UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended March 30, 1997
Commission File Number 1-5109
TODD SHIPYARDS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 91-1506719
(State or other jurisdiction of (IRS Employer I.D.No.)
incorporation or organization)
1801-16th Avenue SW, Seattle, WA 98134-1089 (206) 623-1635
(Address of principal executive offices)(zip code) Registrant's
telephone number
Securities registered pursuant to Section 12(g) of the Act:
Name of each exchange on
Title of each class which registered
Common stock, $.01 par value per share New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports) and (2) has been subject to such filing
requirements for the past 90 days. X Yes No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of voting stock held by non affiliates
of the registrant was approximately $29 million as of June 18,
1997.
There were 9,910,180 shares of the corporation's $.01 par value
common stock outstanding at June 18, 1997.
TABLE OF CONTENTS
PART I
Item 1. Business.............................................
Item 2. Properties...........................................
Item 3. Legal Proceedings....................................
Item 4. Submission of Matters to a Vote of Security Holders..
PART II
Item 5. Market for the Registrant's Common Equity and
Related Shareholder Matters..........................
Item 6. Selected Financial Data..............................
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations..................
Item 8. Consolidated Financial Statements and
Supplementary Data..................................
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.................
PART III
Item 10. Directors and Executive Officers of the
Registrant..........................................
Item 11. Executive Compensation..............................
Item 12. Security Ownership of Certain Beneficial Owners
and Management.....................................
Item 13. Certain Relationships and Related Transactions......
PART IV
Item 14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K ................................
ITEM 1. BUSINESS
INTRODUCTION
Todd Shipyards Corporation (the "Company") was organized in 1916
and has operated a shipyard in Seattle, Washington (the
"Shipyard") since incorporation. The Company operates the
Shipyard through its wholly owned subsidiary Todd Pacific
Shipyards Corporation ("Todd Pacific"). Todd Pacific is engaged
in the repair/overhaul, conversion and construction of commercial
and military marine vessels.
Until early in this decade, a substantial portion of the
Company's revenues and profits were attributable to long-term
United States Government ("Government") contracts. The
significant decline in the annual shipbuilding budgets of the
Department of the Navy (the "Navy") has greatly reduced the
Company's bidding opportunities for long-term Government
contracts. This reduction in long-term Government contracts has
created excess ship construction and repair capacity in all of
the Company's markets. This excess shipyard capacity, both
nationally and locally, has resulted in intense price
competition. The Company has responded to this competition by
carefully reviewing its overhead, streamlining its operations and
implementing advanced shipyard production techniques.
Recent Shipyard activity has included construction of Jumbo Mark
II Class ferries ("Mark II Ferry") for the Washington State Ferry
System ("Ferry System"), short-term repair, overhaul and phased
maintenance work on Government vessels, as well as commercial
repair, overhaul and conversion work on container vessels,
tankers, fishing industry vessels, cruise ships, barges, tug
supply vessels and ferries.
The Company believes that it will continue to perform a
substantial amount of maintenance and repair work on commercial
vessels engaged in various seagoing trade activities in Puget
Sound (near Seattle). It plans to pursue repair, maintenance,
overhaul and new construction work for the ferry fleets operated
by the states of Washington and Alaska. Additionally, the
military vessels home ported in Puget Sound waters at the
Everett, Washington Navy home port facility are expected to
present business opportunities to Puget Sound shipyards.
The Company has from time to time considered opportunities to
diversify in marine industries and businesses unrelated to the
Shipyard.
OPERATIONS OVERVIEW
Repair and Overhaul Operations
The Company's repair and overhaul work ranges from relatively
minor repair to major overhauls and often involves the drydocking
of the vessel under repair. The level of repair and overhaul
business available to domestic private-sector shipyards has been
impacted by the downsizing of the active Navy fleet. Also
affecting private shipyards is the impact of stationing vessels
at Navy home ports, the location of marine accidents, the
availability and scheduling of maintenance and overhauls, and
conditions within the maritime industry as a whole.
Commercial repair and overhaul contracts are obtained by
competitive bidding, awarded by negotiation or assigned by
customers who have a preference for a specific shipyard. On jobs
that are advertised for competitive bids, owners usually furnish
specifications and plans which become the basis for an agreed
upon contract. Repair and overhaul jobs are usually contracted
on a fixed-price basis with additional work contracted on a
negotiated-price basis.
Government ship repair and overhaul work is usually awarded
through a formal bidding process. The Company also performs
repair/overhaul work for the Navy under flexibly-priced
contracts. These contracts provide for reimbursement of costs, to
the extent allocable and allowable under applicable regulations,
and payment of an incentive or award fee based on the customer's
judgment of the contractor's performance with respect to certain
pre-established criteria. The Government regulates the methods
by which overhead costs are allocated to Government contracts.
The Company's commercial and Government repair and overhaul
contracts contain terms of customer payment determined by mutual
agreement. Typically the Company is periodically reimbursed
through progress payments based on the achievement of certain
agreed to benchmarks subject to a specified level of retention.
Some vessel owners contracting for repair, overhaul and new
construction work require some form and amount of performance and
payment bonding, particularly state agencies.
Construction Operations
The Company has a contract with the Ferry System for the
construction of three Mark II Ferries for $181 million (including
$7 million of optional growth items). The Mark II Ferries are
designed to transport 218 automobiles and 2,500 passengers on the
waterways of Puget Sound and will be the largest ferries in the
Ferry System fleet.
Future Operations
The Company plans to actively pursue Government and commercial
repair/overhaul opportunities. International construction and
repair opportunities are limited because shipbuilders in foreign
countries are often subsidized by their governments. These
subsidies allow foreign shipyards to enter into production
contracts at prices below their actual production costs. Passage
of the proposed Organization for Economic Cooperation and
Development ("OECD") legislation currently being considered in
Congress is expected to require reduction of these shipbuilding
subsidies and enhance the Company's ability to pursue
international prospects. Competition for domestic construction
and repair opportunities will be intense as certain of the
Company's larger east coast competitors have better shipbuilding
facilities and access to more financial resources. The Company
is working to maximize its advantages of geographic location, its
current Mark II Ferry construction activities and the skills of
its experienced workforce.
Distribution of Work
The approximate distribution of the Company's Shipyard activities
for each of the last three fiscal years are summarized as
follows:
1997 1996 1995
Government 10% 35% 60%
Commercial 90% 65% 40%
Total 100% 100% 100%
As the table indicates, a majority of the Company's work in
fiscal years 1997 and 1996 was comprised of commercial activity.
Commercial activity increased in each year, principally due to
the construction activities related to the three Mark II Ferries
discussed above in "Construction Operations".
Employees
The number of persons employed by the Company varies considerably
from time to time depending primarily on the level of Shipyard
activity, averaging approximately 1,100 employees during fiscal
year 1997 and totaling approximately 1,400 employees on March 30,
1997. With respect to the Mark II Ferry project, the Company
employed an average of approximately 515 persons on the project
during fiscal year 1997 and 570 persons on March 30, 1997.
During fiscal year 1997 an average of approximately 925 of the
Company's Shipyard employees were covered by a union contract
which expired on July 31, 1996. At March 30, 1997 approximately
1,225 Company employees were covered under this contract.
During fiscal year 1997, the Company negotiated a new labor
contract with local union leadership aimed at resolving
contractual and business issues. Subsequent to the end of fiscal
year 1997, on April 9, 1997 and again on May 20, 1997, Company
union workers did not ratify two versions of the proposed
contract. For the duration of the Mark II Ferry contract, the
Company's existing contracts with the unions include "no
strike/no lockout" provisions. Additionally, these agreements
provide that a binding arbitration process be utilized between
the bargaining parties in the event an agreement for a new labor
contract cannot be reached. It is the Company's intent to
request such an arbitration in order to achieve a new collective
bargaining agreement. The Company expects work to continue under
the existing contract until contractual issues are resolved.
Over the past two fiscal years, the Company has invested heavily
in its labor relations efforts including the establishment of
labor/management committees and conflict resolution education for
all parties. Notwithstanding the contract rejections, the
Company believes that its relations with its employees are
stable.
Availability of Materials
The principal materials used by the Company in its Shipyard are
steel and aluminum plate and shapes, pipe and fittings, and
electrical cable and fittings. The Company believes that each of
these items can presently be obtained in the domestic market from
a number of different suppliers. In addition, the Company
maintains a small on-site inventory of these items that is deemed
sufficient for emergency ship repairs.
Competition
Competition in the domestic shipyard industry is intense. The
Company competes for commercial and Government work with a number
of other northwest shipyards, some of which have more
advantageous cost structures. The Company's competitors for
overhaul/conversion and repair work include non-union shipyards,
shipyards with excess capacity and government subsidized
facilities. The Company's competitors for new construction work
include shipyards on the gulf coast and east coast with
substantial financial resources and significant recent
investments in productivity enhancing facilities. The reduced
size of the Government's active duty fleet has resulted in a
significant decline in the total amount of Government business
available to the private sector shipyards, has created excess
shipyard capacity, and has led to acute price competition.
Commercial ship construction and, and to a lesser extent, repair
work performed in certain foreign markets is less costly than
domestic ship construction and repair. Many contracts are
awarded pursuant to competitive bidding and profitability is
dependent upon effective cost controls, production efficiencies
and the ability to meet strict schedules, among other factors.
With respect to repair work, the location, availability and
technical capability of repair facilities are important factors.
Environmental Matters
The Company is subject to federal, state and local environmental
laws and regulations that impose limitations on the discharge of
pollutants into the environment and establish standards for the
treatment, storage and disposal of toxic and hazardous wastes.
Fines and penalties may be imposed for non-compliance with these
laws. Such laws and regulations may expose the Company to
liability for acts of the Company which are or were in compliance
with all applicable laws at the time such acts were performed.
Recurring costs associated with the Company's environmental
compliance program are not material and are expensed as incurred.
Capital expenditures in connection with environmental compliance
are not material to the Company's financial statements. See Item
7, Management's Discussion and Analysis and Note 1 to the
Consolidated Financial Statements for further discussion of these
costs.
The Company has an accrued liability of $15.9 million as of March
30, 1997 for environmental matters. As assessments of
environmental matters and remediation activities progress, these
liabilities are reviewed periodically and adjusted to reflect
additional technical, engineering and legal information that
becomes available. The Company's estimate of its environmental
liabilities is affected by several uncertainties such as, but not
limited to, the method and extent of remediation of contaminated
sites, the percentage of material attributable to the Company at
the sites relative to that attributable to other parties, and the
financial capabilities of the other Potentially Responsible
Parties ("PRP") at most sites. The Company's estimate of its
environmental liabilities is also affected as additional
information becomes known regarding alleged damages from past
exposure to asbestos at Company facilities. The Company is
covered under its various insurance policies for some, but not
all, potential environmental liabilities. See Item 3. Legal
Matters, Item 7. Management's Discussion and Analysis and Note 11
of the Notes to Consolidated Financial Statements for further
information regarding the Company's environmental matters.
Safety Matters
The Company is also subject to the federal Occupational Safety
and Health Act ("OSHA") and similar state statutes. The Company
has an extensive health and safety program and employs a staff of
safety inspectors and industrial hygiene technicians, whose
primary functions are to develop Company policies that meet or
exceed the safety standards set by OSHA, train production
supervisors and make periodic inspections of safety procedures to
insure compliance with Company policies on safety and industrial
hygiene. All employees are required to attend routine periodic
safety training meetings.
Backlog
At March 30, 1997 the Company's backlog consists of approximately
$85 million of construction, repair and overhaul work. This
compares with backlogs of $146 million and $76 million at March
31, 1996 and April 2, 1995 respectively. Substantially all of
the Company's firm backlog is for the construction of three Mark
II Ferries that are scheduled for delivery during fiscal years
1998 and 1999.
In May 1996, the Company was awarded a cost-type contract for
phased maintenance repairs to four Navy supply ships currently
scheduled over eleven availabilities in five years. The notional
value of the contract is $79 million. The Company can provide no
assurance as to the timing or level of work that may be performed
as part of the maintenance contract.
INVESTMENTS AND ACQUISITIONS
The Company has from time to time pursued opportunities to
diversify its business, in areas such as metal fabrication,
marine transportation, other marine industries and businesses
unrelated to the Shipyard. In fiscal year 1996, the Company,
through a subsidiary, purchased three radio stations. As
discussed further in Note 13 to the Consolidated Financial
Statements, in June 1997, the Company announced the sale of the
three radio stations. The Company continues to evaluate suitable
investment opportunities which it believes will appropriately
utilize the Company's resources.
ITEM 2. PROPERTIES
The Company has three drydocks, two steel and one wood, all of
which are located at the Shipyard. The design capacities of the
drydocks are as follows:
Year Type Max.Displacement Date of Lease
Name Built Owned Leased Capacity(in tons) Expiration
Emerald Sea 1970 Steel 40,000 -
YFD-70 1945 Steel 17,500 4/15/01
YFD-54 1943 Wood 5,700 9/30/99
The Company is required to maintain Navy certification on its
drydocks and cranes in order to qualify its facilities to bid on
and perform work under certain Navy and United States Coast Guard
("Coast Guard") contracts. The Company's current certification
for the drydocks listed above are 30,000 tons, 14,000 tons and
4,205 tons, respectively. While such certification is less than
the maximum design capacity, it is sufficient to allow the
Company to perform work on most Navy and all Coast Guard vessels.
The Company also maintains certification of its cranes.
The Company believes that its owned and leased properties at the
Shipyard are in reasonable operating condition given their age
and usage, although, from time to time, the Company has been
required to incur substantial expenditures to ensure the
continuing serviceability of its owned and leased machinery and
equipment.
ITEM 3. LEGAL PROCEEDINGS
The Company is subject to federal, state and local environmental
laws and regulations that impose limitations on the discharge of
pollutants into the environment and establish standards for the
treatment, storage and disposal of toxic and hazardous wastes.
Fines and penalties may be imposed for non-compliance with these
laws. Such laws and regulations may expose the Company to
liability for acts of the Company which are or were in compliance
with all applicable laws at the time such acts were performed.
The Company faces potential liabilities in connection with the
alleged presence of hazardous waste materials at certain of its
closed shipyards, at its Shipyard and at several sites used by
the Company for disposal of alleged hazardous waste.
The Company is identified as a PRP by the Environmental
Protection Agency ("EPA") under the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA," commonly
known as the "Superfund") in connection with matters pending at
five Superfund sites. Additionally, the Company has been named
as a PRP for three Superfund cases where the Company has asserted
that its liability was discharged when it emerged from bankruptcy
in 1990.
In addition to the five pending Superfund matters, the Company is
subject to suits, claims and proceedings brought by state
agencies and others seeking contribution towards remediation of
alleged environmental impairments at five additional sites.
Generally these environmental claims relate to sites used by the
Company for disposal of alleged hazardous waste, although one
matter relates to a site in which the allegations are predicated
upon the Company's prior ownership of a shipyard property. The
matters relating to the Harbor Island sites, at which the
Company's Shipyard is located, are discussed below. Reference is
made to Note 11 of the Notes to the Consolidated Financial
Statements in Item 8 below for information with respect to all
pending suits, claims and proceedings, including four as to which
the Company believes it has no or only nominal liability.
The Company and several other parties have been named as PRPs by
the EPA pursuant to CERCLA in connection with the documented
release or threatened release of hazardous substances, pollutants
and contaminants at the Harbor Island Superfund Site,(the "Harbor
Island Site"). To date, the EPA has separated the Harbor Island
Site into two operable units, the Soil and Groundwater Unit (the
"Soil Unit")and the Shipyard Sediments Operable Unit (the
"Sediments Unit"). The Company, along with a number of other
Harbor Island PRPs, received a Special Notice Letter from the EPA
on May 4, 1994 pursuant to section 122 (e) of CERCLA. The
Company entered into a Consent Decree for the Soil Unit in
September 1994 under which the Company has agreed to remediate
the designated contamination on its property. Soil Unit
remediation is anticipated to begin in fiscal year 1998. The
Company and the EPA are currently negotiating the extent and
methodology of the Soil Unit remediation. The Company estimates
remediation of the Soil Unit will take approximately 12 to 24
months from the clean-up start date.
In the third quarter of the fiscal year 1997, the EPA issued its
Record of Decision ("ROD") for the Sediments Unit. The ROD
identifies four alternative solutions for the Sediments Unit
remediation and identifies the EPA's selected solution. The
Company and the EPA are negotiating the scope and extent of
testing and evaluation necessary to determine the extent of the
clean-up of the Sediments Unit. The parties have not agreed to a
remedial design for the Sediments Unit. The Company believes
that the timing and cost of the Sediments Unit clean up will
remain significantly uncertain until a remedial design has been
finalized with the EPA that identifies the scope of remediation
and the method of sediment disposal. Included in the Company's
$15.9 million total reserve for environmental matters is a
reserve of $11.4 million to address the Harbor Island Site.
The Company has been named as a defendant in civil actions by
parties alleging damages from past exposure to toxic substances,
generally asbestos, at closed former Company facilities. The
Company has approximately 109 cases involving 262 plaintiffs
pending against it, together with other ship builders and
repairers, ship owners, asbestos manufacturers, distributors and
installers and equipment manufacturers, involving injuries or
illnesses allegedly caused by exposure to asbestos or other toxic
substances. The Company and its insurers are vigorously
defending these actions. Most of these cases have been filed
since 1991 by heirs of retired employees or employees of
subcontractors who allegedly worked at Company sites, and allege
contact with asbestos for varying periods of time and allege that
such exposure caused illness and/or death. The cases are
generally filed with multiple claimants and multiple defendants
and are generally insured matters. Suits of this nature
generally seek amounts in excess of $100,000 on behalf of each
claimant as against all defendants and to date have been settled
for immaterial amounts. The Company and its insurers are
vigorously defending these actions. By their very nature, civil
actions relating to toxic substances vary according to the cases'
fact patterns, jurisdiction and other factors. Accordingly, the
Company cannot predict the eventual number of such cases or their
eventual resolution. The Company has included an estimate of its
potential liability for these issues in its environmental
reserves.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders, through
solicitation of proxies or otherwise, during the fourth quarter
of fiscal year 1997.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
SHAREHOLDER MATTERS
The Company's stock is listed on the New York Stock Exchange (the
"NYSE"). The following table sets forth for the fiscal quarters
indicated the high and low composite sales prices of the stock as
reported by the NYSE.
Quarter Ended High Low
July 2, 1995 6.50 5.38
October 1, 1995 7.00 5.50
December 31, 1995 6.50 5.88
March 31, 1996 7.50 5.88
June 30, 1996 7.88 7.00
September 29, 1996 7.38 6.00
December 29, 1996 7.38 6.50
March 30, 1997 6.63 5.38
On June 18, 1997 the high and low prices of the Company's common
stock on the NYSE were $4.25 and $4.125, respectively.
At June 18, 1997 there were approximately 2088 holders of record
of the outstanding shares of common stock. The Company does not
presently anticipate the declaration of dividends.
ITEM 6. SELECTED FINANCIAL DATA (In thousands of dollars,
except per share data)
Mar 30, Mar 31, Apr 2, Apr 3, Mar 28,
1997 1996 1995 1994 1993
Revenue $114,398 $101,687 $69,096 $68,552 $54,278
Income (loss)
from operations (25,793) 1,017 (393) (6,958) (14,018)
Income (loss)
before cumulative
effect of change
in accounting
principle (21,253) 4,132 3,402 (2,714) (11,802)
Cumulative effect
of change in
accounting
principle (1) - - 438 - -
Net income(loss) (21,253) 4,132 3,840 (2,714) (11,802)
Per share of common stock
Income (loss)
before cumulative
effect of change
in accounting
principle (2.14) 0.42 0.32 (0.24) (0.99)
Cumulative effect
of change in
accounting
principle (1) - - 0.04 - -
Net income (loss) (2.14) 0.42 0.36 (0.24) (0.99)
Financial position:
Working capital 33,245 48,880 50,704 52,337 57,311
Fixed assets 24,477 26,499 24,552 24,001 24,636
Total assets 115,789 120,571 110,924 111,447 129,287
Stockholders'
equity 47,940 67,380 62,433 63,740 70,700
per common share 4.84 6.80 6.28 5.83 5.99
(1) Effective April 4, 1994 the Company changed its method of
accounting for general and administrative costs from
recognizing these expenses as contract costs to recognizing
them as incurred. The change in method reflects the
change, over time, in the Company's business from
predominately longer term Department of Defense contracts to
predominately shorter term commercial and Government
contracts. This change has been applied to general and
administrative costs of prior years and resulted in a
cumulative effect credit of $438 thousand ($0.04 per share)
at the time of adoption.
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION & ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Notes to Consolidated Financial Statements are an integral
part of Management's Discussion and Analysis of Financial
Condition and Results of Operations and should be read in
conjunction herewith. The following discussion and analysis of
financial condition and results of operations contains forward-
looking statements which involve risks and uncertainties. The
Company's actual results in future periods may differ
significantly from the results discussed in or anticipated by
such forward looking statements. Certain factors which may
impact results for future periods are discussed below under the
captions "Overview - Mark II Ferry Program," "Overview -
Profitability," and "Environmental Matters." Readers should also
consider the statements and factors discussed under the caption
"Operation Overview" in Item 1 of the Company's Form 10-K Annual
Report filed with the Securities and Exchange Commission for the
fiscal year ended March 30, 1997, and in the Notes to the
Company's Consolidated Financial Statements for the fiscal year
then ended.
Overview:
The Company lost $21.3 million on sales of $114.4 million in
fiscal year 1997. The year's sales performance reflects high
levels of Mark II Ferry activity as the Company approached the
completion of the first vessel, the MV Tacoma, and started
construction of the second and third vessels, the MV Wenatchee,
and the MV Puyallup. The fiscal year's sales performance also
reflects lower levels of Government maintenance efforts due to
Navy budget cuts. The Company's loss for the year reflects loss
reserves recognized on the Mark II Ferry construction program,
the reversal of previously recognized Mark II Ferry profits,
losses experienced on commercial overhaul activities, lower
levels of Government maintenance work and a provision for the
sediment portion of the environmental clean-up for the Company's
Harbor Island Site. The net loss for the year benefited from the
$1.7 million gain on the sale of securities.
Mark II Ferry Program
The Company's Mark II Ferry program, awarded in fiscal year 1995,
is approximately 55% complete at March 30, 1997. Construction of
the first ferry began in the fall of 1995. The Company
anticipates delivering the first ferry and launching the second
ferry during the summer of 1997.
As construction of the Mark II Ferries progresses, the Company
reviews and revises its estimates of long term contract sales
values and costs at completion. Based upon its reviews initiated
in conjunction with the fiscal year-end, the Company estimates
that it will incur contract costs of approximately $11.5 million
in excess of the contract prices for the three ship program
resulting in the fourth quarter 1997 reversal of previously
recognized program profit of $2.4 million and the establishment
of a program loss reserve of $11.5 million. During fiscal year
1997, the Company reversed a total of $3.6 million of previously
recognized Mark II Ferry program profit.
Mark II Ferry contract costs, which include direct and related
labor costs, direct material costs and allocated manufacturing
overhead costs, are expected to exceed contract price due to the
following factors: steel work overruns encountered on the first
vessel, higher than previously forecast program engineering
costs, and increased efforts to complete the outfitting of the
vessel - including installation of the joiner work; piping and
electrical system; and painting costs.
The Company's construction cost estimates as of March 30, 1997
are based upon implementing improved production techniques and
better utilization of modular shipbuilding practices in the
construction of the second and third ships compared to the first
ship. The Company also expects to benefit from production
efficiencies gained in the experience of constructing the first
ship (learning curve efficiencies) and has incorporated these
factors in its construction cost estimates for the second and
third vessels. However, favorable or unfavorable variances to the
estimated production efficiencies could materially affect the
Company's financial results.
As construction of the ferries progresses, revisions in cost and
profit estimates for the contract will be made. Changes in these
estimates will be made based upon the facts then known to the
Company and may be a result of productivity factors, change order
pricing, overhead costs, material costs, production schedules and
levels of shipyard activity. Changes in these factors could
materially affect the Company's financial results. The Company's
ability to complete this contract within the Company's current
estimates of the costs to complete is not presently determinable.
If the Company is unable to complete this contract within its
current estimate of the costs to complete, the Company could
incur losses on this contract beyond the $11.5 million recorded
herein with a related adverse impact on cash flow.
The Company believes that a portion of the increased contract
costs relate to high levels of engineering and production change
orders directed by the Ferry System. These customer-directed
change orders, which have continued throughout the production
process and into the Company's fiscal year 1998, have caused
production rework, delays and disruption. These change orders
have resulted in increased production costs for the first two
ferries, the MV Tacoma and the MV Wenatchee, and the entire three
ship ferry construction project. The Company will pursue full
recovery from the Ferry System for the impact of these changes.
The Company cannot predict the outcome of any negotiations with
the Ferry System. Accordingly, the Company has not included any
estimates of such settlements, if any, in its above mentioned
Mark II Ferry program loss reserve estimates.
Business Volume and Backlog
The Company's backlog at March 30, 1997 was approximately $85
million. This backlog consists primarily of Mark II Ferry work
to be performed. In May 1996, the Company was awarded a cost-
type contract for phased maintenance repairs to four Navy supply
ships currently scheduled over eleven availabilities in five-
years. The notional value of the contract is $79 million. The
Company can provide no assurance as to the timing or level of
work that may be performed as part of the maintenance contract.
The Company is working to identify and win additional
construction and repair work that would match the Shipyard's
production capacity.
Profitability
The Company's future profitability depends largely on the ability
of the Shipyard to maintain an adequate volume of ship repair,
overhaul and conversion business to augment its longer term
contracts. The variables affecting the Company's business volume
include public support provided to competing Northwest shipyards,
excess west coast and industry-wide shipyard capacity, foreign
competition, governmental legislation and regulatory issues,
activity levels at the Everett Navy home port, competitors
pricing behavior, and Company labor efficiencies and work
practices.
The Company continues to respond to the increasingly competitive
shipbuilding and repair industry. Company management is focusing
on profitably operating the Shipyard. To accomplish this
objective, Shipyard management is working to increase business
volume, reduce operating costs and improve production
efficiencies.
Year to year comparisons:
1997 Compared with 1996
Net income for 1997 decreased by $25.4 million from 1996 levels
as a result of the following components.
Revenues
Revenues for the fiscal year ended March 30, 1997 increased $12.7
million (13%) compared to the prior fiscal year. The increase in
fiscal year 1997 sales was primarily attributable to the Mark II
Ferry construction program partially offset by lower Government
maintenance work.
Cost of Revenues
Fiscal year 1997 cost of revenues increased $22.3 million (31%)
compared to 1996 results as 1997 includes higher Mark II
activity. Cost of revenues in fiscal year 1997 reflect
production and engineering difficulties encountered on the Mark
II Ferry project.
Administrative and Manufacturing Overhead
Administrative and manufacturing overhead expenses for the year
were up $1.5 million (5%) from prior year results due to
increased radio station activity and increased Shipyard volume.
Contract Reserves Activity
As discussed above, during the fourth quarter of fiscal year
1997, the Company estimated that it would incur costs of
approximately $11.5 million in excess of the contract prices of
the three Mark II Ferries and accordingly established a reserve
for these costs in fiscal year 1997. No contract loss reserves
were recognized in fiscal year 1996.
Provision for Environmental Reserves
In fiscal year 1997, the Company added $4.3 million to its
environmental reserves for estimated Sediments Unit clean-up
costs and other environmental matters. In fiscal year 1996, the
Company did not add to its environmental provision.
Operating Results
Fiscal year 1997 operating income decreased $26.8 million
compared to the prior fiscal year income of $ 1.0 million. The
decrease in operating income reflects the establishment of the
Mark II Ferry contract loss reserve, the reversal of $3.6 million
of previously recognized Mark II Ferry program profits, losses on
commercial overhaul activity and lower Government repair volume.
Operating results for fiscal year 1997 also include a $4.3
million environmental reserve established to address sediment
clean up at the Company's Seattle Shipyard.
Investment and Other Income
The Company's fiscal year 1997 investment and other income of
$2.8 million decreased $.3 million compared to fiscal year 1996
as fiscal year 1997's lower investment balances were partly
offset by the effect of higher interest rates.
Gain on sale of available-for-sale security
Fiscal year 1997 results include a $1.7 million gain from the
sale of an available-for-sale security.
Income Taxes
The Company did not have taxable income for fiscal year 1997,
accordingly the Company recognized no income tax expense and
recorded a net operating loss carryforward as described in Note 7
to the Consolidated Financial Statements. For fiscal year 1996,
the Company recognized no income tax expense as the expense was
offset by a reduction in the deferred tax valuation reserve.
1996 Compared with 1995
Net income for 1996 increased by 8% from 1995 levels as a result
of the following components.
Revenues
Revenues for the fiscal year ended March 31, 1996 increased $32.6
million (47%) compared to the prior fiscal year. The increase in
sales was primarily attributable to the Mark II Ferry
construction program partially offset by lower Government
maintenance work.
Cost of Revenues
Fiscal year 1996 cost of revenues increased $26.5 million (59%)
compared to 1995 results as the Company's 1996 Mark II Ferry
margins recognized were lower than the margins earned on
maintenance work in 1995. As a result of this difference, costs
of revenues were 70% of sales in fiscal year 1996 compared to 65%
of sales in fiscal year 1995.
Administrative and Manufacturing Overhead
Administrative and manufacturing overhead expenses for fiscal
year 1996 were up $5.3 million (22%) from prior year results as
the Company incurred higher than usual repair and maintenance
costs preparing for the new construction project and added costs
relating to the radio station acquisitions. These repair cost
increases and radio station start-up costs were partially offset
by changes in the estimate of workers' compensation insurance
refunds for favorable claims experience during past fiscal years.
Contract Reserves Activity
In 1995, the Company utilized $1.0 million in contract loss
reserves related to performance of a contract to repair a
Government vessel.
Provision for Environmental Reserves
In fiscal year 1996, the Company did not add to its environmental
provisions. In fiscal year 1995, the Company added $2.0 million
in provisions for environmental liabilities for sites and
circumstances where it was possible to make reasonable estimates
of the Company's potential liability.
Operating Results
In fiscal year 1996 operating profit increased $1.4 million
compared to the prior fiscal year. The increase in operating
profit reflects increased Mark II Ferry construction overhead
contribution and environmental reserve activity in 1995 offset by
lower contract margins on repair activities, increased
administrative costs and modest start-up losses for the Company's
radio station operations. The Company completed the sale of an
inactive facility in fiscal year 1995 and recognized a gain on
the sale of $.5 million.
Investment and Other Income
Investment and other income decreased $.7 million compared to
fiscal year 1995 results. Higher interest rates earned in fiscal
year 1996 were offset by decreased investment balances compared
to fiscal year 1995. Fiscal year 1995 investment and other
income results included a $.4 million bankruptcy distribution.
Income Taxes
For fiscal year 1996 and fiscal year 1995, the Company recognized
no income tax expense as the expense was offset by a reduction in
the deferred tax valuation reserve.
Cumulative Effect of Change in Accounting Principles
Effective April 4, 1994 the Company changed its method of
accounting for general and administrative costs from recognizing
these expenses as contract costs to recognizing them as incurred
which reflects the change, over time, in the Company's business
from predominately longer term Department of Defense contracts to
predominately shorter term commercial and Government contracts.
This change has been applied to general and administrative costs
of prior years and resulted in a cumulative effect credit of $.4
million, which was included in income of the first quarter of
fiscal year 1995. The effect of the change was to decrease
fiscal year 1995 income before the cumulative effect of the
accounting change by $1.3 million. There was no income tax effect
as a result of the change.
Environmental Matters
Ongoing Operations:
Recurring costs associated with the Company's environmental
compliance program are not material and are expensed as incurred.
Capital expenditures in connection with environmental compliance
are not material to the Company's financial statements.
Past Activities:
The Company faces significant potential liabilities in connection
with the alleged presence of hazardous waste materials at certain
of its closed shipyards, at its Shipyard and at several sites
used by the Company for disposal of alleged hazardous waste. The
Company has been named as a defendant in civil actions by parties
alleging damages from past exposure to toxic substances at
Company facilities.
The EPA has separated the Harbor Island Site into two operable
units, the Soil Unit and the Sediments Unit. The Company, along
with a number of other Harbor Island PRPs, received a Special
Notice Letter from the EPA on May 4, 1994 pursuant to section 122
(e) of CERCLA. The Company entered into a Consent Decree for the
Soil Unit in September 1994 under which the Company has agreed to
remediate the designated contamination on its property. Soil Unit
remediation is anticipated to begin in fiscal year 1998. The
Company and the EPA are currently negotiating the extent and
methodology of the Soil Unit remediation. The Company estimates
remediation of the Soil Unit will take 12 to 24 months from the
clean-up start date. In the third quarter of fiscal year 1997,
the EPA issued its Record of Decision ("ROD") for the Sediments
Unit. The ROD identifies four alternative solutions for the
Sediments Unit remediation and identifies the EPA's selected
solution (the "Selected Solution").
The Selected Solution proposes the dredging and disposal of
approximately 116,000 cubic yards of material currently in the
Duwamish River and Elliott Bay surrounding the Company's
facility. The EPA estimated the Company's portion of the
remedial cost including long term monitoring and maintenance
between $5.5 million and $7.9 million. The estimated range does
not include the cost of any potential under-pier dredging or
capping, should any be required. The potential scope and costs
of dredging and capping remedies are currently indeterminable as
the necessity and magnitude of such efforts is strongly dependent
on site-specific conditions. The Company believes that the
timing and cost of the Sediments Unit clean up will remain
significantly uncertain until a remedial design has been
finalized with the EPA that identifies the scope of remediation
and the method of sediment disposal. The Company is currently
negotiating an Order of Consent with the EPA covering solely the
additional sampling necessary for any remedial design. The
proposed Order of Consent does not include the remedial design
itself.
During the fiscal year ending March 30, 1997, based on the ROD,
currently available facts and consideration of other factors, the
Company recognized a $4.3 million charge to earnings, including
$7.9 million for anticipated costs associated with the Company's
portion of the remediation costs associated with the Sediments
Unit, a decrease to the Soil Unit remediation reserve and
adjustments to other environmental matters.
The Company has approximately 109 cases involving 262 plaintiffs
pending against it, together with other ship builders and
repairers, ship owners, asbestos manufacturers, distributors and
installers and equipment manufacturers, involving injuries or
illnesses allegedly caused by exposure to asbestos or other toxic
substances. The Company and its insurers are vigorously
defending these actions. By their very nature, civil actions
relating to toxic substances vary according to the cases' fact
patterns, jurisdiction and other factors. Accordingly, the
Company cannot predict the eventual number of such cases or their
eventual resolution. The Company has included an estimate of its
potential liability for these issues in its environmental
reserves. Potential additional future expenses related to
alleged damages from past exposure to toxic substances is not
quantifiable due to uncertainties of the number of cases, the
extent of alleged damages, the population of claimants and size
of any awards and/or settlements.
The Company spent $.5 million in fiscal year 1997 for site
remediation and other matters. Most of these expenditures were
related to the Shipyard and for judgments and settlements of
civil matters relating to toxic substances. While the Company
expects to spend larger amounts in future years, the timing of
such expenditures is impossible to predict due largely to
uncertainties relating to remediation of the Harbor Island
facility.
During its fiscal year 1998, the Company will be required by
Washington state environmental regulations to take action in
order to determine all known, available and reasonable methods of
prevention, control, and treatment ("AKART") for storm water
discharges from its shipyard. In accordance with its National
Pollution Discharge Elimination System permit the Company will be
required to submit its engineering analysis of AKART to the
Washington State Department of Ecology during the second quarter
of fiscal year 1998. Potential future expense for compliance
with these AKART regulations will be not quantifiable until the
engineering analysis has been completed and will be recognized in
the period incurred.
The Company's policy is to accrue costs for environmental matters
in the accounting period in which the responsibility is
established and the cost is estimable. The Company's estimates
of its liabilities for environmental matters are based on
evaluations of currently available facts with respect to each
individual situation and take into consideration factors such as
existing technology, presently enacted laws and regulations, and
the results of negotiations with regulatory authorities. The
Company does not discount these liabilities.
The Company's financial statements as of March 30, 1997 reflect
reserves of $15.9 million. The Company has recorded a non-
current asset of $3.8 million to reflect a contractual
arrangement with an insurance company to share costs for certain
environmental matters. The Company is negotiating with its
insurance carriers and certain prior landowners and operators for
past and future remediation costs. In addition, the Company
believes that the Government may be obligated to contribute to a
share of clean-up costs for certain sites.
Actual costs to address the Soil and Sediments Units and other
environmental sites and matters will depend upon numerous
factors, including the number of parties found liable at each
environmental site, the method of remediation, outcome of
negotiations with regulatory authorities, outcome of litigation,
technological developments and changes in environmental laws and
regulations.
The effect of resolution of environmental matters on results of
operations, liquidity, capital resources or on the consolidated
financial condition of the Company cannot be predicted due to the
uncertainty concerning both the amount and timing of future
expenditures. No assurance can be given that the Company's $15.9
million reserve as of March 30, 1997 is adequate to cover all
potential environmental costs the Company could incur.
Liquidity, Capital Resources and Working Capital
During fiscal year 1997, working capital decreased by $15.6
million to $33.2 million at March 30, 1997 which includes
restricted and unrestricted cash, cash equivalents and marketable
securities of $47.3 million. The decrease in working capital is
attributable predominantly to the $11.5 million contract loss
reserve accrual and the reversal of $3.6 million of previously
recognized profit on the Mark II Ferry project.
Expenditures for property, plant and equipment in fiscal year
1997 were $1.8 million compared to $5.0 million for the prior
fiscal year and were attributable to Shipyard equipment
purchases. These expenditures are in addition to ongoing repair
and maintenance expenditures in the Shipyard of $4.7 million,
$6.2 million, and $3.3 million in fiscal years 1997, 1996 and
1995, respectively. The decrease in fiscal year 1997 capital
expenditures compared to 1996 reflects last year's investment in
Shipyard modifications necessary to accommodate the Mark II Ferry
construction project.
The Company is required on some of its projects to provide
customers with performance, contract and payment bonds. On
December 28, 1994 Todd Pacific entered into an agreement with a
surety pursuant to which the surety provided a contract bond for
the Mark II Ferry contract. The contract bond is secured by Todd
Pacific's machinery, equipment, inventory and trade accounts
receivable on certain bonded jobs. The surety has also issued
bonds totaling $5.0 million for current commercial repair jobs.
Todd Pacific established an annually renewable $3 million
revolving credit facility secured by a first lien on certain
trade receivables. Outstanding borrowings under the credit
facility may not exceed certain percentages of Todd Pacific's
trade receivables.
The Company received $5.4 million of special project revenue
bonds ("Revenue Bonds")from the Board of Trustees of the
Galveston Wharves ("Galveston Wharves") upon the December 1993
sale of its Galveston shipyard facilities. The Revenue Bonds
bear interest at the rate of eight percent payable semiannually
and are secured by a lien on the shipyard property and a
subordinate lien on the revenues of the Galveston Wharves. The
bonds contain provisions for annual principal payments of $216
thousand beginning on January 1, 1995 with a balloon payment of
$3.456 million due on January 1, 2004. As of March 30, 1997, the
Company has received three annual principal payments. The
Company is recognizing the gain on the sale of the facility as
payments are received.
Based upon its cash position described above and anticipated
fiscal year 1998 cash flow, the Company believes it has
sufficient liquidity to meet cash flows or to fund operations for
fiscal year 1998.
ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See following page.
<PAGE>
REPORT OF ERNST & YOUNG LLP INDEPENDENT AUDITORS
The Board of Directors and Stockholders
Todd Shipyards Corporation
We have audited the accompanying consolidated balance sheets of
Todd Shipyards Corporation and subsidiaries (the "Company") as of
March 30, 1997 and March 31, 1996 and the related consolidated
statements of operations, cash flows and stockholders' equity for
each of the three years in the period ended March 30, 1997. Our
audits also included the financial statement schedule listed on
the index at item 14(a). The financial statements and schedule
are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial
statements and schedule based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statements presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion the consolidated financial statements referred to
above present fairly, in all material respects, the consolidated
financial position of Todd Shipyards Corporation and subsidiaries
at March 30, 1997 and March 31, 1996 and the consolidated results
of their operations and their cash flows for each of the three
years in the period ended March 30, 1997 in conformity with
generally accepted accounting principles. Also, in our opinion,
the related financial statements schedule, when considered in
relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set
forth therein.
As more fully described in Note 1 to the financial statements, in
1995 the Company changed its method of applying general and
administrative costs on contracts.
/s/Ernst & Young LLP
Seattle, Washington
June 6, 1997
<PAGE>
TODD SHIPYARDS CORPORATION
CONSOLIDATED BALANCE SHEETS
MARCH 30, 1997 and March 31, 1996
(In thousands of dollars)
1997 1996
ASSETS
Cash and cash equivalents $ 4,233 $ 8,552
Restricted cash 5,210 1,546
Securities available-for-sale 37,878 33,036
Accounts receivable, less allowance for
losses of $861 and $511, respectively
U.S. Government 2,696 2,731
Other 3,701 6,299
Costs and estimated profits in excess of
billings on incomplete contracts 7,865 15,063
Inventories 1,323 1,225
Other 251 254
Total current assets 63,157 68,706
Property, plant and equipment, net 24,477 26,499
Deferred pension asset 19,564 17,201
Other 8,591 8,165
Total assets $115,789 $120,571
LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable and accruals $ 9,453 $ 11,831
Payrolls and vacations 4,535 3,896
Accrual for loss on contract 11,500 -
Billings in excess of costs and estimated
profits on incomplete contracts 982 656
Taxes other than income taxes 1,436 1,073
Income taxes 2,006 2,370
Total current liabilities 29,912 19,826
Environmental reserves 15,900 11,087
Accrued post retirement health benefits 22,037 22,278
Stockholders' equity:
Common stock $.01 par value-authorized
19,500,000 shares, issued 11,956,033
shares at March 30, 1997 and March 31, 1996,
and outstanding 9,910,180 at March 30, 1997
and at March 31, 1996 120 120
Additional paid-in capital 38,181 38,181
Retained earnings 19,256 38,696
57,557 76,997
Less treasury stock 9,617 9,617
Total stockholders' equity 47,940 67,380
Total liabilities and stockholders'
equity $115,789 $120,571
The accompanying notes are an integral part of this statement.
<PAGE>
TODD SHIPYARDS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended March 30, 1997, March 31, 1996, and April 2, 1995
(In thousands of dollars, except per share amounts)
1997 1996 1995
Revenues $114,398 $101,687 $ 69,096
Operating Expenses:
Cost of revenues 93,982 71,674 45,234
Administrative and
manufacturing overhead 30,459 28,996 23,740
Contract reserve 11,500 - (980)
Provision for environmental
reserves 4,250 - 2,000
Other - - (505)
Subtotal 140,191 100,670 69,489
Operating Income (Loss) (25,793) 1,017 (393)
Investment and other income 2,802 3,139 3,795
Gain (loss) on sale of securities 1,738 (24) -
Income (Loss) Before Cumulative
Effect of Change in Accounting
Principle (21,253) 4,132 3,402
Cumulative effect to April 3,
1994 of accounting change, - - 438
Net Income (Loss) $(21,253) $ 4,132 $ 3,840
Net Income (Loss) per Common Share:
Income (Loss), before Cumulative
Effect of Change in Accounting
Principle $ (2.14) $ .42 $ .32
Cumulative effect of change
in accounting principle - - .04
Net Income (Loss) $ (2.14) $ .42 $ .36
Weighted Average Number of Shares
(thousands) 9,910 9,931 10,740
The accompanying notes are an integral part of this statement.
<PAGE>
TODD SHIPYARDS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended March 30, 1997, March 31, 1996, and April 2, 1995
(in thousands of dollars)
1997 1996 1995
OPERATING ACTIVITIES:
Net income (loss) $(21,253) $ 4,132 $ 3,840
Adjustments to reconcile net
income (loss) to net cash
provided by (used in)
operating activities:
Depreciation and amortization 3,589 3,208 3,078
Increase (decrease) in contract
loss reserves 11,500 - (980)
Decrease (increase) in costs
and estimated profits in
excess of billings on
incomplete contracts 7,198 (8,671) (4,178)
Increase in environmental
reserves 4,813 2,664 1,923
Decrease (increase) in accounts
receivable 2,633 (2,264) 1,377
Increase (decrease) in accounts
payable and accruals (2,378) 4,755 (190)
Increase in deferred pension
asset (2,363) (1,637) (1,627)
Increase in other assets (426) (2,360) (282)
Other 629 (428) (964)
Total adjustments 25,195 (4,733) (1,843)
Net cash provided by (used in)
operating activities 3,942 (601) 1,997
Cash flows from investing
activities:
Purchases of marketable securities (14,365) (19,774) (10,297)
Maturities of marketable
securities 7,580 22,959 15,358
Sales of marketable securities 3,607 6,721 1,466
Capital expenditures (1,835) (4,954) (3,287)
Acquisition - (3,850) -
Other 416 16 106
Net cash provided by (used in)
investing activities (4,597) 1,118 3,346
Cash flows from financing
activities:
Increase in cash restricted
to secure bid and performance
bonds $ (3,664) $(1,233) $ 5,406
Purchases of treasury stock - (2,698) (2,570)
Net cash provided by (used in)
financing activities (3,664) (3,931) 2,836
Net increase (decrease) in cash
and cash equivalents (4,319) (3,414) 8,179
Cash and cash equivalents at
beginning of period 8,552 11,966 3,787
Cash and cash equivalents at
end of period $ 4,233 $ 8,552 $11,966
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest $ 27 $ 3 $ 3
Income taxes 291 541 900
Noncash financing activities:
Treasury stock purchases payable - - 2,525
The accompanying notes are an integral part of this statement.
TODD SHIPYARDS CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Years Ended March 30, 1997, March 31, 1996, and April 2, 1995
(in thousands of dollars)
Additional
Common Paid-in Retained Treasury Total
Stock Capital Earnings Stock Equity
Balance at
April 3, 1994 $ 120 $38,181 $29,788 $(4,349) $63,740
Purchase of common
shares for treasury (5,095) (5,095)
Unrealized losses on
marketable securities
available-for-sale,
net of tax (52) (52)
1995 Net income 3,840 3,840
Balance at
April 2, 1995 120 38,181 33,576 (9,444) 62,433
Purchase of common
shares for treasury (173) (173)
Unrealized gains on
marketable securities
available-for-sale,
net of tax 988 988
1996 Net income 4,132 4,132
Balance at
March 31, 1996 120 38,181 38,696 (9,617) 67,380
Unrealized gains on
marketable securities
available-for-sale,
net of tax 1,813 1,813
1997 Net loss (21,253) (21,253)
Balance at
March 30, 1997 $ 120 $38,181 $19,256 $(9,617) $47,940
The accompanying notes are an integral part of this statement.
<PAGE>
TODD SHIPYARDS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended March 30, 1997, March 31, 1996, and April 2, 1995
1. PRINCIPAL ACCOUNTING POLICIES
(A) Basis of Presentation - The Consolidated Financial
Statements include the accounts of Todd Shipyards Corporation
(the "Company") and its wholly-owned subsidiaries Todd Pacific
Shipyards Corporation ("Todd Pacific"), TSI Management, Inc.
("TSI") and Elettra Broadcasting, Inc. ("Elettra"). All
intercompany transactions have been eliminated. The Company's
policy is to end its fiscal year on the Sunday nearest March 31.
Certain reclassifications of amounts in the Consolidated
Financial Statements have been made to conform to the current
year presentation.
(B) Business - The Company's primary business is shipbuilding,
conversion and repair for the United States Government (the
"Government"), state ferry systems, and domestic and
international commercial customers. Substantially all of the
Company's work is performed at its Seattle, Washington facility
(the "Shipyard") by a unionized production workforce. Through
TSI, the Company's investment subsidiary, the Company has
invested in Elettra, a radio station operator.
(C) Depreciation and Amortization - Depreciation and amortization
are determined on the straight-line method based upon estimated
useful lives or lease periods; however, for income tax purposes,
depreciation is determined on both the straight-line and
accelerated methods, and on shorter periods where permitted.
Intangible assets, predominantly broadcasting licenses held by
Elettra, are amortized using the straight-line method over the
expected period of benefit ranging from 5 to 40 years.
(D) Revenues - Revenues consist of the estimated realizable value
of work performed under construction, repair and conversion
contracts. Profits on major contracts, those in excess of $3
million or six months duration, are recorded on the percentage-of-
completion method (determined based on direct labor hours).
Losses on contracts are reported in the period when first
estimated. Revisions to contract estimates are recorded as the
estimating factors are refined. The effect of these revisions is
included in income in the period the revisions are made.
(E) Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.
(F) Changes in Accounting Principles - Effective April 4, 1994
the Company changed its method of accounting for general and
administrative costs from recognizing these expenses as contract
costs to recognizing them as incurred which reflects the change,
over time, in the Company's business from predominately longer
term Department of Defense contracts to predominately shorter
term commercial and Government contracts. This change has been
applied to general and administrative costs of prior years and
results in a cumulative effect credit of $.4 million, which is
included in income of the first quarter of fiscal year 1995. The
effect of the change was to decrease income before the cumulative
effect of the accounting change by $1,314 ($.12 per share) for
the fiscal year ended April 2, 1995. There was no income tax
effect as a result of the change.
(G) Income Taxes - Income taxes are determined in accordance with
an asset and liability approach for financial accounting and
reporting of income taxes. A valuation allowance is recorded to
reduce deferred tax assets when realization of the tax benefit is
uncertain.
(H) Inventories - Inventories, consisting of materials and
supplies, are valued at lower of cost (principally average) or
replacement market. The Company has many available sources of
supply for its commonly used materials.
(I) Cash and Cash Equivalents - The Company considers all highly
liquid debt instruments with a maturity of three months or less
to be cash equivalents. Cash equivalents consist primarily of
money market instruments, investment grade commercial paper and
Government securities. The carrying amounts reported in the
balance sheet are stated at cost which approximates fair value.
(J) Securities Available-for-Sale - The Company considers all
debt instruments purchased with a maturity of more than three
months to be securities available-for-sale. Securities available-
for-sale consist primarily of Government securities, investment
grade commercial paper and equities and are valued based upon
market quotes.
Company management determines the appropriate classification of
debt and equity securities at the time of purchase and
reevaluates such designation as of each balance sheet date. All
of the Company's investments are classified as available-for-sale
as of the balance sheet date and are reported at fair value, with
unrealized gains and losses, net of tax, recorded as a component
of stockholders' equity.
(K) Environmental Accounting - For current operating activities,
costs of complying with environmental regulations are immaterial
and expensed as incurred. Environmental costs are capitalized if
the costs extend the life of the property and/or increase its
capacity.
For matters associated with past practices and closed operations,
accruals for environmental matters are recorded when it is
probable that a liability has been incurred and the amount of the
liability can be reasonably estimated, based upon the projected
scope of the remediation, current law and existing technologies.
These accruals are adjusted periodically as assessment and
remediation efforts progress or as additional technical or legal
information becomes available. Such accruals are classified in
the balance sheet as long term obligations at undiscounted
amounts. As applicable, accruals include the Company's share of
the following costs: engineering costs to determine the scope of
the work and the remediation plan, testing costs, project
management costs, removal of contaminated material, disposal of
contaminated material, treatment of contaminated material,
capping of affected areas and long term monitoring costs.
Accruals for environmental liabilities exclude legal costs and
claims, if material, for recoveries from insurance or other third
parties. Accruals for environmental liabilities also exclude
legal costs to defend against claims of other parties. Accruals
for insurance or other third party recoveries for environmental
liabilities are recorded separately from the associated liability
in the financial statements when it is probable that a claim will
be realized.
In October 1996, the American Institute of Certified Public
Accountants issued Statement of Position 96-1, "Environmental
Remediation Liabilities," which establishes new accounting and
reporting standards for the recognition and disclosure of
environmental remediation liabilities. The provisions of the
statement are effective for fiscal years beginning after December
15, 1996. The impact of this new standard is not expected to
have a significant effect on the Company's financial position or
results of operations.
2. RESTRICTED CASH AND SURETY LINE
On December 28, 1994 Todd Pacific entered into an agreement with
a surety pursuant to which the surety will provide a contract
bond for a contract to build three Jumbo Mark II class ferries
("Mark II Ferries") for the Washington State Ferry System ("Ferry
System"). The contract bond is secured by Todd Pacific's
machinery, equipment, inventory and trade accounts receivable on
certain bonded jobs. The surety has also issued bonds totaling
$5.0 million for current commercial repair jobs. Restricted cash
includes retention relating to Mark II Ferry construction
progress payments pursuant to contract terms.
3. SECURITIES AVAILABLE FOR SALE
The following is a summary of available-for-sale securities:
Amor- Gross Gross Estimated
tized Unrealized Unrealized Fair
(In thousands) Cost Gains Losses Value
March 30, 1997
U.S. Treasury securities
and agency obligations $ 7,979 $ - $ 119 $ 7,860
U.S. corporate
securities 15,948 4 94 15,858
Mortgage-backed
securities 3,875 - 25 3,850
Total debt securities 27,802 4 238 27,568
Equity securities 7,963 2,347 - 10,310
$35,765 $2,351 $ 238 $37,878
Amor- Gross Gross Estimated
tized Unrealized Unrealized Fair
(In thousands) Cost Gains Losses Value
March 31, 1996
U.S. Treasury
securities and agency
obligations $13,424 $ - $ 128 $13,296
U.S. corporate securities 8,131 8 51 8,088
Mortgage-backed
securities 6,524 1 36 6,489
Total debt securities 28,079 9 215 27,873
Equity securities 4,603 560 - 5,163
$32,682 $ 569 $ 215 $33,036
The Company had gross realized gains of $1,786 thousand on sales
of available-for-sale securities for the fiscal year ending March
30, 1997. The Company had no gross realized gains on sales of
available-for-sale securities for the fiscal years ending March
31, 1996 or April 2, 1995. The Company had gross realized losses
of $48 thousand and $24 thousand on sales of available-for-sale
securities during fiscal year 1997 and 1996, respectively. The
Company had no realized losses on sales of available-for-sale
securities in fiscal year 1995.
The amortized cost and estimated fair value of the Company's
available-for-sale debt, mortgage-backed and equity securities
are shown below:
Estimated
Amortized Fair
(In thousands) Cost Value
March 30, 1997
Due in one year or less $ 3,166 $ 3,165
Due after one year through three years 20,761 20,553
23,927 23,718
Mortgage-backed securities 3,875 3,850
Equity securities 7,963 10,310
$35,765 $37,878
Estimated
Amortized Fair
(In thousands) Cost Value
March 31, 1996
Due in one year or less $ 6,978 $ 6,968
Due after one year through three years 14,577 14,416
21,555 21,384
Mortgage-backed securities 6,524 6,489
Equity securities 4,603 5,163
$32,682 $33,036
4. CONTRACTS
Mark II Ferry Contract
The Company has a $181 million contract to construct three Jumbo
Mark II Ferries for the Ferry System. The Mark II Ferries are
designed to transport 218 automobiles and 2,500 passengers each
and will be the largest ferries in the Ferry System fleet. The
Mark II Ferry contract is approximately 55% complete at March 30,
1997. Delivery of the first ferry, the MV Tacoma, is scheduled
for Summer 1997 and delivery of the second and third ferries (the
MV Wenatchee and the MV Puyallup) is scheduled for fourth quarter
of fiscal years 1998 and 1999, respectively.
As construction of the Mark II Ferries progresses, the Company
reviews and revises its estimates of long term contract sales
values and costs at completion. Based upon its reviews initiated
in conjunction with the fiscal year-end, the Company estimates
that it will incur contract costs of approximately $11.5 million
in excess of the contract prices for the three ship Mark II Ferry
program resulting in the fourth quarter 1997 reversal of
previously recognized program profit of $2.4 million and the
establishment of a program loss reserve of $11.5 million. During
fiscal year 1997, the Company reversed a total of $3.6 million of
previously recognized Mark II Ferry program profit.
Mark II Ferry contract costs, which include direct and related
labor costs, direct material costs and allocated manufacturing
overhead costs, are expected to exceed contract price due to the
following factors: steel work overruns encountered on the first
vessel, higher than previously forecast program engineering
costs, and increased efforts to complete the outfitting of the
first vessel - including installation of the joiner work; piping
and electrical system; and painting costs.
The Company's construction cost estimates as of March 30, 1997
are based upon implementing improved production techniques and
better utilization of modular shipbuilding practices in the
construction of the second and third ships. The Company also
expects to benefit from production efficiencies gained in the
experience of constructing the first vessel (learning curve
efficiencies) and has incorporated these factors in its
construction cost estimates for the second and third vessels.
However, favorable or unfavorable variances to the estimated
production efficiencies could materially affect the Company's
financial results.
As construction of the Mark II Ferries progresses, revisions in
cost and profit estimates for the contract will be made. Changes
in these estimates will be made based upon the facts then known
to the Company and may be a result of productivity factors,
change order pricing, overhead costs, material costs, production
schedules and levels of shipyard activity. Changes in these
factors could materially affect the Company's financial results.
The Company's ability to complete this contract within the
Company's current estimates of the costs to complete is not
presently determinable. If the Company is unable to complete
this contract within its current estimate of the costs to
complete, the Company could incur losses on this contract beyond
the $11.5 million recorded herein with a related adverse impact
on cash flow.
The Company believes that a portion of the increased contract
costs relate to high levels of engineering and production change
orders directed by the Ferry System. These customer-directed
change orders, which have continued throughout the production
process and into the Company's fiscal year 1998, have caused
significant production rework, delays and disruption. These
change orders have resulted in increased production costs for the
first two ferries, the MV Tacoma and the MV Wenatchee, and the
entire three ship Mark II Ferry construction project. The
Company will pursue full recovery from the Ferry System for the
impact of these changes. The Company cannot predict the outcome
of any negotiations with the Ferry System. Accordingly, the
Company has not included estimates of such settlements, if any,
in its above mentioned Mark II Ferry program loss reserve
estimates.
Unbilled Receivables - Certain unbilled items on completed
contracts included in accounts receivable were approximately $2.0
million at March 30, 1997 and $.3 million at March 31, 1996.
Retainages - Costs and estimated profits in excess of billings on
incomplete contracts include $5.2 million in retainages at March
30, 1997 and $.4 million at March 31, 1996 (after deducting
progress billings relating to multi-year Government maintenance
work and the Mark II Ferry contract of $296 million and $196
million at March 30, 1997 and March 31, 1996, respectively).
Retainages are generally due upon completion or acceptance of the
contracted work and completion of related warranty periods.
Retainage at March 30, 1997 is predominantly related to the Mark
II Ferry project. Mark II Ferry retainage will be released as
each ship is accepted by the Ferry System.
Customers - Revenues from the Government were $11.0 million
(10%), $35.5 million (35%) and $41.2 million (60%) in fiscal
years 1997, 1996 and 1995, respectively. Revenues from the Ferry
System were $66.8 million (59%), $40.7 million (40%) and $8.3
million (12%) in fiscal year 1997, 1996 and 1995, respectively.
5. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, accumulated depreciation and
accumulated amortization at March 30, 1997 and March 31, 1996
consisted of the following:
1997 1996
Land $ 1,151 $ 1,151
Buildings 11,244 9,755
Piers, shipways and drydocks 22,304 26,105
Machinery and equipment 32,114 28,596
Total plant and equipment, at cost $66,813 $65,607
Less accumulated depreciation 42,336 39,108
Plant, property and equipment, net $24,477 $26,499
The Company recognized $3,499 and $3,188 of depreciation expense
in fiscal years 1997 and 1996, respectively. The Company
recognized $90 and $20 of amortization expense in fiscal years
1997 and 1996, respectively.
6. EMPLOYEE BENEFIT PLANS
Union Pension Plans - Operating Shipyard - The Company
participates in several multi-employer plans, which provide
defined benefits to the Company's collective bargaining employees
at its Shipyard. The expense for these plans totaled $3.1
million, $2.5 million and $1.8 million, for fiscal years 1997
1996 and 1995, respectively.
Union Pension Plans - Previously Operated Shipyards - The Company
is a sponsor of several union pension plans due to the prior
operation of other shipyards. The ongoing operation and
management of these plans is the responsibility of boards of
trustees made up of equal numbers of Company and union
representatives.
Nonunion Pension Plans - The Company sponsors the Todd Shipyards
Corporation Retirement System (the "Retirement System"), a
noncontributory defined benefit plan under which substantially
all nonunion employees are covered. The benefits are based on
years of service and the employee's compensation before
retirement. The Company's funding policy is to fund such
retirement costs as required to meet allowable deductibility
limits under current Internal Revenue Service regulations. New
membership in the Retirement System was frozen on July 1, 1993.
The components of net periodic pension benefit for the Retirement
System defined benefit plan in fiscal years 1997, 1996 and 1995
are as follows (in thousands):
1997 1996 1995
Service cost during the time period $ 258 $ 195 $ 248
Interest cost on projected benefit
obligation 2,077 2,184 2,179
Actual return on plan assets (3,862) (5,583) (2,367)
Net amortization and deferral (1,913) 342 (3,093)
Net periodic pension benefit before
OBRA '90 (3,440) (2,862) (3,033)
Transfer of assets for payment of
retiree medical benefits
(401(h) Plan) 1,077 1,225 1,406
Net periodic pension benefit $(2,363) $(1,637) $(1,627)
Significant assumptions used in determining pension obligations,
and the related pension expense, include a weighted-average
discount rate of 7.5% at March 30, 1997, 7.25% at March 31, 1996
and 8% at April 2, 1995, an assumed rate of increase in future
compensation of 4.5% at March 30, 1997 and March 31, 1996 and 5%
at April 2, 1995, and an estimate of expected long-term rate of
return on plan assets of 7% at March 30, 1997 and March 31, 1996
and 6.5% at the end of fiscal year 1995. The increase in the
discount rate reflects the increase in long-term interest rates
at March 30, 1997.
The following table sets forth the Retirement System plan's
funded status and amounts recognized in the Company's
consolidated balance sheets at March 30, 1997 and March 31, 1996
for the Retirement System defined benefit plan (in thousands):
1997 1996
Actuarial present value of benefit obligation:
Accumulated benefit obligations,
fully vested $28,874 $28,371
Projected benefit obligation $30,504 $29,810
Plan's assets at fair value 52,983 52,525
Plan's assets in excess of projected
benefit obligation 22,479 22,715
Unrecognized net loss 6,743 6,559
Unrecognized net transition asset being
recognized over 15 years (9,658) (12,073)
Deferred pension asset $19,564 $17,201
The Retirement System plan assets consist principally of common
stocks and Government and corporate obligations.
Under a provision of the Omnibus Budget Reform Act of 1990 ("OBRA
'90") the Company transferred approximately $1.1 million in
excess pension assets from its Retirement System into a fund to
pay fiscal year 1997 retiree medical benefit expenses. OBRA '90,
was modified by the Retirement Protection Act of 1994 to extend
annual excess asset transfers through the fiscal year ending
March 2001.
Savings Investment Plan - The Company sponsors a Savings
Investment Plan (the "Savings Plan"), under Internal Revenue Code
Section 401, covering substantially all non-union employees.
Under the Savings Plan, the Company at its sole discretion can
contribute an amount equal to up to 6% of each participant's
annual salary depending on the participant's Savings Plan
contributions, and the Company's profits and performance. The
Company has made no contributions to the Savings Plan during the
last three years.
Post Retirement Group Health Insurance Program - The Company
sponsors a defined benefit retirement health care plan that
provides post retirement medical benefits to former full-time
exempt employees, and their spouses, who met specified criteria.
The Company terminated post retirement health benefits for any
employees retiring subsequent to May 15, 1988. The retirement
health care plan contains cost-sharing features such as
deductibles and coinsurance. These benefits are funded monthly
through the payment of group health insurance premiums.
The actuarially calculated components of net periodic post
retirement health care benefit cost for the defined benefit plan
in fiscal years 1997, 1996 and 1995 are as follows (in
thousands):
1997 1996 1995
Interest cost on projected
benefit obligation $ 1,214 $ 1,180 $ 1,343
Net amortization of gain (336) (276) (182)
Net period postretirement benefit
cost $ 878 $ 904 $ 1,161
Current year plan contributions $ 1,118 $ 1,274 $ 1,467
Because such benefit obligations do not accrue to current
employees of the Company, there is no current year service cost
component of the accumulated post retirement health benefit
obligation.
The weighted average discount rates for fiscal years 1997, 1996
and 1995 were 7%, 6.5% and 7%, respectively. The rate of
increase in the per capita cost of covered benefits (i.e., health
care cost trend) used in determining the actuarial present value
of the accumulated health benefit obligation were 8% grading down
to 5% over 20 years for fiscal years 1997 and 1996 and 8% for
fiscal year 1995. The 1997 health care cost trend reflects the
expectation that long term medical cost growth trends will not
stay at current levels. Retirement health care plan gains or
losses exceeding 10% of the benefit obligation are amortized over
the beneficiaries average remaining life expectancy (10 years).
The health care cost trend rate assumption has a significant
effect on the amounts reported. Increasing the assumed health
care cost trend rate by one percentage point in each year would
increase the accumulated post retirement health benefit
obligation as of March 30, 1997 by $1.9 million and the interest
cost component of net periodic post retirement benefit cost for
1997 by $.1 million.
The following table sets forth the amounts recognized in the
Company's consolidated balance sheet at March 30, 1997 and March
31, 1996 for the post retirement health benefit obligation (in
thousands):
1997 1996
Accumulated post retirement health benefit
obligation $18,000 $20,016
Plan assets - -
Accumulated post retirement health benefit
obligation in excess of plan assets 18,000 20,016
Unrecognized net gain 5,153 3,378
Accrued post retirement health benefits 23,153 23,394
Less estimated current portion of obligations
classified as accrued expenses 1,116 1,116
Long-term portion of accrued post retirement
health benefits $22,037 $22,278
7. INCOME TAXES
The provision for income taxes differs from the amount of tax
determined by applying the federal statutory rate for the
following reasons (in thousands):
1997 1996 1995
Tax provision (benefit) at
federal statutory tax rate $(7,439) $ 1,446 $ 1,344
Increase (decrease) in valuation
allowance 7,501 (829) (908)
Tax effect of adjustment of
contingent liabilities (291) (541) (850)
Other - net 229 (76) 414
$ - $ - $ -
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used
for income tax purposes. Significant components of the Company's
deferred income tax assets and liabilities at March 30, 1997,
March 31, 1996 and April 2, 1995 were as follows (in thousands):
1997 1996 1995
Deferred income tax assets:
Business credit carryforwards $7,261 $7,269 $8,092
Net operating loss carryforwards 5,878 - -
Alternative minimum tax credit
carryforwards 3,091 2,874 2,874
Accrued employee benefits 9,031 9,214 9,272
Environmental reserve 4,226 2,490 2,815
Contract deferrals 1,062 1,115 958
Deferred gain on sale of facility 575 601 627
Securities available-for-sale - - 241
Reserve for doubtful accounts 301 179 192
Other 202 1,087 802
Total deferred income tax assets 31,627 24,829 25,873
Valuation reserve for deferred
tax assets (19,923) (13,872) (14,701)
Net deferred tax assets 11,704 10,957 11,172
Deferred income tax liabilities:
Deferred pension income 6,847 6,020 5,447
Accelerated depreciation 4,036 4,739 5,488
Securities available-for-sale 739 124 -
Other 82 74 237
Total deferred income tax liabilities 11,704 10,957 11,172
Net deferred taxes $ - $ - $ -
The Company records its deferred tax assets on the balance sheet
net of a valuation reserve due to the lack of reasonable
assurance that they will be realized.
The Company had, for federal income tax purposes, net operating
loss carryforwards of $5.9 million at March 30, 1997 and tax
credit carryforwards of $7.3 million at March 30, 1997 and March
31, 1996. If not utilized, the net operating loss carryforwards
will expire in fiscal year 2012 and the tax credit carryforwards
will expire in fiscal years 1998 through 2001.
In addition, the Company has paid approximately $3.1 million of
alternative minimum taxes on alternative minimum taxable income
from fiscal years 1988 through 1992, which will be allowed as a
credit carryforward against regular federal income taxes in
future years in the event regular federal income taxes exceed the
alternative minimum tax.
8. LEASES
Operating lease payments charged to expense were $1.0 million,
$.9 million, and $.5 million for fiscal years 1997, 1996 and
1995, respectively. Certain leases contain renewal options and
escalation clauses. Minimum lease commitments at March 30, 1997
are summarized below (in thousands):
Operating
Leases
1998 $ 271
1999 237
2000 199
2001 183
2002 73
Thereafter 437
Total minimum lease commitments $ 1,400
9. OTHER CONTINGENCIES
The Company is subject to various risks and is involved in
various claims and legal proceedings arising out of the ordinary
course of its business. These include complex matters of contract
performance specifications, employee relations, union
proceedings, environmental protection and Government procurement
regulations. Only a portion of these risks and legal proceedings
involving the Company are covered by insurance, because the
availability and coverage of such insurance generally has
declined or the cost has become prohibitive.
10. FINANCING ARRANGEMENTS
Todd Pacific utilizes an annually renewable $3 million revolving
credit facility secured by a first lien on certain trade
receivables. Outstanding borrowings under the credit facility
may not exceed certain percentages of Todd Pacific's trade
receivables. There were no balances outstanding at March 30,
1997.
11. ENVIRONMENTAL MATTERS
The Company faces potential liabilities in connection with the
alleged presence of hazardous waste materials at certain of its
closed shipyards, at the Shipyard and at several sites used by
the Company for disposal of alleged hazardous waste. The Company
continues to analyze environmental matters and associated
liabilities for which it may be responsible. No assurance can be
given as to the existence or extent of any environmental
liabilities until such analysis has been completed. The eventual
outcome of all environmental matters cannot be determined at this
time, however, the analysis of some matters have progressed
sufficiently to warrant establishment of reserve provisions in
the accompanying consolidated financial statements.
Harbor Island Site:
The Company and several other parties have been named as
potentially responsible parties ("PRPs") by the Environmental
Protection Agency (the "EPA") pursuant to the Comprehensive
Environmental Response, Compensation, and Liability Act ("CERCLA"
also known as "Superfund") in connection with the documented
release or threatened release of hazardous substances, pollutants
and contaminants at the Harbor Island Superfund Site (the "Harbor
Island Site"), upon which the Shipyard is located.
To date, the EPA has separated the Harbor Island Site into two
operable units that involve the Company: the Soil and Groundwater
Operable Unit (the "Soil Unit") and the Shipyard Sediments
Operable Unit (the "Sediments Unit").
The Company, along with a number of other Harbor Island PRPs,
received a Special Notice Letter from the EPA on May 4, 1994
pursuant to section 122 (e) of CERCLA. The Company entered into
a Consent Decree for the Soil Unit in September 1994 under which
the Company has agreed to remediate the designated contamination
on its property. That remediation is anticipated to begin in
1997. The Company and EPA currently are negotiating the extent
and methodology of that remediation. The duration of the Soil
Unit remediation is expected to be approximately 12 to 24 months
from the start date. The Company has accrued the EPA's estimate
of the cost of the Soil Unit clean-up in its below stated
environmental matters reserves.
During the quarter ended December 29, 1996, the EPA issued its
Record of Decision ("ROD") for the Sediments Unit. The ROD
identifies four alternative clean-up remedies and specifies the
EPA's selected solution (the "Selected Solution"). The Selected
Solution requires sediment dredging, and installation of a clean
sediment cap and various monitoring efforts extending over ten
years. The Selected Solution includes dredging and disposal of
approximately 116,000 cubic yards of material currently in the
Duwamish River and Elliott Bay surrounding the Shipyard. The
Selected Solution allows for two sediment disposal options:
confined nearshore disposal ("CND") and confined aquatic
disposal. The Company identified CND as what would be its
preferred disposal method if the Selected Solution is
implemented. In that regard, the Company has initiated
independent studies to estimate costs of a CND effort. The EPA
estimates the Company's portion of the remedial cost for the
Selected Solution including long term monitoring and maintenance
between $5.5 million and $7.9 million. The low end of the EPA's
estimated range reflects the Company's independent cost estimate
for CND of sediments on Company-owned property. The high end of
the EPA range reflects the average CND cost of other Puget Sound
CND dredging projects.
The estimated range does not include the cost of any potential
under-pier dredging or capping, should any be required. The
potential scope and costs of under-pier dredging and capping
remedies are currently indeterminable as the necessity and
magnitude of such efforts is strongly dependent on site-specific
conditions. The Company believes that the timing and the
eventual cost of the Sediments Unit clean up will remain
significantly uncertain until a remedial design has been
finalized with the EPA that identifies the scope of remediation
and the method of sediment disposal. The Company has accrued an
amount equal to the high end of the EPA's estimated range, as the
reasonably expected cost of the Sediments Unit clean-up in its
below stated environmental matters reserves. The Company is
currently negotiating an Order of Consent with the EPA covering
solely the additional sampling necessary for any remedial design.
The proposed Order of Consent does not include the remedial
design itself.
In January 1990, the Company was notified that it was a PRP in an
action brought by the National Oceanic and Atmospheric
Administration ("NOAA") for alleged damages caused to the coastal
and marine natural resources in the Duwamish River and Elliott
Bay off the Harbor Island Site. Subsequent to this notification,
NOAA brought suit against the City of Seattle and the
Governmental agency responsible for sewage treatment in the
Seattle area ("Metro") for their contributions of hazardous
materials to the Duwamish River and Elliott Bay. This litigation
was settled between the parties. While NOAA, the City of Seattle
and Metro retain the right to bring suit against all the other
named PRPs, including the Company, the Company has not been
contacted since the January 1990 notification. The Company does
not know the scope of the alleged damages caused to the coastal
and marine natural resources or the methods of measuring these
alleged damages. For these reasons, the Company does not believe
that any estimate of any potential liability relating to these
actions can be made at this time.
Other Environmental Matters:
The Company entered into a Consent Decree with the EPA for the
clean up of the Casmalia Resources Hazardous Waste Management
Facility in Santa Barbara County, California under the Resource
Conservation and Recovery Act. The Company has included an
estimate of the potential liability for this site in its below
stated reserves. Payments, expected to be immaterial, began in
fiscal year 1997 and will extend for up to ten years.
In June 1989, the Company was notified by the City of Hoboken,
New Jersey (the "City") that a volume of oil had been discovered
on the surface of the property that had been owned and operated
as the Hoboken Division of the Company. In June 1992, the City
and the Company were named as PRPs by the State of New Jersey
(the "State"). The City has undertaken a clean-up of the
property. The State has issued a Notice of Violation against the
Company pursuant to the New Jersey Spill Act ("Spill Act"). The
City and the State allege that the Company abandoned three
underground storage tanks in 1969 when the property was sold to
the City and that the discovered surface oil spilled from those
tanks. In April 1994 the City of Hoboken initiated a civil
action against the Company entitled City of Hoboken v. Todd et
al. for contribution under the Spill Act seeking reimbursement
for all monies expended for the cleanup of the Hoboken property.
Also named in the suit is the developer who allegedly trespassed
onto the property and caused the oil spill and several insurance
companies who allegedly issued comprehensive general liability
insurance policies in favor of the City of Hoboken covering the
property. The Company is vigorously defending this action. The
Company has included an estimate of the potential liability for
the site in its below stated reserves. The trial date for this
case is scheduled for Spring of calendar year 1998.
Todd Pacific was notified by the California Environmental
Protection Agency that it may be considered a potentially
responsible party for the cleanup of the Omega Chemical
Corporation site ("Omega Site") in Whittier, California in
September of 1994. It is alleged that the Los Angeles Division
of Todd Pacific caused certain production wastes and by-products
to be transported to this hazardous waste treatment and storage
facility between 1976 and 1991. The California Department of
Toxic Substances Control is pursuing the clean up of the Omega
Site pursuant to state and federal regulations. The Company is
investigating these allegations. No estimation of potential
liability or potential timing of payments, if any, is currently
available as the scope of the total Omega Site has not yet been
quantified and little information regarding the Company's
involvement in the site has to date been identified.
In November 1987, the Company was identified as a PRP by the EPA
in conjunction with the cleanup of the Operating Industries, Inc.
("OII") hazardous materials disposal site at Monterey Park,
California. In September 1995, the Company entered into a
Partial Consent Decree with the EPA to contribute $.6 million as
its partial share of remediation costs at the OII site which
encompasses all costs assessed to date. Payment was made to the
EPA in July 1996. A proposed final consent decree for site
remediation is not expected from the EPA until late calendar year
1997. The cost of the partial settlement and future final
consent decree settlement is included in the below stated
reserve.
The Company has recently been named as one of approximately 50
defendants in a civil action seeking monetary damages incurred as
the result of the ongoing clean up of the Basin By-Products
CERCLA Site in Los Angeles County, California. Investigation has
just begun in this matter and no estimate yet can be made of any
liability.
During its fiscal year 1998, the Company will be required by
Washington state environmental regulations to take action in
order to determine all known, available and reasonable methods of
prevention, control, and treatment ("AKART") for storm water
discharges from its shipyard. In accordance with its National
Pollution Discharge Elimination System permit the Company will be
required to submit its engineering analysis of AKART to the
Washington State Department of Ecology during the second quarter
of FY'98. Potential future expense for compliance with these
AKART regulations will be not quantifiable until the engineering
analysis has been completed and will be recognized in the period
incurred.
The Company has been named as a defendant in civil actions by
parties alleging damages from past exposure to toxic substances,
generally asbestos, at closed former Company facilities. These
cases are generally filed with multiple claimants and multiple
defendants and are generally insured matters. In certain
jurisdictions, the laws are structured to allow the heirs of
former employees to sue for gross negligence and to seek punitive
damages in addition to compensatory awards. The Company is not
fully insured for these matters. Costs to date to administer and
settle these cases have not been material. Estimation of
eventual potential liability, if material, is not possible as the
Company has no means to quantify the number of potential cases,
the timing of such cases, the jurisdiction or what judgments or
settlements, if any, would result. The Company and its insurers
are vigorously defending these actions. The Company has included
its current estimate of the potential liability for known issues
in its below stated reserves.
During fiscal year 1997, the Company recognized a $4.3 million
charge against earnings that includes $7.9 million for
anticipated costs associated with the Company's portion of the
Selected Solution, a decrease to the Soil Unit reserve and
adjustments to other environmental matters. The Company has also
reclassified a previously established $1 million siltation
dredging reserve to the Selected Solution reserve as the efforts
will be performed concurrently. These adjustments increase the
Company's environmental reserves for the entire Harbor Island
Site to $11.4 million. The Company has provided total aggregate
reserves of $15.9 million for the above described contingent
environmental liabilities. The Company is negotiating with its
insurance carriers and prior landowners and operators for past
and future remediation costs. The Company has recorded a non-
current asset of $3.8 million to reflect a contractual
arrangement with an insurance company to share costs for certain
environmental matters. No assurance can be given that the
Company's reserves are adequate to cover all potential
environmental costs the Company could incur.
12. COLLECTIVE BARGAINING AGREEMENT
On July 31, 1996, the existing labor contract with a consortium
of unions covering substantially all production workers expired.
During fiscal year 1997, the Company negotiated a new labor
contract with local union leadership aimed at resolving
contractual and business issues. Subsequent to the end of fiscal
year 1997, on April 9, 1997 and again on May 20, 1997, Company
workers did not ratify two versions of the proposed contract.
For the duration of the Mark II Ferry contract, the Company's
existing contracts with the unions include "no strike/no lockout"
provisions. Additionally, these agreements provide that a
binding arbitration process be utilized between the bargaining
parties in the event an agreement for a new labor contract cannot
be reached. It is the Company's intent to request such an
arbitration in order to achieve a new collective bargaining
agreement. The Company expects work to continue under the
existing contract until contractual issues are resolved. The
Company cannot quantify the financial impact, if any, to the
Consolidated Financial Statements of operating without a union
contract. Over the past two fiscal years, the Company has
invested heavily in its labor relations efforts including the
establishment of labor/management committees and conflict
resolution education for all parties. Notwithstanding the
contract rejections, the Company believes that its relations with
its employees are stable.
13. SUBSEQUENT EVENT
Subsequent to the Company's fiscal year ending March 30, 1997,
the Company announced that it had entered into an agreement to
sell its radio broadcasting subsidiary, Elettra Broadcasting,
Inc., for $5.3 million. The Company expects to record a small
gain on completion of the transaction, which is expected to close
in the third quarter of fiscal year 1998.
14. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Financial results by quarter for the fiscal years ended March 30,
1997 and March 31, 1996 are as follows. Each quarter is 13 weeks
in length (in thousands):
Net
Operating Net Income
income income Per
Revenues (loss) (loss) Share
1st Qtr 1997 $ 30,231 $ (2,528) $ 31 $ 0.00
2nd Qtr 1997 26,627 (2,240) (1,643) (0.17)
3rd Qtr 1997 27,215 (5,873) (5,067) (0.51)
4th Qtr 1997 30,325 (15,151) (14,574) (1.47)
1st Qtr 1996 $ 12,952 $ (800) $ 59 $ 0.01
2nd Qtr 1996 26,837 (1) 689 0.07
3rd Qtr 1996 21,783 1,240 2,059 0.21
4th Qtr 1996 40,115 578 1,325 0.13
The third quarter of fiscal year 1997 includes a $4.25 million
environmental provision. The fourth quarter of fiscal year 1997
reflects a $11.5 million loss reserve established for the Mark II
Ferry project and the reversal of $2.4 million of previously
recognized Mark II Ferry profit.
Todd Shipyards Corporation
Schedule II - Valuation and Qualifying Reserves
For years ending March 30, 1997, March 31, 1996 and April 2, 1995
(in thousands)
Reserves deducted from assets to which they apply - Allowance for
doubtful accounts:
Year Year Year
ended ended ended
Mar 30, Mar 31, Apr 2,
1997 1996 1995
Balance at beginning of period $ 511 $ 548 $ 653
Charged to costs and expenses 350 68 -
Deductions from reserves (1) - (105) (105)
Balance at close of period $ 861 $ 511 $ 548
Notes:
(1) Deductions from reserves represent uncollectible accounts
written off less recoveries. Deductions to the allowance account
include $100 thousand credited to other income in fiscal year
1995 for changes in the Company's business volume.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCED DISCLOSURE
None
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
**
ITEM 11. EXECUTIVE COMPENSATION
**
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
**
ITEM 13. CERTAIN RELATIONSHIPS AND TRANSACTIONS
**
** The information for the above items will be provided in, and
is incorporated by reference to, the 1997 Proxy Statement.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
REPORTS ON FORM 8-K
(a) 1 & 2. Financial Statements
The financial statements and financial statement schedule
listed in the accompanying index to financial statements and
financial statement schedules are filed as part of this annual
report.
3. Exhibits
The exhibits listed on the accompanying Index to Exhibits are
filed as part of this annual report.
(b) Reports on Form 8-K
The Company filed no reports on Form 8-K during the fourth
quarter ended March 30, 1997.
<PAGE>
TODD SHIPYARDS CORPORATION
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
COVERED BY REPORT OF INDEPENDENT AUDITORS
Report of Ernst & Young LLP Independent Auditors.............
Consolidated Balance Sheets at March 30, 1997
and March 31, 1996..........................................
Consolidated Statements of Operations
For the years ended March 30, 1997,
March 31, 1996 and April 2, 1995.............................
Consolidated Statements of Cash Flows
For the years ended March 30, 1997,
March 31, 1996 and April 2, 1995.............................
Consolidated Statements of Stockholders Equity
For the years ended March 30, 1997,
March 31, 1996 and April 2, 1995.............................
Notes to Consolidated Financial Statements
For the years ended March 30, 1997,
March 31, 1996 and April 2, 1995.............................
Supplementary Information:
Quarterly Financial Data (unaudited).......................
Consolidated Financial Statement Schedule:
II-Valuation and Qualifying Reserves.......................
<PAGE>
TODD SHIPYARDS CORPORATION INDEX TO EXHIBITS
Item 14(a)3
Exhibit
Number
3-1 Certificate of Incorporation of the Company #
dated November 29, 1990.
3-2 By-Laws of the Company dated November 29, 1990, *
as amended October 1, 1992 filed in the Company's
Form 10-K Report for 1993 as Exhibit 3-2.
10-1 Lease Agreement of floating drydock YFD-70 dated *
April 16, 1996 between the Company and NAVSEA,
filed in the Company's Form 10-K Report for 1996
as Exhibit 10-1.
10-2 Lease Agreement of floating drydock YFD-54 dated *
April 1, 1987 between the Company and NAVSEA and
amendments thereto filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-2.
10-3 Collective Bargaining Agreement between Todd *
Pacific, Seattle Division and the Metal Trades
Dept. of the A.F.L.- C.I.O., the Pacific Coast
Metal Trades District Council, the Seattle Metal
Trades Council and the International Unions
signatory thereto dated April 1, 1993 filed in the
Company's Form 10-K Annual Report for 1994 as
Exhibit 10-4.
10-4 Project Agreement between Todd Pacific, Seattle *
Division and the Metal Trades Dept. of the A.F.L.
- C.I.O., the Pacific Coast Metal Trades District
Council, the Seattle Metal Trades Council and the
International Unions signatory thereto dated August
1994 filed in the Company's Form 10-K Report for
1995 as Exhibit 10-4.
10-5 Unsigned executed copy of Harbor Area Lease *
Agreement No. HA-2202 dated March 21, 1985 between
the Company and the State of Washington Dept. of
Natural Resources filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-5.
10-6 Harbor Area Lease Agreement No. 2590 dated *
December 13, 1982 between the Company and the State
of Washington Dept. of Natural Resources filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-6.
10-7 Harbor Area Lease Agreement No. 22-090038 dated *
September 1, 1986 between the Company and the State
of Washington Dept. of Natural Resources filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-7.
10-8 Harbor Area Lease Agreement No. 22-090039 dated *
September 1, 1986 between the Company and the State
of Washington Dept. of Natural Resources filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-8.
10-9 Savings Investment Plan of the Company effective *
April 1, 1989 filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-9.
10-10 Todd Shipyards Corporation Retirement System Plan *
and Amendments thereto filed in the Company's Form
10-K Report for 1995 as Exhibit 10-10.
10-13 Purchase and Sale Agreement and Deed of Trust *
relating to the sale of the Company's Galveston
facility to the Galveston Wharves dated December
16, 1993 filed in the Company's Form 10-K
Annual Report for 1994 as Exhibit 10-14.
10-14 Employment contract between Todd Pacific and Roland *
H. Webb dated December 27, 1994 filed in the Company's
Form 10-K Report for 1995 as Exhibit 10-14.
10-15 Contract between Todd Pacific and the Washington *
State Ferries, a division of the Washington State
Department of Transportation for the construction of
one Jumbo Mark II Class Ferry dated January 30, 1995
filed in the Company's Form 10-K Report for 1995 as
Exhibit 10-15.
10-15(a) Change Order Estimate from the Washington State *
Ferries, amending Exhibit 10-15 and exercising its
Option for the construction of the second and third
Jumbo Mark II Class Ferries dated June 14, 1995,
filed in the Company's Form 10-K Report for 1996
as Exhibit 10-15(a).
10-16 Contract No. N000024-91-C-8503 between Todd Pacific *
and the Department of the Navy for the maintenance
and repair of supply ships filed in the Company's Form
10-K Report for 1995 as Exhibit 10-16.
10-16(a) Contract No. N000024-96-R-8500 between Todd Pacific #
and the Department of the Navy for the maintenance
and repair of supply ships dated May 20, 1996.
10-17 Documents pertaining to the bonding arrangements of *
Todd Pacific relating to the Ferry Contract (Exhibit
10-16): Underwriting and Continuing Indemnity Agreement,
Security Agreement, Pledge Agreement, Intercompany
Credit Agreement, Preferred Mortgage of vessel
EMERALD SEA, UCC-1 Financing Statement, and UCC-2
Fixture Statement filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-17.
10-18 Documents pertaining to revolving line of credit *
agreement between Todd Pacific and U.S. Bank of
Washington, National Association: Security Agreement,
Commercial Guaranties, Corporate Resolution to Borrow,
Corporate Resolutions to Guaranty/Grant Collateral,
Business Loan Agreement, Disbursement Request and
Authorization Agreement, Accounts Receivable Collateral
Parameters Agreement, Promissory Note, and UCC-1
Financing Agreement filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-18.
10-19 Todd Shipyards Corporation Incentive Stock *
Compensation Plan effective October 1, 1993, approved
by the shareholders of the Company at the 1994 Annual
Meeting of Shareholders filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-19.
10-20 Grant of Nonqualified Stock Option dated *
June 24, 1994 to Patrick W.E. Hodgson pursuant
to the Incentive Stock Compensation Plan
(Exhibit 10-19) filed in the Company's Form 10-K
Report for 1995 as Exhibit 10-20.
10-21 Grant of Incentive Stock Option dated June 24, 1994 *
to Roland H. Webb pursuant to the Incentive
Stock Compensation Plan (Exhibit 10-19) filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-21.
10-22 Grant of Incentive Stock Option dated September 29, *
1994 to Stephen G. Welch pursuant to the Incentive
Stock Compensation Plan (Exhibit 10-19) filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-22.
10-23 Grant of Incentive Stock Option dated September 29, *
1994 to Michael G. Marsh pursuant to the Incentive
Stock Compensation Plan (Exhibit 10-19) filed in the
Company's Form 10-K Report for 1995 as Exhibit 10-23.
10-25 Form of Grant of Non-Qualified Stock Options dated *
July 17, 1995 to Patrick W.E. Hodgson pursuant
to the Incentive Stock Compensation Plan
(Exhibit 10-19).
10-26 Form of Grant of Incentive Stock Options dated *
July 17, 1995 to certain key employees pursuant to
the Incentive Stock Compensation Plan (Exhibit 10-19).
18-1 Letter dated 8/17/94 from Ernst & Young, LLP *
regarding changes in accounting principles, filed in
the Company's Form 10-K for 1996 as Exhibit 18-1.
22-1 Subsidiaries of the Company. #
27 Financial Data Schedule. #
Note: All Exhibits are in SEC File Number 1-5109.
* Incorporated herein by reference.
# Filed herewith.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934 the registrant has duly caused
this Annual Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
TODD SHIPYARDS CORPORATION
Registrant
By: /s/ Stephen G. Welch
Stephen G. Welch
Vice President, Chief Financial Officer
and Treasurer
June 7, 1997
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the
dates indicated:
/s/ Brent D. Baird /s/ Steven A. Clifford
Brent D. Baird, Director Steven A. Clifford, Director
June 7, 1997 June 7, 1997
/s/ Patrick W.E. Hodgson /s/ Joseph D. Lehrer
Patrick W.E. Hodgson, Joseph D. Lehrer, Director
Chairman, Chief Executive June 7, 1997
Officer, and Director
June 7, 1997
/s/ Philip N. Robinson /s/ John D. Weil
Philip N. Robinson, Director John D. Weil, Director
June 7, 1997 June 7, 1997
/s/ Stephen G. Welch
Stephen G. Welch
Vice President, Chief Financial Officer
Principal Financial Officer and
Principal Accounting Officer
June 7, 1997
SUBSIDIARIES OF TODD SHIPYARDS CORPORATION
EXHIBIT 22-1
ELETTRA BROADCASTING, INC.
MONTANA VALLEY LAND COMPANY
TODD PACIFIC SHIPYARDS CORPORATION
TSI MANAGEMENT, INC.
CERTIFICATE OF INCORPORATION
OF
TODD SHIPYARDS CORPORATION
Article 1. Name. The name of the corporation is
Todd Shipyards Corporation (the "Corporation").
Article 2. Registered Office and Agent. The address
of the Corporation's registered office in the state of Delaware
is the Corporation Trust Center, 1209 Orange Street, in the City
of Wilmington, County of New Castle. The name of the
Corporation's registered agent at such address is The Corporation
Trust Company.
Article 3. Purpose. The purpose for which the
Corporation is formed is to engage in any lawful act or activity
for which corporations may be organized under the General
Corporation Law of Delaware and to possess and exercise all of
the powers and privileges granted by such law and other law of
Delaware.
Article 4. Authorized Capital. The aggregate number
of shares of all classes of stock which the Corporation shall
have authority to issue is 20,500,000 shares, divided into two
classes consisting of 1,000,000 shares of Preferred Stock, of no
par value ("Preferred Stock"), and 19,500,000 shares of Common
Stock, of no par value ("Common Stock").
The board of directors of the Corporation (the "Board
of Directors") is expressly authorized, at any time and from time
to time, to provide for the issuance of shares of Preferred Stock
in one or more series with such designations, preferences and
relative, participating, optional or other special rights, and
such qualifications, limitations or restrictions thereof, as
shall be expressed in the resolution or resolutions providing for
the issuance thereof adopted by the Board of Directors (a
"Preferred Stock Designation") and as are not inconsistent with
this Certificate of Incorporation or any amendment hereto, and as
may be permitted by the General Corporation Law of Delaware.
Except as otherwise expressly required by law and except for such
voting powers as may be stated in the Preferred Stock Designation
relating to any series of Preferred Stock, the holders of any
such series shall have no voting power whatsoever.
Article 5. Incorporator. The name and mailing
address of the Incorporator are as follows:
Name Mailing Address
Christopher V. Roehrer 66 York Street
Jersey City
New Jersey 07302
Article 6. Term. The Corporation is to have
perpetual existence.
Article 7. Right to Amend. The Corporation reserves
the right to amend the provisions in this certificate and in any
certificate amendatory hereof in the manner now or hereafter
prescribed by law, and all rights conferred on stockholders or
others hereunder or thereunder are granted subject to such
reservation.
Article 8. Limited Liability. No director of the
Corporation shall be liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as
a director, except for liability (i) for any breach of the
director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of
law, (iii) under section 174 of the Delaware General Corporation
Law as in effect on the date hereof, or (iv) for any transaction
from which the director derived an improper personal benefit.
Any repeal or modification of this Article 8 shall be prospective
only, and shall not affect, to the detriment of any director, any
limitation on the personal liability of a director of the
Corporation existing at the time of such repeal or modification.
Article 9. Indemnification. The Corporation shall
indemnify any person who was or is a party or witness, or is
threatened to be made a party or witness, to any threatened,
pending or completed action, suit or proceeding (including,
without limitation, an action, suit or proceeding by or in the
right of the Corporation or any predecessor of the Corporation),
whether civil, criminal, administrative or investigative
(including a grand jury proceeding), by reason of the fact that
he or she (a) is or was a director or officer of the Corporation
or any predecessor of the Corporation or (b) as a director or
officer of the corporation or any predecessor of the Corporation,
is or was serving at the request of the Corporation or any
predecessor of the Corporation as a director, officer, employee,
agent, partner or trustee (or in any similar position) of another
corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, to the fullest extent authorized or
permitted by the Delaware General Corporation Law and any other
applicable law, as the same exists or may hereafter be amended
(but, in the case of such amendment, only to the extent that such
amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to
provide prior to such amendment), against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him or her in connection with
such action, suit or proceeding, or in connection with any appeal
thereof; provided, however, that, except as provided in the next
paragraph of this Article with respect to proceedings to enforce
rights to indemnification, the Corporation shall indemnify any
such person in connection with an action, suit or proceeding (or
part thereof) initiated by such person only if the initiation of
such action, suit or proceeding (or part thereof) was authorized
by the Board of Directors. Such right to indemnification shall
include the right to payment by the Corporation of expenses
incurred in connection with any such action, suit or proceeding
in advance of its final disposition; provided, however, that the
payment of such expenses incurred by a director or officer in
advance of the final disposition of such action, suit or
proceeding shall be made only upon the delivery to the
Corporation of an undertaking, by or on behalf of such director
or officer, to repay all amounts so advanced if it should be
determined ultimately that such director or officer is not
entitled to be indemnified under this Article or otherwise.
Any indemnification or advancement of expenses
required under this Article shall be made promptly, and in any
event within sixty days, upon the written request of the person
entitled thereto. If a determination by the Corporation that the
person is entitled to indemnification pursuant to this Article is
required, and the Corporation fails to respond within sixty days
to a written request for indemnity, the Corporation shall be
deemed to have approved such request. If the Corporation denies
a written request for indemnity or advancement of expenses, in
whole or part, or if payment in full pursuant to such request is
not made within sixty days, the right to indemnification and
advancement of expenses as granted by this Article shall be
enforceable by the person in any court of competent jurisdiction.
Such person's costs and expenses incurred in connection with
successfully establishing his or her right to indemnification, in
whole or in part, in any such action or proceeding shall also be
indemnified by the Corporation. It shall be a defense to any
such action (other than an action brought to enforce a claim for
the advancement of expenses pursuant to this Article where the
required undertaking has been received by the Corporation) that
the claimant has not met the standard or conduct set forth in the
general Corporation Law of Delaware, but the burden of proving
such defense shall be on the Corporation. Neither the failure of
the Corporation (including the Board of Directors, independent
legal counsel or the stockholders) to have made a determination
prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he or she has
met the applicable standard of conduct set forth in the Delaware
General Counsel Law, nor the fact that there has been an actual
determination by the Corporation (including the Board of
Directors, independent legal counsel or the stockholders) that
the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.
The indemnification and advancement of expenses
provided by, or granted pursuant to, this Article shall not be
deemed exclusive of any other rights (whether supplementary or in
addition to or inconsistent with those provided in this Article)
to which those seeking indemnification or advancement of expenses
or contribution may be entitled under any law, by-law, agreement,
vote of stockholders or disinterested directors or otherwise,
both as to action in his or her official capacity and as to
action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer,
employee or agent, and shall inure to the benefit of the heirs,
executors and administrators of such a person. Any repeal or
modification of the provisions of this Article shall not affect
any obligations of the Corporation or any rights regarding
indemnification and advancement of expenses of a director,
officer, employee or agent with respect to any threatened,
pending or completed action, suit or proceeding for which
indemnification or the advancement of expenses is requested, in
which the alleged cause of action accrued at any time prior to
such repeal or modification.
The Corporation may purchase and maintain insurance, at
its expense, to protect itself and any person who is or was a
director, officer, employee or agent of the Corporation or any
predecessor of the Corporation, or is or was serving at the
request of the Corporation or any predecessor of the Corporation
as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other
enterprise against any liability asserted against him or her and
incurred by him or her in any such capacity, or arising out of
his or her status as such, whether or not the Corporation would
have the power to indemnify him or her against such liability
under the provisions of this Article, the Delaware General
Corporation Law or otherwise.
If this Article or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction,
then the Corporation shall nevertheless indemnify each director
and officer of the Corporation or any predecessor of the
Corporation as to expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement with respect to
any action, suit or proceeding, whether civil, criminal,
administrative or investigative, including, without limitation, a
grand jury proceeding and an action, suit or proceeding by or in
the right of the Corporation or any predecessor of the
Corporation, to the fullest extent permitted by any applicable
portion of this Article that shall not have been invalidated, by
the Delaware General Corporation law or by any other applicable
law.
Article 10. Board of Directors. (a) The property and
business of the Corporation shall be managed by a Board of not
less than one nor more than fifteen Directors. At all annual
elections, each of the Directors shall be elected by the
stockholders for a term of one year; provided that nothing herein
shall be construed to prevent the election of a Director to
succeed himself. Within the limits herein specified, the number
of Directors shall be fixed and may be changed, from time to
time, by resolution of the Board of Directors. The Directors
shall be elected at the annual meeting of the stockholders,
except as hereinafter provided in this Certificate of
Incorporation, and each Director elected shall hold office until
his successor shall be elected and shall qualify. Directors need
not be stockholders.
(b) Except as otherwise provided in this Certificate of
Incorporation, only persons who are nominated in accordance with
the procedures set forth in this Article 10 shall be eligible for
election as Directors of the Corporation. Nominations of persons
for election to the Board of Directors of the Corporation may be
made at a meeting of stockholders (a) by or at the direction of
the Board of Directors of the Corporation or (b) by any
stockholder of the Corporation entitled to vote for the election
of Directors at such meeting who complies with the notice
procedures set forth in this Article 10. Such nominations made
by a stockholder shall be made pursuant to a written notice
received by the Secretary of the Corporation (i) not less than 90
days prior to such meeting. Such stockholder's notice to the
Secretary shall set forth (a) the name, age and address, as they
appear on the Corporation's books, of the stockholder who intends
to make the nomination, (b) the name, age, occupation, business
and residence addresses, if known, and the principal occupation
of each person whom the stockholder intends to nominate, (c) a
representation that the stockholder is a holder of record of Todd
Delaware's stock entitled to vote at the meeting and intends to
appear in person or by proxy at the meeting to nominate the
person or persons specified in the notice (d) a description of
all arrangements and understandings between the stockholder and
each person the stockholder intends to nominate and each other
person or persons, if any, (naming such person or persons and
stating the beneficial ownership of securities of the Corporation
of each such person) pursuant to which the nomination or
nominations will be made by the stockholder, (e) such additional
information with respect to each nominee proposed by the
stockholder as would have been required to be included in a proxy
statement pursuant to the then effective proxy rules of the
Securities and Exchange Commission had each such proposed nominee
been nominated by the Board of Directors of the Corporation, and
(f) the signed consent of each such proposed nominee to being
nominated and to serving as a Director is elected. Except as
otherwise provided herein, no person shall be eligible for
election as a Director of the Corporation unless nominated in
accordance with the procedures set forth in this Article 11.
(c) If any vacancies occur in the Board of Directors
caused by death, resignation, retirement, disqualification or
removal from office of any Director or otherwise, or any new
Directorship is created by any increase in the authorized number
of Directors, a majority of the Directors then in office, though
less than a quorum, may choose a successor or successors, or fill
the newly created Directorship, and the Director so chosen shall
hold office only until the expiration of the term of his
predecessor or, as to any new Directorship, until the end of the
term to which he is so chosen and until his successor shall be
duly elected and qualified, unless sooner displaced.
Article 11. Special Meetings of the Stockholders.
Special meetings of the stockholders of the Corporation may be
held only upon the call of the Chairman of the Board, the
President or a majority of the members of the Board of Directors.
IN WITNESS WHEREOF, the undersigned has executed the
Certificate of Incorporation this day of November, 1990.
Christopher V. Roehrer
Sole Incorporator
SOLICITATION, OFFER AND AWARD
1. THIS CONTRACT IS A RATED ORDER UNDER DPAS (15 CFR 350)
PAGE 1 OF 125 PAGES
2. CONTRACT NO. N00024-96-C-8500
3. SOLICITATION NO. N00024-96-R-8500
4. TYPE OF SOLICITATION ( ) SEALED BID (x) NEGOTIATED (RFP)
5. DATE ISSUED 04 MARCH 96
5. REQ/PURCHASE N00024-96-NR-91808
ISSUED BY ADDRESS OFFER TO (If other than Item 7)
NAVAL SEA SYSTEMS COMMAND DEPARTMENT OF THE NAVY
BUYER/SYMBOL: DUANE T. ROBINSON
NAVAL SEA SYSTEMS COMMAND, SEA 0291
2531 JEFFERSON DAVIS HWY 2531 JEFFERSON DAVIS HWY, RM 5E40
ARLINGTON, VA 22242-5160 ARLINGTON, VA 22242-5160
NOTE: If sealed bid solicitations, "offer" and "offeror" mean
"bid" and "bidder"
SOLICITATION
9. Sealed offers in original and 1 signed copies for furnishing
the supplies or services in the Schedule will be received at the
place specified in Item 8, or if handcarried, in the depository
located in Block 8 unless 2:00 p.m. Eastern 23 APRIL 06
CAUTION - LATE Submissions, Modifications and Withdrawals: See
Section L, Provision No. 52.214-7 or 52.215-10. All offers are
subject to all terms conditions contained in this solicitation.
10. FOR INFORMATION CALL
A. DUANE T. ROBINSON
B. (703) 602- 7714 NO COLLECT CALLS
11. TABLE OF CONTENTS
PART I - THE SCHEDULE PAGES
X A SOLICITATION/CONTRACT FORM 1
X B SUPPLIES OR SERVICES AND PRICES/COSTS 2-40
X C DESCRIPTION/SPECS/WORK STATEMENT 41-72
X D PACKAGING AND MARKING 73
X E INSPECTION AND ACCEPTANCE 74-78
X F DELIVERIES OR PERFORMANCE 79-84
X G CONTRACT ADMINISTRATION DATA 85-86
X H SPECIAL CONTRACT REQUIREMENTS 87-102
PART II - CONTRACT CLAUSES
X I CONTRACT CLAUSES 103-124
PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACH.
X J LIST OF ATTACHMENTS 125
PART IV - REPRESENTATIONS AND INSTRUCTIONS
X K REPRESENTATIONS, CERTIFICATIONS
AND OTHER STATEMENTS OF OFFERORS
X L INSTS., CONDS, AND NOTICE TO OFFERORS
X M EVALUATION FACTORS FOR AWARD
OFFER (Must be fully completed by offeror)
NOTE: Item 12 does not apply if the solicitation includes
provisions in 52.214-16 Minimum Bid Acceptance Period
12. In compliance with the above, the undersigned agrees, if
this offer is accepted within 60 calendar days (60 days unless a
different period is inserted by the Offeror) from the date for
receipt of offers specified above, to furnish any or all items
upon which prices are offered at the price set opposite each
item, delivered at the designated point(s), within the time
specified in the schedule.
13. DISCOUNT FOR PROMPT PAYMENT
14. ACKNOWLEDGMENT OF AMENDMENTS (The offeror acknowledges
receipt of amendments to the SOLICITATION for offers and related
documents numbered and dated:
AMENDMENT NO. DATE
0001 4/3/96
15A. NAME AND ADDRESS OF OFFEROR 16. NAME AND TITLE OF PERSON
CEC NO. AUTHORIZED TO SIGN OFFER
Todd Pacific Shipyards Corporation Roland H. Webb
1801 16th Avenue S.W. President & COO
Seattle, WA 98134
TIN NO: 13-2906669
15B. TELEPHONE NO. (Include area code)
(206) 623-1635
15C. CHECK IF REMITTANCE ADDRESS IS DIFFERENT FROM ABOVE, ENTER
SUCH ADDRESS IN SCHEDULE ( )
17. SIGNATURE /s/ Roland H. Webb
18. OFFER DATE APRIL 23, 1996
AWARD
19. ACCEPTED AS TO ITEMS NUMBERED 0001 - 0007
20. AMOUNT $30,116.00
21. ACCOUNTING AND APPROPRIATION SEE ATTACHMENT J-4
22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION
N/A
( ) 10 U.S.C. 2304(c) ( )
( ) 41 U.S.C. 253(c) ( )
23. SUBMIT INVOICES TO ADDRESS SHOWN IN ITEM 24
24. ADMINISTERED BY (If other than Item 7)
Supervisor of Shipbuilding, Conversion & Repair, USN
Puget Sound, 2802 Wetmore Ave. Suite 500, Code 400
Everett, WA 98201-3518
25. PAYMENT WILL BE MADE BY
DAO - CLEVELAND CENTER
937 HARBOR DRIVE, ATTN: CODE SDBCA
SAN DIEGO, CA 92132
EFFECTIVE DATE: 16 April 1996
26. NAME OF CONTRACTING OFFICER LCDR DALE P. COTTONGIM, SC, US
NAVY
27. UNITED STATES OF AMERICA /s/ Jonathan B. Hall
28. AWARD DATE 20 MAY 96
IMPORTANT - Award will be made on this Form, or on Standard Form
26, or by other authorized official written notice.
<PAGE>
SUPPLIES OR SERVICES AND PRICES/COST
ITEM SUPPLIES/SERVICES AMOUNT
FY 96
0001 Accomplish FY 96 Procurement Fee-Bearing Est Cost 28,984
of Long Lead Time Material *Cost of Money for
(LLTM) for USS CAMDEN Facilities Capital (FCOM) $552
(AOE 2) FY 97 PMA Total CLIN Est Cost
(See Section C) (Exclusive of Fee) $29,536
*Base Fee (Max 3% of
Fee Bearing Est Cost) $ 580
*CLIN Total $ 30,116
*Award Fee Pool $ 2,319
0001AB Title "D" and "F" SHIPALTS Fee Bearing Est Cost $28,984
and Repairs FCOM $ 552
Total Est Cost
$29,536
Base Fee $ 580
Sub-CLIN Total $30,116
Award Fee Pool $ 2,319
0002 Accomplish Non-Scheduled See Section C
Repair and Alteration
Requirements between
Availabilities
0003 Provisioned Item Order (PIO) See Section C
for Items 0001 and 0002, and
if options are exercised, for
Items 0008 thru 0029
0004 Data for Item 0001 and if NSP
options are exercised, for * NSP = Not Separately Priced
Items 0008 thru 0029 (See CDRL "A" attached)
0005 Provisioning Technical See Section C
Documentation for Items 0001
and 0002 and if options are
exercised for Items 0008 thru 0029
(See CDRL Exhibit "B" attached)
0006 Data for Item 0002 (See CDRL NSP
Exhibit "C" attached)
0007 Messing and Berthing See Section C
0008 Option
FY 96 (OPTIONS)
Accomplish FY 96 Advance Fee-Bearing Est Cost $24,347
Planning for USS CAMDEN *Cost of Money for
(AOE 2) FY 97 PMA Facilities Capital (FCOM) $464
Total CLIN Est Cost
(Exclusive of Fee) $24,811
*Base Fee (Max 3% of
Fee Bearing Est Cost) $ 487
*CLIN Total $25,297
*Award Fee Pool $ 1,948
0008AB Title "D" and "F" Fee Bearing Est Cost $20,289
SHIPALTS and Repairs FCOM $386
Total Est Cost $20,675
Base Fee $ 406
Sub-CLIN Total $21,081
Award Fee Pool $1,623
0008AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,058
FCOM $ 77
Total Est Cost $ 4,135
Base Fee $ 81
Sub-CLIN Total $ 4,216
Award Fee Pool $ 325
0009 Option
Accomplish FY 96 *Cost of Money for
Advance Planning for Facilities Capital (FCOM) $435
USS RAINIER Total CLIN Est Cost
(AOE 7) FY 97 PMA (Exclusive of Fee) $26,623
*Base Fee (Max 3% of
(Fee Bearing Est Cost) $484
*CLIN Total $25,107
*Award Fee Pool $1,935
0009AB Title "D" and "F" Fee Bearing Est Cost $20,157
SHIPALTS and Repairs FCOM $362
Total Est Cost $20,519
Base Fee $ 403
Sub-CLIN Total $20,923
Award Fee Pool $ 1,613
0009AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,031
FCOM $ 72
Total Est Cost $ 4,104
Base Fee $ 81
Sub-CLIN Total $ 4,185
Award Fee Pool $ 323
0010 Option Fee-Bearing Est Cost $5,479,146
FY 97 (OPTIONS) *Cost of Money for
Accomplish Repair and Facilities Capital (FCOM)$71,025
Alterations for USS CAMDEN Total CLIN Est Cost
(AOE 2) FY 97 PMA (Exclusive of Fee) $5,550,171
*Base Fee (Max 3% of
Fee Bearing Est Cost) $109,583
*CLIN Total $5,659,754
*Award Fee Pool $ 438,332
0010AB Title "D" and "F" Fee Bearing Est Cost $4,236,506
SHIPALTS and Repairs FCOM $ 56,859
Total Est Cost $ 4,293,364
Base Fee $ 84,730
Sub-CLIN Total $4,378,094
Award Fee Pool $ 38,920
0010AC Title "K" SHIPALTS Fee Bearing Est Cost $1,242,640
FCOM $ 14,167
Total Est Cost $1,256,807
Base Fee $ 24,853
Sub-CLIN Total $1,281,660
Award Fee Pool $99,411
0011 Option
Accomplish Repair and Fee-Bearing Est Cost $5,379,455
Alterations for USS RAINIER *Cost of Money for
(AOE 7) FY 97 PMA Facilities Capital (FCOM) $56,184
Total CLIN Est Cost
(Exclusive of Fee) $5,435,640
*Base Fee (Max 3% of
Fee Bearing Est Cost) $107,589
*CLIN Total $5,543,229
*Award Fee Pool $ 430,356
0011AB Title "D" and "F" Fee Bearing Est Cost $4,114,347
SHIPALTS and Repairs FCOM $ 44,978
Total Est Cost $4,159,325
Base Fee $ 82,287
Sub-CLIN Total $4,241,612
Award Fee Pool $ 329,148
0011AC Title "K" SHIPALTS Fee Bearing Est Cost $1,265,108
FCOM $11,207
Total Est Cost $1,276,315
Base Fee $25,302
Sub-CLIN Total $1,301,617
Award Fee Pool $101,209
0012 Option
Accomplish FY 97 Advance Fee-Bearing Est Cost $ 23,772
Planning for USS SACRAMENTO *Cost of Money for
(AOE 1) FY 98 DPMA Facilities Capital (FCOM) $356
Total CLIN Est Cost
(Exclusive of Fee) $ 24,129
*Base Fee (Max 3% of
Fee Bearing Est Cost) $475
*CLIN Total $ 24,604
*Award Fee Pool $1,902
0012AB Title "D" and "F" Fee Bearing Est Cost $19,810
SHIPALTS and Repairs FCOM $297
Total Est Cost $20,107
Base Fee $ 396
Sub-CLIN Total $20,503
Award Fee Pool $1,585
0012AC Title "K" SHIPALTS Fee Bearing Est Cost $3,962
FCOM $59
Total Est Cost $4,021
Base Fee $ 79
Sub-CLIN Total $ 4,101
Award Fee Pool $317
0013 Option
Accomplish USS BRIDGE Fee-Bearing Est Cost $27,896
(AOE 10) FY 97 Advance *Cost of Money for
Planning, Engineering Facilities Capital (FCOM) $416
Management and Material Total CLIN Est Cost
Procurement Support for (Exclusive of Fee) $28,311
the FY 98 PSA *Base Fee (Max 3% of
Fee Bearing Est Cost) $558
*CLIN Total $28,869
*Award Fee Pool $2,232
0013AB TYCOM Authorized Repairs Fee Bearing Est Cost $19,925
(See Section C) FCOM $297
Total Est Cost $20,222
Base Fee $399
Sub-CLIN Total $20,621
Award Fee Pool $1,594
0013AF NAVSEA Deferred Work Fee Bearing Est Cost $3,985
Items (SCN Funded) Total Est Cost $4,044
(See Section C) Base Fee $ 80
Sub-CLIN Total $4,124
Award Fee Pool $319
0013AG NAVSEA Post Delivery Fee Bearing Est Cost $3,985
Work Items (SCN Funded) FCOM $59
(See Section C) Total Est Cost $4,044
Base Fee $80
Sub-CLIN Total $4,124
Award Fee Pool $319
0014 Option
FY 98 (OPTIONS) Fee-Bearing Est Cost $8,752,971
Accomplish Repair and *Cost of Money for
Alterations for Facilities Capital (FCOM) $81,064
USS SACRAMENTO (AOE 1) Total CLIN Est Cost
FY 98 DPMA (Exclusive of Fee) $8,834,035
*Base Fee (Max 3% of
Fee Bearing Est Cost) $175,059
*CLIN Total $9,009,094
*Award Fee Pool $700,238
0014AA Messing and Berthing Fee Bearing Est Cost $681,261
FCOM $253
Total Est Cost $681,514
Base Fee $13,625
Sub-CLIN Total $695,139
Award Fee Pool $_54,501
0014AB Title "D" and "F" Fee Bearing Est Cost$6,875,391
SHIPALTS and Repairs FCOM $ 70,044
Total Est Cost $6,945,435
Base Fee $137,508
Sub-CLIN Total $7,082,943
Award Fee Pool $550,031
0014AC Title "K" SHIPALTS Fee Bearing Est Cost$1,196,319
FCOM $10,767
Total Est Cost $1,207,086
Base Fee $23,926
Sub-CLIN Total $1,231,012
Award Fee Pool $95,706
0015 Option
Accomplish USS BRIDGE Fee-Bearing Est Cost $ 6,575,747
(AOE 10) Defined Work *Cost of Money for
Package for the FY 98 Facilities Capital (FCOM) $72,039
Post Shakedown Availability Total CLIN Est Cost
(PSA) (Exclusive of Fee) $ 6,647,786
*Base Fee (Max 3% of
Fee Bearing Est Cost) $779,301
*Award Fee Pool $526,060
0015AB TYCOM Authorized Repairs Fee Bearing Est Cost$4,228,811
(See Section C) FCOM $ 45,350
Total Est Cost $4,274,160
Base Fee $ 84,576
Sub-CLIN Total $4,358,737
Award Fee Pool $ 338,305
0015AF NAVSEA Deferred Work Fee Bearing Est Cost $483,416
Items (SCN Funded) FCOM $ 5,490
(See Section C) Total Est Cost $488,906
Base Fee $9,668
Sub-CLIN Total $ 498,574
Award Fee Pool $___38,673
0015AG NAVSEA Post Delivery Fee Bearing Est Cost$1,863,520
Work Items (SCN Funded) FCOM $21,200
(See Section C) Total Est Cost $1,884,720
Base Fee $ 37,270
Sub-CLIN Total $1,921,990
Award Fee Pool $149,082
0016 Option
Accomplish FY 98 Fee-Bearing Est Cost $24,189
Advance Planning for *Cost of Money for
USS CAMDEN Facilities Capital (FCOM) $435
(AOE 2) FY 99 PMA (Exclusive of Fee) $24,623
*Base Fee (Max 3% of
Fee Bearing Est Cost) $484
*CLIN Total $25,107
*Award Fee Pool $ 1,935
0016AB Title "D" and "F" Fee Bearing Est Cost $20,157
SHIPALTS and Repairs Total Est Cost $20,159
Base Fee $ 403
Sub-CLIN Total $20,923
Award Fee Pool $ 1,613
0016AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,031
FCOM $ 72
Total Est Cost $ 4,104
Base Fee $ 81
Sub-CLIN Total $4,185
Award Fee Pool $323
0017 Option
Accomplish FY 98 Fee-Bearing Est Cost $ 24,111
Advance Planning *Cost of Money for
for USS RAINIER Facilities Capital (FCOM) $347
(AOE 7) FY 99 PMA Total CLIN Est Cost
(Exclusive of Fee) $24,459
*Base Fee (Max 3% of
Fee Bearing Est Cost) $482
*CLIN Total $24,941
*Award Fee Pool $1,929
0017AB Title "D" and "F" Fee Bearing Est Cost $20,093
SHIPALTS and Repairs FCOM $289
Total Est Cost $20,382
Base Fee $402
Sub-CLIN Total $20,784
Award Fee Pool $1,607
0017AC Title "K" SHIPALTS Fee Bearing Est Cost $4,019
FCOM $58
Total Est Cost $ 4,076
Base Fee $80
Sub-CLIN Total $4,157
Award Fee Pool $321
0018 FY 99 (OPTIONS) Fee-Bearing Est Cost $5,430,477
Accomplish Repair and *Cost of Money for
Alterations for USS Facilities Capital (FCOM) $55,427
CAMDEN (AOE 2) Total CLIN Est Cost
FY 99 PMA (Exclusive of Fee) $5,485,905
*Base Fee (Max 3% of
Fee Bearing Est Cost) $108,610
*CLIN Total $5,594,514
*Award Fee Pool $434,438
0018AB Title "D" and "F" Fee Bearing Est Cost$4,199,641
SHIPALTS and Repairs FCOM $44,372
Total Est Cost $4,244,013
Base Fee $ 83,993
Sub-CLIN Total $4,328,005
Award Fee Pool $ 335,971
0018AC Title "K" SHIPALTS Fee Bearing Est Cost$1,230,837
FCOM $ 11,056
Total Est Cost $1,241,892
Base Fee $ 24,617
Sub-CLIN Total $1,266,509
Award Fee Pool $98,467
0019 Option
Accomplish Repair and Fee-Bearing Est Cost $5,423,792
Alterations for USS *Cost of Money for
RAINIER (AOE 7) Facilities Capital (FCOM) $48,764
FY 99 PMA Total CLIN Est Cost
(Exclusive of Fee) $5,472,556
*Base Fee (Max 3% of
Fee Bearing Est Cost) $ 108,476
*CLIN Total $5,581,032
*Award Fee Pool $ 433,903
0019AB Title "D" and "F" Fee Bearing Est Cost$4,155,077
SHIPALTS and Repairs FCOM $ 39,037
Total Est Cost $4,194,115
Base Fee $ 83,102
Sub-CLIN Total $4,277,216
Award Fee Pool $332,406
0019AC Title "K" SHIPALTS Fee Bearing Est Cost$1,268,715
FCOM $ 9,726
Total Est Cost $1,278,441
Base Fee $25,374
Sub-CLIN Total $1,303,816
Award Fee Pool $ 101,497
0020 Option
Accomplish FY 99 Fee-Bearing Est Cost $24,111
Advance Planning for *Cost of Money for
USS SACRAMENTO Facilities Capital (FCOM) $330
(AOE 1) FY 00 PMA Total CLIN Est Cost
(Exclusive of Fee) $24,441
*Base Fee (Max 3% of
Fee Bearing Est Cost) $482
*CLIN Total $24,923
*Award Fee Pool $1,929
0020AB Title "D" and "F" Fee Bearing Est Cost $20,093
SHIPALTS and Repairs FCOM $275
Total Est Cost $20,368
Base Fee $402
Sub-CLIN Total $20,770
Award Fee Pool $1,607
0020AC Title "K" SHIPALTS Fee Bearing Est Cost $4,019
FCOM $55
Total Est Cost $4,074
Base Fee $80
Sub-CLIN Total $4,154
Award Fee Pool $321
0021 Option
Accomplish FY 99 Fee-Bearing Est Cost $24,111
Advance Planning for *Cost of Money for
USS BRIDGE Facilities Capital (FCOM) $319
(AOE 10) FY00 PMA Total CLIN Est Cost
(Exclusive of Fee) $24,430
*Base Fee (Max 3% of
Fee Bearing Est Cost) $482
*CLIN Total $24,913
*Award Fee Pool $1,929
0021AB Title "D" and "F" Fee Bearing Est Cost $20,093
SHIPALTS and Repairs FCOM $266
Total Est Cost $20,359
Base Fee $ 402
Sub-CLIN Total $20,760
Award Fee Pool $ 1,607
0021AC Title "K" SHIPALTS Fee Bearing Est Cost $4,019
FCOM $53
Total Est Cost $4,072
Base Fee $80
Sub-CLIN Total $4,152
Award Fee Pool $321
0022 Option
Accomplish FY 99 Fee-Bearing Est Cost $24,154
Advance Planning for *Cost of Money for
USS CAMDEN (AOE 2) Facilities Capital (FCOM) $304
FY00 DPMA Total CLIN Est Cost
(Exclusive of Fee) $24,458
*Base Fee (Max 3% of
Fee Bearing Est Cost) $483
*CLIN Total $24,941
*Award Fee Pool $1,932
0022AB Title "D" and "F" Fee Bearing Est Cost $20,128
SHIPALTS and Repairs FCOM $ 254
Total Est Cost $20,382
Base Fee $ 403
Sub-CLIN Total $20,784
Award Fee Pool $1,610
0022AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,026
FCOM $51
Total Est Cost $4,076
Base Fee $81
Sub-CLIN Total $4,157
Award Fee Pool $322
0023 Option
Accomplish Repairs and *Cost of Money for
Alterations for Facilities Capital (FCOM) $48,764
USS SACRAMENTO (AOE 1) Total CLIN Est Cost
FY00 PMA (Exclusive of Fee) $5,472,556
*Base Fee (Max 3% of
Fee Bearing Est Cost) $108,476
*CLIN Total $5,581,032
*Award Fee Pool $433,903
0023AB Title "D" and "F" FCOM $39,037
SHIPALTS and Repairs Total Est Cost $4,194,115
Base Fee $83,102
Sub-CLIN Total $4,277,216
Award Fee Pool $332,406
0023AC Title "K" SHIPALTS Fee Bearing Est Cost$1,268,715
FCOM $ 9,726
Total Est Cost $1,278,441
Base Fee $25,374
Sub-CLIN Total $1,303,816
Award Fee Pool $101,497
0024 Option
Accomplish Repair and Fee-Bearing Est Cost $5,429,246
Alterations for USS BRIDGE *Cost of Money for
(AOE 10) FY00 PMA Facilities Capital (FCOM) $48,140
Total CLIN Est Cost
(Exclusive of Fee) $5,477,387
*Base Fee (Max 3% of
Fee Bearing Est Cost) $108,585
*CLIN Total $5,585,972
*Award Fee Pool $434,340
0024AB Title "D" and "F" Fee Bearing Est Cost$4,199,262
SHIPALTS and Repairs FCOM $38,538
Total Est Cost $4,237,800
Base Fee $ 83,985
Sub-CLIN Total $4,321,786
Award Fee Pool $335,941
0024AC Title "K" SHIPALTS Fee Bearing Est Cost$1,229,984
FCOM $9,602
Total Est Cost $1,239,586
Base Fee $ 24,600
Sub-CLIN Total $1,264,186
Award Fee Pool $98,399
0025 Option
Accomplish Repair and Fee-Bearing Est Cost $8,791,867
Alterations for USS *Cost of Money for
CAMDEN (AOE 2) Facilities Capital (FCOM) $64,239
FY 00 DPMA Total CLIN Est Cost
(Exclusive of Fee) $8,856,107
*Base Fee (Max 3% of
Fee Bearing Est Cost) $175,837
*CLIN Total $9,031,944
*Award Fee Pool $703,349
0025AA Messing and Berthing Fee Bearing Est Cost$678,451
FCOM $201
Total Est Cost $678,652
Base Fee $13,568
Sub-CLIN Total $692,221
Award Fee Pool $ 54,276
0025AB Title "D" and "F" Fee Bearing Est Cost$6,912,082
SHIPALTS and Repairs FCOM $55,507
Total Est Cost $6,967,589
Base Fee $138,242
Sub-CLIN Total $7,105,831
Award Fee Pool $552,967
0025AC Title "K" SHIPALTS Fee Bearing Est Cost$1,201,334
FCOM $8,532
Total Est Cost $1,209,866
Base Fee $ 24,027
Sub-CLIN Total $1,233,892
Award Fee Pool $96,107
0026 Option
Accomplish FY 00 Fee-Bearing Est Cost $24,255
Advance Planning for *Cost of Money for
USS RAINIER Total CLIN Est Cost
(AOE 7) FY 01 DPMA (Exclusive of Fee) $24,548
*Base Fee (Max 3% of
Fee Bearing Est Cost) $485
*CLIN Total $25,033
*Award Fee Pool $1,940
0026AB Title "D" and "F" Fee Bearing Est Cost $20,212
SHIPALTS and Repairs FCOM $ 244
Total Est Cost $20,456
Base Fee $ 404
Sub-CLIN Total $20,861
Award Fee Pool $1,617
0026AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,042
FCOM $ 49
Total Est Cost $4,091
Base Fee $81
Sub-CLIN Total $ 4,172
Award Fee Pool $ 323
0027 Option
Accomplish FY 00 Fee-Bearing Est Cost $24,140
Advance Planning for *Cost of Money for
USS SACRAMENTO Facilities Capital (FCOM) $306
(AOE 1) FY 01 PMA Total CLIN Est Cost
(Exclusive of Fee) $24,445
*Base Fee (Max 3% of
Fee Bearing Est Cost) $483
*CLIN Total $24,928
*Award Fee Pool $1,931
0027AB Title "D" and "F" Fee Bearing Est Cost $20,116
SHIPALTS and Repairs FCOM $ 255
Total Est Cost $20,371
Base Fee $ 402
Sub-CLIN Total $20,774
Award Fee Pool $ 1,609
0027AC Title "K" SHIPALTS Fee Bearing Est Cost $ 4,023
FCOM $ 51
Total Est Cost $ 4,074
Base Fee $ 80
Sub-CLIN Total $ 4,155
Award Fee Pool $ 322
0028 Option
Accomplish Repair and Fee-Bearing Est Cost $8,795,584
Alterations for USS RAINIER *Cost of Money for
(AOE 7) FY 01 DPMA Facilities Capital (FCOM) $ 64,148
Total CLIN Est Cost
(Exclusive of Fee) $8,859,732
*Base Fee (Max 3% of
Fee Bearing Est Cost) $ 175,912
*CLIN Total $9,035,643
*Award Fee Pool $ 703,647
0028AA Messing and Berthing Fee Bearing Est Cost $678,463
FCOM $ 200
Total Est Cost $678,663
Base Fee $ 13,569
Sub-CLIN Total $692,232
Award Fee Pool $ 54,277
0028AB Title "D" and "F" Fee Bearing Est Cost$6,915,294
SHIPALTS and Repairs FCOM $ 55,427
Total Est Cost $6,970,721
Base Fee $ 138,306
Sub-CLIN Total $7,109,027
Award Fee Pool $ 553,224
0028AC Title "K" SHIPALTS Fee Bearing Est Cost$1,201,827
FCOM $ 8,520
Total Est Cost $1,210,347
Base Fee $ 24,037
Sub-CLIN Total $1,234,384
Award Fee Pool $ 96,146
0029 Option
Accomplish Repair and Fee-Bearing Est Cost $5,557,701
Alterations for *Cost of Money for
USS SACRAMENTO (AOE 1) Facilities Capital (FCOM) $ 42,403
FY 01 PMA Total CLIN Est Cost
(Exclusive of Fee) $5,600,104
*Base Fee (Max 3% of
Fee Bearing Est Cost) $ 111,154
*CLIN Total $5,711,258
*Award Fee Pool $ 444,616
0029AB Title "D" and "F" Fee Bearing Est Cost$4,256,966
SHIPALTS and Repairs FCOM $ 33,945
Total Est Cost $4,290,911
Base Fee $ 85,139
Sub-CLIN Total $4,376,051
Award Fee Pool $ 340,557
0029AC Title "K" SHIPALTS Fee Bearing Est Cost$1,300,735
FCOM $ 8,458
Total Est Cost $1,309,193
Base Fee $ 26,015
Sub-CLIN Total $1,335,207
Award Fee Pool $ 104,059
TOTAL FOR ALL CLINS Fee-Bearing Est Cost $71,338,037
Cost of Money for
Facilities Capital (FCOM) $ 656,754
Total CLIN Est Cost $71,994,791
Base Fee (Max 3% of Fee
Bearing Est Cost) $ 1,426,761
CLIN Total $73,421,552
Award Fee Pool $ 5,707,043
NOTE 1: EXERCISE OF OPTIONS - By written notice to the
Contractor, the Contracting Officer may exercise, if at all, any
of the Option Items identified in Section B and require the
Contractor to provide, within the performance period specified in
Section F, the work described in Section C for such Option
Item(s) at the estimated cost and base fee set forth in Section
B. The option(s) may be exercised after the Contractor's receipt
of the Specification Work Package prepared by the Planning
Supervisor in accordance with the procedures stated in Section C,
but in any event, the Option(s) shall be exercised, if at all,
within the time frames listed in Section I clause entitled
"Option For Increased Quantity -- Separately Priced Line Item"
(FAR 52.217-7).
* CLIN Totals shall be equal to the sum of all SUB-CLIN Totals.
The Maximum Base Fee of 3% is to be reduced by the Cost of Money
for Facilities Capital (FCOM), if proposed, up to 1% in
accordance with DOD FAR SUPPLEMENT 215.973. The Award Fee Pool
shall not exceed 10% minus the amount of the BASE FEE after
application of the OFFSET for FCOM.
The proposed AWARD FEE POOL shall equal at least 7% for all
offerors. AWARD FEE POOL can exceed 7% only if there is a
concomitant decrease in BASE FEE. Contractors are not allowed to
propose any separate limitation (or "cap") of AWARD FEE during
the performance of the contract under the clause in Section B
entitled "DETERMINATION OF FEE."
DOD FAR SUPPLEMENT 16.404-2(b) (71) requires that the amount of
base fee shall not exceed three percent (3%) of the Total Fee-
Bearing Estimated Cost of the contract.
Pursuant to FAR 15.903, the maximum fee (base fee plus award fee)
shall not exceed ten percent (10%) of the Total Fee-Bearing
Estimated Cost of the contract. The fee payable shall be the
base fee increased by an award fee determined by the Fee
Determination Official pursuant to
Section B clause entitled "DETERMINATION OF FEE".
The Government will make payments on account for the base fee
equal up to three percent (3%) (depending on Base Fee proposed)
of the amounts invoiced by the Contractor and payable for the
work performed in accordance with the clause of the Special
Provisions entitled "DETERMINATION OF FEE" and with the clause in
Section I entitled "ALLOWABLE COST AND PAYMENT".
In the event of discontinuance of work, the base fee shall be
redetermined by mutual agreement in accordance with the clause of
the General Provisions entitled "TERMINATION", and the
redetermined base shall equitably reflect the diminution of the
work performed. The amounts by which such redetermined base fee
is less than, or exceeds, payments previously made on account of
the base fee, shall be paid to or repaid by the contractor as the
case may be. In the event of discontinuance of the work, the
award fee otherwise payable shall be determined in accordance
with the clause of the Special Contract Requirements entitled
"AWARD FEE DETERMINATION IN EVENT OF TERMINATION OR
DISCONTINUANCE."
The Cost of Money for Facilities Capital is not a fee-bearing
cost under this contract. However, such amount is included in
the Total Estimated Cost for purposes of the "LIMITATION OF COST"
clause of this contract.
LIMITATION OF COST OR LIMITATION OF FUND (NAVSEA) (OCT 1990)
The "Limitation of Cost" (FAR 52.232-20) clause or the
"Limitation of Funds" (FAR 52.232-22) clause, as appropriate,
shall apply separately and independently to each separately
identified estimated cost.
DETERMINATION OF FEE
(a) Minimum Fee
The base fee, as set forth in Section B of this contract, shall
constitute a minimum fee to be paid for the performance of this
contract. The Base Fee shall be paid in accordance with FAR
clause 52.216-8, entitled Fixed Fee.
(b) Award Fee
In addition to the minimum (or base fee) to be paid hereunder,
the Contractor may earn an award fee, as determined by the Fee
Determining Official. The Government's purpose in granting an
award fee is to encourage and reward superior contracting effort
directed toward performance of this contract. The specifics for
evaluation are set forth in paragraphs that follow.
(c) Award Fee Board
The Contractor's performance evaluation for each period will be
conducted by an Award Fee Board (AFB) consisting of not more than
seven members consisting of:
(1) The Chairperson
(SUPSHIP Code 100 or designated representative)
(2) Administrative Contracting Officer
(SUPSHIP Code 400 or designated representative)
(3) TYCOM Representative
(4) NAVSEA Representative
(PMS 325 for PSAs)(PMS 335 for PMAs/DPMAs)
(5) SUPSHIP Code (To Be Determined)
(6) SUPSHIP Code (To Be Determined)
(7) SUPSHIP Code (To Be Determined)
(d) Fee Determining Official
The Fee Determining Official (FDO) for PMAs/DPMAs will be PMS
335, the Program Manager Surface Ship Program Office, and for
PSAs will be PMS 325, the Program Manager Combat Support Ships.
The FDO shall make determinations of the award fee due to the
Contractor based upon the performance evaluation conducted by the
Award Fee Board established pursuant to paragraph (c) above.
(e) Award Fee Determination and Reclama Procedures
(1) Within fifteen (15) working days after the end of each
evaluation period under the contract, the Contractor shall
furnish to the AFB such information as may be reasonably
required, including a statement of cost incurred, to assist the
AFB in evaluating the Contractor's performance during the
evaluation period.
(2) Within three (3) working days after the Award Fee meeting,
the AFB shall prepare the performance evaluation letter and
present it to the Fee Determining Official. A copy will be
provided to the Contractor upon transmittal to the FDO.
(3) Within six (6) working days from receipt of the copy of the
performance evaluation, the Contractor may submit to the FDO any
comments with respect thereto in support of his performance
during the period under consideration. This description shall
clearly identify specific evaluation categories, factors and
elements, and the Contractor's own rating thereof.
(4) Within six (6) working days from the receipt of the
Contractor evaluation comments, the FDO shall provide the
contracting officer a final performance evaluation and
determination of the award fee.
(5) Within three (3) working days from receipt of the final
determination, the SUPSHIP Contracting Officer shall notify the
Contractor in writing of that final determination.
(6) Within three (3) working days from the receipt of this
written notification, the Contracting Officer shall issue a
unilateral modification to the contract to provide for the award
fee.
(f) Finality of Fee Determination Official's Determination
Determinations of the Fee Determining Official with respect to
the amount of the award fee to be paid to the Contractor are
final and shall not be subject to the "DISPUTES" Clauses of this
contract.
(g) Evaluation Categories and Factors
The Contractor's performance during each evaluation period will
be judged in three categories, as listed below. For Advance
Planning CLINs, (1) Management and Schedule Performance; (2)
Technical Performance; and (3) Cost Performance. For Production
CLINs, (1) Schedule and Production Performance; (2)
Technical/Management Performance; and (3) Cost Performance. For
the first evaluation period, the category weighing factors will
be 33 percent, 33 percent and 34 percent, respectively. The
Contractor will be notified of changes in the evaluation
categories and factors as well as any adjustments to the weighing
of categories, if any, prior to commencement of each evaluation
period. Unsatisfactory performance under an award fee criterion
may result in an increased weighing for that factor in subsequent
evaluation period.
ADVANCED PLANNING:
(1) Management and Schedule Performance
(i) Apply knowledge of technical requirements, such as Class
Items, Trial Items, Ship Alteration Records (SARs), TP-05
material supplements, various NAVSEA/PERA planning letters, SARP,
identify material requirements, etc., in support of performing
shipchecks, preparing reports, developing drawings/test
memorandums and specifications, and procurement of material.
(ii) Report shipcheck results, document SHIPALT technical
deviations and configuration changes via Liaison Action Record
(LAR) format, and perform engineering calculations, such that
technical characteristics and changes can be evaluated.
(iii) Maintain and provide an advance planning progress
measurement system, such that periodic progress reports and an
effective recovery schedule for missed milestone dates is
submitted.
(iv) Delivery of technical and advance planning
documents/progress reports and cost proposal/estimates are
provided in accordance with Table C-1 milestones.
(2) Technical Performance
(i) Control the quality of drawings/test memoranda, work
specifications, support material recommendation list, and other
advance planning deliverables.
(ii) Development and quality of drawings, test memoranda, work
item specifications, and technical instructions to identify
document, and accomplish alteration and repairs will be
evaluated.
(iii) Evaluate problems and provide corrective actions
demonstrating a complete knowledge of engineering principles,
such that Supervisor can evaluate methods and solutions for job
accomplishment.
(iv) Respond and control technical details, such that required
ship configuration/system compatibility is maintained within the
ship class.
(v) Effectiveness in problem anticipation and/or problem
avoidance will be evaluated.
(vi) Responsiveness in issuing drawings, sketches, work item
specifications, technical instructions and similar documents
required by the Supervisor, and by the waterfront organization in
performing repairs and alterations will be evaluated. Use of
simple solutions and economic work methods for job accomplishment
will be considered. The number of milestones missed because of
deficient engineering and planning information will be
considered. The degree (cost) of rework caused by inadequate
contractor technical documentation/solutions to work requirements
will be considered.
(vii) Effectiveness in controlling all Government Property
(GFM/CFM) provided to or acquired by the Contractor, from initial
receipt through final disposition, will be evaluated.
(viii) Ability to select and effectively manage subcontractors
(i.e., material vendors, and both off and on-site subcontractors)
will be evaluated. Control over the quality of their work, their
adherence to schedule, and their timely and reasonable response
to the pricing of contract changes will be considered.
(ix) Effectiveness in fulfilling the in-process quality
assurance and test program will be evaluated. Also, completeness
in identifying and correcting quality deficiencies and their
causes in a timely manner will be considered.
(3) Cost Performance
(i) Effectiveness in providing complete cost estimates and cost
proposals as established in Table C-1.
(ii) Effectiveness in providing reasonable cost estimates and
proposals for negotiating a fair and reasonable price for the
work to be accomplished.
(iii) Effectiveness in early identification of cost problems
and in dealing with identified problems will be evaluated.
Emphasis will be placed on the Contractor's ability to maintain
the initial budgets by making appropriate cost effective
decisions.
PRODUCTION:
(1) Schedule and Production (Manpower Utilization Performance)
(i) Effectiveness in establishing and maintaining a timely and
efficient scheduling system will be evaluated. Particular
emphasis will be placed on establishment and timely updating of a
scheduling system that properly integrates Contractor material,
Government furnished material, planning and production labor,
including subcontractor effort, into cost effective planning and
accomplishment of availabilities.
(ii) Effectiveness in measuring schedule progress, using
preplanned milestones and critical paths, will be evaluated.
Communications with the Supervisor, regarding appraisal of
performance related to critical paths, will be considered.
(iii) Effectiveness in meeting preplanned milestones will be
evaluated. Particular consideration will be given to the
contractor's ability to maintain adequate progress in
anticipation of completion of milestones.
(iv) Effectiveness in the recovery from and in the correction
of causes leading to missed events will be evaluated.
(v) Effectiveness of manpower utilization, to meet planning and
production schedules, will be evaluated. This may include such
items as methods and procedures to reduce the amounts of premium
time used, to minimize time lost on the job and between
personnel. The Contractor's effectiveness in stabilization of
overhead rates, will be considered.
(vii) In addition to the above, any special or innovative cost
control avoidance initiatives will be considered.
(2) Technical/Management Performance
(i) Effectiveness of the management organization in problem
anticipation and/or problem avoidance of, as well as
implementation of timely corrective action in problem areas which
could impact good quality of on time completion of
availabilities, will be evaluated. Consideration will be given
to the prevention of schedule slippage or cost escalation through
the use of budgeting techniques and regular management reviews of
job techniques, material selection, subcontractor utilization and
manpower loading.
(ii) Effectiveness of the engineering and planning organization
in the assimilation and effectiveness utilization of advance
planning technical direction and guidance such as NAVSEA/PERA
advance planning letters, SAR, SID, material data, SARP, etc.,
in the orderly accomplishment of the advance planning function
for availabilities assigned will be evaluated. The ability to
schedule, monitor, and produce specifications, drawings, data and
other engineering products which present practical engineering
solutions based upon tradeoffs between total costs, reliability,
maintainability and productability will be considered. The cost
effective and timely production of those advance planning
products, whether deliverables under the contract or required for
the contractor's internal production planning, will be
considered.
(iii) Responsiveness of the engineering and planning
organization in issuing drawings, sketches, work item
specifications, technical instructions and similar documents
required by the Supervisor and by the waterfront organization in
performing repairs and alterations, will be evaluated. Use of
simple solutions and economic work methods for job accomplishment
will be considered. The number of jobs held up for lack of
engineering information, and rapidity with the which waterfront
engineering problems are resolved, will be considered. The
degree (cost) of rework caused by inadequate contractor technical
documentation/solutions to work requirements will be considered.
(iv) Responsiveness of the purchasing organization in obtaining
and providing parts, material and equipment necessary to maintain
waterfront schedules, will be evaluated. Factors such as: the
number of jobs held up because of lack of material; cost savings
obtained through the use of economic purchasing techniques (i.e.,
procurement options or multi-unit purchases, where appropriate);
and the avoidance of expenditures on such things as premium
transportation costs will be considered. The selection of cost
effective materials, when several approved options exist, will be
considered.
(v) Effectiveness of the material control organization in
controlling all Government property (GFM/CFM) provided to or
acquired by the contractor, from initial receipt through final
disposition, will be evaluated. Factors such as acquisition,
receipt inspection, storage, safeguarding, handling, preventive
maintenance, subcontractor control, record keeping, utilization,
disposition and inventory control of all Government property,
including salvage, interferences, scrap and excess property, will
be considered.
(vi) Ability of the Contractor to select and effectively manage
his subcontractors (i.e., material vendors and both off- and on-
site sub-contractors) will be evaluated. Control over the
quality of their work, their adherence to schedule, and their
timely and reasonable response to the pricing of contract changes
will be considered. The number of jobs held up for the vendor
provided material and delays caused by off- or on-site
subcontractors will also be considered.
(vii) Effectiveness of Contractor utilization of Government-
Furnished Information (GFI) will be evaluated. The Contractor
will be judged on his effectiveness in detecting consequential
technical errors in GFI prior to production, and on his
effectiveness in working with the Supervisor to resolve such
problems before they have any adverse cost impact. The
Contractor will be judged on his ability to apply GFI to his
engineering of work, and his use of GFI in installation, test,
and checkout of completed work.
(viii) Effectiveness of the quality assurance and test
organization in fulfilling the in-process as well as the at-
completion quality requirements of the contract will be
evaluated. Effectiveness of the quality assurance and test
organization in identifying and correcting quality deficiencies
and their causes in a timely manner will be considered. The
contractor's management approach to fulfilling the quality
requirements of the contract and as-found testing requirements
will also be considered.
(ix) The timely submission of condition reports by the
Contractor, his cooperation in negotiation of changes, and his
willingness to provide information needed by the Government for
timely negotiations will be evaluated.
(x) Effectiveness of repairs and alterations, as indicated by
completeness of the work, minimum number of post-repair
deficiencies and satisfactory completion of post-repair tests
with little or no rework and retest in the period during which
sea trials occur, will be evaluated. Quality of work will also
be indicated by the number of and extent of the sea trial
deficiencies, to be corrected. Particular attention will be
given to control of metal joining processes (aluminum welding,
silver brazing, and high strength steel welding) and the
Contractor's ability to maximize use of equipment and parts
standard to the class.
(xi) Effectiveness of the Contractor's care and preservation in
installed, removed, and new equipment and material will be
evaluated. Particular emphasis will be placed on the
effectiveness of the Contractor's effort to exclude foreign
substances from open equipment, hydraulic system cleanliness, and
the like.
(xii) Effectiveness of Contractor's effort to prevent excessive
build up and to keep compartments, passageways, docks, etc.,
clear of trash, debris, extraneous material and the like, in
compliance with Navy and OSHA regulations, will be evaluated.
(xiii) Responsiveness, timeliness and effectiveness of the
Contractor's accomplishment of non-scheduled emergent work,
outside of scheduled availability periods, will be evaluated.
(xiv) In addition to the above, any special or innovative cost
control and cost avoidance initiatives, will be considered.
(3) Cost Performance
(i) Effectiveness in establishing and meeting a cost
performance plan which is representative of the actual work
accomplished will be evaluated.
(ii) Effectiveness in identification of potential and actual
cost problems and in taking appropriate and timely action to
maintain budget or minimize unavoidable cost increases will be
evaluated. Consideration will be given to timely and accurate
submission of cost reports which reflect realistic projected end
cost and which include accurate identification of causes and
action taken on cost variances.
(iii) Effectiveness in taking action to control both direct and
indirect expenses in order to avoid unnecessary costs will be
evaluated. Emphasis will be placed on ability to estimate
correctly the first time, ability to make cost effective
decisions with respect to technical requirements, schedule, and
quality control, measures taken to obtain reasonable and
effective prices for subcontractors, budgeting and controlling
overhead expenses, etc.
(iv) The Contractor's use of Facilities Cost of Money to
acquire capital investments that enhance productivity and thus
provide cost savings will be evaluated.
(h) Evaluation Periods/Award Fee Pool
(1) The Evaluation Board will evaluate the contractor's
performance on accomplishment of Advance Planning line item(s),
Repair and Alteration line item(s) and related provisioning
actions associated with each availability. The Evaluation Board
will also evaluate the contractor's performance on accomplishment
of Non-Scheduled Repair and Alteration Requirement line item(s)
and related provisioning actions ordered between each
availability by the ACO.
(2) The formal award fee evaluation will take place
approximately seventy-five (75) days after completion of the
availability. The actual award fee amount will be determined by
the formal award fee process.
(3) Specific Award Fee Pool values will be made available by the
ACO after award and/or exercise of option(s).
(4) The first evaluation period of the contract shall be:
Period 1: Contract Award through completion of the first
availability.
5) The basis for award fee, subsequent evaluation periods, and
award fee pools will be provided by contract modification at the
time of exercise of the line item option for that fiscal year.
(i) Performance Ratings
(1) In evaluating contractor performance, the following
numerical ratings will be used:
OUTSTANDING 94-100
The Contractor's performance exceeds all requirements by a
substantial margin. There are no significant rework areas,
equipment failures, or cost attributable to the Contractor. Any
areas cited for improvement are not significant.
SUPERIOR 80-93
The Contractor's performance exceeds overall performance
requirements. The evaluator may cite one or more areas for
improvements, but they are substantially offset by better
performance in other areas.
SATISFACTORY 65-79
The Contractor's performance meets most but not all requirements.
The are several areas for improvement, but they are offset by
better performance in other areas. This level of achievement
would be the norm for completion of an availability, having
minimal Government- directed changes, on schedules with
reasonable quality and cost.
MARGINAL 41-64
The content and quality of performance are close to being overall
satisfactory, but the areas for improvement are significant or
numerous that overall performance is considered less than
normally expected.
UNSATISFACTORY 0-40
The Contractor's performance is such that is has had or will have
an adverse impact on the program.
(2) The relationship of the percent of award fee pool to be paid
for each contract line item evaluated (subject to the
determination of the Fee Determining Official) to the performance
rating will be as follows:
Performance Rating Percent of Award Fee Pool
0 - 40 0
41 - 100 (Rating - 40) x 100
60
(3) A performance rating of 40 or below is deemed
unsatisfactory. The contractor is not entitled to any award fee
for a rating of 40 or below.
(j) Maximum Fee
In no event shall the total fee (base fee plus award fee) under
this contract exceed 10 percent of the total estimated cost.
(k) Payment of Award Fee
The Contractor shall be paid award fee, if any, upon submittal of
a proper invoice or voucher to the cognizant payment office,
together with a copy of the unilateral modification to the
contract authorizing payment of award fee for the applicable
evaluation period. The Contractor's invoice shall show the
amount of award fee payable to each sub-line item, which shall be
directly proportionate to the amount or allowable Estimated Cost
(exclusive of base fee and FCOM) incurred by the Contractor
during the Evaluation Period. The Contractor's invoice must cite
the appropriate accounting data in order for payment to be
affected.
CONTRACTOR BILLING (COST, FPI) (NAVSEA) (OCT 1990)
Invoices/vouchers (not requests for progress payments) submitted
by the Contractor shall identify the specific accounting
classification cited in this contract. The Contractor shall
sibmit invoices/vouchers by Contract Line Item (CLIN), Contract
Subline Item (SLIN), and ACRN level as identified on the Fiancial
Accounting Data Sheet(s) attached to this contract. To the
extent reasonably feasible, costs of performance of this contract
shall be segregated, accumulated, and invoiced to the appropriate
ACRN categories listed on the Financial Accouting Data Sheet(s).
When it is not feasible with respect to invoices/vouchers
submitted for CLINs/SLINs with more than one ACRN, an allocation
ratio shall be established in the same ratio as the obligations
cited in the accounting data so that invoices/vouchers will
allocate costs to the ACRN level on a proportionate basis.
Invoices/vouchers submitted to the paying office that do not
identify billing amounts by the ACRN level will be returned to
the Contractor for proper identification.
LIMITATION OF INDIRECT COST RATES (NAVSEA) (OCT 1990) DELETED
NOTE: Any rates that the Contractor decides to cap are solely at
the Contractor's risk and are NOT subject to renegotiation based
on the Government's decision to exercise any, all or no option(s)
under this or any other Phased Maintenance (PMP) Contract.
PROVISIONING TECHNICAL DOCUMENTATION -- WITHHOLDING OF PAYMENT
(NAVSEA) (SEP 1990)
(a) The PTD is considered to be a part of the "Technical Data"
specified to be delivered under this contract for the purposes of
the "TECHNICAL DATA -- WITHHOLDING OF PAYMENT" (DFARS 252.227-
7030) clause. The terms and conditions of the clause entitled
"LIMITATION ON WITHHOLDING OF PAYMENTS" (FAR 52.232-9), if
included in this contract, shall not apply to withholding of
payment for failure to make timely delivery of the PTD or
delivery of deficient PTD.
TRAVEL COSTS (NAVSEA) (MAY 1993)
(a) The Contractor shall not charge, and the Government shall
not pay, as an allowable cost under this contract, any manhour
costs (whether straight-time or overtime) for Contractor
personnel or subcontractor personnel traveling to or from
worksites, including travel to worksites other than the
Contractor's facility for performance of contract work.
(b) Workers being paid under this contract, as prime contractor
personnel or subcontractor personnel, will complete a full shift
at the worksite, and no compensation will be paid for travel time
before or after the shift.
(c) This requirement pertains only to payments for travel time
before or after these workers' regular shifts, and does not apply
to legitimate travel costs incurred during normal working hours,
provided that those costs are otherwise reasonable, allocable and
allowable. This requirement does not apply to manufacturer's
representatives or Original Equipment Manufacturer (OEM)
representatives when specifically required by the Government work
specifications.
(d) Additionally, the Contractor shall not charge, and the
Government shall not pay, any transportation costs under this
contract associated with transporting Contractor or subcontractor
personnel between the Contractor's facility (or subcontractor's
facility), and any other worksite to perform Phased Maintenance
Availabilities (PMAs)/Drydocking Phased Maintenance
Availabilities (DPMAs)/Post Shakedown Availabilities (PSAs).
Transportation costs include, but are not limited to, bus fare,
car fare, train fare, or boat fare, paid by the work force, or
paid by the Contractor on behalf of the work force.
SECTION C
DESCRIPTION/SPECIFICATION/WORK STATEMENT
C.I CLIN DESCRIPTION
The Contractor, under the direction of the Supervisor of
Shipbuilding, Conversion and Repair, USN, Puget Sound,
Washington, (hereinafter referred to as the "Supervisor"), and as
an independent Contractor and not as an agent of the Government,
shall furnish the material, services, and facilities (except
those furnished by the Government under express provisions of
this contract) necessary for the accomplishment of the following
work:
FY 96
ITEM 0001 ACCOMPLISH FY 96 PROCUREMENT OF LONG LEAD TIME MATERIAL
(LLTM) FOR USS CAMDEN (AOE 2) FY 97 PMA
1.1 SCOPE
The Contractor is required to provide the necessary management,
technical and facility resources to procure, receive and store
Long Lead Time Material (LLTM) in support of TYCOM Repairs and
Title D/F ShipAlts. The Supervisor shall provide a list of
authorized LLTM upon award of the contract. The government
provided estimate for this level of effort is 100 mandays.
ITEM 0002 ACCOMPLISH NON-SCHEDULED REPAIR AND ALTERATION
REQUIREMENTS BETWEEN SCHEDULED AVAILABILITIES
1.2 SCOPE
a. GENERAL. The Contractor shall furnish such supplies or
services related to emergent type work which cannot be
accommodated in scheduled availabilities, repair or alteration
work as may be ordered by the Government in accordance with the
procedures specified herein. Notwithstanding any contrary
provision in any document referred to in subparagraph (d) below,
the Contractor shall not begin work on these supplies or services
prior to the placement of orders therefore by the Administrative
Contracting Officer (ACO). The Government reserves the right to
order these supplies and services elsewhere at its discretion.
b. ORDERS.
(I) Orders (or revisions thereto) for supplies or services
hereunder will be placed by the ACO (on the basis of funded
requisitions to be supplied by the cognizant Requiring Activity)
in the form of modifications (unilateral or bilateral) to this
contract. The Contractor shall comply with orders only when so
made. (To the maximum extent possible, such orders will be made
by bilateral modifications to the contract which are fully priced
and contain definitive delivery schedules.)
(II) In the event the ACO determines that time does not permit
negotiation of a bilateral modification, a unilateral
modification will be issued by the ACO which will specify a
dollar limitation (see paragraph (c) below) and a desired
delivery schedule for the supplies or services ordered together
with a detailed description of the supplies or services to be
furnished and a statement of the cost and pricing data required
to be furnished. Price (estimated cost and fee) and delivery
schedule will later be the subject of a bilateral modification to
be executed on behalf of the Government by the ACO. To this end,
the Contractor shall submit a price (estimated cost and fee)
proposal, in the number of copies requested by the ACO, no later
than ten (10) days after receipt of each unilateral modification
or as soon as practicable thereafter, but in any event before
costs equal to twenty (20) percent of the dollar limitation have
been incurred. (The unilateral modification shall not be used
for end item billing purposes for delivered items under this
contract.) Failure to agree on a bilateral modification for any
unilateral order shall be considered a dispute within the meaning
of the "Disputes" Clause.
c. Limitation of Obligations with Respect to Orders not Finally
Priced. The Contractor shall commence work upon receipt of any
unilateral modification to this contract. If at any time the
contractor has reason to believe that the price (estimated cost
and fee) of an order placed hereunder will exceed the dollar
limitation (ceiling price) established by the ACO in a unilateral
modification, the Contractor shall so notify the ACO in writing
and propose an appropriate increase. Within ten (10) days of
such notice, the ACO will either (i) notify the Contractor in
writing of such appropriate increase, or (ii) instruct the
Contractor how and to what extent the work shall be continued;
provided, however, that in no event shall the contractor be
obligated to proceed with work on a unilateral modification
beyond the point where his cost plus a reasonable profit (fee)
hereon exceed the dollar limitation, and provided also that in no
event shall the Government be obligated to pay the Contractor any
amount in excess of the dollar limitation specified in any
unilateral modification placed pursuant to paragraph (b) above.
d. Applicable Documents. All documents invoked form a part of
this SOW to the extent specified herein. Where written approval
to streamline requirements has not been received from the
Government, the full intent of all documents referenced in the
SOW shall apply. Military specifications and standards listed in
reference documents are considered second tiered documents and
are to be considered as guidance only for implementing the tasks.
The support document applicable to ordering the supplies or
services hereunder is as follows:
MIL-STD-1388-1A Logistics Support Analysis
e. Terminal Date for Placement of Orders. The Contractor shall
not be obligated to accept any orders placed hereunder beyond 180
days after delivery of the last end item.
ITEM 0003 PROVISIONED ITEMS ORDERS - ALTERNATE I (NAVSEA) (MAY
1993)
1.3 SCOPE
(a) General. The Contractor agrees that it will furnish the
supplies or services ordered by the Government in accordance with
the procedures specified herein. Orders will be placed by the
Contracting Officer, Provisioning Activity or Administrative
Contracting Officer as unilateral or bilateral modifications to
this contract on SF 30, Amendment of Solicitation/Modification of
Contract. Any amounts shown in Section B at time of award of the
initial contract for each provisioned line item are estimated
amounts only and are subject to upward or downward adjustment by
the issuing activity. If no amounts are shown, funding will be
obligated before or at time of order issuance. It is understood
and agreed that the Government has no obligation under this
contract to issue any orders hereunder.
(b) Priced Orders. For each proposed order, the Contractor
agrees that it will submit a signed SF 1411 (Contract Pricing
Proposal) or such other cost or pricing data as the Contracting
Officer may require. Promptly thereafter, the Contractor and the
Contracting Officer shall negotiate the price and delivery
schedule for the proposed order. Upon execution and receipt of
the priced order, the Contractor shall promptly commence the work
specified in the order.
(c) Undefinitized Orders. Whenever the Contracting Officer
determines that urgent demands or requirements prevent the
issuance of a priced order, he/she may issue an unpriced order.
Such order may be unilateral or bilateral and shall establish a
limitation of Government liability, a maximum ceiling amount, and
a schedule for definitization, as described in subparagraph
(e)(2) below. Upon request the Contractor shall submit a maximum
ceiling amount proposal before the undefinitized order is issued.
The maximum ceiling amount is the maximum price at which the
order may be definitized. The Contractor shall begin performing
the undefinitized order upon receipt, except as provided in
paragraph (d) below. The clause entitled "PRICE CEILING" (DFARS
252.217-7027) shall be included in any undefinitized order.
(d) Undefinitized Unilateral Orders.
(1) For a unilateral undefinitized order, the Contractor shall
within ten calendar days of receipt of the order notify the
Contracting Officer in writing if it takes exception to the
ceiling amount and/or the delivery schedule and shall propose a
revised ceiling amount and/or a revised delivery schedule at that
time. For unilateral undefinitized orders to which the
Contractor takes no exception, the Contractor is obligated to
perform just as if it were a fully definitized order.
(2) After receipt of the Contractor's proposal to establish the
revised ceiling amount and/or the revised delivery schedule, the
Contracting Officer shall: (1) adjust the ceiling amount and/or
the delivery schedule; (2) advise the Contractor that the order
will be adjusted in a different amount than proposed by the
Contractor; or (3) advise the Contractor that no adjustment will
be made. In the event the Contractor has taken exception to the
ceiling amount and/or the delivery schedule and has submitted a
timely proposal in accordance with the preceding requirement and
the Contracting Officer has not accepted the Contractor's
proposal, the Contractor shall not be obligated to perform the
order beyond the point at which it would be entitled to be
compensated in an amount in excess of the Government's limitation
of liability contained in the unilateral order.
(e) Definitization of Undefinitized Orders.
(1) The Contractor agrees that following the issuance of an
undefinitized order, it will promptly begin negotiating with the
Contracting Officer the price and terms of a definitive order
that will include: (A) all clauses required by regulation on the
date of the order; (B) all clauses required by law on the date of
execution of the definitive order; and, (C) any other mutually
agreeable clauses, terms and conditions. No later than sixty (60)
days after the undefinitized order is issued, the Contractor
agrees to submit a cost proposal with sufficient data to support
the accuracy and derivation of its price; and, when required by
FAR, cost or pricing data, including SF 1411. If additional cost
information is available prior to the conclusion of negotiations,
the Contractor shall provide that information to the Contracting
Officer. The price agreed upon shall be set forth in a bilateral
modification to the order. In no event shall the price exceed
the maximum ceiling amount specified in the undefinitized order.
(2) Each undefinitized order shall contain a schedule for
definitization which shall include a target date for
definitization and dates for submission of a qualifying proposal,
beginning of negotiations and, if appropriate, submission of make-
or-buy and subcontracting plans and cost or pricing data.
Submission of a qualifying proposal in accordance with the
definitization schedule is a material element of the order. The
schedule shall provide for definitization of the order by the
earlier of:
(i) a specified target date which is not more than 180 days
after the issuance of the undefinitized order. However, that
target date may be extended by the Contracting Officer for up to
180 days after the Contractor submits a qualifying proposal as
defined in DFARS 217.7401; or
(ii) the date on which the amount of funds expended by the
Contractor under the undefinitized order exceed fifty percent
(50%) of the order's maximum ceiling amount, except as provided
in subparagraph (f)(3) below.
(3) If agreement on a definitive order is not reached within the
time provided pursuant to subparagraph (e)(2) above, the
Contracting Officer may, with the approval of the Head of the
Contracting Activity, determine a reasonable price in accordance
with Subpart 15.8 and Part 31 of the FAR, and issue a unilateral
order subject to Contractor appeal as provided in the "DISPUTES"
clause (FAR 52.233-1). In any event, the Contractor shall
proceed with completion of the order, subject to the "LIMITATION
OF GOVERNMENT LIABILITY" clause (FAR 52.216-24).
(f) Limitation of Government Liability.
(1) Each undefinitized order shall set forth the limitation of
Government liability, which shall be the maximum amount that the
Government will be obligated to pay the Contractor for
performance of the order until the order is definitized. The
Contractor is not authorized to make expenditures or incur
obligations exceeding the limitation of Government liability set
forth in the order. If such expenditures are made, or if such
obligations are incurred, they will be at the Contractor's sole
risk and expense. Further, the limitation of Government
liability shall be the maximum Government liability if the order
is terminated. The "LIMITATION OF GOVERNMENT LIABILITY" clause
shall be included in any undefinitized order.
(2) Except for undefinitized orders for Foreign Military
Sales; purchases of less than $25,000; special access programs;
and Congressionally-mandated long-lead procurements; and except
as otherwise provided in subparagraph (f)(3) below, the
limitation of Government liability shall not exceed fifty percent
(50%) of the ceiling amount of an undefinitized order. In the
case of orders within these excepted categories, however, the
procedures set forth herein shall be followed to the maximum
extent practical.
(3) If the Contractor submits a qualifying proposal (as
defined in DFARS 217.7401) to definitize an order before the
Contractor has incurred costs in excess of fifty percent (50%) of
the ceiling amount, the Contracting Officer may increase the
limitation of Government liability to up to seventy-five percent
(75%) of the maximum ceiling amount or up to seventy-five percent
(75%) of the price proposed by the Contractor, whichever is less.
(4) If at any time the Contractor believes that its
expenditure under an undefinitized order will exceed the
limitation of Government liability, the Contractor shall so
notify the Contracting Officer, in writing, and propose an
appropriate increase in the limitation of Government liability of
such order. Within thirty (30) days of such notice, the
Contracting Officer will either (i) notify the Contractor in
writing or such appropriate increase, or (ii) instruct the
Contractor how and to what extent the work shall be continued;
provided, however, that in no event shall the Contractor be
obligated to proceed with work on an undefinitized order beyond
the point where its costs incurred plus a reasonable profit
thereon exceed the limitation of Government liability, and
provided also that in no event shall the Government be obligated
to pay the Contractor any amount in excess of the limitation of
Government liability specified in any such order prior to
establishment of firm prices.
(g) Initial Spares. The limitations set forth in paragraph (c)
and subparagraphs (e)(2), (f)(2) and (f)(3) do not apply to
undefinitized orders for the purchase of initial spares.
(h) All documents invoked form a part of this SOW to the
extent specified herein. Where written approval to streamline
requirements has not been received from the Government, the full
intent of all documents referenced in the SOW shall apply.
Military specifications and standards listed in reference
documents are considered second tiered documents and are to be
considered as guidance only for implementing the tasks. The
following Military Standards apply to all orders:
MIL-STD-1388-1A Logistic Support Analysis Record
MIL-STD-1388-2B DoD Requirements for a Logistic Support Analysis
Record
(i) Terminal Date for Placement of Orders. The Contractor shall
not be obligated to accept any orders placed hereunder beyond 180
days after delivery of the last end item.
(j) Segregation of Costs. The Contractor shall segregate the
costs of performance of each undefinitized order from the cost of
any other work performed by the Contractor.
(k) Ordering. The cognizant ordering activities are designated
below:
Supervisor of Shipbuilding,
Conversion and Repair, USN
2802 Wetmore Ave.
Suite 500
Everett, WA 98201-3518
ITEM 0004 DATA FOR ITEM 0001 AND IF OPTIONS ARE EXERCISED,
ITEMS 0008 THROUGH 0029.
1.4 SCOPE
The data to be furnished hereunder shall be prepared and
delivered in accordance with Contract Data requirement List
(CDRL), DD Form 1423, Exhibit "A" attached hereto. The CDRL,
attached as Exhibit "A" forms a part of the schedule of this
solicitation.
ITEM 0005 PROVISIONING TECHNICAL DOCUMENTATION FOR ITEMS 0001
AND 0002 AND IF OPTION(S) ARE EXERCISED, ITEMS 0008 THROUGH 0029.
1.5 SCOPE
The Provisioning Technical Documentation (PTD) shall be in
accordance with the NAVSEA Statement of Work for Provisioning
Technical Documentation Requirements dated January 1990
(Attachment J-2), the Provisioning Performance Schedule and the
Contract Data Requirements List (CDRL), DD Form 1423, Exhibit "B"
attached hereto.
ITEM 0006 DATA FOR ITEM 0002
1.6 SCOPE
The data to be furnished hereunder shall be prepared and
delivered in accordance with Contract Data requirement List
(CDRL), DD Form 1423, Exhibit "C" attached hereto. The CDRL,
attached as Exhibit "C" forms a part of the schedule of this
solicitation.
ITEM 0007 MESSING AND BERTHING
1.7 SCOPE
For periods other than CNO scheduled DPMAs, the Contractor shall
furnish such supplies or services related to messing and berthing
facilities for ships crew as may be ordered by the Government.
FY 96 (OPTIONS)
ITEM 0008 (OPTION) ACCOMPLISH FY 96 ADVANCE PLANNING FOR USS
CAMDEN (AOE 2) FY 97 PMA
1.8 SCOPE
The Contractor is required to accomplish the FY 96 Advance
Planning functions for CAMDEN in accordance with the schedule of
TABLE C-1, including the design review of Government alteration
drawings, shipchecks to validate work specifications and
drawings, and other work necessary to prepare for the alteration
and repair of CAMDEN. These requirements include, but are not
limited to, the following:
a. Accomplish advance planning for the repair and alteration of
CAMDEN in accordance with work specifications, drawings, test
procedures and other detailed data provided by the Government.
The Contractor will be required to accomplish advance planning
functions, including development of specifications, design review
of Government alteration drawings, procurement of materials,
shipchecks, and other work necessary to prepare for repair and
alteration of the vessel. This work will be based on SHIPALT
authorization letters and on SARP, WDC and/or continuous
maintenance work authorized by the Port Engineer via the
Supervisor . (Note: For PSAs as authorized by PMS325 via the
Supervisor.) The specifications, cost proposals, and other data
developed by the Contractor in support of the basic work package,
as well as work specification references obtained from the
Planning Yard or other sources, shall be submitted to the
Supervisor not later than the date shown in TABLE C-1 for each
availability being planned.
b. Develop specifications for emergent work items
identified/tasked by the Supervisor. These specifications shall
be written in format similar to the basic specifications,
describing the additional work to be accomplished as defined by
the Supervisor, support by OPNAV Form 4790/2K's, 2L Drawings,
SARP line item specifications and other commonly used
documentation.
c. Prepare material ordering lists, develop engineering data
forms, submit Liaison Action Records, and correct engineering
drawings as authorized.
d. Identify, procure, receive and store authorized LLTM. When
authorized, and where practical and economical, the Contractor
shall procure, or arrange options for, multiship quantities of
identical materials.
e. Provide an integrated milestone plan for the advance
planning and procurement phases of the availability. These
milestones will include a schedule of key events necessary to
meet the contract delivery dates.
f. Develop and utilize a progress measurement system to
determine the physical progress of the advance planning and
procurement phases. The progressing system shall permit a direct
comparison of the physical progress of completed work to the
integrated milestone plan that is to be developed in subparagraph
1.8.e. above.
g. Apply stringent change control procedures to ensure timely
identification and incorporation of emergent work.
Emergent work is defined as work identified after provision of
the authorized SARP and/or Continuous Maintenance Package. All
emergent work will be classified as either "Growth Work" or "New
Work." Growth work will be related to a previously identified
work specification item. New work will not be related to any
previously authorized work specification item, and the work will
be assigned a new specification item number.
(1) GROWTH WORK
The anticipated amount of growth work will be estimated and
proposed by the Contractor at A-80 along with the proposal for
the work package. Through the end of each availability, the
Contractor shall prepare all growth work specifications in the
form of "Work Packages." Each package shall include work
operations, trade skills involved, material requirements,
estimated manhours by trades and schedule of which work is to be
completed. SUPSHIP Representatives and the Port Engineer will
review each work package when submitted, and authorization
proceed with the work will be provided by the SUPSHIP Project
Manager. (Note: For PSAs, SUPSHIP /NAVSEA PMS325 Representatives
will review each work package when submitted, and authorization
proceed with the work will be provided by the SUPSHIP Project
Manager.)
(2) NEW WORK
All new work specifications shall be written and/or approved by
SUPSHIP Representatives and the Port Engineer. (Note: For PSAs,
all new work specifications shall be written and/or approved by
SUPSHIP/NAVSEA PMS325 Representatives.) Upon receipt or approval
of a new work specification, the Contractor shall propose a
change in estimated cost and fee to be incorporated into Section
B. Authorization to proceed with new work will be granted only
by the Contracting Officer, only after the work has been priced,
and will be subject to the LIMITATION OF FUNDS CLAUSE.
h. Apply approved quality assurance procedures as required by
this contract and the associated specifications. Ensure that
procured material and performed engineering and production work
will achieve and maintain the required quality standards.
i. The Contractor cannot modify the basic design features of
the engineering data provided by the Government. If
modifications are deemed necessary by the Contractor, the
Contractor shall follow the Engineering Change Proposals and
Request for Deviations and Waivers procedures.
j. Work specifications shall be based on the SARP, WDC and/or
Continuous Maintenance results, and other data derived from
shipchecks and/or provided by the Supervisor using the Standard
Items, Standard Work Items (SWI) which are in effect on the date
of specification submission to the Supervisor for acceptance.
Specifications, created by the Contractor or reapplied from
previous program efforts, shall be examined prior to submission
to ensure applicability and compliance with requirements
specified herein. In preparing the specifications and in
accomplishing the work, it is mandatory that repairs be based on
actual material condition to the maximum extent possible. The
use of Class "B" repairs is to be minimized. Work specifications
shall be prepared and stored using ADP or word processing
techniques in order to minimize preparation or revision of
specifications for the same or similar work required for other
availabilities.
k. All required engineering and drafting modifications to
drawings and illustrative material shall be prepared to interpret
and define the repair and alterations to the ship. If tasked,
the contractor shall update Ship Selected Record Drawings (SSRDs)
in accordance with NAVSEAINST 4790.1A and the Fleet Modernization
Program (FMP) Management and Operations Manual (SL720-AA-MAN-
010).
l. Drawings, data and other work products shall be completely
and thoroughly checked and reviewed by the Contractor for
technical accuracy and compliance with provisions of
specifications and assignments to such an extent that checking
and detailed review by the technical personnel of SUPSHIP will
not be necessary. Any corrections to drawings or other work
products found necessary due to error or omission of the
Contractor shall be promptly accomplished by the Contractor.
m. All drawings and other data to be furnished shall be
reviewed and approved by the Contractor's Chief Design Engineer
prior to delivery to the Supervisor.
n. All drawings and other data developed by the Contractor
shall represent a practical engineering solution based on the
best trade-off between total cost, reliability, maintainability,
availability of material, labor skill and industrial capability,
state-of-the-art, and timely accomplishment of the task. The
design will meet the requirement of the General Specifications
for Ships and be presented on a format consistent with the
requirements of the references and instructions in force on the
start date of the work assignment. Maximum utilization of
existing "Class" drawings and Navy Standard Drawings will be
made. Redrawing or tracing in whole or in part of the existing
class or standard drawings will not be permitted unless
specifically authorized in writing by the Supervisor.
o. The Contractor shall be responsible for producing
interference-free, technically accurate drawings and shall be
responsible for calling to the attention of the Supervisor,
orally and in writing, any interface and interference problems.
p. The following documents or their subsequent revisions in
effect at time of contract award and/or option exercise, as well
as applicable current instructions, general specifications, type
plans, naval ship technical manuals and directives from the Naval
Sea Systems Command shall be used in the technical requirements
of work under the Contract:
MIL-STD-100E Engineering Drawing Practices
MIL-STD-881B Work Breakdown Structures for Defense Material
Items
MIL-STD-973 Configuration Management
MIL-STD-1388-1A Logistic Support Analysis
MIL-STD-1625C Safety Certification Program for Drydocking
Facilities and Shipbuilding Ways for U.S. Navy
Ships
MIL-D-5480F Data, Engineering and Technical, Reproduction
Requirements for
MIL-M-9868E Microfilming of Engineering Documents, 35MM,
Requirements for
MIL-T-31000 Technical Data Packages, General Specification for
MIL-M-38784C Manuals, Technical; General Style and Format
Requirements
MIL-I-45208A Inspection System Requirements
NAVAL INSTRUCTIONS
S9086-7G-STM-0000
NAVSHIPS Technical Manual Chapter 997, Docking Instructions and
Routine Work in Drydocks
NAVSEA 0900-LP-079-5010
Ship Repair Contracting Manual, Appendix 2-I NAVSEA Fleet
Modernization Program (FMP)
SL720-AA-MAN-010
Management and Operations Manual
NAVSEAINST 4790.1A
Expanded Ship Work Breakdown Structure (ESWBS) for Ships, Ship
Systems and Combat Systems
S9040-AA-IDX-010/SWBS
Expanded Ship Work Breakdown 5D VOL. 1 Structure for Ships,
Ships Systems and Combat Systems
S9040-AA-IDX-020/SWBS
Users Guide for the Expanded Ship
SWBS 5D VOL. 2
Work Breakdown Structure for Ships, Ship Systems and Combat
Systems
q. Submit a preliminary time and cost estimate for
accomplishment of the work listed in the preliminary SARP. This
information is for Government use during the Work Definition
Conference. The estimates shall be as accurate as practicable
and shall be provided after receipt of the preliminary SARP
and/or Continuous Maintenance Package in the following format:
ESTIMATED
ITEM TIME REQUIRED ESTIMATED ESTIMATED TOTAL COST
NO. CALENDAR DAYS MANDAYS MATERIAL COST (PRELIMINARY)
ITEM 0009 (OPTION) ACCOMPLISH FY 96 ADVANCE PLANNING FOR USS
RAINIER (AOE 7) FY 97 PMA
1.9 SCOPE
The Contractor shall accomplish the FY 96 Advance Planning
functions for RAINIER in accordance with the statement of work
for Line Item 0008.
FY 97 (OPTIONS)
ITEM 0010 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
CAMDEN (AOE 2) FY 97 PMA
1.10 SCOPE
The Contractor shall accomplish planning, document preparation,
engineering, procurement, prefabrication, shipyard production
work, and any other work necessary to prepare for and accomplish
the FY 97 Repair and Alteration of CAMDEN as specified herein.
These requirements include, but are not limited to, the
following:
a. Provide the management, technical, procurement, production,
test quality assurance and facility resources necessary to
prepare for and accomplish the repair and alteration of CAMDEN in
accordance with the requirements stated in this Section, the Work
Items Specifications (Section J), the Delivery Schedule specified
in Section F, and all other terms and conditions set forth in
this contract.
b. Accomplish planning and scheduling to ensure a rational,
integrated and timely plan for receipt, storage and installation
of Government Furnished Material as identified in work item
specifications, and for accomplishment of production work. A
critical path analysis (if required by the Supervisor for
particular work items) and a milestone schedule shall be used to
measure schedule accomplishment of the functions and elements
required to successfully complete the repair and alteration of
CAMDEN within the availability dates specified in Section F.
c. Develop Progress Measurement Systems to permit the
determination of the physical progress of completed work for each
of the elements in the scheduling plan, including material,
manpower, engineering, production, tests and trials. The
progress measurement system shall permit a direct comparison of
the physical progress of completed work to the planned
performance measurement baseline for each of the elements in the
scheduling system.
d. Establish management procedures and systems to identify
behind schedule conditions and unfavorable schedule variances,
using the scheduling systems performance measurement baseline and
the progress measurement systems. The applied systems and
procedures shall provide timely identification of scheduling
problem areas to permit prompt management action to correct
unsatisfactory conditions.
e. Apply stringent change control procedures to ensure timely
identification and incorporation of emergent work.
f. Prepare and submit in definitive form, a proposal for
accomplishment of emergent work. This proposal shall be
submitted within five working days after work identification in
accordance with the detailed requirements for emergent work
proposals and emergent work specifications detailed in DD Form
1423, CDRL, attached hereto.
g. The Navy intends that all basic and emergent work authorized
for the repair and alteration of the vessel be compatible with
the duration of the scheduled production accomplishment periods.
The Contractor agrees; therefore, to inform the Supervisor as
soon as practicable, but not later than as specified in paragraph
1.10.f of this Section, if it appears that any work items will
require a longer period.
h. The Contractor shall be responsible for producing
interference free, technically accurate drawings and shall be
responsible for calling to the attention of the Supervisor,
orally and in writing, any interface and interference problems.
i. Apply approved quality assurance procedures as required by
this contract and the associated specifications to ensure that
procured material and performed production work will achieve and
maintain the required quality standards.
j. The documents identified in 1.8.p or their subsequent
revisions in effect at time of contract award or option exercise
as well as applicable current instructions, general
specifications, type plans, naval ship technical manuals and
directives from the Naval Sea Systems Command, shall be used in
the technical requirements of work under the contract.
ITEM 0011 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
RAINIER (AOE 7) FY 97 PMA
1.11 SCOPE
The Contractor shall accomplish the repair and alteration of
RAINIER in accordance with the statement of work for Line Item
0010.
ITEM 0012 (OPTION) ACCOMPLISH FY 97 ADVANCE PLANNING FOR USS
SACRAMENTO (AOE 1) FY 98 DPMA
1.12 SCOPE
The Contractor shall accomplish the FY 97 Advance Planning
functions for SACRAMENTO in accordance with the statement of work
for Line Item 0008.
ITEM 0013 (OPTION) ACCOMPLISH FY 97 ADVANCE PLANNING, (DEFERRED
WORK, POST DELIVERY WORK, OR TYCOM FUNDED WORK) ENGINEERING,
MANAGEMENT AND MATERIAL PROCUREMENT SUPPORT FOR FY 98 USS BRIDGE
(AOE 10) PSA
1.13 SCOPE
The Contractor shall accomplish the FY 97 Advance Planning
functions for BRIDGE in accordance with the statement of work for
Line Item 0008. The Advance Planning Work work will be
categorized by NAVSEA via the supervisor as either Deferred Work
(0013AF), or for the correction of Government responsible defects
and deficiencies identified during trials (0013AG), or by the
Type Commander via the Supervisor (0013AB). NOTE: For this
solicitation, PSA Advance Planning shall be priced using the
following work items:
TYCOM Authorized Repairs (0013AB) 813-80-000
NAVSEA Deferred Work Items (0013AF) 813-90-000
NAVSEA Post Delivery Items (0013AG) 813-90-000
FY 98 (OPTIONS)
ITEM 0014 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
SACRAMENTO (AOE 1) FY 98 DPMA
1.14 SCOPE
The Contractor shall accomplish the repair and alteration of
SACRAMENTO in accordance with the statement of work for Line Item
0010. Also, the Contractor shall make certified drydocking
facilities available for accomplishment of work items below the
ship's waterline. In addition, the Contractor shall make messing
and berthing facilities for ships crew available for ship's force
use.
ITEM 0015 (OPTION) ACCOMPLISH USS BRIDGE (AOE 10) DEFINED WORK
PACKAGE FOR THE FY 98 POST SHAKEDOWN AVAILABILITY (PSA) (DEFERRED
WORK, POST DELIVERY WORK, OR TYCOM FUNDED WORK)
1.15 SCOPE
The Contractor shall accomplish planning, document preparation,
engineering, procurement, prefabrication, shipyard production
work, and any other work necessary to prepare for and accomplish
the FY 98 Repair and Alteration of BRIDGE as specified herein.
This planning and production work will be categorized by NAVSEA
via the supervisor as either Deferred Work (0015AF), or for the
correction of Government responsible defects and deficiencies
identified during trials (0015AG), or by the Type Commander via
the Supervisor (0015AB). Note: For the purposes of this
solicitation, PSA Production shall be priced using the following:
TYCOM Authorized Repairs (0015AB) - All AB CLIN PMA Notional
Work Items
NAVSEA Deferred Work Items (0015AF) - AF CLIN Notional Work Items
Only
NAVSEA Post Delivery Items (0015AG) - The Government
provided estimate for this effort is 5000 mandays, $400,000
material.
These requirements include, but are not limited to, the
following:
a. Provide the management, technical, procurement, production,
test quality assurance and facility resources necessary to
prepare for and accomplish the repair and alteration of BRIDGE in
accordance with the requirements stated in this Section, the Work
Items Specifications (Section J), the Delivery Schedule specified
in Section F, and all other terms and conditions set forth in
this contract.
b. Accomplish planning and scheduling to ensure a rational,
integrated and timely plan for receipt, storage and installation
of Government Furnished Material as identified in work item
specifications, and for accomplishment of production work. A
critical path analysis (if required by the Supervisor for
particular work items) and a milestone schedule shall be used to
measure schedule accomplishment of the functions and elements
required to successfully complete the repair and alteration of
BRIDGE within the availability dates specified in Section F.
c. Develop Progress Measurement Systems to permit the
determination of the physical progress of completed work for each
of the elements in the scheduling plan, including material,
manpower, engineering, production, tests and trials. The
progress measurement system shall permit a direct comparison of
the physical progress of completed work to the planned
performance measurement baseline for each of the elements in the
scheduling system.
d. Establish management procedures and systems to identify
behind schedule conditions and unfavorable schedule variances,
using the scheduling systems performance measurement baseline and
the progress measurement systems. The applied systems and
procedures shall provide timely identification of scheduling
problem areas to permit prompt management action to correct
unsatisfactory conditions.
e. Apply stringent change control procedures to ensure timely
identification and incorporation of emergent work.
f. Prepare and submit in definitive form, a proposal for
accomplishment of emergent work. This proposal shall be
submitted within five working days after work identification in
accordance with the detailed requirements for emergent work
proposals and emergent work specifications detailed in DD Form
1423, CDRL, attached hereto.
g. The Navy intends that all basic and emergent work authorized
for the repair and alteration of the vessel be compatible with
the duration of the scheduled production accomplishment periods.
The Contractor agrees; therefore, to inform the Supervisor as
soon as practicable, but not later than as specified in paragraph
1.15.f of this Section, if it appears that any work items will
require a longer period.
h. The Contractor shall be responsible for producing
interference free, technically accurate drawings and shall be
responsible for calling to the attention of the Supervisor,
orally and in writing, any interface and interference problems.
i. Apply approved quality assurance procedures as required by
this contract and the associated specifications to ensure that
procured material and performed production work will achieve and
maintain the required quality standards.
j. The documents identified in 1.8.p or their subsequent
revisions in effect at time of contract award or option exercise
as well as applicable current instructions, general
specifications, type plans, naval ship technical manuals and
directives from the Naval Sea Systems Command, shall be used in
the technical requirements of work under the contract.
ITEM 0016 (OPTION) ACCOMPLISH FY 98 ADVANCE PLANNING FOR USS
CAMDEN (AOE 2) FY 99 PMA
1.16 SCOPE
The Contractor shall accomplish the FY 98 Advance Planning
functions for CAMDEN in accordance with the statement of work for
Line Item 0008.
ITEM 0017 (OPTION) ACCOMPLISH FY 98 ADVANCE PLANNING FOR USS
RAINIER (AOE 7) FY 99 PMA
1.17 SCOPE
The Contractor shall accomplish the FY 98 Advance Planning
functions for RAINIER in accordance with the statement of work
for Line Item 0008.
FY 99 (OPTIONS)
ITEM 0018 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
CAMDEN (AOE 2) FY 99 PMA
1.18 SCOPE
The Contractor shall accomplish the repair and alteration of
CAMDEN in accordance with the statement of work for Line Item
0010.
ITEM 0019 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
RAINIER (AOE 7) FY 99 PMA
1.19 SCOPE
The Contractor shall accomplish the repair and alteration of
RAINIER in accordance with the statement of work for Line Item
0010.
ITEM 0020 (OPTION) ACCOMPLISH FY 99 ADVANCE PLANNING FOR USS
SACRAMENTO (AOE 1) FY 00 PMA
1.20 SCOPE
The Contractor shall accomplish the FY 99 Advance Planning
functions for SACRAMENTO in accordance with the statement of work
for Line Item 0008.
ITEM 0021 (OPTION) ACCOMPLISH FY 99 ADVANCE PLANNING FOR USS
BRIDGE (AOE 10) FY 00 PMA
1.21 SCOPE
The Contractor shall accomplish the FY 99 Advance Planning
functions for BRIDGE in accordance with the statement of work for
Line Item 0008.
ITEM 0022 (OPTION) ACCOMPLISH FY 99 ADVANCE PLANNING FOR
USS CAMDEN (AOE 2) FY 00 DPMA
1.22 SCOPE
The Contractor shall accomplish the FY 99 Advance Planning
functions for CAMDEN in accordance with the statement of work for
Line Item 0008 including drydocking requirements.
FY 00 (OPTIONS)
ITEM 0023 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
SACRAMENTO (AOE 1) FY 00 PMA
1.23 SCOPE
The Contractor shall accomplish the repair and alteration of
SACRAMENTO in accordance with the statement of work for Line Item
0010.
ITEM 0024 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
BRIDGE (AOE 10) FY 00 PMA
1.24 SCOPE
The Contractor shall accomplish the repair and alteration of
BRIDGE in accordance with the statement of work for Line Item
0010.
ITEM 0025 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
CAMDEN (AOE 2) FY 00 DPMA
1.25 SCOPE
The Contractor shall accomplish the repair and alteration of
CAMDEN in accordance with the statement of work for Line Item
0010. Also, the Contractor shall make certified drydocking
facilities available for accomplishment of work items below the
ship's waterline. In addition, the Contractor shall make messing
and berthing facilities for ships crew available for ship's force
use.
ITEM 0026 (OPTION) ACCOMPLISH FY 00 ADVANCE PLANNING FOR USS
RAINIER (AOE 7) FY 01 DPMA
1.26 SCOPE
The Contractor shall accomplish the FY 00 Advance Planning
functions for RAINIER in accordance with the statement of work
for Line Item 0008 including drydocking requirements.
ITEM 0027 (OPTION) ACCOMPLISH FY 00 ADVANCE PLANNING FOR USS
SACRAMENTO (AOE 1) FY 01 PMA
1.27 SCOPE
The Contractor shall accomplish the FY 00 Advance Planning
functions for SACRAMENTO in accordance with the statement of work
for Line Item 0008.
FY 01 (OPTIONS)
ITEM 0028 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
RAINIER (AOE 7) FY 01 DPMA
1.28 SCOPE
The Contractor shall accomplish the repair and alteration of
RAINIER in accordance with the statement of work for Line Item
0010. Also, the Contractor shall make certified drydocking
facilities available for accomplishment of work items below the
ship's waterline. In addition, the Contractor shall make messing
and berthing facilities for ships crew available for ship's force
use.
ITEM 0029 (OPTION) ACCOMPLISH REPAIR AND ALTERATIONS OF USS
SACRAMENTO (AOE 1) FY 01 PMA
1.29 SCOPE
The Contractor shall accomplish the repair and alteration of
SACRAMENTO in accordance with the statement of work for Line Item
0010.
C.II GENERAL REQUIREMENTS
GOVERNMENT SURPLUS PROPERTY (NAVSEA) (SEP 1990)
No former Government surplus property or residual inventory
resulting from terminated Government contracts shall be furnished
under this contract unless (i) such property is identified in the
Special Contract Requirements or (ii) is approved in writing by
the Contracting Officer. Notwithstanding any such identification
in the Special Contract Requirements or approval by the
Contracting Officer, the Contractor agrees all items or
components described in this clause shall comply in all respects
with the specifications contained herein.
COMMAND INSPECTION OF BERTHING FACILITIES (NAVSEA) (OCT 1990)
Once the ship's force takes occupancy of a berthing facility, it
is recognized that the premises will be under the control of the
Department of the Navy and subject to inspections by the
Commanding Officer or his duly authorized representative(s). In
recognition of (1) the Navy's need to ensure security, military
fitness, and good order and discipline and (2) the Navy's policy
to conduct regularly scheduled periodic inspections, the
Contractor hereby agrees that while its berthing facilities are
occupied by ship's force, the Commanding Officer or his duly
authorized representative(s) has (have) the right to conduct
command inspections of the berthing facilities occupied by ship's
force.
In instances where the contractor is using commercial facilities
to satisfy the berthing requirement, the contractor hereby agrees
to insert the following clause in any subcontract for berthing
facilities to be provided under this contract:
In recognition of (1) the Navy's need to ensure security,
military fitness, and good order and discipline and (2) the
Navy's policy to conduct regularly scheduled periodic
inspections, (insert names of subcontractor) hereby agrees that
while its facilities are occupied by ship's force the Commanding
Officer or his duly authorized representative(s) has (have) the
right to conduct command inspections of the facilities occupied
by ship's force.
STANDARDIZATION - ALTERNATE I (NAVSEA) (MAY 1993)
Subject to meeting the requirements of the specifications, the
Contractor shall utilize equipments and components identical to
those of the AOE 1 & AOE 6 Class Ships. Where equipments or
components are not available, the Contractor shall select hull,
mechanical, and electrical components in the following order:
(a) Equipment which meets the requirements of the specifications
and is identical to equipments and components of the AOE 1 & AOE
6 Class Ships.
(b) Equipment which meets the requirements of the specifications
and which appears in NAVSEA Standard Components List for Hull,
Mechanical and Electrical Equipment, NAVSEA S-0300-A-PLL-00-0.
(c) Equipment which meets the requirements of the specifications
(non-standard equipment). For this category, Provisioning
Technical Documentation shall be submitted in accordance with
paragraph (d) below, and the requirements of the Contract Data
Requirements List (CDRL),
Exhibit B.
(d) For Contractor furnished equipments that meet standardization
requirements of paragraph (a) or (b) above, only a Statement of
Prior Submission is required. For non-standard equipment,
paragraph (c) above, Provisioning Technical Documentation (PTD)
shall be developed in accordance with MIL-STD-1388-2B dated 28
March 1991, MIL-STD-1388-1A, and the Provisioning Requirements
Statement.
(e) For non-standard equipment, paragraph (c) above, new/revised
Level 3 drawings per DOD-D-1000B dated 28 March 1977 with Notice
1 dated 1 July 1990 shall be developed for new/modified
Contractor furnished equipment. In addition, the Contractor
shall update applicable Level 3 contract ship construction
drawings.
(f) For non-standard equipment, paragraph (c) above, new/revised
technical manuals shall be developed in accordance with NAVSEA
Standard Items 009-39, 009-41 and 009-42. Technical manual
management data shall include those deliverable data items
required for Government monitoring/ tracking/approval of
Contractor's technical manual efforts.
ACCESS TO THE VESSEL(S) (AT) (NAVSEA) (JAN 1983)
Officers, employees, and associates of the prime Contractors with
the Government, and their subcontractors, shall, as authorized by
the Supervisor, have at all reasonable times, admission to the
plant, access to the vessel(s) where and as required, and be
permitted, within the plant and on the vessel(s) to perform and
fulfill their respective obligations to the Government. The
Contractor shall make reasonable arrangements with the Government
or Contractors of the Government, as shall have been identified
and authorized by the Supervisor to be given admission to the
plant and access to the vessel(s) for office space, work areas,
storage or shop areas, or other facilities and services,
necessary for the performance of the respective responsibilities
involved, reasonable to their performance.
QUALIFICATION OF CONTRACTOR NONDESTRUCTIVE TESTING (NDT)
PERSONNEL (NAVSEA) (MAY 1993)
(a) The Contractor and any NDT subcontractor (as hereinafter
defined) shall utilize for the performance of required
Nondestructive Testing (NDT) (which includes radiography,
magnetic particle, liquid penetrant, eddy current, ultrasonic
inspections and visual inspections) only personnel who have been
previously qualified and certified in accordance with
MIL-STD-271F(SH) dated 27 June 1986 (including the l980 edition
of SNT-TC-lA). The term "NDT Subcontractor" is defined to be a
first tier subcontractor performing NDT in conjunction with the
production of materials, components, or equipments for the
vessel(s).
(b) Qualification and certification of Level III (Examiner)
personnel shall be based on (1) successful completion of
appropriate American Society for Nondestructive Testing Level III
Examinations, and (2) successful completion of specific and
practical examinations developed by the Contractor and based on
MIL-STD-271F(SH) and associated fabrication documents.
Documentation pertaining to the qualification and certification
of NDT personnel shall be available to the Contracting Officer
for review upon request.
(c) These requirements do not apply with respect to nuclear
propulsion plant systems and other matters under the technical
cognizance of SEA 08. Because of health and safety
considerations, such matters will continue to be handled as
directed by SEA 08.
DEPARTMENT OF LABOR OCCUPATIONAL SAFETY AND HEALTH STANDARDS FOR
SHIP REPAIR (NAVSEA) (SEP 1990)
Attention of the Contractor is directed to the Occupational
Safety and Health Act of 1970 (29 USC 651-678), and to the Safety
and Health Regulations for Ship Repairing (29 CFR 1915),
promulgated under Public Law 85-742, amending Section 41 of the
Longshoremen's and Harbor Workers' Compensation Act (33 USC 941),
and adopted by the Department of Labor as occupational safety or
health standards under Section 6(a) of the Occupational Safety
and Health Act of 1970 (See 29 CFR 1910.13). These regulations
apply to all ship repair and related work, as defined in the
regulations performed under this contract on the navigable waters
of the United States including any drydock or marine railway.
Nothing contained in this contract shall be construed as
relieving the Contractor from any obligations which it may have
for compliance with the aforesaid regulations.
ADDITIONAL PROVISIONS RELATING TO GOVERNMENT PROPERTY (NAVSEA)
(OCT 1990)
(a) For purposes of paragraph (g) of the clause entitled
"GOVERNMENT PROPERTY (COST-REIMBURSEMENT, TIME-AND-MATERIAL, OR
LABOR-HOUR CONTRACTS)" (FAR 52.245-5) in addition to those items
of property defined in that clause as Government Property, the
following shall also be included within the definition of
Government Property:
(1) the vessel;
(2) the equipment on the vessel
(3) movable stores;
(4) cargo; and
(5) other material on the vessel
(b) For purposes of paragraph (e) of the clause entitled
"GOVERNMENT PROPERTY (COST-REIMBURSEMENT, TIME-AND-MATERIAL, OR
LABOR-HOUR CONTRACTS)" (FAR 52.245-5)" notwithstanding any other
requirement of this contract, the following shall not be
considered Government Property:
(1) the vessel;
(2) the equipment on the vessel;
(3) movable stores;
(4) other material on the vessel
TESTS AND TRIALS (NAVSEA) (OCT 1990)
During the conduct of required tests and trials, the vessel shall
be under the control of the vessel's Commander and crew with
representatives of the Contractor and Government on-board to
determine whether or not the work done by the Contractor has been
satisfactorily performed. The Contractor shall provide and
install all fittings and appliances which may be necessary for
dock and sea trials, to enable the representatives of the
Government to determine whether the requirements of the contract
have been met, and the Contractor shall install and remove
instruments and apparatus furnished by the Government for such
trials, as required by the specifications.
ACCESS TO VESSELS BY NON-U.S. CITIZENS (NAVSEA) (MAY 1993)
(a) No person not known to be a U.S. citizen shall be eligible
for access to naval vessels, work sites and adjacent areas when
said vessels are under construction, conversion, overhaul, or
repair, except upon a finding by NAVSEA or his designated
representative that such access should be permitted in the best
interest of the United States. The Contractor shall establish
procedures to comply with this requirement and NAVSEAINST 5500.3
(series) in effect on the date of this contract or agreement.
(b) If the Contractor desires to employ non-U.S. citizens in the
performance of work under this contract or agreement that
requires access as specified in paragraph (a) of this
requirement, approval must be obtained prior to access for each
contract or agreement where such access is required. To request
such approval for non-U.S. citizens of friendly countries, the
Contractor shall submit to the cognizant Contract Administration
Office (CAO), an Access Control Plan (ACP) which shall contain as
a minimum, the following information:
(1) Badge or Pass oriented identification, access, and movement
control system for non-U.S. citizen employees with the badge or
pass to be worn or displayed on outer garments at all times while
on the Contractor's facilities and when performing work aboard
ship.
(i) Badges must be of such design and appearance that permits
easy recognition to facilitate quick and positive identification.
(ii) Access authorization and limitations for the bearer must
be clearly established and in accordance with applicable security
regulations and instructions.
(iii) A control system, which provides rigid accountability
procedures for handling lost, damaged, forgotten or no longer
required badges, must be established.
(iv) A badge or pass check must be performed at all points of
entry to the Contractor's facilities or by a site supervisor for
work performed on vessels outside the Contractor's plant.
(2) Contractor's plan for ascertaining citizenship and for
screening employees for security risk.
(3) Data reflecting the number, nationality, and positions held
by non-U.S. citizen employees, including procedures to update
data as non-U.S. citizen employee data changes, and pass to
cognizant CAO.
(4) Contractor's plan for ensuring subcontractor compliance with
the provisions of the Contractor's ACP.
(5) These conditions and controls are intended to serve as
guidelines representing the minimum requirements of an acceptable
ACP. They are not meant to restrict the Contractor in any way
from imposing additional controls necessary to tailor these
requirements to a specific facility.
(c) To request approval for non-U.S. citizens of hostile and/or
communist-controlled countries (listed in Department of Defense
Industrial Security Manual, DOD 5220.22-M or available from
cognizant CAO), Contractor shall include in the ACP the following
employee data: name, place of birth, citizenship (if different
from place of birth), date of entry to U.S., extenuating
circumstances (if any) concerning immigration to U.S., number of
years employed by Contractor, position, and stated intent
concerning U.S. citizenship. COMNAVSEA or his designated
representative will make individual determinations for
desirability of access for above group. Approval of ACP's for
access of non-U.S. citizens of friendly countries will not be
delayed for approval of non-U.S. citizens of hostile communist-
controlled countries. Until approval is received, Contractor
must deny access to vessels for employees who are non-U.S.
citizens of hostile and/or communist-controlled countries.
(d) An ACP which has been approved for specific Master Ship
Repair Agreement (MSRA) or Agreement for Boat Repair (ABR) or
Basic Ordering Agreement (BOA), is valid and applicable to all
job orders awarded under that agreement.
(e) The Contractor shall fully comply with approved ACPs.
Noncompliance by the Contractor or subcontractor serves to cancel
any authorization previously granted, in which case the
Contractor shall be precluded from the continued use of non-U.S.
citizens on this contract or agreement until such time as the
compliance with an approved ACP is demonstrated and upon a
determination by the CAO that the Government's interests are
protected. Further, the Government reserves the right to cancel
previously granted authority when such cancellation is determined
to be in the Government's best interest. Use of non-U.S.
citizens, without an approved ACP or when a previous
authorization has been canceled, will be considered a violation
of security regulations. Upon confirmation by the CAO of such
violation, this contract, agreement or any job order issued under
this agreement may be terminated or default in accordance with
the clause entitled "DEFAULT (FIXED-PRICE SUPPLY AND SERVICE)"
(FAR 52.249-8), "DEFAULT (FIXED-PRICE RESEARCH AND DEVELOPMENT)"
(FAR 52.249-9) or "TERMINATION (COST REIMBURSEMENT)" (FAR 52.249-
6), as applicable.
(f) Prime Contractors have full responsibility for the proper
administration of the approved ACP for all work performed under
this contract or agreement, regardless of the location of the
vessel, and must ensure compliance by all subcontractors,
technical representatives and other persons granted access to
U.S. Navy vessels, adjacent areas, and work sites.
(g) In the event the Contractor does not intend to employ non-
U.S. citizens in the performance of the work under this contract,
but has non-U.S. citizen employees, such employees must be
precluded from access to the vessel and its work site and those
shops where work on the vessel's equipment is being performed.
The ACP must spell out how non-U.S. citizens are excluded from
access to contract work areas.
(h) The same restriction as in paragraph (g) above applies to
other than non-U.S. citizens who have access to the Contractor's
facilities (e.g., for accomplishing facility improvements, from
foreign crewed vessels within its facility, etc.).
FACILITIES NOT TO BE GOVERNMENT-FURNISHED (CT) (NAVSEA) (JAN
1990)
The Contractor's obligation to perform this contract is in no way
conditioned upon the providing by the Government of any
facilities, except as may be otherwise expressly provided herein.
Accordingly, no such facilities, shall be either acquired by the
Contractor for the account of the Government or furnished to the
Contractor by the Government hereunder.
For the purpose of this requirement, facilities means industrial
property (other than material, special tooling, military property
and special test equipment) for production, maintenance,
research, development or test, including real property and rights
therein, building, structures, improvements, and plant equipment
as defined in FAR 45.101 and 45.301 and DFARS 245.301.
DRYDOCK CERTIFICATION (NAVSEA) (MAY 1993)
The drydocking of all vessels on or after 1 January 1980 shall be
accomplished in dry docks certified in accordance with MIL-STD-
1625C(SH) dated 25 August 1987 as invoked by NAVSEA Standard Item
009-01.
HEAVY WEATHER PLAN (NAVSEA) (APR 1992)
In order to ensure that Navy vessels and materials are protected
during the hurricane or "heavy weather" season, the Contractor is
required to have a written Heavy Weather Plan or Procedure which
assigns responsibilities and prescribes actions to be taken in
the event a hurricane is expected to approach or to strike the
place of performance. The contractor shall furnish to the
cognizant Shipbuilding, Conversion and Repair, U.S. Navy, upon
his request, a copy of such Heavy Weather Plan, and shall make
such changes in the plan as the Supervisor considers necessary
and reasonable to protect and care for vessels and machinery and
equipment to be installed therein.
PROTECTION OF THE VESSEL (NAVSEA) (SEP 1990)
(a) The Contractor shall exercise reasonable care, as agreed
upon with the Supervisor, to protect the vessel from fire, and
shall maintain a system of inspection over the activities of its
welders, burners, riveters, painters, pipe fitters, and similar
workers, and of its subcontracts, particularly where such
activities are undertaken in the vicinity of the vessels
magazines, fuel oil tanks, or storage rooms containing
inflammable materials. All ammunition, fuel oil, motor fuels,
and cleaning fluids shall have been off-loaded and the tanks
cleaned, except as may be mutually agreed upon between the
Contractor and the Supervisor prior to work on the vessel by the
Contractor. Fire hose lines shall be maintained by the
contractor ready for immediate use on the vessel at all times
while the vessel is berthed alongside the Contractor's pier or in
drydock. All tanks under alteration or repair shall be cleaned,
washed, and steamed out or otherwise made safe to the extent
necessary, and the Contractor shall furnish the vessel's Gas Free
Officer and the Supervisor with a "Gas Chemists' Certificate"
before any hot work is done. The Contractor shall maintain a
fire watch aboard the vessel in areas where the Contractor is
working. All other fire watchers aboard the vessel shall be the
responsibility of the Government.
(b) Except as otherwise provided in contractually invoked
technical specifications or NAVSEA furnished directives, while
the vessel is at the Contractor's plant and when the temperature
becomes as low as thirty-five degrees Fahrenheit, the Contractor
shall assist the Government when requested in keeping all pipe-
lines, fixtures, traps, tanks, and other receptacles on the
vessel drained to avoid damage from freezing, or if this is not
practicable, the vessel shall be kept heated to prevent such
damage. The vessel's stern tube and propeller hubs shall be
protected by the contractor from frost damage by applied heat
through the use of a salamander or other proper means.
(c) The work shall, whenever practicable, be performed in such
a manner as not to interfere with the work performed by military
personnel attached to the vessel, and provisions shall be made so
that personnel assigned shall have access to the vessel at all
times, it being understood that such personnel will not unduly
interfere with the work of the Contractor's workmen.
(d) The Contractor shall at all times keep the site of the work
on the vessel free from accumulation of waste material or rubbish
caused by its employees, or the work performed by the Contractor
in accordance with this contract, and at the completion of such
work shall remove all rubbish from and about the site of the
work, and shall leave the work in its immediate vicinity "broom
clean", unless more exactly specified by the Supervisor.
TABLE C-1
ADVANCE PLANNING SCHEDULE
ACTION FY97 RAINIER &
CAMDEN SUBSEQUENT
AVAIL AVAILS
A-180 A-360
Government provide inital advance A-180 A-360
planning funding increment
Government provide milestone A-180 A-360
planning letter.
Governemnt provide Title "K" Ship A-180 A-360
Alteration letter, Title "D" and
"F" Ship Alteration letter and
Title "D", "F" and "K" LLTM lists.
(FMPMIS Tp-05 Report or equivalent.
Government provides SIDs. A-180 A-360
Contractor complete SID design, A-175 A-360
review and submit results.
(Government may authorize shipcheck).
Contractor provide recommendations A-160 A-315
for non-Government-furnished LLTM.
Contractor commence procurement A-150 A-300
of authorized non-Government
furnished alteration LLTM.
Contractor assist in conduct of IF AUTHORIZED IF AUTHORIZED
work package determination.
Government provide resolution of A-150 A-300
Contractor SID design review problems.
Contractor recommend changes to A-130 A-270
alteration LLTM list, if any.
Contractor supplement alteration A-125 A-255
LLTM procurement, as authorized.
Contractor submit preliminary "K" A-120 A-230
Alteration and "D" and "F"
Alteration Cost Estimates.
ACTION FY97 RAINIER &
CAMDEN SUBSEQUENT
AVAIL AVAILS
A-180 A-360
Government provide preliminary A-100 A-230
SARP to Contractor.
Contractor submit cost proposal A-90 A-220
for advance planning.
Contractor provide repair item A-75 A-210
LLTM recommendations.
Contractor commence procurment of A-75 A-200
authorized repair item LLTM.
Contractor provide preliminary A-60 A-185
SARP time and cost estimates.
Contractor conduct shipchecks for IF AUTHORIZED IF AUTHORIZED
specification preparation.
Government provide authorized SARP A-60 A-165
to contractor.
Government provide actual SHIPALT N/A N/A
and Repair work package to Contractor.
Contractor provide complete NAVSEA A-40 A-135
Title "K" Alteration work item
specifications for basic work package.
Contractor submit proposal for basic A-40 A-120
work package NAVSEA Title "K" Alterations.
Contractor provide complete repair A-40 A-90
and Title "D/F" Alteration work item
specifications for basic work package.
Contractor submit complete proposal A-30 A-80
for basic work package.
(To include SSR update, if tasked,
and growth and/or overtime estimates).
Contractor provide updated Ship C+60 C+60
Selected Records (if tasked).
SECTION D
PACKING AND MARKING, PREPARATION FOR DELIVERY
D-1 All unclassified data shall be prepared for shipment in
accordance with best commercial practice. Classified reports,
data, and documentation, shall be prepared for shipment in
accordance with the Department of Defense Industrial Security
Manual for Safeguarding Classified Information, DOD 5220.22-M
dated 3 January 1991.
D-2 PROVISIONED ITEM ORDER
Item 0003 - The parts ordered hereunder shall be cleaned,
preserved, packaged, packed, and marked in accordance with
instructions provided by the Contracting Officer provisioning
activity or ACO. When not otherwise instructed, spare and repair
parts shall be cleaned, preserved, packaged, packed and marked
level A in accordance with Military Specification MIL-E-17555H,
dated 15 November 1984.
SECTION E
INSPECTION AND ACCEPTANCE
E-1 The Contractor's performance and the quality of the
completed work shall be subject to inspection, review and final
acceptance by the SUPSHIP or his duly authorized representative.
E-2 Failure of any contractually required document to conform to
any of the applicable requirements of this Contract will result
in the rejection of the non-conforming document. Non-conforming
engineering drawings documents shall be re-examined after
correction of all discrepancies. The contractor shall identify
the deficiencies corrected and the action taken to prevent
recurrence.
E-3 Data. Inspection and acceptance of all data shall be as
specified on the attached Contract Data Requirements list(s) DD
Form 1423, Exhibits A, B and C of Section J.
E-4 The Inspection System which the Contractor is required to
maintain, as provided in paragraph (b) of the clause entitled
"Inspection of Supplies-Cost Reimbursement", shall be in
accordance with Military Specification
MIL-I-45208 in effect on the date of this Contract and NAVSEA
Standard Item 009-04 in effect on the date of this Contract
unless otherwise specified.
E-5 INSPECTION FACILITIES (NAVSEA) (JAN 1990)
The facilities to be provided pursuant to the clause
entitled "Inspection of Supplies-Cost Reimbursement", shall be
equal to those provided by the Contractor for his use for
generally similar purposes, and shall include offices and related
equipment, drafting rooms, convenient parking facilities,
equipment for reproduction of such items as plans, booklets, test
memoranda and allowance lists, and telephones connected to the
Contractor's and local telephone systems. Toll charges for calls
placed by the Government shall be paid by the Government. In
lieu of providing the reproduction equipment referred to above,
the Contractor may provide reproduction services.
E-6 In accordance with paragraph (b) of the clause entitled
"Inspection of Supplies-Cost Reimbursement", the Contractor shall
make his records of all inspection work available to the
Government for a period of six (6) months after completion of all
work called for in the Contract.
E-7 Provisioned Item Orders. Item(s) 0003 - Inspection and
acceptance of parts ordered hereunder shall be as establised in
each PIO. Unless otherwise stated in the PIO, parts shall be
inspected and accepted at source by a representative of the
Contract Administration Office.
E-8 ADDITIONAL PROVISIONS RELATING TO CORRECTION OF DEFECTS
(NAVSEA) (OCT 1990)
In case any work done or materials or supplies furnished by the
Contractor, under this contract for any vessel, or the equipment
thereof, shall within sixty (60) days of delivery of the vessel
to the Government, or the date of final acceptance, whichever
occurs first, prove defective or deficient, such defects of
deficiencies shall, as required by the Government, be corrected
or repaired by the Contractor to the satisfaction of the
Contracting Officer; provided, however, that with respect to any
individual work item which is incomplete or deficient at the time
of delivery or acceptance, the Contractor's obligation under this
clause to correct or repair such deficiency shall extend sixty
(60) days from the date of such correction or repair, whichever
occurs first. The Contractor shall be entitled to allowable
costs for corrections or repairs performed in accordance with the
clause but shall not be entitled to any additional fee for such
work.
E-9 INSPECTION OF SUPPLIES - COST REIMBURSEMENT (FAR 52.246-3)
(APR 1984)
(a) Definitions.
"Contractor's managerial personnel," as used in this clause,
means any of the Contractor's directors, officers, managers,
superintendents, or equivalent representatives who have
supervision or direction of -
(1) All or substantially all of the Contractor's
business;
(2) All or substantially all of the Contractor's
operation at a plant or separate location at which the contract
is being performed; or
(3) A separate and complete major industrial
operation connected with performing this contract.
"Supplies" as used in this clause, includes but is not
limited to raw materials, components, intermediate assemblies,
end products, lots of supplies, and, when the contract does not
include the Warranty of Data clause, data.
(b) The Contractor shall provide and maintain an inspection
system acceptable to the Government covering the supplies,
fabricating methods, and special tooling under this contract.
Complete records of all inspection work performed by the
Contractor shall be maintained and made available to the
Government during contract performance and for as long afterwards
as the contract requires.
(c) The Government has the right to inspect and test the
contract supplies, to the extent practicable at all places and
times, including the period of manufacture, and in any event
before acceptance. The Government may also inspect the plant or
plants of the Contractor or any subcontractor engaged in the
contract performance. The Government shall perform inspections
and tests in a manner that will not unduly delay the work.
(d) If the Government performs inspection or test on the
premises of the Contractor or a subcontractor, the Contractor
shall furnish and shall require subcontractors to furnish all
reasonable facilities and assistance for the safe and convenient
performance of these duties.
(e) Unless otherwise specified in the contract, the
Government shall accept supplies as promptly as practicable after
delivery, and supplies shall be deemed accepted 60 days after
delivery, unless acceptable earlier.
(f) At any time during contract performance, but no later
than 6 months (or such other time as may be specified in the
contract) after acceptance of the supplies to be delivered under
the contract, the Government may require the Contractor to
replace or correct any supplies that are non-conforming at time
of delivery. Supplies are nonconforming when they are defective
in material or workmanship or are otherwise not in conformity
with contract requirements. Except as otherwise provided in
paragraph (h) below, the cost of replacement or correction shall
be included in allowable cost, determined as provided in the
Allowable Cost and Payment clause, but no additional fee shall be
paid. The Contractor shall not tender for acceptance supplies
required to be replaced or corrected without disclosing the
former requirement for replacement or correction, and, when
required, shall disclose the corrective action taken.
(g)(1) If the Contractor fails to proceed with reasonable
promptness to perform required replacement or correction, the
Government may -
(i) By contract or otherwise, perform the
replacement or correction and charge to the Contractor any
increased cost or make an equitable reduction in any fixed fee
paid or payable under the contract;
(ii) Require delivery of undelivered supplies at
an equitable reduction in any fixed fee paid or payable under the
contract; or
(iii) Terminate the contract for default.
(2) Failure to agree on the amount of increased cost to
be charged to the Contractor or to the reduction in the fixed fee
shall be a dispute.
(h) Notwithstanding paragraphs (f) and (g) above, the
Government may at any time require the Contractor to correct or
replace, without cost to the Government, nonconforming supplies,
if the nonconformances are due to (1) fraud, lack of good faith,
or willful misconduct on the part of the Contractor's managerial
personnel or (2) the conduct of one or more of the Contractor's
employees selected or retained by the Contractor after any of the
Contractor's managerial personnel has reasonable grounds to
believe that the employee is habitually careless or unqualified.
(i) This clause applies in the same manner to corrected or
replacement supplies as to supplies originally delivered.
(j) The Contractor shall have no obligation or liability
under this contract to replace supplies that were nonconforming
at the time of delivery, except as provided in this clause or as
may be otherwise provided in the contract.
(k) Except as SECTION F
DELIVERIES OR PERFORMANCE
F-1 PLACE OF PERFORMANCE
Work on all vessels under this contract shall be performed
at the:
Todd Pacific Shipyards Corporation
(Name of Facility)
1801 16th Avenue S.W.
(Street Address)
Seattle, Washington 98134
(City, State, Zip Code)
F-2 PERIOD OF PERFORMANCE
ITEM PERIOD OF PERFORMANCE
0001 Effective date of contract through start of availabilty.
0002 Section C.
0003 Section C.
0004 Effective date of contract through delivery of
all data items specified on DD Form 1423, Exhibit A.
0005 Effective date of contract through completion and
delivery of data items specified on DD Form 1423,
Exhibit B for Item 0001, and if options exercised;
for option Items 0008 thru 0029.
0006 Effective date of interavailability work authorization
through delivery of all data. Items specified on
DD Form 1423, Exhibit C.
0007 Section C.
ITEM PERIOD OF PERFORMANCE
FY96
0008 Effective date of option exercised through start of
availability.
0009 Effective date of option exercised through start of
availability.
FY97
0010 Effective date of option exercised through completion
of PMA requirements.
0011 Effective date of option exercised through completion
of PMA requirements.
0012 Effective date of option exercised through start of
availability.
0013 Effective date of option exercised through start of
availability.
FY98
0014 Effective date of option exercised through completion
of DPMA requirements.
0015 Effective date of option exercised through completion
of PSA requirements.
0016 Effective date of option exercised through start of
availability.
0017 Effective date of option exercised through start of
availability.
FY99
0018 Effective date of option exercised through completion
of PMA requirements.
0019 Effective date of option exercised through completion
of PMA requirements.
ITEM PERIOD OF PERFORMANCE
0020 Effective date of option exercised through start of
availability.
0021 Effective date of option exercised through start of
availability.
0022 Effective date of option exercised through start of
availability.
FY00
0023 Effective date of option exercised through completion
of PMA requirements.
0024 Effective date of option exercised through completion
of PMA requirements.
0025 Effective date of option exercised through completion
of DPMA requirements.
0026 Effective date of option exercised through start of
availability.
0027 Effective date of option exercised through start of
availability.
FY01
0028 Effective date of option exercised through completion
of DPMA requirements.
0029 Effective date of option exercised through completion
of PMA requirements.
F-3 DELIVERY/REDELIVERY SCHEDULE FOR THE VESSELS
The Government agrees to deliver the vessels to the
Contractor at the Contractor's plant on or about the following
"Commencement Dates." The Contractor agrees to redeliver the
vessels no later than the following "Completion Dates":
AVAIL
SHIP HULL TYPE AVAILABILITY DATES FY CLIN
USS CAMDEN (AOE 2) PMA 1/13/97-4/11/97 97 0010
USS RAINIER (AOE 7) PMA 7/7/97-10/10/97 97 0011
USS SACRAMENTO (AOE 1) DPMA 4/13/98-9/11/98 98 0014
USS BRIDGE (AOE 10) PSA 9/1/98-11/1/98 98 0015
USS CAMDEN (AOE 2) PMA 1/11/99-4/9/99 99 0018
USS RAINIER (AOE 7) PMA 6/7/99-9/10/99 99 0019
USS SACRAMENTO (AOE 1) PMA 10/18/99-1/21/00 00 0023
USS BRIDGE (AOE 10) PMA 1/10/00-4/14/00 00 0024
USS CAMDEN (AOE 2) DPMA 6/5/00-11/10/00 00 0025
USS RAINIER (AOE 7) DPMA 11/6/00-4/6/01 01 0028
USS SACRAMENTO (AOE 1) PMA 5/14/01-8/17/01 01 0029
F-4 DELIVERY SCHEDULE FOR NON-SCHEDULED REPAIR AND ALTERATION
REQUIREMENTS BETWEEN SCHEDULED AVAILABILITIES. (ITEM 0002)
In cases where orders are placed by unilateral modification,
deliveries shall be effected in accordance with the delivery
schedule proposed by the Administrative Contracting Officer (ACO)
in each unilateral modification, unless the Contractor, within
thirty (30) days of the receipt of the unilateral modification,
notifies the ACO that the proposed delivery schedule is not
acceptable. In the latter case, the Contractor shall propose an
alternate delivery schedule, which shall be the subject of
negotiation prior to its inclusion in the bilateral modification
expressing the order for the supplies.
F-5 DELIVERY SCHEDULE FOR PROVISIONED ITEM ORDER (PIO) (ITEM
0003)
In cases where orders are placed by bilateral modification,
delivery shall be effected in accordance with the delivery
schedule established in the bilateral modification.
In cases where orders are placed by unilateral modification,
deliveries shall be effected in accordance with delivery schedule
proposed by the Administrative Contracting Officer (ACO) in each
unilateral modification, unless the Contractor, within thirty
(30) days of the receipt of the unilateral modification, notifies
the ACO that the proposed delivery schedule is not acceptable.
In the latter case, the Contractor shall propose an alternate
delivery schedule, which shall be the subject of negotiation
prior to its inclusion in the bilateral modification expressing
the order for the supplies.
Unless otherwise expressed in the unilateral or bilateral
modification, the supplies shall be delivered F.O.B. carrier's
freight station at or near the Contractor's plant, and shipment
shall be on Government Bills of Lading.
F-6 DELIVERY SCHEDULE FOR DATA (ITEM 0004)
The data provided by the Contractor under Item 0004 shall be
delivered as specified on the Contract Data Requirements List, DD
Form 1423, Exhibit A hereto.
F-7 DELIVERY SCHEDULE FOR PROVISIONING TECHNICAL
DOCUMENTATION (ITEM 0005)
The Provisioning Technical Documentation provided by the
Contractor under Item 0005 shall be delivered as specified in the
Contract Data Requirements List, DD Form 1423, Exhibit B hereto.
F-8 DELIVERY SCHEDULE FOR DATA (ITEM 0006)
The data provided by the Contractor under Item 0006 shall be
delivered as specified on the Contract Data Requirements List, DD
Form 1423, Exhibit C hereto.
F-9 STOP WORK ORDER
FAR 52.212-13, "Stop Work Order - ALTERNATE I" (Aug 1989) is
incorporated by reference into this contract.
F-10 MILESTONES (NAVSEA) (SEP 1982)
(a) The Contractor shall submit with his offer dates
for the successful accomplishment of the following major
milestones for the USS CAMDEN (AOE 2) FY 97 PMA:
Milestone Event Date
Systems Check-out 3/30/97
Propulsion System Light-Off 4/01/97
Dock Trials 4/07/97
Sea Trials 4/10/97
(b) The Contractor shall successfully accomplish the
major milestones prior to the dates listed above.
(c) If any milestone event is not accomplished by the
date listed, and the failure to accomplish any such milestone
event does not arise from a cause beyond the control and without
the fault or negligence of the Contractor or a subcontractor,
such failure may be deemed to constitute a failure to perform
this contract in accordance with its terms within the meaning of
subparagraph (a)(i) of the clause of this contract entitled
"TERMINATION." otherwise specified in the contract, the
Contractor's obligation to correct or replace Government-
furnished property shall be governed by the clause pertaining to
Government property.
SECTION G
CONTRACT ADMINISTRATION DATA
G-1 CONTRACT ADMINISTRATION DATA
a. Work under this contract shall be under the cognizance
of the Supervisor of Shipbuilding, Conversion and Repair, USN
designated at the time of contract award.
b. The Contract Administration Officer is the designated
Supervisor of Shipbuilding, Conversion and Repair, USN.
G-2 CONTRACT ADMINISTRATION/PURCHASING OFFICE REPRESENTATIVE
A. Contract Administration Office Representative
NAME:
TELEPHONE: ( )
ADDRESS: Supervisor of Shipbuilding,
Conversion and Repair, USN
San Diego, CA 92136-5119
B. Purchasing Office Representative
NAME: Mr. Duane T. Robinson
TELEPHONE: (703) 602-7714 ext. 297
ADDRESS: Naval Sea Systems Command
Attn: SEA 0285
Arlington, VA 22242-5160
G-3 PAYMENT ADDRESS
Offerors shall indicate below the address to which payment should
be mailed.
Todd Pacific Shipyards Corporation
P.O. Box 94042
Seattle, Washington 98124-6542
G-4 ACCOUNTING/APPROPRIATION DATA
For appropriate accounting and appropriation data see Section J
of this contract.
SECTION H
SPECIAL CONTRACT REQUIREMENTS
H-1 Other Change Proposals
H-2 Award Fee Determination in Event of Termination or
Discontinuance
H-3 Tug and Pilot Services
H-4 Deleted
H-5 Management and Disposal of Hazardous Waste
H-6 Additional Definitions
H-7 Documentation of Requests for Equitable Adjustment
H-8 Orders
H-9 Indemnification for Access to Vessel
H-10 Government-Industry Data Exchange Program
H-11 Equitable Adjustments: Waivers and Release of
Claims
H-1 NAVSEA 5252.243-9113 OTHER CHANGE PROPOSALS (CT) (JAN
1990)
(a) The Contracting Officer, in addition to proposing
engineering changes pursuant to other requirements of this
contract, and in addition to issuing changes pursuant to the
clause of this contract entitled "CHANGES", may propose other
changes within the general scope of this contract as set forth
below. Within forty-five (45) days from the date of receipt of
any such proposed change, or within such further time as the
Contracting Officer may allow, the Contractor shall submit the
proposed scope of work, plans and sketches, and his estimate of:
(A) the cost, (B) the weight and moment effect, (C) effect on
delivery dates of the vessel(s), and (D) status of work on the
vessels affected by the proposed change. The proposed scope of
work and estimate of cost shall be in such form and supported by
such reasonably detailed information as the Contracting Officer
may require. Within sixty (60) days from the date of receipt of
the Contractor's estimate, the Contractor agrees to either (A)
enter into a supplemental agreement covering the estimate as
submitted, or (B) if the estimate as submitted is not
satisfactory to the Contracting Officer, enter into negotiations
in good faith leading to the execution of a bilateral
supplemental agreement. In either case, the supplemental
agreement shall cover an equitable adjustment in the contract
cost and fee including an equitable adjustment for the
preparatory work set forth above, scope, and all other necessary
equitable adjustments. The Contractor's estimate referred to in
this subparagraph shall be a firm offer for sixty (60) days from
and after the receipt thereof by the Contracting Officer having
cognizance thereof, unless such period of time is extended by
mutual consent.
(b) Pending execution of a bilateral agreement or the
direction of the Contracting Officer pursuant to the "CHANGES"
clause, the Contractor shall proceed diligently with contract
performance without regard to the effect of any such proposed
change.
(c) In the event that a change proposed by the Contracting
Officer is not incorporated into the contract, the work done by
the Contractor in preparing the estimate in accordance with
subparagraph (a) above shall be treated as if ordered by the
Contracting Officer under the "CHANGES" clause. The Contractor
shall be entitled to an equitable adjustment in the contract cost
and fee for the effort required under subparagraph (a), but the
Contractor shall not be entitled to any adjustment in delivery
date. Failure to agree to such equitable adjustment in the
contract cost and fee shall be a dispute within the meaning of
the clause of this contract entitled "DISPUTES" (FAR 52.233-1).
(End of Text)
H-2 NAVSEA 5252.249-9105 AWARD FEE DETERMINATION IN EVENT OF
TERMINATION OR DISCONTINUANCE (CA) (JAN 1990)
In the event that this contract is terminated in whole pursuant
to the contract clause entitled "TERMINATION (COST-
REIMBURSEMENT)" (FAR 52.249-6) or in the event this contract is
discontinued pursuant to the contract clause entitled "LIMITATION
OF COST" (FAR 52.232-20), the last award fee period shall end
with the effective date of such termination or discontinuance.
In either of such events, the amount of award fee, if any,
determined to be otherwise payable shall be adjusted or prorated
to reflect the difference, if any, in award fee periods resulting
from termination or discontinuance.
(End of Text)
H-3 NAVSEA 5252.247-9110 TUG AND PILOT SERVICES (SEP 1990)
The Contractor shall provide necessary tug and pilot services to
move the vessel(s) from the fairway of the plant to the pier or
dock, and upon completion of all work from the pier or dock, to
the fairway of the plant.
H-4 DELETED
H-5 NAVSEA 5252.223-9114 MANAGEMENT AND DISPOSAL OF
HAZARDOUS WASTE (SEP 1990) (ALTERNATE 1)
(a) The Contractor shall comply with the Resource
Conservation and Recovery Act (RCRA) and all other applicable
Federal, State and local laws, codes ordinance and regulations
for the management and disposal of hazardous waste.
(b) In accordance with RCRA and 10 U.S.C. 7311, for purpose
of this contract following definitions apply:
(1) Navy generated hazardous waste is hazardous waste,
as defined by RCRA, that is generated solely by the actions of
the ship's force or Navy employees on board a ship. Hazardous
materials or substances within a ship's systems or on the ship
structure are not considered hazardous waste prior to removal;
the act of removing hazardous waste materials or substances shall
be considered "hazardous waste generation" within the meaning of
RCRA.
(2) Contractor generated hazardous waste is hazardous
waste as defined by RCRA, that is generated by the performance of
the work specified in this contract. Contractor generated
hazardous waste includes, but is not limited to, hazardous waste
that contains materials from the ship's systems, operations and
structure that is first subjected to regulation as a hazardous
waste by actions of the contractor in performing the work
specified in this contract.
(3) Co-generated hazardous waste is hazardous waste, as
defined by RCRA, that is a combination of hazardous waste
generated solely by the actions of the Navy personnel and
hazardous waste generated solely by the actions of Contractor
personnel, where combination of the hazardous waste cannot be
avoided by reasonable hazardous waste management or work
practices. Co-generated hazardous waste does not include
hazardous waste that contains materials from the ship's systems,
operations and structure that is first subjected to regulation as
a hazardous waste by the actions of the contractor in performing
the work specified in this contract.
(c) Disposal of Navy generated hazardous waste. When the
disposal of Navy generated hazardous waste is the responsibility
of the contractor under the terms of this contract, the Navy
shall furnish an EPA identification number issued to the Navy for
use on any required manifests or other documents for the disposal
of the hazardous waste.
(d) Disposal of contractor generated hazardous waste. The
Contractor shall be responsible for the proper management and
disposal of all contractor generated hazardous waste and shall
use an EPA identification number issued to the contractor for the
disposal of the hazardous waste. No EPA identification number
issued to the Navy shall be used on required manifests or other
documents or Contractor generated hazardous waste.
(e) Disposal of co-generated hazardous waste. The
Contractor shall be responsible for the proper management and
disposal of all co-generated hazardous waste. Any required
manifests or other documents prepared for the disposal of the
hazardous waste shall use an EPA identification number issued to
the Contractor first followed by an EPA identification number
issued to the Navy in an appropriate location on the manifest or
other form.
(f) Copies of all manifests prepared under this contract
shall be provided to the contracting officer within 48 hours of
receipt of the manifest from the disposal site.
H-6 NAVSEA 5252.202-9101 ADDITIONAL DEFINITIONS (MAY 1993)
As used throughout this contract, the following terms shall have
the meanings set forth below:
(a) DEPARTMENT - means the Department of the Navy.
(b) REFERENCES TO THE FEDERAL ACQUISITION REGULATION
(FAR) - All references to the FAR in this contract shall be
deemed to also reference the appropriate sections of the Defense
FAR Supplement (DFARS), unless clearly indicated otherwise.
(c) REFERENCES TO ARMED SERVICES PROCUREMENT
REGULATION OR DEFENSE ACQUISITION REGULATION - All references in
this document to either the Armed Services Procurement Regulation
(ASPR) or the Defense Acquisition Regulation (DAR) shall be
deemed to be references to the appropriate sections of the
FAR/DFARS.
(d) The term "Secretary" means the Secretary, the
Under Secretary, or any Assistant Secretary of the Department;
and the term "his duly authorized representative: means any
person on board )other than the Contracting Officer) authorized
to act for the Secretary.
(e) The term "Contracting Officer" means the person
executing this contract on behalf of the Government, and any
other officer or civilian employee of the Department who is a
properly designated Contracting Officer; and the term includes,
except as otherwise provided in this contract, the authorized
representative of a Contracting Officer acting within the limits
of his authority.
(f) Except as otherwise provided in this contract, the
term "subcontracts" includes purchase orders.
(g) As used throughout this contract, the term
"Commander, Naval Sea Systems Command" means the Commander of the
Naval Sea Systems Command of the Department of the Navy or his
duly authorized successor or duly authorized representative.
(h) As used throughout this contract, the term
"Supervisor" means the cognizant Supervisor of Shipbuilding,
Conversion and Repair, Department of the Navy.
H-7 NAVSEA 5252.233-9103 DOCUMENTATION OF REQUESTS FOR
EQUITABLE ADJUSTMENT (MAY 1993)
(a) For the purposes of this clause, the term "change"
includes not only a change that is made pursuant to a written
order that is designated as a "change order," but also (i) an
engineering change proposed by the Government or by the
Contractor and (ii) any act or omission to act on the part of the
Government in respect of which a request is made for equitable
adjustment.
(b) Whenever the Contractor requests or proposes an
equitable adjustment of $100,000 or more per vessel in respect to
a change made pursuant to a written order designated as a "change
order" or in respect of a proposed engineering change and
whenever the Contractor requests an equitable adjustment in any
amount in respect of any other act or omission to act on the part
of the Government, the proposal supporting such a request shall
contain the following information for each individual item or
element of the request:
(1) A description (i) of the work required by the
contract before the change, which has been deleted by the change,
and (ii) of the work deleted by the change which already has been
completed. The description is to include a list of components,
equipments, and other identifiable property involved. Also, the
status of manufacture, procurement, or installation of such
property is to be indicated. Separate description is to be
furnished for design and production work. Items of raw material,
purchase parts, components, and other identifiable hardware,
which are made excess by the change and which are not to be
retained by the Contractor, are to be listed for later
disposition;
(2) Description of work necessary to undo work already
completed which has been deleted by the change;
(3) Description of work not required by the terms
hereof before the change, which is substituted or added by the
change. A list of components and equipment (not bulk materials
or items) involved, should be included. Separate descriptions
are to be furnished for design work and production work;
(4) Description of interferences and inefficiencies in
performing the change;
(5) Description of each element of disruption and
exactly how work has or will be disrupted:
(i) The calendar period of time during which
disruption occurred, or will occur;
(ii) Area(s) aboard the vessel where disruption
occurred, or will occur;
(iii) Trade(s) disrupted, with a breakdown of
manhours for each trade;
(iv) Scheduling of trades before, during, and
after the period of disruption;
(v) Description of measures taken to lessen
the disruptive effect of the change.
(6) Delay in delivery attributable solely to the
change;
(7) Other work attributable to the change;
(8) Supplementing the foregoing, a narrative
statement of the direct "causal" relationship between any alleged
Government act or omission and the claimed consequences
therefore, cross-referenced to the detailed information provided
as required above.
(9) A statement setting forth a comparative
enumeration of the amounts "budgeted" for the cost elements,
including the material costs, labor hours, and pertinent indirect
costs, estimated by the Contractor in preparing his initial and
ultimate proposal(s) for this contract, and the amounts claimed
to have been incurred and/or projected to be incurred
corresponding to each such "budgeted cost" element.
(c) Each proposal in excess of $100,000 submitted in
support of a claim for equitable adjustment under any provision
of this contract shall, in addition to the information required
by paragraph (b) hereof, contain a duly executed SF-1411 with
respect to each individual claim item.
(d) It is recognized that individual claims for equitable
adjustment may not comprehend all of the factors listed in
paragraph (b) above. Accordingly, the Contractor is required to
set forth in his proposal information only with respect to those
factors which are comprehended in the individual claim for
equitable adjustment. In any event, the information furnished
hereunder shall be in sufficient detail to permit the Contracting
Officer to allocate the claimed increased costs, or delay in
delivery, or both, as appropriate, as set forth in the SF-1411,
submitted pursuant to paragraph (c) of this clause, with the
information submitted pursuant to paragraph (b) hereof.
(e) The certification requirements as set forth in the
cause of this contract entitled "CERTIFICATION OF CLAIMS AND
REQUESTS FOR ADJUSTMENT OR RELIEF" (DFARS 252.233-7000) shall be
complied with.
H-8 NAVSEA 5252.216-9112 ORDERS (COST PLUS FIXED FEE) (MAY
1993)
(a) General. Orders for Provisioning Technical
Documentation (PTD) and Technical Manuals specified in Section B
of the Schedule may be issued by the Contracting Officer at any
time during the performance period of this contract. Except as
otherwise provided in paragraph (e) of this clause, the
Contractor agrees to accept and perform orders issued by the
Contracting Officer within the scope of this agreement. It is
understood and agreed that the Government has no obligation under
the terms of this agreement to issue any orders. Except as
otherwise provided in any order, the Contractor shall furnish all
materials and services necessary to accomplish the work specified
in each order issued hereunder; provided, however, that this
agreement shall not be used for the furnishing of supplies or
services which are covered by any "guaranty" or "warranty"
clause(s) of the contract(s) under which the supplies were
manufactured. In the event of any inconsistency between any
order and this agreement, this agreement shall control. All the
requirements of this agreement shall be applicable to all orders
issued hereunder. Wherever the word "contract" appears in this
agreement, it shall be deemed to include within its meaning the
word "order", and each order shall be considered a separate
binding contract as of its effective date. The Contractor shall
segregate the costs incurred in the performance of any order
issued hereunder from the costs of all other orders issued under
this agreement.
(b) Ordering. Orders and revisions thereto shall be made
in writing and be signed by any authorized Contracting Officer.
Each order shall:
(1) set forth detailed specifications or requirements
for the supplies or services being ordered, (or reference
applicable specifications or requirements in Section C of this
agreement), and, if applicable, shall refer to the appropriate
item under Section B of this agreement;
(2) set forth quantities being ordered;
(3) set forth preservation, packaging and packing
instructions, if any;
(4) set forth delivery or performance dates;
(5) designate the place(s) where inspection and
acceptance will be made by the Government;
(6) set forth the estimated cost and fixed fee or, in
the case of an undefinitized order, the definitization schedule
and both the monetary limitation of Government liability for the
undefinitized order and the maximum ceiling amount at which the
order may be definitized;
(7) set forth appropriation and accounting data for
the work being ordered;
(8) be dated;
(9) be identified by number in accordance with
DFARS 204.7004;
(10) set forth the property, if any, to be furnished
by the Government and the date(s) such property is to be
delivered to the Contractor;
(11) set forth the disbursing office where payment is
to be made and other applicable contract administration data;
(12) cite the applicable circumstance or exception and
the justification control number. Orders for items not
identified in the class justification, or an individual
justification and the basic ordering agreement are unauthorized;
(13) be issued on an SF 26 or DD Form 1155; and
(14) set forth any other pertinent information.
(c) Priced Orders. Except as otherwise provided in
paragraph (d) below, the Contractor shall not begin any work on
an order until the estimated cost and fixed fee for the order
have been agreed upon by the Contracting Officer and Contractor
and an order is issued by the Contracting Officer. Upon receipt
of a proposed order, the Contractor shall promptly submit to the
Contracting Officer a cost proposal for the work specified in the
order. The Contractor shall submit a signed SF 1411 (Contract
Pricing Proposal) or such other cost or pricing data as the
Contracting Officer may require. Promptly after receipt of the
Contractor's proposal and supporting cost or pricing data, the
Contractor and the Contracting Officer shall negotiate and agree
upon the estimated cost, fixed fee, and delivery schedule for the
work being ordered. The estimated cost, fixed fee, and delivery
schedule, as agreed upon, shall be set forth in the priced order
and the order shall be signed by both the Contracting Officer and
the Contractor. Upon receipt of the proceed order, the
Contractor shall promptly commence work and shall diligently
complete it.
(d) Undefinitized Orders. Whenever the Contracting Officer
determines that urgent demands or requirements prevent the
issuance of a priced order, the Contracting Officer may issue an
unpriced order. Such order may be unilateral or bilateral and
shall establish a limitation on Government liability, a maximum
ceiling amount, and a schedule for definitization of the order,
as described in subparagraph (f) (2) below. Upon request, the
Contractor shall submit a maximum ceiling amount proposal before
the undefinitized order is issued. The maximum ceiling amount is
the maximum amount (including fee) at which the order may be
definitized. Except as provided in paragraph (e) below, the
Contractor shall commence performance of the order upon receipt.
A clause substantially the same as The clause entitled "Price
Ceiling" (DFARS 252.217-7027 shall be included in any
undefinitized order.
(e) Rejection of Unilateral Orders. The Contractor may
reject any unilateral order if the Contractor determines that it
cannot feasibly perform the order or if it does not concur with
the maximum ceiling amount. However, each unilateral order shall
be deemed to have been accepted by the Contractor unless within
fifteen (15) days of issuance of the order the Contractor
notifies the Contracting Officer in writing of its rejection of
the order.
(f) Definitization of Undefinitized Orders.
(1) The Contractor agrees that following the issuance
of an undefinitized order, it will promptly begin negotiating
with the Contracting Officer the CPFF and terms of a definitive
order that will include: (A) all clauses required by regulation
on the date of the order; (B) all clauses required by law on the
date of execution of the definitive order; and, (C) other
mutually agreeable clauses, terms and/or conditions. No later
than sixty (60) days after the undefinitized order is issued, the
Contractor shall submit a cost proposal with sufficient data to
support the accuracy and derivation of its CPFF proposal; and,
when required by FAR or the Contracting Officer, cost or pricing
data, including SF 1411. If additional cost information is
available prior to the conclusion of negotiations, the Contractor
shall provide that information to the Contracting Officer. The
CPFF agreed upon shall be set forth in a bilateral modification
to the order. In no event shall be CPFF exceed the maximum
ceiling amount specified in the undefinitized order.
(2) Each undefinitized order shall contain a schedule
for definitization which shall include a target date for
definitization and dates for submission of a proposal, beginning
of negotiations and, if appropriate, submission of make-or-but
and subcontracting plans and cost or pricing data. Submission of
a qualifying proposal in accordance with the definitization
schedule is a material element of the order. The schedule shall
provide for definitization of the order by the earlier of:
(i) a specified target date which is not more
than 180 days after the issuance of the undefinitized order.
However, that target date may be extended by the Contracting
Officer for up to 180 days after the Contractor submits a
qualifying proposal as defined in DFARS 217.7401; or
(ii) the date on which the amount of funds
expended by the Contractor under the undefinitized order exceeds
fifty percent (50%) of the order's maximum ceiling amount, except
as provided in subparagraph (f) (3) below.
(3) If agreement on a definitive order is not reached
within the time provided pursuant to subparagraph (f) (2) above,
the Contracting Officer may, with the approval of the Head of the
Contracting Activity, determine a reasonable CPFF in accordance
with Subpart 15.8 and Part 31 of the FAR, and issue a unilateral
order subject to the Contractor appeal as provided in the
"DISPUTES" clause (FAR 52.233-1). In any event, the Contractor
shall proceed with completion of the order, subject to the
"LIMITATION OF GOVERNMENT LIABILITY" clause (FAR 52.216-24).
(g) Limitation of Government Liability.
(1) Each undefinitized order shall set forth the
limitation of Government liability, which shall be the maximum
amount that the government will be obligated to pay the
Contractor for performance of the order until the order is
definitized. The Contractor is not authorized to make
expenditures or incur obligations exceeding the limitation of
Government liability set forth in the order. If such
expenditures are made or if such obligations are incurred, those
expenditures and obligations will be at the Contractor's sole
risk and expense. Further, the limitation of liability shall be
the maximum Government liability if the order is terminated. The
clause at FAR 52.216-24 shall be included in any undefinitized
order.
(2) Except for undefinitized orders for Foreign
Military Sales; purchases of less than $25,000; special access
programs,; and Congressionally-mandated long-lead procurements,
and except as otherwise provided in subparagraph (g) (3) below,
the limitation of Government liability shall not exceed fifty
percent (50%) of the maximum ceiling amount of an undefinitized
order. In the case of orders within these excepted categories,
however, the procedures set forth herein shall be followed to the
maximum extent practical.
(3) If the Contractor submits a qualifying proposal,
as defined in DFARS 217.7401 to definitize an order before the
Contractor has incurred costs in excess of fifty percent (50%) of
the maximum ceiling amount, the Contracting Officer may increase
the limitation of Government Liability up to no more than seventy-
five percent (75%) of the maximum ceiling amount or up to seventy-
five percent (75%) of the total CPFF proposed by the Contractor,
whichever is less.
(4) If at any time the Contractor believes that its
expenditure under an order will exceed the limitation of
Government liability, the Contractor shall so notify the
Contracting Officer, in writing, and propose an appropriate
increase in the limitation of Government liability of such order.
Within thirty (30) days of such notice, the Contracting Officer
will either (i) notify the Contractor in writing of such
appropriate increase, or (ii) instruct the Contractor how and to
what extent the work shall be continued; provided, however, that
in no event shall the Contractor be obligated to proceed with
work on an undefinitized order beyond the point where its costs
incurred plus a reasonable profit exceed the limitation of
government liability, and provided also that in not event shall
the government be obligated to pay the Contractor any amount in
excess of the limitation of Government liability specified in any
such order prior to definitization.
(h) Initial Spares. The limitations set forth in the above
paragraph (d) regarding establishment of the maximum ceiling
amount, (f) (2), (g) (2) and (g) (3) do not apply to
undefinitized orders for the purchase of initial spares.
(i) Ordering Activities. The following activities are
authorized to issue orders hereunder: See Section G-2
The Contracting Officer of the Ordering Activity shall
forward a copy of each executed order marked "DD-350", to the
Commander, Naval Sea Systems Command, ATTN: SEA 0294.
H-9 NAVSEA 5252.217-9121 INDEMNIFICATION FOR ACCESS TO
VESSELS (MAY 1989)
Notwithstanding any provision in the "Access to Vessel" clause
(DOD FAR SUPP 252.217-7011), or any other clause of the contract,
the Contractor agrees to allow officers, employees, and
associates of the Government, or other prime contractors with the
Government and their subcontractor, and officers, employees, and
associates of offerors on other contemplated work, admission to
the Contractor's facilities and access to the vessel without any
further request for indemnification from any party, which has not
been previously included in the contract price.
H-10 NAVSEA 5252.227-9113 GOVERNMENT-INDUSTRY DATA EXCHANGE
PROGRAM (JUL 1995)
(a) The Contractor shall participate in the appropriate
interchange of the Government-Industry Data Exchange Program
(GIDEP) in accordance with the latest revision of MIL-STD-1556B
dated 24 February 1986. Data entered is retained by the program
and provided to qualified participants. Compliance with this
requirement shall not relieve the Contractor from complying with
any other requirement of the contract.
(b) The Contractor agrees to insert paragraph (a) of this
requirement in any subcontract hereunder exceeding $500,000.000.
When so inserted, the word "Contractor" shall be changed to
"Subcontractor".
H-11 NAVSEA 5252.233-9107 EQUITABLE ADJUSTMENTS: WAIVER AND
RELEASE OF CLAIMS (AT) (JAN 1983)
(a) Whenever the Contractor, after receipt of a change made
pursuant to the clause of this contract entitled "CHANGES" or
after affirmation of a constructive change under the
"NOTIFICATION OF CHANGES" (FAR 52.243-7) requirement, submits any
claim for equitable adjustments under the foregoing, such claim
shall include all types of adjustments in the total amounts to
which the foregoing entitle the Contractor, including but not
limited to adjustments arising out of delays or disruptions or
both caused by such change.
(b) Further, the Contractor agrees (except as the parties
may otherwise agree) that, if required by the Contracting
Officer, it will execute a release, in form and substance
satisfactory to the Contracting Officer, as part of the
supplemental agreement setting forth the aforesaid equitable
adjustment, and that such release shall discharge the Government,
its officers, agents and employees, from any further claims
including but not limited to further claims arising out of delays
or disruptions or both, caused by the aforesaid change.
SECTION I - CONTRACT CLAUSES
SECTION I-1 - CLAUSES INCORPORATED BY REFERENCE
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1) CLAUSES:
FAR
SOURCE TITLE AND DATE
52.202-1 DEFINITIONS (OCT 1995)
52.203-3 GRATUITIES (APR 1984)
52.203-5 COVENANT AGAINST CONTINGENT FEES (APR 984)
52.203-6 RESTRICTIONS ON SUBCONTRACTOR SALES TO THE
GOVERNMENT (JUL 1995)
52.203-7 ANTI-KICKBACK PROCEDURES (JUL 1995)
52.203-10 PRICE OR FEE ADJUSTMENT FOR ILLEGAL OR
IMPROPER ACTIVITY (SEP 1990)
52.203-12 LIMITATION ON PAYMENTS TO INFLUENCE CERTAIN
FEDERAL TRANSACTIONS (JAN 1990) (Applies if this contract exceeds
$100,000.)
52.204-2 SECURITY REQUIREMENTS (APR 1984)
52.204-4 PRINTING/COPYING DOUBLE-SIDED ON RECYCLED
PAPER
(MAY 1995)
52.208-1 REQUIRED SOURCES FOR JEWEL BEARINGS AND
RELATED ITEMS (APR 1984)
52.209-6 PROTECTING THE GOVERNMENT'S INTEREST WHEN
SUBCONTRACTING WITH CONTRACTORS DEBARRED, SUSPENDED, OR PROPOSED
FOR DEBARMENT (JUL 1995)
FAR
SOURCE TITLE AND DATE
52.211-5 NEW MATERIAL (MAY 1995)
52.211-7 OTHER THAN NEW MATERIAL, RESIDUAL
INVENTORY, AND FORMER GOVERNMENT SURPLUS PROPERTY (MAY 1995)
52.211-15 DEFENSE PRIORITY AND ALLOCATION
REQUIREMENTS (SEP 1990)
52.215-2 AUDIT AND RECORDS--NEGOTIATION (OCT 1995)
52.215-22 PRICE REDUCTION FOR DEFECTIVE COST OR
PRICING DATA (OCT 1995)
52.215-23 PRICE REDUCTION FOR DEFECTIVE COST OR
PRICING DATA--MODIFICATIONS (OCT 1995)
52.215-24 SUBCONTRACTOR COST OR PRICING DATA (OCT
1995)
52.215-25 SUBCONTRACTOR COST OR PRICING DATA--
MODIFICATIONS (OCT 1995)
52.215-27 TERMINATION OF DEFINED BENEFIT PENSION
PLANS (MAR 1996)
52.215-33 ORDER OF PRECEDENCE (JAN 1986)
52.215-39 REVERSION OR ADJUSTMENT OF PLANS FOR POST-
RETIREMENT BENEFITS (PRB) OTHER THAN PENSIONS (MAR 1996)
52.215-40 NOTIFICATION OF OWNERSHIP CHANGES (FEB
1995)
52.216-7 ALLOWABLE COST AND PAYMENT (JUL 1991)
52.216-8 FIXED FEE (APR 1984)
52.219-8 UTILIZATION OF SMALL, SMALL DISADVANTAGED
AND WOMEN-OWNED BUSINESS CONCERNS (OCT 1995)
52.219-9 SMALL, SMALL DISADVANTAGED AND WOMEN-OWNED
SMALL BUSINESS SUBCONTRACTING PLAN (OCT 1995)
52.219-16 LIQUIDATED DAMAGES--SUBCONTRACTING PLAN
(OCT 1995)
FAR
SOURCE TITLE AND DATE
52.222-1 NOTICE TO THE GOVERNMENT OF LABOR DISPUTES
(APR 1984)
52.222-3 CONVICT LABOR (APR 1984)
52.222-4 CONTRACT WORK HOURS AND SAFETY STANDARDS
ACT--OVERTIME COMPENSATION (JUL 1995)
52.222-20 WALSH-HEALEY PUBLIC CONTRACTS ACT (APR
1984)
52.222-26 EQUAL OPPORTUNITY (APR 1984)
52.222-28 EQUAL OPPORTUNITY PREAWARD CLEARANCE OF
SUBCONTRACTS (APR 1984) (Applies if this contract is $1,000,000
or more.) (As used in the foregoing clause, the term
"Contracting Officer" shall be deemed to mean the "Administrative
Contracting Officer (ACO)".)
52.222-35 AFFIRMATIVE ACTION FOR SPECIAL DISABLED
AND VIETNAM ERA VETERANS (APR 1984)
52.222-36 AFFIRMATIVE ACTION FOR HANDICAPPED
WORKERS (APR 1984)
52.222-37 EMPLOYMENT REPORTS ON SPECIAL DISABLED
VETERANS AND VETERANS OF THE VIETNAM ERA (JAN 1988)
52.223-2 CLEAN AIR AND WATER (APR 1984)
52.223-6 DRUG-FREE WORKPLACE (JUL 1990)
52.223-11 OZONE-DEPLETING SUBSTANCES (MAY 1995)
52.223-12 REFRIGERATION EQUIPMENT AND AIR
CONDITIONERS (MAY 1995)
52.223-14 TOXIC CHEMICAL RELEASE REPORTING (OCT
1995)
52.225-10 DUTY-FREE ENTRY (APR 1984) (Applies if
this contract exceeds $100,000.)
52.225-11 RESTRICTIONS ON CERTAIN FOREIGN PURCHASES
(MAY 1992)
FAR
SOURCE TITLE AND DATE
52.225-14 INCONSISTENCY BETWEEN ENGLISH VERSION AND
TRANSLATION OF CONTRACT (AUG 1989)
52.225-17 BUY AMERICAN ACT--SUPPLIES UNDER EUROPEAN
COMMUNITY AGREEMENT (MAY 1995) (Applies if this contract equals
or exceeds $182,000.)
52.226-1 UTILIZATION OF INDIAN ORGANIZATIONS AND
INDIAN-OWNED ECONOMIC ENTERPRISES (AUG 1991)
52.227-1 AUTHORIZATION AND CONSENT (JUL 1995) AND
and Alt I ALTERNATE I (APR 1984)
52.227-2 NOTICE AND ASSISTANCE REGARDING PATENT AND
COPYRIGHT INFRINGEMENT (APR 1984)
52.227-10 FILING OF PATENT APPLICATIONS--CLASSIFIED
SUBJECT MATTER (APR 1984)
52.228-7 INSURANCE--LIABILITY TO THIRD PERSONS (MAR
1996)
52.230-2 COST ACCOUNTING STANDARDS (AUG 1992)
52.230-3 DISCLOSURE AND CONSISTENCY OF COST
ACCOUNTING PRACTICES (NOV 1993)
52.230-5 ADMINISTRATION OF COST ACCOUNTING
STANDARDS (FEB 1995)
52.232-9 LIMITATION ON WITHHOLDING OF PAYMENTS (APR
1984)
52.232-22 LIMITATION OF FUNDS (APR 1984) (Applies
if this contract contains incrementally funded line items.)
52.232-23 ASSIGNMENT OF CLAIMS (JAN 1986)
52.232-25 PROMPT PAYMENT (MAR 1994)
52.232-28 ELECTRONIC FUNDS TRANSFER PAYMENT METHODS
(APR 1989)
FAR
SOURCE TITLE AND DATE
52.233-1 DISPUTES (OCT 1995) AND ALTERNATE I (DEC
1991) and Alt I
52.233-3 PROTEST AFTER AWARD (OCT 1995) AND and Alt
I ALTERNATE I (JUN 1985)
52.234-1 INDUSTRIAL RESOURCES DEVELOPED UNDER
DEFENSE PRODUCTION ACT TITLE III (FEB 1995)
52.242-1 NOTICE OF INTENT TO DISALLOW COSTS (APR
1984)
52.242-3 PENALTIES FOR UNALLOWABLE COSTS (OCT 1995)
(Applies if this contract exceeds $500,000.)
52.242-10 F.O.B. ORIGIN--GOVERNMENT BILLS OF LADING
OR PREPAID POSTAGE (APR 1984)
52.242-11 F.O.B. ORIGIN--GOVERNMENT BILLS OF LADING
OR INDICIA MAIL (FEB 1993)
52.242-12 REPORT OF SHIPMENT (REPSHIP) (JUL 1995)
52.242-13 BANKRUPTCY (JUL 1995)
52.243-2 CHANGES--COST-REIMBURSEMENT (AUG 1987)
52.243-6 CHANGE ORDER ACCOUNTING (APR 1984)
52.244-2 SUBCONTRACTS (COST-REIMBURSEMENT AND
LETTER CONTRACTS) (FEB 1995) AND ALT I (JUL 1995)
52.244-5 COMPETITION IN SUBCONTRACTING (JAN 1996)
52.244-6 SUBCONTRACTS FOR COMMERCIAL ITEMS AND
COMMERCIAL COMPONENTS (OCT 1995)
FAR
SOURCE TITLE AND DATE
52.245-5 GOVERNMENT PROPERTY (COST-REIMBURSEMENT,
TIME-AND-MATERIAL, OR LABOR-HOUR CONTRACTS) (JAN 1986)
52.246-23 LIMITATION OF LIABILITY (APR 1984)
52.246-24 LIMITATION OF LIABILITY--HIGH VALUE ITEMS
(APR 1984)
52.247-1 COMMERCIAL BILL OF LADING NOTATIONS (APR
1984)
52.248-1 VALUE ENGINEERING (MAR 1989) (Applies if
this contract equals or exceeds $100,000.)
52.249-6 TERMINATION (COST-REIMBURSEMENT) (MAY
1986)52.249-14
EXCUSABLE DELAYS (APR 1984) 52.251-1 GOVERNMENT
SUPPLY SOURCES (APR 1984) 52.253-1 COMPUTER
GENERATED FORMS (JAN 1991) DEFENSE FAR SUPPLEMENT (48 CFR CHAPTER
2) CLAUSES: DFARS SOURCE TITLE AND DATE CONTRACTING
OFFICER'S REPRESENTATIVE (DEC 1991) (Applies if this contract
requires a Contracting Officer's Representative (COR).) STATUTORY
PROHIBITIONS ON COMPENSATION TO FORMER DEPARTMENT OF DEFENSE
EMPLOYEES (NOV 1995) (Applies if this contract exceeds $100,000.)
SPECIAL PROHIBITION ON EMPLOYMENT (NOV 1995) DISPLAY OF DOD
HOTLINE POSTER (DEC 1991)(Applies if this contract exceeds
$5,000,000.)
252.204-7000 DISCLOSURE OF INFORMATION (DEC 1991)
252.204-7003 CONTROL OF GOVERNMENT PERSONNEL WORK
PRODUCT (APR 1992)
252.205-7000 PROVISION OF INFORMATION TO COOPERATIVE
AGREEMENT HOLDERS (DEC 1991) (Applies if this contract exceeds
$500,000.)
252.208-7000 INTENT TO FURNISH PRECIOUS METALS AS
GOVERNMENT-
FURNISHED MATERIAL (DEC 1991)
252.209-7000 ACQUISITION FROM SUBCONTRACTORS SUBJECT TO
ON-SITE INSPECTION UNDER THE INTERMEDIATE-RANGE NUCLEAR FORCES
(INF) TREATY (NOV 1995)
252.209-7004 REPORTING OF COMMERCIAL TRANSACTIONS WITH
THE GOVERNMENT OF A TERRORIST COUNTRY (SEP 1994)
252.211-7000 ACQUISITION STREAMLINING (DEC 1991)
252.215-7000 PRICING ADJUSTMENTS (DEC 1991)
DFARS SOURCE TITLE AND DATE
252.215-7002 COST ESTIMATING SYSTEM REQUIREMENTS
(DEC 1991)
252.217-7016 PLANT PROTECTION (DEC 1991)
252.219-7003 SMALL, SMALL DISADVANTAGED BUSINESS AND
WOMEN OWNED SMALL SUBCONTRACTING PLAN (DoD CONTRACTS) (NOV 1995)
252.219-7005 INCENTIVE FOR SUBCONTRACTING WITH SMALL
BUSINESSES,
SMALL DISADVANTAGED BUSINESSES, HISTORICALLY
BLACK COLLEGES AND UNIVERSITIES AND MINORITY INSTITUTIONS (DEC
1991)
252.222-7001 RIGHT OF FIRST REFUSAL OF EMPLOYMENT--
CLOSURE OF MILITARY INSTALLATIONS (APR 1993)
252.223-7002 SAFETY PRECAUTIONS FOR AMMUNITION AND
EXPLOSIVES (DEC 1991)
252.223-7003 CHANGE IN PLACE OF PERFORMANCE - AMMUNITION
(MAY 1994)
252.223-7004 DRUG-FREE WORK FORCE (SEP 1988)
252.225-7001 BUY AMERICAN ACT AND BALANCE OF PAYMENTS
PROGRAM (JAN 1994)
252.225-7002 QUALIFYING COUNTRY SOURCES AS
SUBCONTRACTORS (DEC 1991)
252.225-7007 TRADE AGREEMENT (JAN 1994)
252.225-7009 DUTY-FREE ENTRY--QUALIFYING COUNTRY END
PRODUCTS AND SUPPLIES (DEC 1991)
252.225-7010 DUTY-FREE ENTRY-ADDITIONAL PROVISIONS (DEC
1991)
252.225-7012 PREFERENCE FOR CERTAIN DOMESTIC COMMODITIES
(NOV 1995)
252.225-7014 PREFERENCE FOR DOMESTIC SPECIALTY METALS
and Alt I (NOV 1995) AND ALTERNATE I (DEC 1991)
DFARS SOURCE TITLE AND DATE
252.225-7015 PREFERENCE FOR DOMESTIC HAND OR MEASURING
TOOLS (DEC 1991)
252.225-7016 RESTRICTION ON ACQUISITION OF ANTIFRICTION
BEARINGS (NOV 1995)
252.225-7017 PREFERENCE FOR UNITED STATES AND CANADIAN
VALVES AND MACHINE TOOLS (APR 1995)
252.225-7019 RESTRICTION ON ACQUISITION OF FOREIGN
ANCHOR AND MOORING CHAIN (DEC 1991)
252.225-7022 RESTRICTION ON ACQUISITION OF POLYACRYL-
ONITRILE (PAN) BASED CARBON FIBER (DEC 1991)
252.225-7025 FOREIGN SOURCE RESTRICTIONS (APR 1993)
252.225-7026 REPORTING OF CONTRACT PERFORMANCE OUTSIDE
THE UNITED STATES (NOV 1995) (Applies if this contract exceeds
$500,000 or is modified to exceed $500,000.)
252.225-7028 EXCLUSIONARY POLICIES AND PRACTICES OF
FOREIGN GOVERNMENTS (DEC 1991)
252.225-7029 PREFERENCE FOR UNITED STATES OR CANADIAN
AIR CIRCUIT
BREAKERS (APR 1995)
252.225-7031 SECONDARY ARAB BOYCOTT OF ISRAEL (JUN 1992)
252.225-7034 RESTRICTION ON ACQUISITION OF COAL
PETROLEUM PITCH CARBON FIBER (MAY 1994)
252.227-7013 RIGHTS IN TECHNICAL DATA--NONCOMMERCIAL
ITEMS (NOV 1995)
252.227-7014 RIGHTS IN NONCOMMERCIAL COMPUTER SOFTWARE
AND NONCOMMERCIAL COMPUTER SOFTWARE DOCUMENTATION (JUN 1995)
252.227-7016 RIGHTS IN BID OR PROPOSAL INFORMATION (JUN
1995)
252.227-7019 VALIDATION OF ASSERTED RESTRICTIONS--
COMPUTER SOFTWARE (JUN 1995)
DFARS SOURCE TITLE AND DATE
252.227-7025 LIMITATIONS ON THE USE OR DISCLOSURE OF
GOVERNMENT FURNISHED INFORMATION MARKED WITH RESTRICTIVE LEGENDS
(JUN 1995)
252.227-7027 DEFERRED ORDERING OF TECHNICAL DATA AND
COMPUTER SOFTWARE (APR 1988)
252.227-7030 TECHNICAL DATA--WITHHOLDING OF PAYMENT (OCT
1988)
252.227-7036 CERTIFICATION OF TECHNICAL DATA CONFORMITY
(MAY 1987)
252.227-7037 VALIDATION OF RESTRICTIVE MARKINGS ON
TECHNICAL DATA (NOV 1995)
252.231-7000 SUPPLEMENTAL COST PRINCIPLES (DEC 1991)
252.232-7006 REDUCTION OR SUSPENSION OF CONTRACT
PAYMENTS UPON FINDING OF FRAUD (AUG 1992)
252.233-7000 CERTIFICATION OF CLAIMS AND REQUESTS FOR
ADJUSTMENT OR RELIEF (MAY 1994)
252.242-7000 POSTAWARD CONFERENCE (DEC 1991)
252.242-7001 CERTIFICATION OF INDIRECT COST (DEC 1991)
252.242-7003 APPLICATION FOR U.S. GOVERNMENT SHIPPING
DOCUMENTATION/INSTRUCTIONS (DEC 1991)
252.242-7004 MATERIAL MANAGEMENT AND ACCOUNTING SYSTEM
(DEC 1991) (Applies if this contract exceeds $25,000, unless it
is set aside exclusively for a small business or small
disadvantaged business concern.)
252.242-7005 COST/SCHEDULE STATUS REPORT (DEC 1991)
252.245-7001 REPORTS OF GOVERNMENT PROPERTY (MAY 1994)
252.246-7000 MATERIAL INSPECTION AND RECEIVING REPORT
(DEC 1991)
DFARS SOURCE TITLE AND DATE
252.248-7000 PREPARATION OF VALUE ENGINEERING CHANGE
PROPOSAL (MAY 1994)
252.249-7001 NOTIFICATION OF SUBSTANTIAL IMPACT ON
EMPLOYMENT
(DEC 1991) (Applies if this contract equals
or exceeds $5 million or has a subcontract of $500,000 or more.)
252.249-7002 NOTIFICATION OF PROPOSED PROGRAM
TERMINATION OR REDUCTION (MAY 1995)
252.251-7000 ORDERING FROM GOVERNMENT SUPPLY SOURCES
(MAY 1995)
SECTION I-2 - ADDITIONAL CONTRACT CLAUSES:
The following clauses are incorporated in full text.
FAR 52.217-7 OPTIONS FOR INCREASED QUANTITY-- SEPARATELY
PRICED LINE ITEM (MARCH 1989)(NAVSEA VARIATION II) (SEP 1990)
(a) By written notice to the Contractor, the
Contracting Officer may exercise, if at all, any of the Option
Items identified in Section B and require the Contractor to
provide, within the performance period specified in Section F,
the work described in Section C for such Option(s) Item(s) at the
estimated cost and base fee set forth in Section B. The
option(s) may be exercised after the Contractor's receipt of the
Specification Work Package prepared by the Planning Supervisor in
accordance with the procedures stated in Section C, but in any
event, the Option(s) shall be exercised, if at all, on or before
the following dates:
FISCAL YEAR ITEM LATEST OPTION EXERCISE DATE
FY 96: 0007 06/14/96
0008 06/14/96
FY 97: 0009 09/30/97
0010 09/30/97
0011 09/30/97
FY 98: 0012 11/07/97
0013 01/09/98
0014 04/03/98
0015 09/30/98
0016 09/30/98
FY 99: 0017 07/09/99
0018 07/09/99
0019 09/30/99
FY 00: 0020 11/05/99
0021 09/29/00
0022 09/29/00
0023 09/29/00
FY 01: 0024 01/12/01
0025 01/12/01
0026 05/04/01
(b) The exercise of any item identified under Section B
as an Option Item shall also extend the period of performance for
the Contract Data Requirements List, DD 1423, Exhibit "A" and the
Provisioning Technical Documentation, Exhibit "B".
FAR 52.252-6 AUTHORIZED DEVIATIONS IN CLAUSES (APR 1984)
(a) The use in this solicitation or contract of any
Federal Acquisition Regulation (48 CFR Chapter 1) clause with an
authorized deviation is indicated by the addition of
"(DEVIATION)" after the date of the clause.
(b) The use in this solicitation or contract of Defense
Federal Acquisition Regulation Supplement (48 CFR .....) clause
with an authorized deviation is indicated by the addition of
"(DEVIATION)" after the name of the regulation.
(End of clause)
FAR 52.222-2 PAYMENT FOR OVERTIME PREMIUMS)(JUL 1990)
(a) The use of overtime is authorized under this
contract if the overtime premium cost does not exceed *
___________ or the overtime premium is paid for work ---
(1) Necessary to cope with emergencies such as
those resulting from accidents, natural disasters, breakdowns of
production equipment, or occasional production bottlenecks of a
sporadic nature;
(2) By indirect-labor employees such as those
performing duties in connection with administration, protection,
transportation, maintenance, standby plant protection, operation
of utilities, or accounting;
(3) To perform tests, industrial processes,
laboratory procedures, loading or unloading of transportation
conveyances, and operations in flight or afloat that are
continuous in nature and cannot reasonably be interrupted or
completed otherwise; or
(4) That will result in lower overall costs to the
Government.
(b) Any request for estimated overtime premiums that
exceeds the amount specified above shall include all estimated
overtime for contract completion and shall ---
(1) Identify the work unit; e.g., department or
section in which the requested overtime will be used, together
with present workload, staffing and other data of the affected
unit sufficient to permit the Contracting Officer to evaluate the
necessity for overtime;
(2) Demonstrate the effect that denial of the
request will have on the contract delivery or performance
schedule;
(3) Identify the extent to which approval of
overtime would affect the performance or payments in connection
with other Government contracts, together with identification of
each affected contract; and
(4) Provide reasons why the required work cannot
be performed by using multishift operations or by employing
additional personnel.
* Insert either zero or the dollar amount
agreed to during negotiations. The inserted figure does not
apply to the exceptions in subparagraph (a)(1) through (a)(4) of
the clause.
FAR 52.203-9 REQUIREMENT FOR CERTIFICATE OF PROCUREMENT
INTEGRITY-MODIFICATION (SEP 1995)
(a) Definitions. The definitions set forth in FAR
3.104-4 are hereby incorporated in this clause.
(b) The Contractor agrees that it will execute the
certification set forth in paragraph (c) of this clause when
requested by the Contracting Officer in connection with the
execution of any modification of this contract.
(c) Certification. As required in paragraph (b) of
this clause, the officer or employee responsible for the
modification proposal shall execute the following certification.
The certification in paragraph (c)(2) of this clause is not
required for a modification which procures commercial items.
CERTIFICATE OF PROCUREMENT INTEGRITY - MODIFICATION (SEP
1995)
(1) I, [Name of Certifier], am the officer or employee
responsible for the preparation of this modification proposal and
hereby certify that, to the best of my knowledge and belief, with
the exception of any information described in this certification,
I have no information concerning a violation or possible
violation of subsection 27(a), (b), (d), or (f) of the Office of
Federal Procurement Policy Act, as amended* (41 U.S.C 423),
(hereinafter referred to as "the Act"), as implemented in the
FAR, occurring during the conduct of this procurement (contract
and modification number).
(2) As required by subsection 27(e)(1)(B) of the Act, I
further certify that to the best of my knowledge and belief, each
officer, employee, agent, representative, and consultant of (Name
of Offeror) who has participated personally and substantially in
the preparation or submission of this proposal has certified that
he or she is familiar with, and will comply with, the
requirements of subsection 27(a) of the Act, as implemented in
the FAR, and will report immediately to me any information
concerning a violation or possible violation of subsections
27(a), (b), (d), of (f) of the Act, as implemented in the FAR,
pertaining to this procurement.
(3) Violations or possible violations: (Continue on
plain bond paper if necessary and label Certificate of
Procurement Integrity - Modification (Continuation Sheet), ENTER
"NONE" IF NONE EXIST
[Signature of the officer or employee responsible for the
modification proposal and date]
_____________________________________________________
[Typed name of the officer or employee responsible for the
modification proposal]
______________________________________________________________
* Subsections 27(a)(b), and (d) are effective on December 1,
1990. Subsection 27(f) is effective on June 1, 1991.
THIS CERTIFICATION CONCERNS A MATTER WITHIN THE JURISDICTION OF
AN AGENCY OF THE UNITED STATES AND THE MAKING OF A FALSE,
FICTITIOUS, OR FRAUDULENT CERTIFICATION MAY RENDER THE MAKER
SUBJECT TO PROSECUTION UNDER TITLE 18, UNITED STATES CODE,
SECTION 1001.
(End of certification)
(d) In making the certification in paragraph (2) of the
certificate, the officer or employee of the competing Contractor
responsible for the offer or bid, may rely upon a one-time
certification from each individual required to submit a
certification to the competing Contractor, supplemented by
periodic training. These certifications shall be obtained at the
earliest possible date after an individual required to certify
begins employment or association with the contractor. If a
contractor decides to rely on a certification executed prior to
the suspension of section 27(i.e., prior to Dec 1, 1989), the
Contractor shall ensure that an individual who has so certified
is notified that section 27 has been reinstated. These
certification shall be maintained by the Contractor for a period
of 6 years from the date a certifying employment with the company
ends or, for an agency, representative, or consultant, 6 years
from the date such individual ceases to act on behalf of the
contractor.
(e) The certification required by paragraph (c) of this
clause is a material representation of fact upon which reliance
will be placed in executing this modification.
(End of clause)
252.217-7014 DISCHARGE OF LIENS (DEC 1991)
(a) The Contractor shall immediately discharge or
cause to be discharged any lien or right in rem of any kind,
other than in favor of the Government, that exists or arises in
connection with work done or material furnished under any job
order under this agreement.
(b) If any lien or right in rem is not immediately
discharged, the Government, at the expense of the Contractor, may
discharge, or cause to be discharged, the lien or right.
(End of clause)
252.247-7023 TRANSPORTATION OF SUPPLIES BY SEA (NOV 1995)
(a) Definitions.
As used in this clause --
(1) "Components" means articles, materials,
and supplies incorporated directly into end products at any level
of manufacture, fabrication, or assembly by the Contractor or any
subcontractor.
(2) "Department of Defense" (DoD) means the
Army, Navy, Air Force, Marine Corps., and defense agencies.
(3) "Foreign flag vessel" means any vessel
that is not a U.S.-flag vessel.
(4) "Ocean transportation" means any
transportation aboard a ship, vessel, boat, barge, or ferry
through international waters.
(5) "Subcontractor" means a supplier,
materialman, distributor, or vendor at any level below the prime
contractor whose contractual obligation to perform results from,
or is conditional upon, award of the prime contract and who is
performing any part of the work or other requirement of the prime
contract. However, effective May 1, 1996, the term does not
include a supplier, materialman, distributor, or vendor of
commercial items or commercial components.
(6) "Supplies" means all property, except
land and interests in land, that is clearly identifiable for
eventual use by or owned by the DoD at the time of transportation
by sea.
(i) An item is clearly identifiable for
eventual use by the DoD if, for example, the contract
documentation contains a reference to a DoD contract number or a
military destination.
(ii) "Supplies" includes (but is not
limited to) public works; buildings and facilities; ships;
floating equipment and vessels of every characters, type, and
description, with parts, subassemblies, accessories, and
equipment; machine tools; material; equipment; stores of all
kinds; end items; construction materials; and components of the
foregoing.
(7) "U.S.-flag vessel" means a vessel of the
United States or belonging to the United States, including any
vessel registered or having national status under the laws of the
United States.
(b) The Contractor shall employ U.S.-flag vessels in
the transportation by sea of any supplies to be furnished in the
performance of this contract. The Contractor and its
subcontractors may request that the Contracting Officer authorize
shipment in foreign-flag vessels, or designate available U.S.-
flag vessels, if the Contractor or a subcontractor believes that
- - --
(1) U.S.-flag vessels are not available for
timely shipment;
(2) The freight charges are inordinately
excessive or unreasonable; or
(3) Freight charges are higher than charges
to private persons for transportation of like goods.
(c) The Contractor must submit any request for use of
other than U.S.-flag vessels in writing to the Contracting
Officer at least 45 days prior to the sailing date necessary to
meet its delivery schedules. The Contracting Officer will
process requests submitted after such date(s) as expeditiously as
possible, but the Contracting Officer's failure to grant
approvals to meet the shipper's sailing date will not of itself
constitute a compensable delay under this or any other clause of
this contract. Requests shall contain at a minimum --
(1) Type, weight, and cube of cargo;
(2) Required shipping date;
(3) Special handling and discharge requirements;
(4) Loading and discharge points;
(5) Name of shipper and consignee;
(6) Prime contract number; and
(7) A documented description of efforts made to
secure U.S.-flag vessels, including points of contact (with names
and telephone numbers) with at least two U.S.-flag carriers
contacted. Copies of telephone notes, telegraphic and facsimile
message or letters will be sufficient for this purpose.
(d) The Contractor shall, within 30 days after each
shipment covered by this clause, provide the Contracting Officer
and the Division of National Cargo, Office of Market Development,
Maritime Administration, U.S. Department of Transportation,
Washington, DC 20590, one copy of the rated on board vessel
operating carrier's ocean bill of lading, which shall contain the
following information --
(1) Prime contract number;
(2) Name of vessel;
(3) Vessel flag of registry;
(4) Date of loading;
(5) Port of loading;
(6) Port of final discharge;
(7) Description of commodity;
(8) Gross weight in pounds and cubic feet if available;
(9) Total ocean freight in U.S. dollars; and
(10) Name of the steamship company.
(e) The Contractor agrees to provide with its final
invoice under this contract a representation that to the best of
its knowledge and
belief --
(1) No ocean transportation was used in the
performance of this contract;
(2) Ocean transportation was used and only
U.S.-flag vessels used for all ocean shipments under the
contract;
(3) Ocean transportation was used, and the
Contractor has the written consent of the Contracting Officer for
all non-U.S.-flag ocean transportation; or
(4) Ocean transportation was used and some or
all of the shipments were made on non-U.S.-flag vessels without
the written consent of the Contracting Officer. The Contractor
shall describe these shipments in the following format:
ITEM CONTRACT
DESCRIPTION LINE ITEMS QUANTITY
TOTAL
(f) If the final invoice does not include the required
representation, the Government will reject and return it to the
Contractor as an improper invoice for the purposes of the Prompt
Payment clause of this contract. In the event there has been
unauthorized use of non-U.S.-flag vessels in the performance of
this contract, the Contracting Officer is entitled to equitably
adjust the contract, based on the unauthorized use.
(g) The Contractor shall include this clause, including this
paragraph (g) in all subcontracts under this contract, which
exceed the simplified acquisition threshold in Part 13 of the
Federal Acquisition Regulation.
(End of Clause)
FAR 52.223-7 NOTICE OF RADIOACTIVE MATERIALS (NOV 1991)
(a) The Contractor shall notify the Contracting Officer
or designee, in writing, ____3____ days prior to the delivery of,
or prior to completion of any servicing required by this contract
of, items containing either (1) radioactive material requiring
specific licensing under the regulations issued pursuant to the
Atomic Energy Act of 1954, as amended, as set forth in Title 10
of the Code of Federal Regulations, in effect on the date of this
contract, or (2) other radioactive material not requiring
specific licensing in which the specific activity is greater than
0.002 microcuries per gram or the activity per item equals or
exceeds 0.01 microcuries. Such notice shall specify the part or
parts of the items which contain radioactive materials, a
description of the materials, the name and activity of the
isotape, the manufacturer of the materials, and any other
information known to the Contractor which will put users of the
items on notice as to the hazards involved (OMB No. 9000-0107).
______
(b) If there has been no change affecting the quantity
of activity, or the characteristics and composition of the
radioactive material from deliveries under this contract or prior
contracts, the Contractor may request that the Contracting
Officer or designee waive the notice requirement in paragraph (a)
of this clause. Any such request
shall -
(1) Be submitted in writing;
(2) Contain a certification that the quantity of
activity, characteristics, and composition of the radioactive
material have not changed; and
(3) Cite the contract number on which the prior
notification was submitted and the contracting office to which it
was submitted.
(c) All items, parts, or subassemblies which contain
radioactive materials in which the specific activity is greater
than 0.002 microcuries per gram or activity per item equals or
exceeds 0.01 microcuries, and all containers in which such items,
parts or subassemblies are delivered to the Government shall be
clearly marked and labeled as required by the latest revision of
MIL-STD 129 in effect on the date of the contract.
(d) This clause, including this paragraph (d), shall be
inserted in all subcontracts for radioactive materials meeting
the criteria in paragraph (a) of this clause.
(End of Clause)
PART III
LIST OF DOCUMENTS, EXHIBITS, AND OTHER ATTACHMENTS
SECTION J
LIST OF ATTACHMENTS
(a) Any contract awarded as a result of this solicitation
will consist of the following sections of this solicitation, and
the documents, exhibits, and attachments described in paragraph B
below:
I. Part I - The Schedule (Sections A through H)
II. Part II - Contract Clauses (Section I)
III. Part III - List of Documents, Exhibits, and Other
Attachments (Section J)
IV. Any other material and/or documents specifically
incorporated by reference into the contract.
(b) Part IV of the solicitation shall not be incorporated
physically into the contract. However, Section K,
"Representations, Certifications and Other Statements of Offerors
or Quoters" shall be retained in the contract file, and
acceptance of a proposal under this contract shall incorporate
Section K by reference in the resultant contract. (FAR 15.406-
1(b)).
(c) Documents, exhibits, and other attachments that will
form a part of this contract are as follows:
1. Exhibit A - Contract Data Requirements List
(DD Form 1423)
2. Exhibit B - Contract Data Requirements List
(DD Form 1423)
3. Exhibit C - Contract Data Requirements List
(DD Form 1423)
4. Attachment J-1 - Notional Work Specification
Package for AOE Class (Provided by SUPSHIP San Diego under
separate cover)
5. Attachment J-2 - Provisioning Requirements Statement
(DD Form 1949-1/2)
6. Attachment J-3 - Contract Security Classification
Certification (DD Form 254)
7. Attachment J-4 - Accounting and Appropriation Data
Sheet (To be provided at contract award)
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