLOCKS 19-24 (CONTINUED): SEE ATTACHMENT 2

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CAUTION NOTICE

NOTICE TO OFFERORS

The Government reserves the right to cancel this solicitation at any time. If this should occur, the Government will not be liable for any proposal preparation costs or any other costs that offerors may have incurred related to this solicitation.

CONTRACTOR CODE OF BUSINESS ETHICS (FEB 2012)

DLA TROOP SUPPORT

FAR Part 3.1002(a) requires all government contractors to conduct themselves with the highest degree of integrity and honesty. Contractors should have a written code of business ethics and conduct within thirty days of award. To promote compliance with such code of business ethics and conduct, contractors should have an employee business ethics and compliance training program that facilitates timely discovery and disclosure of improper conduct in connection with government contracts and ensures corrective measures are promptly instituted and carried out. A contractor may be suspended and/or debarred for knowing failure by a principal to timely disclose to the government, in connection with the award, performance, or closeout of a government contract performed by the contractor or a subcontract awarded there under, credible evidence of a violation of federal criminal law involving fraud, conflict of interest, bribery, or gratuity violations found in title 18 of the United States Code or a violation of the False Claims Act. (31 U.S.C. 3729-3733)

If this solicitation or contract includes FAR clause 52.203-13 - CONTRACTOR CODE OF BUSINESS ETHICS AND CONDUCT; the contractor shall comply with the terms of the clause and have a written code of business ethics and conduct; exercise due diligence to prevent and detect criminal conduct;

promote ethical conduct and a commitment to compliance with the law within their organization; and timely report any violations of federal criminal law involving fraud, conflict of interest, bribery or gratuity violations found in title 18 of the United States Code or any violations of the False Claims Act.

(31 U.S.C. 3729-3733). When FAR 52.203-13 is included in the contract, contractors must provide a copy of its written code of business ethics and conduct to the contracting officer upon request by the contracting officer.

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****PRE-PROPOSAL CONFERENCE****

SOLICITATION NUMBER SPE300-15-R-0042

A pre-proposal conference will be held by DLA Troop Support to explain and clarify the requirements of this solicitation and to respond to general questions raised by prospective offerors. Interested firms are encourages to attend.

Prospective offeror are requested to submit questions in writing at least 11 days prior to the conference to allow inclusion of the questions in the agenda. Questions will be considered at any time prior to or during the conference; however, offerors will be asked to confirm verbal questions in writing. Responses to all questions will be incorporated in an amendment to the solicitation.

The Government will not be liable for expenses incurred by an offeror prior to contract award.

Offerors are cautioned that remarks and explanations provided at the conference shall not change the terms of this solicitation unless the solicitation is amended in writing.

The conference will be held as follows:

Date: Tuesday, December 29, 2015 Location: Double Tree by Hilton Philadelphia Airport 4509 Island Avenue Philadelphia, PA 19153 Phone #: 215-365-4150 Time: 8:30AM

The cutoff date for receipt of questions is Thursday, December 24, 2015, 3:00 PM, Philadelphia time. If you plan to submit questions, please send an e-mail with the following information:

Name of Firm

Name and Title of Representative Address of Firm E-Mail Address Phone Number Size of Business Questions

This information may be e-mailed to Raynard Jamison and Linda Ford at: Raynard.Jamison@dla.mil and Linda.Ford@dla.mil.

NOTE: Vendors are encouraged to carefully review the solicitation before developing questions for submission.

mailto:Raynard.Jamison@dla.mil mailto:Linda.Ford@dla.mil

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???? DID YOU REMEMBER TO: ????

Number Reminder Check 1 Print and distribute the past performance questionnaire (page 134) to your contract holders?

2 Identify your authorized negotiators above as required? (page 3) Did you identify which negotiator will serve as the primary point of contact? (page 2)

3 Submit a list of all your affiliates / subsidiaries / partially or wholly-owned companies that will be utilized for this contract, see below addendum to FAR 52.212-1 Instructions to Offerors.

4 Use the Attachment 2 spreadsheet for submission of your pricing information?

5 Prepare and return 1 written and 1 electronic copy of a signed and completed solicitation document (Volume I), to include this attachment and amendments;

6 written and 1 electronic copies of the Technical Proposal (Volume 2); 2 written copies of the Business Proposal / Pricing (Volume III), inclusive of attachment 2, and 1 electronic copy of attachment 2? Be sure that all electronic copies match your written copies to include any attachments.

6 Submit (1) hard copy of each MANUFACTURER’S quote using the official DLA Quote sheet on page 143 of this attachment for every item listed on Attachment 2; tab “Market Basket” (ONE COPY OF THE

QUOTE FOR EACH INDIVIDUAL ITEM IN THE MARKET

BASKET)? Identify the item number from the market basket that it supports on the quote sheet? Submit the quotes in item number sequence?

Submit quotes that are dated no earlier than December 18, 2015. Was each line on the Official DLA Quote sheet completed by the manufacturer? Are FOB Origin Terms clearly identified on the quote? Is the NAPA discount clearly identified on the quote and removed from the product price? Refer to solicitation for actual requirements.

7 Submit a list of CONUS and OCONUS “Distribution Facility(s)” or “Places of Performance(s)” that will directly support the proposed customers (page 127, Factor I)? Warehouses functioning as backups should be designated as such.

8 If you are a Large or Foreign Business, submit your Small Business Subcontracting Plan in accordance with FAR 52.219-9?

NOTE: The DoD Office of Small Business Programs lists the following information as it pertain to subcontracting goals for FY 2015:

Small Business – 36% HubZone Small Business – 3.0% Service Disabled Veteran-Owned Small Business – 3.0% Small Disadvantaged Business – 5.0% Women-Owned Small Business – 5.0%

9 Submit your best offer?

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TABLE OF CONTENTS

PAGE #

STATEMENT OF WORK 10

I. Introduction 10 II. Estimated Value/Guaranteed Minimum/Maximum Quantity 12 III. Contract Implementation Phase 12 IV. Product Sourcing and Pricing 16 A. Price Definitions and Provisions 16 B. Distribution Categories 21 C. Domestic Item Preference 22 D. Local Market Ready Items 23 E. Brand Name Items 24 F. Pork Items 24 G. National Contracts 24 H. DLA Troop Support Manufacturer’s Pricing Agreement Program 24 I. Mandatory Items (Mandatory Food Products and Non-Food Items) 25 J. National Allowance Program Agreement 28 K. Rebates/Discounts and Price Related Provisions 31 L. Item Availability 33 M. Surge and Sustainment 34 N. Food Service Operating Supplies 35 O. Dispensing Supplies and Services 35 P. Disposal of Products 38 V. Transportation 39 A. Best Services 39 B. Insurance/Liability and Claims 42 C. Customs 44 D. Prime Vendor Responsibilities Regarding Transportation 44 E. Government Responsibilities Regarding Transportation 45 F. Vehicle Transportation 45 G. Global Positioning System 45

H. Private Convoy Security in Iraq 46 I. Airlifts 60 J. Direct Vendor Deliveries within Iraq 62

K. Overland Transport of Product in support of Aerial Ports of Debarkation and Sea Ports of Debarkation (APOD/SPOD) and Port to Port shipments 62 L. Prime Vendor Product Transfer 63

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VI. International Agreements, Workers Compensation Insurance, and Interpretations/Translations 63 A. International Agreements (i.e., Defense Cooperation Agreement, Diplomatic Notes, Status of Forces Agreement (“SOFA”), etc.) 63

B. Workers Compensation Insurance 64 C. Interpretations/Translations 64 VII. Inventory and Warehouse Management 65 A. Warehouse Management 65 B. Government Furnished Material – Operational Rations 66

C. Breaking Cases 67 D. Office Space and Equipment for Government Employees 67

VIII. Security Measures / Force Protection and Theater Support 69 A. Security Measures / Force Protection 69 B. Theater Support 70 IX. Quality Control, Quality Assurance and Inspections 73 A. Product Quality 73 B. Product Sanitarily Approved Source Requirements 76 C. Warranties 76 D. Quality Program 76 E. Quality Systems Management Visits and Audits 77 F. Warehousing and Sanitation Program/Stored Product Pest

Management 86 G. Delivery Temperatures, Shipping and Storage Requirements 86 H. Rejection Procedures 87 I. Authorized Returns 88 J. Short Shipments and Shipping Errors 88 K. Army Veterinary Inspectors and Inspections 89 L. Military Inspection at Destination 89 X. Packaging, Packing, and Labeling 91 XI. Markings 91 XII. Palletization 93 XIII. Customers 93 A. Kuwait Customers 93 B. Iraq Customers 94 C. Jordan Customers 95 XIV. Delivery, Title, Orders, and Order Fill Rates 95 A. Customer Deliveries 95 B. Title 97

C. Ordering System – Subsistence Total Order and Receipt Electronic System (“STORES”) 97

D. Order Placement 99 E. Order Cancellation 99 F. Holidays 100

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G. Emergency Orders 100 H. Order Fill or Substitution Policy 100 I. New Items 101 J. Fill Rates/Substitutions/Exceptions 104 XV. Contract Authority, Administration, In-Process Reviews, Invoices, Payments, Reports, and Prime Vendor 832 Catalogs 107 A. Contracting Authority 107 B. Administration 108 C. In-Process Reviews 108 D. Notice to Contractors 108 E. Contractor Performance Assessment Reporting System 108 F. Invoicing 110 G. Payments 112 H. Management Reports 113 I. Prime Vendor 832 Catalogs 117 J. Other Considerations 119

ADDENDUM TO FAR 52.212-4 – CONTRACT TERMS AND CONDITIONS –

COMMERCIAL ITEMS 120

ADDENDUM TO FAR 52.212-1 – INSTRUCTIONS TO OFFERORS –

COMMERCIAL ITEMS 123

DLA TROOP SUPPORT PERFORMANCE QUESTIONNAIRE 134

DLA TROOP SUPPORT OCONUS SUBSISTENCE QUOTE SHEET 143

ADDENDUM TO FAR 52.212-2 – EVALUATION – COMMERCIAL ITEMS 145

SUBSISTENCE TOTAL ORDERING AND RECEIPT ELECTRONIC SYSTEM

(STORES) EDI IMPLEMENTATION GUIDELINES 151

SUBSISTENCE 864 INVENTORY REPORTING 199

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I. INTRODUCTION

This solicitation seeks offers for subsistence prime vendor support to military and other federally funded customers located throughout the countries of Kuwait, Iraq, and Jordan (“region”). For purposes of this solicitation, U.S. activities within Iraq have been deemed a “contingency operation” as defined in Federal Acquisition Regulation (“FAR”) 2.101. This designation, though accurate as of the time of the solicitation’s issuance, is subject to change depending upon numerous factors affecting the region. As an offeror, each firm must be aware of the overall fluidity of the political, economic, security, and military climate of the region and incorporate that into its proposal accordingly. Offerors are also advised to consult with the U.S.

Department of State and other appropriate resources for the latest information on the political and security conditions inside Iraq.

The Defense Logistics Agency-Troop Support (“DLA-Troop Support”) intends to enter into a Fixed Price Indefinite Delivery Indefinite Quantity (“IDIQ”) Contract, with Economic Price Adjustment (“EPA”) with a full line food distributor who will act as a Prime Vendor responsible for the supply and delivery of semi-perishable and perishable food items as well as non-food Food Service Operating Supply (“FSOS”) items. The prime vendor must be capable of supplying all chilled products, semi-perishable food products, frozen fish, meat and poultry, other frozen foods (i.e. fruits, vegetables, prepared foods, etc.), dairy and ice cream products, fresh and frozen bakery products, beverage base and juices (for dispensers), beverages and juices (non-dispenser), fresh fruits and vegetables, non-food items, and Government Furnished Material (“GFM”), including but not limited to Unitized Group Rations (“UGRs”), Meals Ready to Eat (“MREs”), Health and Comfort packs (“HCPs”), and other operational rations items either currently in existence or to be introduced during the term of this contract.

The prime vendor will be required to support all authorized DLA customers located in Kuwait, Iraq, and Jordan (i.e. military shore and/or ship facilities, mobile kitchen tents (“MKTs”), ration break points, trailer-transfer points, and military training exercise locations, etc.). As previously stated, these customers include military or other federally funded customers. Though the solicitation describes existing customers known to the Contracting Officer at the time of the solicitation’s issuance, other customers, including military, Department of Defense (“DoD”), or non-DOD, may be added as necessary during the life of any resultant contract. The addition of said customers located within the solicitation’s specified region will be at no additional cost to the Government.

The Government intends to make one award. The contract shall be for a term of 60 months, with three separate pricing tiers. The first tier shall be for a 24-month period (inclusive of an up to 6-month ramp-up period followed by, at least, an 18-month performance period depending on the length of ramp-up). The second tier shall be an 18-month performance period immediately

STATEMENT OF WORK

Page 11 201 following the first tier. The third and final tier will be an additional 18-month performance period directly following the second tier. The price for all aspects of performance detailed in the Statement of Work (“SOW”) below must be included in the offeror’s fixed Distribution Price(s).

Offeror’s are reminded that fixed price type contracts place the maximum risk and responsibility for all costs, and resulting profit or loss, on the contractor. Distribution Price(s) will remain fixed for the life of the contract and an offeror’s failure to consider the full cost of performance and/or the risks of performing in this region will not serve as a basis to adjust Distribution Price(s). As detailed below, Product Price(s) are distinct from the aforementioned Distribution Price(s) and therefore should not be included in any way in the latter.

Notes:

The term “Ordering Facilities” or “Ordering Activities,” as used throughout this solicitation, will refer to all of the delivery points under this solicitation.

The terms “contractor” and “prime vendor”, as well as the terms “purchase order” and

“delivery order” are used interchangeably throughout this Statement of Work.

Prices are to be submitted in an offeror’s proposal, and payment will be made for performance under any resultant contract, in U.S. dollars.

Kuwait, Iraq and Jordan Distribution Network:

At a minimum, the Prime Vendor is required to have one (1) Outside the Continental United States (“OCONUS”) physical warehouse location and distribution network located within Kuwait. This facility and distribution network shall be used to provide subsistence support of those items included on the resulting contract catalog (at award or added during contract performance) to any and all customers located within the countries of Kuwait, Iraq, and Jordan, including the supply of fresh items (i.e. fruits and vegetables, bakery, dairy, etc.). It is expected that the Prime Vendor will support all customers inside of Kuwait, Iraq, and Jordan via delivery routes originating from this warehouse location and distribution network within Kuwait, unless otherwise authorized by the Contracting Officer. For instance, the Contracting Officer may authorize the Prime Vendor to source products from approved sources located within Iraq for delivery to Iraqi customers. Likewise, the Prime Vendor may be authorized by the Contracting Officer to source fresh items that originate from within the local Jordanian market for distribution to customers within Jordan. However, these circumstances are expected to be the exception to the general rule that all subsistence support will originate from the Prime Vendor’s physical warehouse and distribution network within Kuwait.

Deliveries within Iraq:

As the Prime Vendor makes deliveries within Iraq, it will be required to transport both full and empty containers and/or trucks to and from Iraq and Kuwait as part of this delivery process. The Prime Vendor is responsible for providing its own convoy security for all deliveries within Iraq, unless otherwise directed by the Contracting Officer. In so doing, the Prime Vendor must fully comply with all applicable laws and regulations related to convoy security, including Defense Federal Acquisition Regulation Supplement (“DFARS”) clause 252.225-7043 Antiterrorism/Force Protection for Defense Contractors Outside the United States (currently a June 2015 revision), and all appropriate clauses which may supplement it or supersede it. As previously described, U.S.

Page 12 201 military operations within Iraq are designated “contingency operations.” Travel within Iraq remains very dangerous as various forms of terrorist and other criminal elements remain active.

Attacks against military and civilian targets, including private security convoys, continue throughout Iraq. All potential offerors are strongly advised to take these concerns into consideration when preparing a proposal in response to this solicitation. For additional information, as provided previously, all offerors should consult the U.S. Department of State and other appropriate resources for the latest information on the political and security conditions present in Iraq.

II. ESTIMATED VALUE/GUARANTEED MINIMUM/MAXIMUM QUANITY

The estimated dollar value of this solicitation is $451,189, 518.70. The maximum dollar value will be $902,379,037.40 inclusive of all tiered pricing periods and surge requirements. The guaranteed minimum for the entire contract will be ten percent (10%) of the estimated dollar value, which equates to $45,118,951.87. The Government’s legal obligation under this contract shall only be for that guaranteed minimum and shall be satisfied once purchases for that amount have been made.

Each region covered by this solicitation includes multiple ordering facilities (i.e. customers), as listed in the Deliveries and Performance section of this solicitation. Ordering facilities within the regions covered by this solicitation can be added and/or subtracted as conditions warrant. As previously described, said additions/subtractions will occur at no additional cost to the Government. In order to provide an estimate of the size of the contract, an approximate dollar value has been attributed to each region as follows:

Total estimated annual sales for Kuwait: $80,571,308.54 Total estimated annual sales for Iraq: $619, 690.05 Total estimated annual sales for Jordan: $9,046, 905.15

III. CONTRACT IMPLEMENTATION PHASE

The contract implementation phase is defined as the transition period which begins immediately after award and ends when each individual customer supported under the contract has placed its first order under the new contract.

1. In the event that a contract is awarded pursuant to this solicitation to the incumbent Prime Vendor, the contract implementation phase will be utilized to establish fully functional catalogs in accordance with the terms and conditions of the new contract. The following terms shall apply:

i. Within 6 months after award, the incumbent Prime Vendor shall be fully prepared to support all customers under the terms and conditions of the new contract. New and fully functional catalogs must be established during this time.

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ii. The incumbent Prime Vendor shall first use existing inventory that is stored at its facility or in the pipeline prior to using inventory purchased under the terms of the new contract, if those items are included on the new contract. Any such items shall be placed on the new catalog(s) at the product price as defined by the prior contract and the distribution price as defined by the new contract. The incumbent Prime Vendor shall use the existing product before new product is ordered.

iii. New product that is ordered during the implementation phase shall only be ordered to replenish old product or to bring in new items requested and approved by the Contracting Officer. This product must be ordered and cataloged at the product price defined by the new contract.

iv. Product prices shall be updated on the new catalog(s) in accordance with the terms and conditions of the new contract.

2. In the event that a contract is awarded pursuant to this solicitatiion to a firm other than the incumbent Prime Vendor, the contract implementation phase will be utilized to ramp-up the new Prime Vendor and ramp-down the incumbent. Ramp-up/down planning shall begin immediately after award. The ramp up/down process is expected to be completed within 6 months after award. The following terms shall apply:

i. Within 15 days after the incumbent Prime Vendor is notified that it has not received the contract awarded pursuant to this solicitation, the incumbent Prime Vendor is expected to submit a proposed ramp-down schedule to the Contracting Officer. Upon receipt and after review and discussion, the Contracting Officer will begin to provide the new Prime Vendor with the incumbent Prime Vendor’s weekly Supply Chain Fitness Reports to aid forecasting levels and begin the ramp-up phase.

This information will be provided to the new Prime Vendor for informational purposes only, and with no guarantees of demand, accuracy, or otherwise. The new Prime Vendor will remain responsible for making its own demand planning and procurement decisions during contract implementation at its own risk and cost.

ii. It is estimated that the incumbent Prime Vendor will remain the principal source of food and non-food supplies for the first five months of the implementation phase.

iii. The incumbent Prime Vendor may have stocked product available for sale to the new Prime Vendor. If available, the new Prime Vendor is required to procure the available product offered for sale from the incumbent Prime Vendor. Any such sale shall be in accordance with the following terms and conditions. Any additional terms must be agreed upon between the two parties and will be considered a commercial agreement separate from the requirements of the resulting contract from this solicitation.

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• In accordance with the average demand history for each item, quantities sold to the new Prime Vendor shall be a minimum of 2 months of stock (where available) and shall not exceed 8 months of stock, which would account for a total pipeline (stock on-hand and receipted replenishment quantities to include stock levels for surge and sustainment requirements).

Products shall be sold to the new Prime Vendor at the “Product Price” as defined by Defense Logistics Acquisition Directive (“DLAD”) 52.216-9065 Economic Price Adjustment – Actual Material Costs for Subsistence Product Price Business Model. The estimated value for the minimum 2 months of stock (product price only) is $13.7M. The estimated value for the maximum 8 months of stock (product price only) is $55.4M. The new Prime Vendor shall request and obtain supporting invoice documentation from the incumbent Prime Vendor of all items purchased for traceability and price verification purposes. Any other charges by the incumbent Prime Vendor will be billed to the new Prime Vendor separately from the Product Price and shall not be included in the new Prime Vendor’s catalog pricing or otherwise reimbursed by the Government.

• The new Prime Vendor shall inspect all products prior to accepting the product into its warehouse. Product that fails to meet minimum contractual requirements (i.e. proper storage, shelf life remaining, etc.); product that does not have sufficient anticipated demand; and/or product that is sourced from Outside the Contiguous United States (“OCONUS”) contractors (i.e.

fresh fruits and vegetables, etc.), may be excluded from the transaction.

The new Prime Vendor will be responsible for determining whether the product meets minimum contractual requirements.

• Once the new Prime Vendor and the incumbent Prime Vendor have agreed upon the products that will be purchased per the considerations provided herein, the incumbent Prime Vendor shall deliver those products to the new Prime Vendor’s warehouse facility for inspection and acceptance.

• All products purchased by the new Prime Vendor at the “Product Price” as defined by DLAD 52.216-9065 shall be used to establish fully functional catalogs under the new contract and provide initial support to the customers under the terms and conditions of the new contract. See below section titled “Prime Vendor 832 Catalogs.”

• The new Prime Vendor will only be entitled to 50% of its standard distribution price (non-standard distribution price, if applicable, will be paid in full) for product purchased from the incumbent Prime Vendor in

Page 15 201 accordance with this section and ultimately delivered to customers under the resulting contract.

iv. All GFM that meets minimum contractual requirements shall be delivered by the incumbent Prime Vendor to the new Prime Vendor’s warehouse facility.

• GFM product shall be cataloged by the new Prime Vendor at a $0 product price and the new Prime Vendor will only be entitled to 50% of its standard distribution price (non-standard distribution price, if applicable, will be paid in full) for GFM delivered by the incumbent Prime Vendor in accordance with this section and ultimately delivered to customers under the resulting contract.

v. It is the Government’s intent to have all orders placed under the new contract 5 months after award. The new Prime Vendor shall be prepared to make first order deliveries no later than the last month of the implementation period. It is the Government’s intent to have all orders placed under the new Prime Vendor contract when the incumbent contract expires. However, the Government reserves the right to phase in customer ordering points when it is in the best interest of the Government.

Sample Implementation Timeline

NOTE: The implementation timeline begins on the contract award date and ends 180 days thereafter. If a stop work order is issued during the implementation, the Prime Vendor will be required to stop work and will not be able to perform unless the stop work order is rescinded. If the stop work order is rescinded, the Prime Vendor will resume the implementation schedule from the date that the stop work order was issued. The 180 day period will not re-start from the beginning.

For example:

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Contract Award Date: March 30, 2016 Stop Work Order Issued: April 30, 2016 Stop Work Order Rescinded: June 30, 2016 Implementation Timeline: March 30, 2016 – April 30, 2016 and June 30, 2016 – Nov 30, 2016

IV. PRODUCT SOURCING AND PRICING

A. PRICE DEFINITIONS AND PROVISIONS

1. Reference DLAD 52.216-9065 ECONOMIC PRICE ADJUSTMENT – ACTUAL

MATERIAL COSTS FOR DLA TROOP SUPPORT – SUBSISTENCE PRODUCT

PRICE BUSINESS MODEL for pricing details.

2. In reference to DLAD 52.216-9065, paragraph (b)(3):

““Product price” is the most recent DLA Troop Support MPA price or the most recent manufacturer, grower or private label holder commercial price per unit to the Contractor, exclusive of standard freight.

(i) Exceptions:

(A) Fresh fruits and vegetables (FF&V):

(1) The product is listed in the distribution category for prime vendor fresh fruits and vegetables (FF&V)){10}; and

(2) It is necessary for the product to be transported into the local market of the importer, as otherwise approved under the contract, from a foreign country because local supply does not exist or it is insufficient to meet demand requirements; and

(3) The importer that establishes the product price is the firm that actually performs the FF&V import service, including, but not limited to: procurement, storage, consolidation, pallets, and palletizing as it applies to the importer’s normal commercial sales, and the importer has comparable commercial sales in the market that is the point of import.

(B) A contiguous United States (CONUS) based manufacturer, grower or private label holder’s product pricing which is a national

Page 17 201 price** inclusive of transportation costs to a Distribution Point shall be supported by documentation and may be considered by the Government on a case by case basis, upon concurrence of the Contracting Officer.

**National Price is further clarified as a contiguous United States (CONUS) based manufacturer, grower or private label holder’s product price which is inclusive of transportation costs to a Distribution Point and for which is not available to any customer at FOB Point of Origin pricing which excludes transportation costs.

(C) Mandatory source items: The product price shall be limited to the nonprofit agency’s price for product as set in accordance with applicable law. The product price shall be based on f.o.b.

origin/nonprofit agency. (Prices set in accordance with applicable law (f.o.b. origin/nonprofit agency.)

(D) Prime vendor table displays/decorations only: For products listed in category [1] prime vendor table displays/decorations only, the product price shall be based on f.o.b. origin/point of the manufacturer’s distributor because the manufacturer will not sell directly to the prime vendor. This exception must be approved by the Contracting Officer on a case by case basis. Support documentation is required.

(E) A CONUS-based redistributor’s price for a specific manufacturer’s product (also known as a stock keeping unit (SKU)) may be considered by the Government as long as the redistributor’s price for the quantity ordered is equal to or lower than the manufacturer’s published price inclusive of discounts/allowances.

This exception must be approved by the Contracting officer on a case by case basis. Support documentation may be required.”

3. In reference to DLAD 52.216-9065, paragraph (b)(5):

““Distribution price(s)” means the firm fixed price portion of the Contract unit price, offered as a dollar amount per unit of measure, rounded up or down to the nearest cent. The distribution price is the only method for the Contractor to bill the Government for all aspects of contract performance other than product price, including but not limited to, the performance requirements of this statement of work (SOW). As detailed above in paragraph (3) of this clause, product price is distinct from and not to be included in the distribution price. Due to solicitation specific requirements, the distribution price may be further segregated to reflect

Page 18 201 discrete solicitation specific performance arrangements/requirements as outlined in the SOW; i.e., standard distribution price and non-standard distribution price or normal distribution price and premium distribution price or other. On account of their unique solicitation specific nature, these requirements, when applicable, are addressed in the SOW. As detailed above in paragraph (3) of this clause, product price is distinct from and not to be included in the distribution price.”

4. In accordance with the above, the Distribution Price for this solicitation is broken down into Standard and Non-Standard Distribution Price elements as follows. Each distribution price shall remain fixed for the duration of each tiered pricing period. Each distribution price shall exclude ocean shipping costs referenced in DLAD 52.216-9065, paragraph (b)(8). NOTE: As detailed in DLAD 52.216-9065, paragraph (b)(3), product price is distinct from and not to be included in the any standard or non-standard distribution price. (Note that for FF&V items purchased from an importer in the local markets of Kuwait, Iraq, or Jordan, in accordance with DLAD 52.216-9065, paragraph (b)(3)(i)(a) no importer charges shall be included in the standard or non-standard distribution prices.)

i. Standard Distribution Price: The standard distribution price is a firm fixed price and offered as a dollar amount, which represents all elements of the unit price, other than the product price and non-standard distribution prices. All performance under this SOW will be included in the standard distribution price except aspects of performance that are specifically identified as being included in the non-standard distribution price. The Prime Vendor shall not include the same performance or cost element in both the standard and non-standard distribution prices.

ii. Non-Standard Distribution Price for Ground Movement within Iraq inclusive of Private Convoy Security:

This non-standard distribution price category only applies when the Prime Vendor provides customer support within Iraq AND utilizes private convoy security in doing so. This category is Iraq specific in that it will supplement the Prime Vendor’s standard distribution price for the aforementioned support. Because of this, said non-standard distribution price, offered as a firm fixed price dollar amount, shall only represent the unique costs associated with performing contractual obligations within Iraq utilizing private convoy security. Such costs include but are not limited to: business risk associated with Iraq, private convoy security, unique personnel required for Iraq support (i.e. customer service representatives stationed at the Iraq-Kuwait border and/or within Iraq, etc.), changes to border-crossing locations, insurance, recovery, demurrage, vehicles, and any other reasonable and allowable costs that the Prime Vendor deems necessary for this specific type of support within Iraq. None of these cost considerations should be included in the Prime Vendor’s standard distribution price or other non-

Page 19 201 standard distribution prices, which are separate categories altogether with their own specific considerations.

NOTE: Delivery with private convoy security is the method of transportation for support within Iraq at this time and will remain, absent specific direction and authorization from the Contracting Officer in the form of a modification to the resulting contract.

iii. Non-Standard Distribution Price for Ground Movement within Iraq without Private Convoy Security:

This non-standard distribution price category only applies when the Prime Vendor provides customer support within Iraq WITHOUT private convoy security. This category is Iraq-specific in that it will supplement the Prime Vendor’s standard distribution price for the aforementioned support. Because of this, said non-standard distribution price, offered as a firm-fixed price dollar amount, shall only represent the unique costs associated with performing contractual obligations within Iraq absent private convoy security. Such costs include but are not limited to: business risk associated with Iraq, unique personnel required for Iraq support (i.e. customer service representatives stationed at the Iraq-Kuwait border and/or within Iraq, etc.), changes to border-crossing locations, insurance, recovery, demurrage, vehicles, and any other reasonable and allowable costs that the Prime Vendor deems necessary for this specific type of support within Iraq. None of these cost considerations should be included in the Prime Vendor’s standard distribution price or other non-standard distribution prices, which are separate categories altogether with their own specific considerations.

NOTE: The decision to move product within Iraq via ground with or without Private Convoy Security shall be made by the Contracting Officer based on customer requirements.

iv. Non-Standard Distribution Price for Commercial Air Movement to Iraq:

This non-standard distribution price category only applies when the Prime Vendor provides customer support within Iraq via commercial air movement. This scenario will arise when ground movement within Iraq is not possible based on conditions within the country and United States Transportation Command (“USTRANSCOM”) tenders are not available. The Contracting Officer must authorize this type of delivery. This category is Iraq-specific in that it will supplement the Prime Vendor’s standard distribution price for the aforementioned support. Because of this, said non-standard distribution price, offered as a firm-fixed price dollar amount, shall only represent the unique costs associated with performing contractual obligations using commercial air movement. Such costs include but are not limited to: business risk associated with Iraq, insurance, demurrage, tri-walls, ice, commercial airlifting of product from airfield to airfield, Page 20 201 and any other reasonable and allowable costs that the Prime Vendor deems necessary for this specific type of support within Iraq. None of these cost considerations should be included in the Prime Vendor’s standard distribution price or other non-standard distribution prices, which are separate categories altogether with their own specific considerations.

5. Pricing will be based on the following formulas:

For Kuwait and Jordan Customers and Emergency Airlifts from Kuwait when Military assets and/or USTRANSCOM tenders are utilized:

Contract Unit Price = Product Price + Standard Distribution Price

For Iraq Customers, one of the following formulas shall apply:

Contract Unit Price = Product Price + Standard Distribution Price

Note: This formula only applies if military assets and/or USTRANSCOM tenders are utilized to meet Iraq airlift requirements.

OR

Contract Unit Price = Product Price + 50% of the Standard Distribution Price

Note: This formula only applies for direct vendor deliveries within Iraq (i.e. the Prime Vendor purchases product from within Iraq and uses a subcontractor within Iraq to perform the delivery service to the Iraq customer).

Contract Unit Price = Product Price + Standard Distribution Price + Non- Standard Distribution Price for Ground Movement within Iraq inclusive of Private Convoy Security

Standard Distribution Price for Ground Movement within Iraq without Private Convoy Security

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Standard Distribution Price for Commercial Air Movement to Iraq

B. DISTRIBUTION CATEGORIES

1. The supplies and services to be procured and/or performed under this contract have been broken down into the following 23 distribution categories (categories 1-18 and subcategories 1A-5A). See attachment 2, tab “Distribution Category Worksheet” and the addendum to FAR 52.212-1 “Instruction to Offerors - Commercial Items” herein for detailed price submission requirements.

Distribution Category # Distribution Category Description

Distribution Category Unit of Measure (UOM)

1 CONUS DRY CS CS

1A CONUS DRY CS (For Product Price Exceptions B, C, D, or E) CS

2 CONUS DRY EA (UOM for EA = 1 CO) EA 2A CONUS DRY EA (For Product Price Exceptions B, C, D, or E) (UOM for EA = 1 CO) EA

3 CONUS FZN CS CS

3A CONUS FZN CS (For Product Price Exceptions B, C, D, or E) CS

4 CONUS FZN LB LB

4A CONUS FZN LB (For Product Price Exceptions B, C, D, or E) LB

5 CONUS CHILLED CS CS

5A CONUS CHILLED CS (For Product Price Exceptions B, C, D, or E) CS

6 OCONUS DRY CS CS

7 OCONUS FZN CS CS

8 OCONUS CHILLED CS CS

9 OCONUS CHILLED LB LB

10 OCONUS FF&V (For Product Price Exception A) CS

11 OCONUS WATER CS (Potable – Bottled) CS 12 DISPOSAL (Includes Transportation; Approved at the Contracting Officer's Discretion) CS 13 RESTOCKING PRICE FOR ORDERS OVER $10K (Approved at the Contracting Officer's Discretion) CS

14 GFM DISTRIBUTION, STORAGE, REWORK, RELABEL - Dry (Single Case/Box) CS 15 GFM DISTRIBUTION, STORAGE, REWORK, RELABEL - Dry (2 Cases per Module) EA = 2 cases EA 16 GFM DISTRIBUTION, STORAGE, REWORK, RELABEL - Dry (3 Cases per Module) EA = 3 cases EA 17 GFM DISTRIBUTION, STORAGE, REWORK, RELABEL - FRZ (Single Case/Box) CS 18 FSOS (Non-Food) by the CS CS

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2. No substitutions, deletions, or additions to the categories or units of measure indicated above are authorized. However, if any offeror feels that a substantial category has been eliminated, the offeror must bring it to the attention of the Contracting Officer at least 15 days BEFORE the solicitation’s closing date. A determination will be made at that time whether or not to add the category via an amendment to the solicitation.

3. In the event of a change in pack size for an item, the contractor must notify the Contracting Officer of any such change. For reductions in overall case size a new Sub- Category will be established within that Category (e.g., Sub-Category 1B) and the distribution price will be downwardly adjusted proportionally based on the total overall case weight; there will be no upward adjustment for increased pack sizes. Two examples are provided below:

- An item in Category 1 changes from 24/12 oz cans to 12/12 oz cans and the distribution price would change from $6.00 per case for 288 total oz to $3.00 per case for 144 total oz.

- An item in Category 1 changes from 24/12 oz cans to 12/16 oz cans and the distribution would change from $6.00 per case for 288 total oz to $4.00 per case for 192 total oz.

C. DOMESTIC ITEM PREFERENCE

1. In accordance with United States Government’s policy to acquire domestic end products for use outside the United States (see DFARS 225.7501) the Government’s preference under this solicitation remains for domestic product. All offerors, as well as the resulting Prime Vendor, must certify at the time of proposal or contract performance the offering of all non-domestic end products. The certification must be made in the Buy American Act – Balance of Payments Program Certificate (DFARS 252.225-7000 NOV 2014) which is located herein.

2. The source restrictions of the Berry Amendment, 10 U.S.C. 2533a as implemented in DFARS 225.70 and 252.225-7012 and included in this solicitation, are applicable to the procurement of food items. In general, the Berry Amendment requires that food items procured and delivered under this contract be grown, manufactured, reprocessed, or produced in the United States. Several exceptions to that requirement may apply to performance under this contract. One such exception, the “perishable foods” exception, can be found at DFARS 225.7002-2(e). That exception permits the delivery of perishable foods (i.e. fresh fruits and vegetables (“FF&V”), fresh milk, fresh bread, etc.) that are not sourced from the United States. This exception applies to deliveries to customers throughout the region (i.e. Kuwait, Iraq, and Jordan). As such, this solicitation includes requirements for local market ready items, i.e. locally sourced FF&V, fresh milk, fresh bread, etc. The Prime Vendor must be able to locally source, purchase and/or perform deliveries for highly perishable products. A second applicable exception, referred to as the

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“contingency operation” exception, applies to customer deliveries within Iraq, as operations within Iraq have been designated a contingency operation. With that designation, deliveries of all non-domestic food items, not just perishable items, are permitted in Iraq. This exception is subject to change based on changes to contingency operation designations in the region. Please note that even with these exceptions, it is still the Government’s preference to provide domestic items to the maximum extent possible.

Please propose accordingly.

3. The Prime Vendor shall request approval, in writing, from the Contracting Officer prior to adding any non-domestic items to the ordering catalogs. The Prime Vendor must submit pricing information for the foreign product and its domestic equivalent so that the government can perform an analysis in keeping with the Balance of Payments Program.

Non-domestic items will not be added to the catalog without the prior approval of the Contracting Officer. Note: As discussed above, local market ready items that are required to be purchased from local OCONUS approved sources are excluded from this domestic item preference.

4. In some instances, the Contracting Officer may direct the Prime Vendor to source a domestic equivalent item locally at no additional cost to the Government. In this case, the associated Local Market Ready Distribution Price Category 6, 7, 8, 9, 10, or 11 shall be utilized.

D. LOCAL MARKET READY ITEMS:

1. The Prime Vendor must have the ability to procure and perform delivery of the local market ready (“LMR”) items (e.g. FF&V, fresh dairy, fresh juice and beverages, water, olive oil, and fresh baked product from local approved sources within Kuwait, Iraq and Jordan).

2. Based on customer requirements reflected during cataloging, the Prime Vendor will select LMR vendors when required from the United States Central Command (“CENTCOM”) listing of Sanitarily Approved Establishments and/or the Worldwide Directory of Sanitarily Approved Establishments for Armed Forces Procurement listing for approved local Kuwaiti, Iraqi, and Jordanian vendors. If no LMR vendor is identified for a particular requirement, the Prime Vendor shall identify and request United States Army Public Health Command (“USAPHC”) inspection for its designated local source. Vendor inspections are conducted in coordination with USAPHC procedures. The Prime Vendor shall verify that its vendors are approved on the aforementioned listings. All LMR items will be inspected for quality upon receipt by the customer.

3. Estimated market ready items and their usage quantities are identified in the schedule of items and are included in the total estimated annual sales dollar values.

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E. BRAND NAME ITEMS

1. Based on the ordering habits of the customers listed in this solicitation, the current Market Basket includes numerous Brand Name items. These are items which customers have expressed a preference for, and shall be included in the catalog at the customer’s request after review by the Contracting Officer. This does not preclude future catalog changes during the life of the contract to add competing products based on added value to the customer. Changes or additions in brand name products must be approved and authorized by the customer as well as the Contracting Officer.

2. Contractors are required…