ARMED SERVICES BOARD OF CONTRACT APPEALS 
 
Appeal of - )  
 )  
Paragon Defense Solutions, Inc. ) ASBCA No. 64307 
 )  
Under Contract No. SPE7L2-22-P-0710 )  
   
APPEARANCE FOR THE APPELLANT: Mr. Weiwei Jian 
    President 
 
APPEARANCES FOR THE GOVERNMENT: Gary P. Bilski, Esq. 
    DLA Chief Trial Attorney 
 John J. Pritchard, Esq. 
Adam J. Heer, Esq. 
Julie K. Phillips, Esq. 
Deidra Canady, Esq. 
    Trial Attorneys 
    DLA Land and Maritime 
    Columbus, OH 
 
OPINION BY ADMINISTRATIVE JUDGE MCILMAIL 
Appellant, Paragon Defense Solutions, Inc. (Paragon), requests that the Board 
award it $26,846, and convert to a termination for convenience what Paragon says was 
the improper termination of its contract.1  Paragon elected to proceed under the 
Board’s Small Claims (Expedited) procedures, Board Rule 12.2.  The Contract 
Disputes Act, 41 U.S.C. §§ 7106(b)(4)-(5), as implemented by Board Rule 12.2, 
provides that this decision shall have no precedential value, and in the absence of fraud 
shall be final and conclusive and may not be appealed or set aside.  In addition, the 
parties agreed to proceed under Board Rule 11; that is, on the written record, without a 
live hearing. 
 
FINDINGS OF FACT 
 
On April 20, 2022, the government issued a unilateral purchase order to 
Paragon for 96 items described as “Parts, Kit, Seat” (kits) for $168,000, to be delivered 
within 210 days; that is, by November 16, 2022.
2  Paragon never delivered any kits to 
the government, much less 96 kits by November 16, 2022.3  The government 
 
1 App. br. at 5; app. reply br. at 7. 
2 See R4, tab 1 at 1, 4; app. br. at 1 ¶ 1; gov’t br. at 2 ¶ 5.  
3 See app. br. at 1 ¶ 2, 3-4. 

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unilaterally issued Modification No. 1 on December 16, 2022; the modification states 
that “[s]ince that date”—November 16, 2022—“was not met, the Government’s offer 
to purchase has lapsed.”4  The modification further states that “the purchase order is 
hereby cancelled at no cost or liability to the Government.”5 
  
DECISION 
 
Both parties point to Federal Acquisition Regulation (FAR) Part 13 as the 
authority for the purchase order.6  Purchase orders have three distinct phases:  (1) the 
offer, (2) the option contract, and (3) the completed purchase and sale contract.  
DODS, Inc., ASBCA No. 57816, 12-2 BCA ¶ 35,082 at 172,287.  If the contractor 
engages in “substantial performance” in attempting to supply the item, an option 
contract is created wherein the offer becomes irrevocable.  Id.  If the contractor 
successfully performs the contract by delivering conforming services or supplies on 
time, a “completed purchase and sale contract” comes into existence.  Id.  However, if 
complete performance in accordance with the offer’s terms and conditions is not 
tendered, the option contract and purchase order lapse without the need for any action 
on the part of the government.  See id.; Warfighter Def. Inc., ASBCA No. 63924, 
 25-1 BCA ¶ 38,863 at 189,136; Comptech Corp., ASBCA No. 55526, 08-2 BCA 
¶ 33,982 at 168,082. 
 
Paragon says that it “fully manufactur[ed]” the 96 kits, and the government 
concedes that Paragon performed to the extent that an option contract was formed, 
binding the government “to keep its ‘offer’ open for the time stated in the offer.”
7  
However, by the November 16, 2022 contract delivery date, Paragon had not delivered 
any of the kits to the government, much less 96 kits; indeed, Paragon never delivered 
any of the kits to the government.  Consequently, the option contract and the purchase 
order lapsed without the need for any action on the part of the government. 
 
 Paragon says that the government delayed Paragon’s performance through 
“mixed messaging” regarding the “only issue” allegedly affecting performance; that is, 
 the location and legibility of part-identification markings.
8  But Paragon does not 
demonstrate that the government was obligated to help Paragon resolve that issue.  See 
Precision Pine & Timber, Inc. v. United States, 596 F.3d 817, 831 (Fed. Cir. 2010)  
(“The implied duty of good faith and fair dealing cannot expand a party’s contractual 
duties beyond those in the express contract . . .”).  In addition, Paragon says that on 
December 12, 2022, it warned the government that Paragon “would have to assume 
 
4 R4, tab 13 at 2. 
5 R4, tab 13 at 2. 
6 See app. br. at 2; ans. at 2 ¶ 5. 
7 App. reply br. at 2 (alteration added); gov’t br. at 5. 
8 App. br. at 1 ¶ 2, 3-4. 

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where to place the markings.”9  That warning is a concession that Paragon could have 
decided on its own how to label the kits, and could have labeled and delivered those 
kits by the November 16, 2022 delivery deadline.  Paragon having failed to deliver the 
parts on time, the option contract lapsed, even if timely delivery of mislabeled parts 
would have also resulted in the option contract having lapsed. 
  
The parties’ other contentions have been considered and found unnecessary  
to address.  For all these reasons, the appeal is denied. 
 
CONCLUSION 
 
 The appeal is denied. 
 
 Dated:  November 19, 2025  
 
 
 
 
 
 
 
 
 
TIMOTHY P. MCILMAIL 
Administrative Judge 
Armed Services Board 
of Contract Appeals 
 
 
 
 I certify that the foregoing is a true copy of the Opinion and Decision of the 
Armed Services Board of Contract Appeals in ASBCA No. 64307,
 Appeal of Paragon 
Defense Solutions, Inc., rendered in conformance with the Board’s Charter. 
 
 Dated:  November 19, 2025 
 
 
 
 
 
9 App. reply br. at 4-5. 
 
 
 
PAULLA K. GATES-LEWIS 
Recorder, Armed Services 
Board of Contract Appeals