EX-10.4



 Exhibit 10.4 

 

					
	AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT	 	  1. CONTRACT ID CODE  	 	   PAGE OF  

1        2



									
	 2.
AMENDMENT/MODIFICATION NO.
 031
  
	 	3. EFFECTIVE DATE   12/01/2014	 	4. REQUISITION/PURCHASE REQ. NO.	 	 5. PROJECT NO.

(If applicable)

	6. ISSUED BY                        
CODE	 	5ASNET	 	7. ADMINISTERED BY (IF OTHER THAN ITEM 6)	 	  CODE  	 	  5ASNET  
	  
 ALAINA EARL

Air Transportation CMC
 United States Postal
Service
 475 L’Enfant Plaza SW

Room 1P 650
 Washington DC 20260-0650

(202) 268-6580
  
	 	  
 Air Transportation CMC

Air Transportation CMC
 United States Postal Service
 475 L’Enfant Plaza SW, Room 1P650

Washington DC 20260-0650



							
	 8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code)
 FEDERAL EXPRESS CORPORATION
 3610 HACKS CROSS ROAD

MEMPHIS TN 38125-8800
	 	  (x)	  	 9A. AMENDMENT OF SOLICITATION NO.

 

	 	 	  	 9B. DATED (SEE ITEM 11)

 
  

	 	    x
  
	  	 10A. MODIFICATION OF CONTRACT/ORDER NO. ACN-13-FX

	 	 	  	 10B. DATED (SEE ITEM 13)
  

04/23/2013
  

	SUPPLIER CODE:    000389122	 	FACILITY CODE	 	 	  	 

 11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS 

 

							
	 ̈	 	 	 	 	  	     ̈  is extended,       
  ̈  is not extended.


													
	  
 Offers must acknowledge receipt of this amendment
prior to the hour and date specified in the solicitation or as amended, by one of the following methods: (a) By completing items 8 and 15, and
returning                     copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer
submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment number. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and
this amendment, and is received prior to the opening hour and date specified.
  



			
	
12. ACCOUNTING AND APPROPRIATION DATA     (If Required)

See Schedule
	  	  

NET DECREASE: [*]



			
	  
 13. THIS
ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
  
	 	


									
	    (x)    	 	  A.  	 	THIS CHANGE BY CLAUSE IS ISSUED PURSUANT TO: (Specify Clause) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.	 		 	
	 x
  
	 	 	 	 Monthly Fuel Adjustment

 
	 		 	
	 ̈	 	  B.  	 	 THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as
changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14.
  
	 		 	
	 ̈	 	  C.  	 	 THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: THE CHANGES SET FORTH IN
ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
  
	 		 	
	x	 	  D.  	 	 OTHER (such as no cost change/cancellation, termination, etc.) (Specify type of modification and
authority): THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
 By Mutual Agreement of the Contracting
Parties
  
	 		 	


			
	  
 E.
IMPORTANT:     Contractor  ̈ is not, x is required to sign this document and
return          1           copies to the issuing office.

 
	 	
	  
 14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF
section headings, including solicitation/contract subject matter where feasible.)
 In accordance with contract ACN-13-FX and
the “Fuel Adjustment” section, the following Line Haul Rate (fuel) for the Day Network as set out in Attachment 10 is modified for performance during the period of December 1, 2014 to January 4, 2015 (Operating Period 15) as
follows:
  
 From:

[*] per cubic foot
  

To:
 [*]
per cubic foot
  
 Continued...

 
	 	


			
	 Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
  
	 	


					
	 15A. NAME AND TITLE OF SIGNER (Type or
print)
  
 Paul J. Herron, Vice President

 
	 	 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

 
     Brian Mckain

 
	 	 


									
	 15B.
CONTRACTOR/OFFEROR
  

    /s/ PAUL J. HERRON
 (Signature of person authorized to sign)
	 	
15C. DATE SIGNED
  
 02/13/2015
	 	 16B. CONTRACT AUTHORITY

 
     /s/ BRIAN MCKAIN

(Signature of Contracting Officer)
	 	 16C. DATE SIGNED

 
 02/19/15
	 	 

 * Blank spaces contained confidential information which has been filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 








									
	 CONTINUATION SHEET
	 	REQUISITION NO.               
     	 	 PAGE OF

2        2



									
	 CONTRACT/ORDER NO.

ACN-13-FX/031
	 	 AWARD/ EFFECTIVE DATE  

12/01/2014
	 	MASTER/AGENCY CONTRACT NO.	 	SOLICITATION NO.	 	 SOLICITATION ISSUE DATE



											
	ITEM NO	 	SCHEDULE OF SUPPLIES / SERVICES	 	QUANTITY	 	
    UNIT    
	 	UNIT PRICE	 	
AMOUNT

	  

 
  
  

 
  
  

 
  
  

 
  
  

 
  
  

 
  
  

 
 00001

 
  
	 	 This is a decrease of [*].

 
 [*]

 
 This modification also incorporates the language from Modification 30
into the contract document as shown in the attached. A summary of these changes are as follows:
  
 Page 9: “Aviation Supplier Planned Accommodation – Day Network”
  
 Page 22: “Reduction of Payment”
  
 Page 28: “Payment Processing – Day Network – Per Cube”
  
 Page 34: “Clause B-1: Definitions (March 2006) (Tailored)”
  
 An additional language change from Modification 30 is the removal of the following sentence from Line 1262 of the contract language:

 
 “The invoiced cubic feet for ad hoc trucks will be calculated by dividing the
Handling Unit’s Postal Service assigned rounded weight by the applicable contract density.”
  
 Sub Rept Req’d: Y Carrier Code: FX Route Termini
 S: Various Route Termini End: Various
Payment
 Terms: SEE CONTRACT
 Delivery:
12/01/2014
 Discount Terms:
  

See Schedule
  

Accounting Info:
 BFN: 670167

FOB: Destination
 Period of Performance:
12/01/2014 to 09/30/2020
  
 Change Item 00001 to read as follows:

 
 Day Network
 Account Number: 53503
	 	 	 	 	 	 	 	  
  

 
  
  

 
  
  

 
  
  

 
  
  

 
  
  

[*]


 * Blank spaces contained confidential information which has been filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 







 United States Postal Service 

AIR CARGO NETWORK 
 Contract ACN-13-FX 
 Awarded By: 

Air Transportation CMC 
 Transportation Portfolio 
 Supply Management 

475 L’Enfant Plaza SW 
 Room 1P 650 
 Washington, DC 20260-0650 

April 23, 2013 
 Modification 1 Issued May 28, 2013 
 Modification 2 Issued June 24, 2013

 Modification 3 Issued September 24, 2013 
 Modification 7 Issued October 22, 2013 
 Modification 11 Issued January 6,
2014 
 Modification 12 February 3, 2014 
 Modification 13 March 3, 2014 
 Modification 14 March 31, 2014

 Modification 15 April 28, 2014 
 Modification 16 May 27, 2014 
 Modification 17, May 11, 2014

 Modification 18, June 18, 2014 
 Modification 19, June 27, 2014 
 Modification 21, June 27, 2014

 Modification 22, June 30, 2014 








 Air Cargo Network 

Contract ACN-13-FX 
 Table of Contents 
  

 Modification 23, July 28, 2014 

Modification 24, September 1, 2014 
 Modification 25, September 29, 2014 
 Modification
26, September 29, 2014 
 Modification 28, October 27, 2014 

Modification 30, January 5, 2015 
 Modification 31, January 13, 2015 








 Air Cargo Network 

Contract ACN-13-FX 
 Table of Contents 
  

 Table of Contents 

 

					
	 Part 1: Statement of Work
	  	 	6	  
	 Purpose and Scope
	  	 	6	  
	 Scale
	  	 	6	  
	 Services Provided
	  	 	6	  
	 Service Points
	  	 	7	  
	 Management Plan
	  	 	7	  
	 Frequency
	  	 	8	  
	 Mail Assignment and Transport - Day Network
	  	 	8	  
	 Mail Assignment and Transport - Night Network
	  	 	8	  
	 Local Agreements
	  	 	8	  
	 Postal Service Performs Terminal Handling Service (THS) Operation - Day Network
	  	 	8	  
	 Aviation Supplier Planned Accommodation - Day Network
	  	 	9	  
	 Aviation Supplier Planned Accommodation - Night Network
	  	 	10	  
	 Delivery - Day Network
	  	 	10	  
	 Delivery - Night Network
	  	 	10	  
	 Saturday Delivery - Day Network
	  	 	10	  
	 Specific Delivery Instructions
	  	 	10	  
	 Boarding Priority - Day Network
	  	 	10	  
	 Boarding Priority - Night Network
	  	 	11	  
	 Repossession of Mail by the Postal Service
	  	 	11	  
	 Treatment of Exceptional Types of Mail
	  	 	11	  
	 Perishable Mail and Live Mail
	  	 	13	  
	 Registered Mail
	  	 	13	  
	 Offshore Capacity Requirement - Day Network
	  	 	13	  
	 Volume Commitment - General Information
	  	 	14	  
	 Volume Commitment - Contract Volume Minimum - Day Network
	  	 	14	  
	 Operating Period Volume Minimum - Day Network
	  	 	14	  
	 Operating Period Volume Minimum - Night Network
	  	 	14	  
	 Volume Commitment - Holiday - Day Network
	  	 	15	  
	 Volume Commitment - Holiday - Night Network
	  	 	15	  
	 Operating Periods
	  	 	16	  
	 Ordering Process - Non-Peak - Day Network
	  	 	16	  
	 Ordering Process - Non-Peak - Night Network
	  	 	16	  
	 Ordering Process - Peak - Day Network
	  	 	17	  
	 Ordering Process - Peak - Night Network
	  	 	17	  
	 Electronic Data Interchange (EDI)
	  	 	18	  
	 Operational Condition Reports
	  	 	18	  
	 Dimensional Weight Reports
	  	 	19	  
	 Scanning and Data Transmission
	  	 	19	  
	 Performance Requirements and Measurement
	  	 	20	  
	 Reduction of Payment
	  	 	21	  
	 Performance Management
	  	 	22	  
	 Sustainability
	  	 	22	  
	 Security
	  	 	23	  
	 Postal Service Employees Allowed Access
	  	 	23	  
	 Personnel Screening
	  	 	23	  
	 Payment Procedures
	  	 	27	  
	 Rates and Payment General
	  	 	27	  
	 Payment Processing - Day Network - Per Cube
	  	 	28	  
	 Payment Processing - Night Network - Per Pound
	  	 	31	  
	 Reconciliation Process
	  	 	31	  









 Air Cargo Network 

Contract ACN-13-FX 
 Table of Contents 
  


							
		
	 Part 3: Contract Clauses
	  	 	33	  
	 Clause B-1:
	 	 Definitions (March 2006) (Tailored)
	  	 	33	  
	 Clause B-3:
	 	 Contract Type (March 2006) (Tailored)
	  	 	36	  
	 Clause B-9:
	 	 Claims and Disputes (March 2006) (Tailored)
	  	 	36	  
	 Clause B-10:
	 	 Pricing of Adjustments (March 2006) (Tailored)
	  	 	37	  
	 Clause B-15:
	 	 Notice of Delay (March 2006) (Tailored)
	  	 	37	  
	 Clause B-22:
	 	 Interest (March 2006) (Tailored)
	  	 	38	  
	 Clause B-25:
	 	 Advertising of Contract Awards (March 2006)
	  	 	38	  
	 Clause B-30:
	 	 Permits and Responsibilities (March 2006) (Tailored)
	  	 	38	  
	 Clause B-39:
	 	 Indemnification (March 2006) (Tailored)
	  	 	38	  
	 Clause B-45:
	 	 Other Contracts (March 2006) (Tailored)
	  	 	38	  
	 Clause B-65:
	 	 Adjustments to Compensation (March 2006) (Tailored)
	  	 	38	  
	 Clause B-69:
	 	 Events of Default (March 2006) (Tailored)
	  	 	40	  
	 Clause B-75:
	 	 Accountability of the Aviation Supplier (Non-Highway) (March 2006) (Tailored)
	  	 	40	  
	 Clause B-77:
	 	 Protection of the Mail (Non-Highway) (March 2006) (Tailored)
	  	 	41	  
	 Clause B-80:
	 	 Laws and Regulations Applicable (March 2006) (Tailored)
	  	 	42	  
	 Clause B-81:
	 	 Information or Access by Third Parties (March 2006) (Tailored)
	  	 	42	  
	 Clause B-82:
	 	 Access by Officials (March 2006) (Tailored)
	  	 	42	  
	 Clause 1-1:
	 	 Privacy Protection (July 2007)
	  	 	43	  
	 Clause 1-5:
	 	 Gratuities or Gifts (March 2006)
	  	 	44	  
	 Clause 1-6:
	 	 Contingent Fees (March 2006)
	  	 	44	  
	 Clause 1-11:
	 	 Prohibition Against Contracting with Former Officers or PCES Executives (March 2006) (Tailored)
	  	 	45	  
	 Clause 1-12:
	 	 Use of Former Postal Service Employees (March 2006) (Tailored)
	  	 	45	  
	 Clause 2-11:
	 	 Postal Service Property - Fixed-Price (March 2006) (Tailored)
	  	 	45	  
	 Clause 2-22:
	 	 Value Engineering Incentive (March 2006)
	  	 	47	  
	 Clause 3-1:
	 	 Small, Minority, and Woman-owned Business Subcontracting Requirements (March 2006)
	  	 	50	  
	 Clause 3-2:
	 	 Participation of Small, Minority, and Woman-owned Businesses (March 2006)
	  	 	51	  
	 Clause 4-1:
	 	 General Terms and Conditions (July 2007) (Tailored)
	  	 	51	  
	 Clause 4-2:
	 	 Contract Terms and Conditions Required to Implement Policies, Statutes, or Executive Orders (July 2009)
(Tailored)
	  	 	55	  
	 Clause 4-7:
	 	 Records Ownership (March 2006)
	  	 	56	  
	 Clause 6-1:
	 	 Contracting Officer’s Representative (March 2006)
	  	 	56	  
	 Clause 9-1:
	 	 Convict Labor (March 2006)
	  	 	56	  
	 Clause 9-2:
	 	 Contract Work Hours and Safety Standards Act - Overtime Compensation (March 2006)
	  	 	57	  
	 Clause 9-7:
	 	 Equal Opportunity (March 2006) (Tailored)
	  	 	57	  
	 Clause 9-9:
	 	 Equal Opportunity Preaward Compliance of Subcontracts (March 2006) (Tailored)
	  	 	58	  
	 Clause 9-10:
	 	 Service Contract Act (March 2006)
	  	 	58	  
	 Clause 9-12:
	 	 Fair Labor Standards Act and Service Contract Act - Price Adjustment (February 2010)
	  	 	65	  
	 Clause 9-13:
	 	 Affirmative Action for Workers with Disabilities (March 2006) (Tailored)
	  	 	66	  
	 Clause 9-14:
	 	 Equal Opportunity for Disabled Veterans, Recently Separated Veterans, Other Protected Veterans, and Armed Forces Service Medal
Veterans (February 2010) (Tailored)
	  	 	67	  
	 Contract Term
	  	 	69	  
	 Renewal Process
	  	 	69	  
	 Amendments or Modifications
	  	 	69	  
	 Assignment
	  	 	69	  
	 Bankruptcy
	  	 	70	  









 Air Cargo Network 

Contract ACN-13-FX 
 Table of Contents 
  


							
	 Confidentiality
	  	 	70	  
	 Entire Agreement
	  	 	70	  
	 Force Majeure
	  	 	71	  
	 Frequency Adjustment
	  	 	71	  
	 Notices
	  	 	72	  
	 Severability
	  	 	72	  
	 Third Party Governmental Delays
	  	 	73	  
	 Waiver of Breach
	  	 	73	  
		
	 Part 4 - List of Attachments and Forms
	  	 	74	  
	 Attachment 1
	  	 Postal Service Operating Periods, dated June 27, 2014
	  	 	73	  
	 Attachment 2
	  	 Air Stops & Projected Volumes, dated January 8, 2013
	  	 	75	  
	 Attachment 3
	  	 Operating Plan, Day Network, dated June 27, 2014
	  	 	76	  
	 Attachment 4
	  	 Operating Plan, Night Network, dated June 27, 2014
	  	 	83	  
	 Attachment 5
	  	 Reserved
	  			
	 Attachment 6
	  	 Postal Furnished Property, April 16, 2013
	  	 	91	  
	 Attachment 7
	  	 Electronic Data Interchange Service Requirements, dated September 1, 2012
	  	 	92	  
	 Attachment 8
	  	 Investigative / Security Protocol and Guidelines, dated July 2012
	  	 	93	  
	 Attachment 9
	  	 Wage Determination, dated October 31, 2012
	  	 	97	  
	 Attachment 10
	  	 Pricing, dated January 13, 2015
	  	 	99	  
	 Attachment 11
	  	 Perishable Mail and Lives, June 27, 2014
	  	 	102	  
	 Attachment 12
	  	 Reserved
	  			
	 Attachment 13
	  	 Service Contract Act Wage Determinations, dated June 24, 2014
	  	 	104	  
	 Attachment 14
	  	 Contract Density, dated June 27, 2014
	  	 	124	  
	 Attachment 15
	  	 Average Weight Process, dated June 27, 2014
	  	 	126	  
	 Attachment 16
	  	 Re-labeling Process, dated June 27, 2014
	  	 	127	  
	 Attachment 17
	  	 Handling Unit Types, dated June 27, 2014
	  	 	129	  

  

			
	 Forms
	  	
	 DOT Form F 5800.1
	  	Hazardous Materials Incident Report
	 I-9 Form
	  	Employment Eligibility Verification
	 PS Form 2025
	  	Contract Personnel Questionnaire
	 PS Form 8203
	  	Order / Solicitation / Offer / Award
	 US Treasury Form 941
	  	Quarterly Federal Tax Return









 Air Cargo Network 

Contract ACN-13-FX 
 Part 1: Statement of Work 
  


			
	  1	  	Part 1: Statement of Work
	  2	  	
	  3	  	
	  4	  	Purpose and Scope
	  5	  	The United States Postal Service is seeking to purchase air transportation and ancillary services for
	  6	  	mail to and from destinations within the contiguous forty-eight (48) states as well as non-contiguous
	  7	  	areas to include Alaska, Hawaii, and Puerto Rico. This statement of work (SOW) provides for the
	  8	  	transportation of mail on any flight in the aviation supplier’s air transportation network. It also provides
	  9	  	for services associated with the transportation of mail by the aviation supplier. The air carrier’s
	10	  	network or transportation system may include its own flights, flights of its approved subcontractors,
	11	  	flights that may be dedicated to Postal operations, and Road Feeder Service.
	12	  	
	13	  	
	14	  	Scale
	15	  	The volume of mail (expressed in pounds and cubic feet) transported as contracted under this air
	16	  	cargo network contract may increase or decrease significantly over the term of the contract consistent
	17	  	with the needs of the Postal Service.
	18	  	
	19	  	
	20	  	Services Provided
	21	  	The aviation supplier shall provide sufficient resources to efficiently and effectively take possession,
	22	  	sort (if necessary), transport, scan, load, and deliver all mail to the designated destination Service
	23	  	Points specified by the Postal Service in Attachment 2: Air Stops & Projected Volumes, Attachment 3:
	24	  	Operating Plan, Day Network, and Attachment 4: Operating Plan, Night Network.
	25	  	
	26	  	The aviation supplier will present scan data for these events electronically to the Postal Service. See
	27	  	Attachment 7: Electronic Data Interchange Service Requirements.
	28	  	
	29	  	[*]
	30	  	
	31	  	
	32	  	
	33	  	
	34	  	
	35	  	The aviation supplier will be expected to (this list is not all inclusive):
	36	  	 a.      Coordinate and oversee its own operations; supervise and protect its own
employees.

	37	  	 b.      Ensure that the necessary facility support and administrative functions are
performed.

	38	  	 c.      Monitor performance.

	39	  	 d.      Provide feedback to the Postal Service.

	40	  	 e.      Ensure the integrity of data entry.

	41	  	 f.       Coordinate the exchange of information.

	42	  	 g.      Provide notification of changes or anticipated changes in services provided
(including

	43	  	          subcontractors) to the Postal Service.

	44	  	 h.      Scan material Handling Units.

	45	  	 i.       Assist in unloading or loading Unit Load Devices (ULDs) to or from surface
transportation.

	46	  	 j.       Provide the correct type and quantity of equipment necessary to support the
service

	47	  	          requirements of this contract.

	48	  	 k.      Process mail for dispatch from the aviation supplier’s facility to the Postal Service
facility.

	49	  	 l.       Close-out, receive, and dispatch all surface vehicles.

	50	  	 m.     Handle overflow volumes per Postal Service general directions.

	51	  	 n.      Cooperate with all aviation suppliers in the transportation service
chain.

	52	  	 o.      Enter data timely and accurately.

	53	  	 p.      Prepare required reports.

	54	  	 q.      Perform verification of security seals on surface transportation.

	55	  	 r.       Ensure the security of all mail.

	 56	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
 Page 6 of 130










 Air Cargo Network 

Contract ACN-13-FX 
 Part 1: Statement of Work 
  


			
	57	  	
	58	  	Service Points
	59	  	Service Points are the locations where tender and / or delivery takes place. The locations and tender
	60	  	and delivery specifications are listed in Attachment 3: Operating Plan, Day Network, and Attachment
	61	  	4: Operating Plan, Night Network.
	62	  	
	63	  	The Day Network will service approximately eighty (80) origin and destination Service Points.
	64	  	
	65	  	The Night Network will service approximately one hundred forty-five (145) origin and destination
	66	  	Service Points
	67	  	
	68	  	
	69	  	Management Plan
	70	  	The aviation supplier shall develop and maintain a current Management Plan for dealing with normal
	71	  	daily operations as well as unscheduled and unexpected events affecting the expeditious operation of
	72	  	the facility, including aviation and surface service failure and delays. The Management Plan must also
	73	  	address the key personnel involved on a day to day basis.
	74	  	
	75	  	Updates to this plan shall be submitted to the Contracting Officer within ten (10) days of any changes
	76	  	to the plan. The aviation supplier shall review and verify, at least annually, that its management plan
	77	  	is current.
	78	  	
	79	  	The aviation supplier must train its employees to a level of familiarity that ensures a contingency plan
	80	  	can be exercised without delay. The following items must be addressed by the Management Plan; the
	81	  	list is not all inclusive.
	82	  	
	83	  	 a.      Late arriving aircraft and trucks

	84	  	 •    Ability to conduct two operations – Originating and Destinating

	85	  	
	86	  	 b.      Early arriving aircraft and trucks

	87	  	 c.      Mail arriving out of normal sequence

	88	  	 d.      Trucks not on-site for dispatch

	89	  	 e.      Inclement weather during operations

	90	  	 •    Snow issues

	91	  	 •    Ice storms

	92	  	 •    Airport closures

	93	  	
	94	  	 f.       Protection of the mail during inclement weather

	95	  	 g.      Labor actions

	96	  	 h.      Inadequate staffing

	97	  	 i.       An inability to complete all loading in time to meet tender

	98	  	 j.       Overflow mail

	99	  	 k.      Damaged and / or non air worthy containers

	100	  	 l.       Damaged surface containers

	101	  	 m.     Damaged or non-labeled mail

	102	  	 n.      Plan and schedule changes

	103	  	 o.      Loose load mail

	104	  	 p.      Hazardous Material (HAZMAT)-acceptable and non-acceptable pieces

	105	  	 q.      Handling and staging of live animals

	106	  	 r.       Running out of supplies such as placards, bypass tape, etc.

	107	  	 s.      Power losses – Describe in detail all steps to be taken in the event of power loss
to

	108	  	          include specific actions for back up power at the Terminal Handling Service
(THS) location

	109	  	          such as generators and other systems.

	110	  	 t.       Natural disasters

	111	  	 u.      Equipment breakdowns

	112	  	 v.      Airport closings

	113	  	 w.     Air Traffic Control (ATC) impact mitigation plan



  
 Page 7 of 130










 Air Cargo Network 

Contract ACN-13-FX 
 Part 1: Statement of Work 
  


			
	114	  	
	115	  	
	116	  	Frequency
	117	  	The initial frequency of service for the Day Network (Priority Mail / First Class network) is based on six
	118	  	(6) days of Postal Service delivery and shall be Tuesday through Sunday (X1).1 This will provide for
	119	  	approximately 307 (308 in a leap year) operating days annually. This excludes the widely observed
	120	  	holidays as listed in the sections titled, Volume Commitment – Holiday – Day Network and Volume
	121	  	Commitment – Holiday – Night Network.
	122	  	
	123	  	The initial frequency of service for the Night Network (Express Mail network) is based on five (5) days
	124	  	of Postal Service delivery and shall be Monday through Friday (X67).2 This will provide for
	125	  	approximately 254 (255 in a leap year) operating days annually. This excludes the widely observed
	126	  	holidays as listed in the sections titled, Volume Commitment – Holiday – Day Network and Volume
	127	  	Commitment – Holiday – Night Network.
	128	  	
	129	  	
	130	  	Mail Assignment and Transport - Day Network
	131	  	The aviation supplier shall provide flight schedules at least thirty (30) days in advance of the Operating
	132	  	Period. The Postal Service will create dispatch routing instructions based on the aviation supplier’s
	133	  	flight schedule and subsequently shown on the Postal Service Dispatch and Routing (D&R) Tag.
	134	  	
	135	  	The Postal Service agrees to provide up to seventy-five (75%) percent of the total volume assigned to
	136	  	the outbound flights to the aviation supplier one (1) hour before the scheduled ‘All Mail Due Aviation
	137	  	Supplier’ column as listed in Attachment 3: Operating Plan, Day Network. The Postal Service agrees
	138	  	to provide the remaining twenty-five (25%) percent by the ‘All Mail Due Aviation Supplier’ column listed
	139	  	in Attachment 3: Operating Plan, Day Network.
	140	  	
	141	  	
	142	  	Mail Assignment and Transport - Night Network
	143	  	The Postal Service agrees to provide up to seventy-five (75%) percent of the total volume assigned to
	144	  	the outbound flights to the aviation supplier thirty (30) minutes before the scheduled ‘All Mail Due
	145	  	Aviation Supplier’ column as listed in Attachment 4: Operating Plan, Night Network. The Postal
	146	  	Service agrees to provide the remaining twenty-five (25%) percent by the ‘All Mail Due Aviation
	147	  	Supplier’ column listed in Attachment 4: Operating Plan, Night Network.
	148	  	
	149	  	
	150	  	Local Agreements
	151	  	No Local Agreement (any informal agreement or working arrangement made between representatives
	152	  	of the aviation supplier, the Postal Service, or their agents who lack authority to bind either company)
	153	  	shall be binding, obligate the Postal Service or the aviation supplier, or otherwise give rise to any claim
	154	  	under this contract.
	155	  	
	156	  	
	157	  	Postal Service Performs Terminal Handling Service (THS) Operation - Day
	158	  	Network
	159	  	Mail will be tendered to the aviation supplier in accordance with the Operating Plan provided by the
	160	  	aviation supplier. The aviation supplier’s Operating Plan will be provided thirty (30) days before the
	161	  	start up of the Operating Period. The aviation supplier’s Operating Plan will specify the following
	162	  	information:
	163	  	
	164	  	 Specific Type of Airline ULD per origin / destination

	165	  	 Destination of Airline ULD – Direct (bypass)

		  	  
 1    X1 refers to the day of the week that
service will not be performed. The days of the week are numbered consecutively from 1 through 7 beginning with Monday (1). “X1” means that service will operate each day of the week except Monday.

2    X67 refers to the days of the week that service will not be performed. “X67” means that service will operate each day of the week except
Saturday and Sunday.



  
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	166	  	 Destination of Airline ULD – Mixed (to be sorted at hub)

	167	  	
	168	  	The Operating Plan will be mutually agreed upon prior to implementation.
	169	  	
	170	  	The aviation supplier will transport, scan, and deliver the ULDs to the specific Service Points listed in
	171	  	Attachment 3: Operating Plan, Day Network. The Postal Service or its representative will build the
	172	  	ULDs in conformance with the aviation supplier’s Operating Plan.
	173	  	
	174	  	The aviation supplier will perform the following activities including, but not limited to:
	175	  	
	176	  	 a.      Sorting and scanning mail at an aviation supplier hub, as necessary, which also may
include

	177	  	          re-wrap and reapplication of Distribution & Routing (D&R) Tags to
mail requiring such

	178	  	          treatment, and dispatch on service responsive
transportation

	179	  	
	180	  	 b.       In the unlikely event that mail tendered to the aviation supplier is in excess
(overflow) of what

	181	  	 may be transported, the aviation supplier shall:

	182	  	 i.       Secure the mail.

	183	  	 ii.      Scan all Handling Units and record the number of pieces, weight, and destination
of

	184	  	          all overflow Handling Units.

	185	  	 iii.     Immediately notify the local Postal official after becoming aware of an
overflow

	186	  	          situation. The Postal official will direct the aviation supplier to either
hold the mail for

	187	  	          the next outbound flight or return it to the designated Postal
facility.

	188	  	 iv.     Prepare all overflow mail for delivery to the local designated Postal facility
within

	189	  	          twenty (20) minutes of receipt of Postal direction.

	190	  	 v.      Provide a written report of the overflow to the local Postal official with a copy to
the

	191	  	          COR.

	192	  	
	193	  	When transporting mail in carts, containers, or other vehicles, the mail must be securely enclosed to
	194	  	protect it from loss, depredation, and damage. The aviation supplier will stage mail in a secure area
	195	  	while in its possession. The aviation supplier is not allowed to transport mail in the cabs of its vehicles
	196	  	except for mail containing live animals.
	197	  	
	198	  	
	199	  	Aviation Supplier Planned Accommodation - Day Network
	200	  	The aviation supplier will guarantee space to accommodate up to 105% of the Planned Capacity from
	201	  	each origin daily. All mail accepted by the aviation supplier is subject to the service commitments set
	202	  	forth in this contract.
	203	  	
	204	  	FedEx will accept mail from Origin air stops as identified in Attachment 3 Operating Plan - Day
	205	  	Network in excess of 105% of Planned Capacity on a space available basis.
	206	  	
	207	  	If the Postal Service tenders mail to the aviation supplier after the ‘All Mail Due Aviation Supplier’
	208	  	column as shown in Attachment 3: Operating Plan, Day Network, the aviation supplier has the right to
	209	  	refuse that volume.
	210	  	
	211	  	Mail accepted after the agreed upon ‘All Mail Due Aviation Supplier’ column in Attachment 3:
	212	  	Operating Plan, Day Network, shall be subject to the same service commitments as mail tendered at
	213	  	or before the ‘All Mail Due Aviation Supplier’ column.
	214	  	
	215	  	


  
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	216	  	
	217	  	Aviation Supplier Planned Accommodation - Night Network
	218	  	The aviation supplier will guarantee space to accommodate up to 120% of the Planned Capacity from
	219	  	each origin daily. All mail accepted by the aviation supplier is subject to the service commitments set
	220	  	forth in this contract.
	221	  	
	222	  	If the Postal Service tenders mail in excess of 120% of the Planned Capacity for that Service Point,
	223	  	the aviation supplier may refuse to transport the excess tender. If the volume is accepted, the same
	224	  	service requirements apply.
	225	  	
	226	  	If the Postal Service tenders mail to the aviation supplier after the ‘All Mail Due Aviation Supplier’
	227	  	column as shown in Attachment 4: Operating Plan, Night Network, the aviation supplier has the right to
	228	  	refuse that volume.
	229	  	
	230	  	Mail accepted after the agreed upon ‘All Mail Due Aviation Supplier’ column in Attachment 4:
	231	  	Operating Plan, Night Network, shall be subject to the same service commitments as mail tendered at
	232	  	or before the ‘All Mail Due Aviation Supplier’ column.
	233	  	
	234	  	
	235	  	Delivery - Day Network
	236	  	The aviation supplier will deliver mail to a destination Service Point by the scheduled ‘Latest Delivery
	237	  	Time to Postal Service’ column in Attachment 3: Operating Plan, Day Network.
	238	  	
	239	  	
	240	  	Delivery - Night Network
	241	  	The aviation supplier will deliver mail to a Service Point by the scheduled ‘Latest Delivery Time to
	242	  	Postal Service’ column in Attachment 4: Operating Plan, Night Network, on or before the scheduled
	243	  	delivery day (D+1) on Attachment 4: Operating Plan, Night Network. “D+1” is defined as the day
	244	  	following acceptance by the aviation supplier.
	245	  	
	246	  	At destination, the aviation supplier is required to unload the mail from the ULDs received, scan, and
	247	  	deliver the mail to the Postal Service.
	248	  	
	249	  	
	250	  	Saturday Delivery - Day Network
	251	  	See Attachment 3: Operating Plan, Day Network, for details on Saturday delivery.
	252	  	
	253	  	
	254	  	Specific Delivery Instructions
	255	  	The aviation supplier shall:
	256	  	 a.      Assist in loading and dispatching all outbound surface vehicles, as
required

	257	  	
	258	  	 b.      Must develop a cooperative line of communication with the Postal Service to ensure the
timely

	259	  	          delivery and dispatch of mail. All efforts shall be made to provide an
efficient and effective

	260	  	          delivery to the Postal Service.

	261	  	
	262	  	
	263	  	Boarding Priority - Day Network
	264	  	The aviation supplier must board accepted mail using the following mail boarding preference order:
	265	  	 a.      Registered (Con-Con) Mail

	266	  	
	267	  	 b.      Lives

	268	  	
	269	  	 c.      Perishables

	270	  	
	271	  	 d.      HAZMAT, regardless of mail
class



  
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	272	  	
	273	  	 e.      Domestic Priority and Express Mail

	274	  	
	275	  	 f.       First-Class Mail

	276	  	
	277	  	 g.      All Other Mail

	278	  	
	279	  	The Manager, Air Transportation Operations, or a Postal Service designee, will determine if the Postal
	280	  	Service should repossess any mail without exercising rights as described in the section titled
	281	  	Repossession of Mail by the Postal Service.
	282	  	
	283	  	
	284	  	Boarding Priority - Night Network
	285	  	The aviation supplier must board accepted mail using the following mail boarding preference order:
	286	  	 a.      Express Mail

	287	  	 b.      All other classes of mail

	288	  	
	289	  	
	290	  	Repossession of Mail by the Postal Service
	291	  	The Postal Service may, at any time, require the aviation supplier to return to the local Postal Service
	292	  	representative or agent at a Service Point, any or all of the mail in its possession at that location or the
	293	  	Postal Service may take possession of such mail from the aviation supplier.
	294	  	
	295	  	
	296	  	Treatment of Exceptional Types of Mail
	297	  	 1.      Tagging of Hazardous Material

	298	  	 The aviation supplier may carry mailable HAZMAT, subject to applicable law, rules and

	299	  	 regulations, including, without limitation:

	300	  	
	301	  	 a.      ORM-D Air

	302	  	 “ORM-D” stands for “Other Regulated Material-Class D.” ORM-D is a term developed by

	303	  	 the Department of Transportation (DOT) that signifies the hazard class associated with a

	304	  	 consumer commodity. Most hazardous materials accepted by the Postal Service for

	305	  	 mailing are classified as ORM-D. A package marked ORM-D meets the standards for

	306	  	 surface transportation only. “ORM-D-Air” signifies that the item meets the requirements

	307	  	 for air and surface transportation.

	308	  	
	309	  	 The Postal Service currently accepts limited quantity alternative marking options (square

	310	  	 on point) for ORM-D and ORM-D-Air and plans to adopt mandatory effective dates as

	311	  	 identified by the Department of Transportation. There are no intended changes to

	312	  	 quantity limits, package weights, or documentation requirements for these mailable

	313	  	 materials.

	314	  	
	315	  	 b.       Division Class 6.2

	316	  	 Division Class 6.2 materials are not permitted in international mail or domestic mail,

	317	  	 except when they are intended for medical or veterinary use, research, or laboratory

	318	  	 certification related to the public health. These materials are permitted only when they are

	319	  	 properly prepared for mailing to withstand shocks, pressure changes, and other conditions

	320	  	 related to ordinary handling in transit.

	321	  	
	322	  	 c.       Division Class 9

	323	  	 Division Class 9 items are miscellaneous hazardous materials or substance articles that

	324	  	 present a hazard during transportation but do not meet the definition of any other hazard

	325	  	 class. Examples of miscellaneous hazardous materials (not all of which are mailable)

	326	  	 include solid dry ice, elevated temperature substances, environmentally hazardous

	327	  	 substances, life-saving appliances, and asbestos.

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	329	  	 d.      Hazardous and Dangerous Goods

	330	  	 The aviation supplier will accept all Dangerous Goods as defined in the Domestic Mail

	331	  	 Manual, section 601.10. All Dangerous Goods will be tendered on the Night Network.

	332	  	 The Postal Service will be in compliance with the current International Air Transport

	333	  	 Association (IATA) allowed variations as listed for the aviation supplier. The Postal

	334	  	 Service will tender all Dangerous Goods at least two hours prior to the tender time shown

	335	  	 in Attachment 4: Operating Plan, Night Network. The Postal Service shall not tender any

	336	  	 used sharps. Any future changes to Hazardous and Dangerous Goods requirements will

	337	  	 be reviewed and must be acceptable to the aviation supplier prior to implementation of the

	338	  	 changes.

	339	  	
	340	  	 e.       All other hazardous material that is packaged and distributed in a quantity and
form

	341	  	 intended or suitable for retail sale and designed for consumption by individuals for their

	342	  	 personal care or household use purposes; reference

	343	  	 http://pe.usps.gov/text/dmm300/601.htm#wp1065003.

	344	  	
	345	  	 2.      Assignment of Hazardous Materials

	346	  	 a.      The tender of all hazardous materials will be performed a minimum of two (2) hours
prior

	347	  	          to the final tender time of the intended flight.

	348	  	
	349	  	 b.      The desired flight assignment of HAZMAT is to non-stop or direct
flights.

	350	  	
	351	  	 c.      No surcharge is offered for the transportation of HAZMAT mail.

	352	  	
	353	  	 d.      A copy of the manifest and the assigned item MUST be handed to an aviation
supplier

	354	  	          representative a minimum of two (2) hours prior to the closeout time of the
intended flight.

	355	  	          The aviation supplier representative will be responsible for ensuring that
the information

	356	  	          on the postal manifest which includes the number of pieces, weight, and
appropriate

	357	  	          shipper’s certification detail is incorporated onto the aircraft load
manifest and pilot

	358	  	          notification paperwork as outlined in CFR 49, Part 175, Carriage by
Aircraft.

	359	  	
	360	  	 e.      Aviation supplier Refusal to Accept Hazardous Materials: If the aviation supplier
refuses

	361	  	          to accept a properly prepared HAZMAT item, it shall document the reasons
leading to the

	362	  	          refusal. Documentation will include:

	363	  	 i.       Name and address of mailer and air carrier;

	364	  	 ii.      The type and amount of hazardous material; and

	365	  	 iii.     The reason for refusal.

	366	  	
	367	  	 f.       HAZMAT Spills, Releases, Incidents, and Emergencies

	368	  	 i.       While in the possession of the aviation supplier, but not on board an
aircraft:

	369	  	 Hazardous Material items which are damaged must not be boarded on the

	370	  	 aircraft. HAZMAT incidents which occur following the tender but prior to

	371	  	 boarding of the aircraft, or after unloading from an aircraft and before delivery

	372	  	 to the Postal Service, causing injury, illness, significant property damage, or

	373	  	 disruption in operations will require the aviation supplier to enter the required

	374	  	 information into the Mail Piece Incident Reporting Tool (MIRT), a Postal

	375	  	 Service intranet tool for the collection of information on leaking and other non-

	376	  	 mailable items.

	377	  	
	378	  	 ii.      While on board an aircraft:

	379	  	 Any incident which occurs while on board an aircraft will require the aviation

	380	  	 supplier to complete a Department of Transportation (DOT) Form F 5800.1

	381	  	 (01-2004), Hazardous Materials Incident Report. A copy of this form must be

	382	  	 sent to the COR within twenty-four (24) hours of the incident with all

	383	  	 information available. The incident type is not limited to hazardous material

	384	  	 and may include hazardous cargo spills which come in contact with the mail.

	385	  	


  
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	386	  	
	387	  	Perishable Mail and Live Mail
	388	  	The aviation supplier will be required to transport as mail perishable items which the Postal Service
	389	  	has accepted as mailable under Domestic Mail Manual (DMM) 601, sub section 9.0, including live
	390	  	animals as discussed at DMM 601 subsection 9.3. The Postal Service will notify the aviation supplier
	391	  	a minimum of two (2) hours prior to the ‘All Mail Due Aviation Supplier’ time as listed in Attachment 3:
	392	  	Operating Plan, Day Network, and Attachment 4: Operating Plan, Night Network, of the intended flight
	393	  	of known perishable mail, including live animals.
	394	  	
	395	  	Attachment 11: Perishable Mail and Lives, details the requirements for preparation and tender of
	396	  	perishable mail and live animal shipments.
	397	  	
	398	  	
	399	  	Registered Mail
	400	  	The aviation supplier will accept Registered Mail provided in Con-Cons for the Day Network only.
	401	  	
	402	  	Registered Mail Con-Cons will be a part of the Planned Capacity and will be tendered in accordance
	403	  	with Attachment 3: Operating Plan, Day Network.
	404	  	
	405	  	Upon request, the aviation supplier shall furnish the Postal Service the following information
	406	  	concerning Registered Mail:
	407	  	 •    Aircraft number,

	408	  	 •    Aircraft compartment location,

	409	  	 •    Actual flight departure time, and

	410	  	 •    Any accident or irregularity which occurs to a flight containing Registered
Mail.

	411	  	
	412	  	Registered Mail Handling Units will have a D&R Tag affixed indicating the final destination air stop.
	413	  	This Handling Unit shall remain intact and shall not be opened by the aviation supplier. The desired
	414	  	routing for Registered Mail shipments will be to non-stop or direct flights only.
	415	  	
	416	  	The aviation supplier shall advise the U.S. Postal Inspection Service, local Postal Service
	417	  	representatives, and will send an email message to the COR of any Registered Mail that does not
	418	  	make its planned dispatch for disposition instructions.
	419	  	
	420	  	
	421	  	Offshore Capacity Requirement - Day Network
	422	  	The aviation supplier will make available at least the following daily volumes into and out of the
	423	  	following locations.
	424	  	
	425	  	 Cube Based:

	426	  	 [*] cube (Originating) and [*] cube Destinating Anchorage (ANC)

	427	  	 [*] cube (Originating) and [*] cube Destinating Honolulu (HNL)

	428	  	 [*] cube (Originating) and [*] cube Destinating San Juan (SJU)

	429	  	
	430	  	The Postal Service may increase this capacity as needed through the planning process through the
	431	  	mutual agreement of the parties.
	432	  	
	433	  	In the event that destinating offshore volumes exceed the volumes listed in “Offshore Capacity
	434	  	Requirement - Day Network” at the Aviation Supplier’s Memphis hub, the excess volume will receive a
	435	  	scan in Memphis that qualifies as a Delivery Scan. This scan will fulfill the requirement that the
	436	  	aviation supplier obtain a destination Delivery Scan under Payment Procedures. The time of the scan
	437	  	will also be used to measure performance under Performance Requirements and Measurement and in
	438	  	the assessment of reductions under Reduction of Payment.
	439	  	
	440	  	All destinating offshore volume will move to the offshore destination as part of the Aviation Supplier’s
	441	  	services under this contract, on a first-in, first-out basis. The Aviation Supplier is still responsible for

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	442	  	performing a Delivery Scan when the volume is tendered to the Postal Service at the offshore
	443	  	destination.
	444	  	
	445	  	
	446	  	Volume Commitment - General Information
	447	  	The Day Network operating week is defined as Tuesday through Sunday inclusive (X1).
	448	  	
	449	  	The Night Network operating week is defined as Monday through Friday inclusive (X67).
	450	  	
	451	  	The Postal Service is not obligated to request consistent capacity by day of the week. Requests for
	452	  	capacity are detailed in the Ordering Process sections.
	453	  	
	454	  	The following constitute the only minimum volume guarantees under this contract:
	455	  	 •       Contract Volume Minimum of [*] cubic feet on the Day
Network.

	456	  	 •       The Contract Volume Minimum may be reduced in accordance with Clause
4-1:

	457	  	 General Terms and Conditions, paragraph m, and Frequency Adjustment found in

	458	  	 Part 3: Contract Clauses.

	459	  	
	460	  	 [*]

	461	  	
	462	  	
	463	  	
	464	  	
	465	  	 •       90% of Planned Capacity for the Night Network for each Operating
Period

	466	  	
	467	  	Any monies due as a result of the Postal Service not meeting its Contract Volume Minimum or its
	468	  	Operating Period Volume Minimum as measured and calculated at the end of each Operating Period
	469	  	will be included as part of the Operating Period’s reconciliation process.
	470	  	
	471	  	On operating days where volume for lanes with Planned Capacity is withdrawn, withheld, or not
	472	  	transported under the Repossession of Mail by the Postal Service or Force Majeure sections, that
	473	  	volume will not be included in calculating the Operating Period Volume Minimum. The Contract
	474	  	Volume Minimum will be reduced for the Operating Period by the amount of that volume.
	475	  	
	476	  	
	477	  	Volume Commitment - Contract Volume Minimum - Day Network
	478	  	A minimum of [*] cubic feet per operational day, averaged across six (6) days per week, and measured
	479	  	across each Operating Period, will constitute the Contract Volume Minimum guaranteed to be paid by
	480	  	the Postal Service.
	481	  	
	482	  	
	483	  	Operating Period Volume Minimum - Day Network
	484	  	[*]
	485	  	
	486	  	
	487	  	
	488	  	
	489	  	
	490	  	
	491	  	
	492	  	
	493	  	
	494	  	
	495	  	Operating Period Volume Minimum - Night Network
	496	  	[*]
	497	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
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	498	  	[*]
	499	  	
	500	  	
	501	  	
	502	  	
	503	  	
	504	  	
	505	  	
	506	  	Volume Commitment - Holiday - Day Network
	507	  	Each holiday will be addressed separately between the parties during the Ordering Process. The
	508	  	holidays are:
	509	  	 •    New Year’s Day (widely observed)

	510	  	 •    Martin Luther King Day

	511	  	 •    Presidents’ Day

	512	  	 •    Memorial Day (widely observed)

	513	  	 •    Independence Day (widely observed)

	514	  	 •    Labor Day (widely observed)

	515	  	 •    Columbus Day

	516	  	 •    Veterans Day

	517	  	 •    Thanksgiving (widely observed)

	518	  	 •    Christmas (widely observed)

	519	  	
	520	  	For purposes of Contract Volume Minimum and Operating Period Volume Minimum calculations, the
	521	  	following days will not be included:
	522	  	 •    Widely observed holidays

	523	  	 •    The day following the widely observed holidays that occur on a Monday

	524	  	 •    Non-widely observed holidays that occur on a Monday

	525	  	
	526	  	For purposes of Contract Volume Minimum and Operating Period Volume Minimum calculations, the
	527	  	following days will be included at a 50% volume level:
	528	  	 •    The day following widely observed holidays not occurring on a Monday

	529	  	 •    Non-widely observed holidays not occurring on a Monday

	530	  	 •    The day after a non-widely observed holiday

	531	  	
	532	  	
	533	  	Volume Commitment - Holiday - Night Network
	534	  	Each holiday will be addressed separately between the parties during the Ordering Process. The
	535	  	holidays are:
	536	  	 •    New Year’s Day (widely observed)

	537	  	 •    Martin Luther King Day

	538	  	 •    Presidents’ Day

	539	  	 •    Memorial Day (widely observed)

	540	  	 •    Independence Day (widely observed)

	541	  	 •    Labor Day (widely observed)

	542	  	 •    Columbus Day

	543	  	 •    Veterans’ Day

	544	  	 •    Thanksgiving (widely observed)

	545	  	 •    Christmas (widely observed)

	546	  	
	547	  	The widely observed holidays will not be included in the Operating Period Volume Minimum
	548	  	calculation.
	549	  	
	550	  	The non-widely observed holidays will be included at a 50% volume level in the Operating Period
	551	  	Volume Minimum calculation.
	552	  	

  

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	553	  	
	554	  	Operating Periods
	555	  	The Operating Periods are incorporated as Attachment 1: Postal Service Operating Periods. No
	556	  	Operating Period will exceed five weeks. The Peak Operating Periods are designated in Attachment
	557	  	1: Postal Service Operating Periods.
	558	  	
	559	  	
	560	  	Ordering Process - Non-Peak - Day Network
	561	  	The Postal Service will provide the aviation supplier mail volumes in accordance with the identified
	562	  	schedule specified below. The forecasting structure will specify each origin / destination lane pair
	563	  	including cubic feet by day of week for the pairs. The Postal Service will request capacity based on
	564	  	specific plans for a Tuesday / Wednesday plan, a Thursday / Friday plan, a Saturday plan, and a
	565	  	Sunday plan.
	566	  	
	567	  	[*]
	568	  	
	569	  	
	570	  	
	571	  	
	572	  	
	573	  	
	574	  	
	575	  	
	576	  	
	577	  	
	578	  	
	579	  	
	580	  	
	581	  	
	582	  	
	583	  	Over the course of the Ordering Process for two (2) Operating Periods, the Postal Service may reduce
	584	  	volume down to the Contract Volume Minimum.
	585	  	
	586	  	The request for capacity shall be presented to the aviation supplier in a mutually agreed upon
	587	  	electronic origin / destination format.
	588	  	
	589	  	Bypass containers will be allocated in lanes where the requested capacity is greater than one hundred
	590	  	and ten (110) percent of the cubic capacity of the ULD configuration for the aircraft planned for the
	591	  	Service Point provided there is sufficient space to flow the Bypass container from the origin to the final
	592	  	destination on the scheduled flights. To facilitate this process, the Postal Service and the aviation
	593	  	supplier will jointly agree upon both Bypass and Mixed containers to be built at all origins during the
	594	  	Ordering Process.
	595	  	
	596	  	
	597	  	Ordering Process - Non-Peak - Night Network
	598	  	The Postal Service will provide the aviation supplier mail volumes in accordance with the identified
	599	  	schedule specified below. The forecasting structure will specify each origin / destination lane pair
	600	  	including weight.
	601	  	
	602	  	[*]
	603	  	
	604	  	
	605	  	
	606	  	
	607	  	
	608	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	609	  	[*]
	610	  	
	611	  	
	612	  	The request for capacity shall be presented to the aviation supplier in a mutually agreed upon
	613	  	electronic origin / destination format.
	614	  	
	615	  	
	616	  	Ordering Process - Peak - Day Network
	617	  	The Peak Operating Period will consist of four or five individual weeks, measured and planned as
	618	  	independent of each other. One of the five weeks of the Peak Operating Period will include the week
	619	  	of Christmas. As such, the requested volume capacity will include the Christmas week. The
	620	  	forecasting structure will specify each origin / destination lane pair including weight or cubic feet by
	621	  	day of week for the pairs. The Postal Service will request capacity based on specific plans for a
	622	  	Tuesday / Wednesday plan, a Thursday / Friday plan, a Saturday plan and a Sunday plan.
	623	  	
	624	  	The aviation supplier will make available at least [*] cubic feet of capacity per week for the Peak
	625	  	Operating Period for the Day Network. As a general planning guideline, the historical volume
	626	  	transported per day during the Peak Operating Period ranges between [*] to [*] cubic feet. The Peak
	627	  	season tab included in Attachment 2: Air Stops & Projected Volumes provides the historic mail volume
	628	  	in pounds by mail class by week during the Peak Operating Period. These volumes are provided for
	629	  	initial planning purposes and do not constitute a guarantee of volume for the Peak Ordering Period.
	630	  	
	631	  	For the Peak Operating Period, the Postal Service will provide the aviation supplier a request for
	632	  	capacity by lane, expressed in cubic feet, one hundred fifty (150) days prior to the beginning of the
	633	  	Peak Operating Period. The request for capacity shall be presented to the aviation supplier in a
	634	  	mutually agreed upon electronic origin / destination format. The aviation supplier will reply to the
	635	  	request by providing the Postal Service with its response expressed in cubic feet one hundred twenty
	636	  	(120) days prior to the start of the Peak Operating Period. The Postal Service will communicate its
	637	  	acceptance of the aviation supplier’s response ninety (90) days prior to the commencement of the
	638	  	Peak Operating Period. The Postal Service acceptance establishes the Planned Capacity for the
	639	  	Peak Operating Period.
	640	  	
	641	  	The Operating Period Minimum Volume for Peak will be [*] of the Planned Capacity.
	642	  	
	643	  	The aviation supplier will guarantee space to accommodate up to 105% of the Planned Capacity from
	644	  	each origin daily.
	645	  	
	646	  	
	647	  	Ordering Process - Peak - Night Network
	648	  	The Peak Operating Period will consist four or five individual weeks, measured and planned as
	649	  	independent of each other. One of the five weeks of the Peak Operating Period will include the week
	650	  	of Christmas. As such, the requested volume capacity will include the Christmas week. The
	651	  	forecasting structure will specify each origin / destination lane pair including weight.
	652	  	
	653	  	For the Peak Operating Period, the Postal Service will provide the aviation supplier a request for
	654	  	capacity by lane, expressed in pounds, one hundred fifty (150) days prior to the beginning of the Peak
	655	  	Operating Period. The request for capacity shall be presented to the aviation supplier in a mutually
	656	  	agreed upon electronic origin / destination format. The aviation supplier will reply to the request by
	657	  	providing the Postal Service with its response expressed in pounds one hundred twenty (120) days
	658	  	prior to the start of the Peak Operating Period. The Postal Service will communicate its acceptance of
	659	  	the aviation supplier’s response ninety (90) days prior to the commencement of the Peak Operating
	660	  	Period. The Postal Service acceptance establishes the Planned Capacity for the Peak Operating
	661	  	Period.
	662	  	
	663	  	
	664	  	The Operating Period Minimum Volume for Peak will be [*] of the Planned Capacity.

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	665	  	
	666	  	The aviation supplier will guarantee space to accommodate up to 120% of the Planned Capacity from
	667	  	each origin daily.
	668	  	
	669	  	
	670	  	Electronic Data Interchange (EDI)
	671	  	The aviation supplier will provide status and operational data as specified in Attachment 7: Electronic
	672	  	Data Interchange Service Requirements. The aviation supplier will use the EDI methods specified in
	673	  	the attachment to transmit and receive volume, and appropriate scans from its system to the Postal
	674	  	Service system.
	675	  	
	676	  	
	677	  	Operational Condition Reports
	678	  	The aviation supplier shall submit reports of hub and Service Point operating conditions on a daily
	679	  	basis for the Day Network and the Night Network.
	680	  	
	681	  	Some examples of these daily reports (more may be required) are: service performance reports,
	682	  	operations reports for departures / arrivals late due to mechanical issues, operations reports for
	683	  	departures / arrivals late due to weather and other issues, sort mail volume, mis-sent mail volume,
	684	  	surface truck utilization, etc. The format of the report and the items reported will be mutually agreed
	685	  	upon by the COR and the aviation supplier.
	686	  	
	687	  	In addition to these daily reports, the aviation supplier will coordinate with and advise the COR of any
	688	  	contingency plans to move mail delayed in transit, as soon as practical.
	689	  	
	690	  	The table below lists the reports required initially.
	691	  	

  

					
	 Report Type
	  	 Name
	  	 Frequency

	Operational Planning	  	[*]	  	Prior to Operating Period
	Operational Planning	  	[*]	  	Prior to Operating Period
	Operational Planning	  	[*]	  	Prior to Operating Period
	Operational Planning	  	[*]	  	Prior to Operating Period
	Operational Planning	  	[*]	  	Prior to Operating Period
	Operational Planning	  	[*]	  	Monthly
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Monday through Friday
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Monday through Friday
	Operational Reports	  	[*]	  	Tuesday / Wednesday / Thursday / Saturday
	Operational Reports	  	[*]	  	Monday through Thursday
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Tuesday / Wednesday / Thursday / Saturday
	Operational Reports	  	[*]	  	Tuesday through Sunday

  

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	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Monday through Friday
	Operational Reports	  	[*]	  	Monday through Friday
	Operational Reports	  	[*]	  	Daily
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Monday through Friday
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Tuesday through Sunday
	Operational Reports	  	[*]	  	Tuesday through Sunday

  

			
	692	  	
	693	  	
	694	  	Dimensional Weight Reports
	695	  	The aviation supplier will provide a weekly report electronically for the Day Network of the dimensional
	696	  	weights [*]. This report will provide the following information for each Outside Piece’s Handling Unit
	697	  	D&R tag:
	698	  	 •    Time of each Handling Unit through the sort

	699	  	 •    The length of each Handling Unit

	700	  	 •    The width of each Handling Unit

	701	  	 •    The height of each Handling Unit

	702	  	 •    The D&R tag of each Handling Unit

	703	  	
	704	  	A sample of the report is below:
	705	  	
	706	  	 Sorter’, ‘Time Stamp’,‘Length’,‘Width’,‘Height’,‘D&R Tag’

	707	  	 ‘AS002’,‘10170703012011’,‘1863’,‘1663’,‘1005’,‘1GBNP673BF’

	708	  	 ‘AS002’,‘10172003012011’,‘2413’,‘1107’,‘0460’,‘1ICK9H2YF/’

	709	  	 ‘AS002’,‘10172703012011’,‘3425’,‘1911’,‘0968’,‘15HPP8W7D6’

	710	  	 ‘AS002’,‘10175003012011’,‘1864’,‘1200’,‘1149’,‘1FZFOM73BX’

	711	  	 ‘AS002’,‘10175103012011’,‘2404’,‘1153’,‘0460’,‘17MKSORVBQ’

	712	  	
	713	  	
	714	  	Scanning and Data Transmission
	715	  	All scanning data required to be presented to the Postal Service shall be in an electronic format
	716	  	acceptable to the Postal Service, containing all required data elements, and reported within two (2)
	717	  	hours after the occurrence of a reportable event. Available data will be transmitted in EDI message
	718	  	format at fifteen (15) minute intervals.
	719	  	
	720	  	Scanning will be used to measure performance and serve as the basis for payment for both the Day
	721	  	Network and the Night Network.
	722	  	
	723	  	Technical aspects of Electronic Data Interchange and the types of messaging events are discussed in
	724	  	Attachment 7: Electronic Data Interchange Service Requirements.
	725	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	726	  	The aviation supplier will be responsible for providing technology compatible with Postal Service
	727	  	systems for purposes of sending and receiving scanning data.
	728	  	
	729	  	The aviation supplier will be responsible for performing the following scans of D&R Tags and ULD
	730	  	identification tags.
	731	  	 a.      Possession or Load Scan of all Handling Units and ULDs at origin Service Points,
including

	732	  	          Outside Handling Units

	733	  	
	734	  	 b.      Load Scan that associates the ULD to an aircraft

	735	  	
	736	  	 c.      [*]

	737	  	
	738	  	
	739	  	 d.      [*]

	740	  	
	741	  	
	742	  	
	743	  	
	744	  	
	745	  	
	746	  	
	747	  	
	748	  	
	749	  	
	750	  	
	751	  	
	752	  	
	753	  	
	754	  	
	755	  	
	756	  	
	757	  	
	758	  	
	759	  	
	760	  	
	761	  	
	762	  	
	763	  	
	764	  	
	765	  	
	766	  	
	767	  	
	768	  	
	769	  	
	770	  	
	771	  	
	772	  	 e.      [*]

	773	  	
	774	  	
	775	  	 f.       Delivery Scan of each Handling Unit and ULD at the specified delivery Service
Point.

	776	  	
	777	  	
	778	  	Performance Requirements and Measurement
	779	  	Mail delivery performance will be measured against the contract requirements based upon transmitted
	780	  	scan data.
	781	  	
	782	  	Delivery performance requirements are:

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
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	783	  	
	784	  	          Day Network: [*]%

	785	  	
	786	  	          Night Network: [*]%

	787	  	
	788	  	          Peak Operating Period: [*]% for the Day and Night
Networks

	789	  	
	790	  	Delivery performance will be measured across an Operating Period on a lane-by-lane basis, using
	791	  	actual scan delivery time versus Required Delivery Time (RDT), as outlined in Attachment 3:
	792	  	Operating Plan, Day Network, and Attachment 4: Operating Plan, Night Network.
	793	  	
	794	  	Delivery performance will be measured using the following methodology:
	795	  	
	796	  	 a.      The Postal Service will scan all Handling Units at origin.

	797	  	 b.      The Postal Service will nest all Handling Units into ULDs at origin.

	798	  	 c.      The Postal Service will tender the nested ULDs to the aviation supplier at
origin.

	799	  	 d.      The aviation supplier will scan the ULDs with a Possession Scan at
origin.

	800	  	 e.      The aviation supplier will scan all Handling Units processed through the sort at the
hub.

	801	  	 f.       The aviation supplier will nest all Handling Units to ULDs departing from the
hub.

	802	  	 g.      The aviation supplier will scan the ULDs as delivered to the Postal Service upon arrival
at

	803	  	          destination.

	804	  	 h.      The Postal Service will break the ULDs and scan / de-nest all Handling
Units.

	805	  	
	806	  	Delivery performance will be measured for all ULDs and Handling Units receiving at least a Delivery
	807	  	Scan by the aviation supplier.
	808	  	
	809	  	The Postal Service will provide data to the aviation supplier via electronic files. The electronic file will
	810	  	show the nested date and time into the ULD, the possession time and date from the aviation supplier,
	811	  	the delivery time and date from the aviation supplier, and the de-nested break time and date from the
	812	  	Postal Service. Additionally, the files will show the weights of each Handling Unit.
	813	  	
	814	  	Delivery performance on a lane level basis will be calculated as follows:
	815	  	
	816	  	
	817	  	Total on-time Handling Units, by lane, for the Operating Period, receiving a Delivery Scan
	818	  	
	819	  	Divided by
	820	  	
	821	  	Total Handling Units, by lane, for the Operating Period, receiving a Delivery Scan
	822	  	
	823	  	
	824	  	Reduction of Payment
	825	  	If the calculated delivery performance is less than the delivery performance requirement, the late D&R
	826	  	tags will be ordered chronologically by the RDT. The percentage of D&R tags corresponding to the
	827	  	difference between [*]% and the delivery performance requirement (i.e., [*]% Day Network), [*]%
	828	  	(Night Network) or [*]% (Peak Operating Period)) will not be assessed a reduction in payment. The
	829	  	remaining late D&R tags will be assessed a reduction in payment as follows:
	830	  	
	831	  	 a.      All Handling Units delivered up to thirty (30) minutes late will be subject to a [*]%
reduction of

	832	  	          the Transportation Payment.

	833	  	
	834	  	 b.      All Handling Units delivered from thirty-one (31) minutes up to one (1) hour to late will
be

	835	  	          subject to a [*]% reduction of the Transportation
Payment.

	836	  	
	837	  	 c.      All Handling Units delivered 1 hour and one minute late or later will be subject to a
[*]%

	838	  	          reduction of the Transportation Payment.

	839	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
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	840	  	The reduction in payment will be based on a conversion of the weight of the late Handling Units to
	841	  	cubic feet by the applicable contract density and will be applied at the base or the tier in which the late
	842	  	delivery occurred.
	843	  	
	844	  	Handling Units that represent the amount of mail that FedEx accepts in excess of 105% of the
	845	  	Operating Period’s Planned Capacity by Operating Day will not be assessed a reduction of payment
	846	  	under Part 1: Statement of Work Reduction of Payment or be taken into account under Part 1:
	847	  	Statement of Work Performance Requirements and Measurement.
	848	  	
	849	  	 a.      Handling Units in excess of 105% of the Operating Period’s Planned Capacity will be
identified

	850	  	          by determining the actual volume, in cubic feet (weight of the Handling
Units divided by the

	851	  	          contract density for the applicable Operating Period), delivered each day
to each destination

	852	  	          that is in excess of 105% of the Planned Capacity for the relevant
destination.

	853	  	
	854	  	 b.      In each instance, “volume in excess of 105%” will be the latest volume to arrive
as evidenced

	855	  	          by the delivery scans.

	856	  	
	857	  	
	858	  	Performance Management
	859	  	The aviation supplier and the Postal Service will meet once a quarter (at a minimum) to discuss items
	860	  	such as the following:
	861	  	
	862	  	 a.      Cost Control

	863	  	 b.      Holiday Operations and Planning

	864	  	 c.      Aviation Supplier Performance

	865	  	 d.      Peak Season Planning

	866	  	 e.      Quality

	867	  	 f.       Ramp Operations

	868	  	 g.      Reconciliation of Irregularities

	869	  	 h.      Security

	870	  	 i.       Technology Issues

	871	  	 j.       Tender and Delivery Hygiene

	872	  	 k.      Volume Planning

	873	  	 l.       Other Pertinent Topics

	874	  	
	875	  	
	876	  	Sustainability
	877	  	The aviation supplier must provide following sustainability metrics at the times specified below:
	878	  	
	879	  	 a.      All greenhouse gas emission estimates that are attributed to the transport of Postal
Service

	880	  	          mail products via air and (if applicable) ground transport by the aviation
supplier.

	881	  	 i.       Emissions in a standard unit – CO2e

	882	  	 ii.      Total weight of Postal Service products contributing to the emissions in the
Calendar

	883	  	          Year.

	884	  	 iii.    Total air miles travelled to transport the Postal Service products per Calendar
Year.

	885	  	 iv.     High level summary describing methodology which could include the basis for
the

	886	  	          Postal Service emissions allocation such as space, cost, weight, number of
packages

	887	  	          or other methods used to derive numbers. For example, estimates based on
gallons

	888	  	          used, flight characteristics, or both.

	889	  	 v.      Assurance letter of independent verification of Scope 1, 2, and 3
data.

	890	  	 •    Scope 1: Emissions arising from when the aviation supplier burns fuel in its

	891	  	 aircraft or its owned buildings

	892	  	 •    Scope 2: Emissions from purchased electricity or steam.

	893	  	 •    Scope 3: Emissions arising from activities over which the aviation supplier

	894	  	 has less control.

	895	  	


  
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	896	  	 b.      Fiscal Year (October through September) and Calendar Year (January through
December)

	897	  	          greenhouse gas emissions data to be received by the Postal Service no later
than three (3)

	898	  	          months after the close of the fiscal and calendar
year.

	899	  	
	900	  	The aviation supplier will convene a meeting with the Postal Service no later thirty (30) days after
	901	  	contract award to discuss high level greenhouse gas emissions estimation methodologies and network
	902	  	boundaries.
	903	  	
	904	  	The aviation supplier will hold quarterly meetings with the Postal Service to discuss reporting
	905	  	methodology developments, boundaries and notification of estimation methodology or boundary
	906	  	changes.
	907	  	
	908	  	
	909	  	Security
	910	  	See Attachment 8: Investigative / Security Protocol and Guidelines.
	911	  	
	912	  	
	913	  	Postal Service Employees Allowed Access
	914	  	The aviation supplier shall allow escorted Postal officials showing proper credentials access to all
	915	  	buildings, field areas, ground equipment being used to sort, stage, or transport mail under this contract
	916	  	or under any subcontract services performed under this contract. Government regulations (e.g.,
	917	  	Transportation Security Administration) will supersede this section.
	918	  	
	919	  	The aviation supplier will allow unescorted access to Postal Service employees stationed on the
	920	  	aviation supplier’s premises pending compliance with all required processes. Photography or
	921	  	videotaping will not be permitted except as outlined in the security protocols.
	922	  	
	923	  	
	924	  	Personnel Screening
	925	  	In general, the Postal Service accepts air carrier security program requirements set forth by the
	926	  	Transportation Security Administration (TSA). In addition to these, the Postal Service also mandates
	927	  	additional requirements.
	928	  	
	929	  	The Postal Service is aware that the aviation supplier must implement its human resources programs
	930	  	in accordance with certain state laws and that in that respect there may be certain deviations to the
	931	  	literal application of some of the Postal Service requirements set forth herein.
	932	  	
	933	  	In the event the aviation supplier establishes that a state law prohibits it from requesting from its
	934	  	employees or prospective employees any or all of the information requested in responses to questions
	935	  	21a through 21e of PS Form 2025, Contract Personnel Questionnaire, as required by 1.c below, or
	936	  	from certifying, as the result of a criminal records check, to any of the items requested under 1.b,
	937	  	Criminal History, below, the aviation supplier shall be relieved of its contractual obligation to require
	938	  	employees or prospective employees to respond to the portions of those questions requesting the
	939	  	prohibited information or to provide that information as part of its criminal records check. In these
	940	  	situations, the Postal Service Security Investigations Service Center (SISC) shall conduct the required
	941	  	criminal checks as outlined in 1.b. below.
	942	  	
	943	  	To establish the existence and the extent of the prohibitory effect of any such state law referenced
	944	  	above, the aviation supplier shall provide to the SISC documentary evidence (including a copy of the
	945	  	state law) demonstrating the stated prohibition. The Postal Service’s concurrence about the
	946	  	prohibitory nature of a state law shall not be unreasonably withheld.
	947	  	
	948	  	The Contracting Officer may, in consultation with the aviation supplier and the U.S. Postal Inspection
	949	  	Service, grant other appropriate deviations or implement alternate processes to the standard U.S.
	950	  	Postal Inspection Service requirements by letter.
	951	  	
	952	  	Applicability


  
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	953	  	Individuals providing services to the Postal Service under this contract (including aviation suppliers,
	954	  	employees of aviation suppliers, and subcontractors and their employees at all levels), hereinafter,
	955	  	“individuals,” who have been hired after the effective date of this contract and whose duties will or
	956	  	likely may involve handing the mail must obtain a security clearance from the Postal Service, as
	957	  	provided herein. Access to the mail as defined by 3.a below is permitted as soon as the security
	958	  	clearance package has been submitted to the SISC in Memphis.
	959	  	
	960	  	If the aviation supplier commences a new operation (internally or with an aviation supplier) for the
	961	  	purpose of processing Postal volume, the employees hired since the effective date of this contract will
	962	  	be subject to Personnel Screening.
	963	  	
	964	  	Access to the mail is permitted as soon as the security clearance package has been submitted to the
	965	  	SISC in Memphis. If the aviation supplier has ground handling services performed at air stops by
	966	  	another aviation supplier (subcontractor), and if, to the best knowledge of the prime aviation supplier,
	967	  	that subcontractor is in compliance with the provisions of this clause, the prime aviation supplier may
	968	  	certify that fact to the Contracting Officer in writing, and thereby be relieved of the primary
	969	  	responsibility for personnel screening. Prime aviation suppliers are in all cases responsible for
	970	  	meeting these screening requirements for all persons having access to the mail who are their direct
	971	  	employees. For example, if ABC, Inc. is an aviation supplier, and it performs ground handling services
	972	  	at one or more air stops for CDE, Inc., CDE must certify in writing that:
	973	  	
	974	  	 I certify that at the following air stops ground handling services are being performed by ABC,

	975	  	 and that to the best of my knowledge, ABC is an aviation supplier of air transportation services

	976	  	 under contract number    . A listing of airports served by ABC is attached hereto as follows.

	977	  	
	978	  	Aviation suppliers must have clauses in their contracts with subcontractors requiring adherence to the
	979	  	Postal Service screening procedures contained in this contract.
	980	  	
	981	  	 1.      Requirements: The aviation supplier, when employing individuals who will or are
likely to

	982	  	 handle the mail in the performance of their duties under this contract, must provide the

	983	  	 following documentation as early as possible to the Security Investigations Services Center

	984	  	 (SISC), 225 N. Humphreys Blvd., 4th floor, Memphis, Tennessee, 38161-0001 for those

	985	  	 individual aviation supplier employees who will or are likely to handle the mail in the

	986	  	 performance of their duties. (Form can be obtained by calling the SISC at (901) 747-7712 or

	987	  	 by email at Meg@uspis.gov.)

	988	  	 The items listed in sub-sections 1 through 4 and a through c below must be completed prior to

	989	  	 the employee being granted permission to handle mail. For purposes of this requirement, the

	990	  	 term “completed” means that all tasks have been done, and the required submissions to the

	991	  	 SISC in Memphis have been made.

	992	  	
	993	  	 1.      Completed PS Form 2181-C. This form must be dated within 90 days of receipt
by

	994	  	 the SISC.

	995	  	
	996	  	 2.      PS Form 2025. Each item on the PS Form 2025 must be addressed.
Applicants

	997	  	 must provide their complete residential address, including city, state, and ZIP+4. The

	998	  	 form must be signed and dated by the applicant within 90 days of receipt by the SISC.

	999	  	
	1000	  	 3.      The aviation supplier must obtain and provide to the SISC two original
fingerprint

	1001	  	 cards (FD-258) for each applicant. The signature of the applicant and the individual

	1002	  	 taking the prints must be on each FD-258. In lieu of submitting fingerprint cards, a

	1003	  	 FBI rap sheet may be submitted, provided it is dated within 90 days of receipt by the

	1004	  	 SISC. The Postal Inspection Service will provide additional fingerprint cards for

	1005	  	 aviation supplier use. These additional forms may be obtained by calling the

	1006	  	 Memphis office at (901) 747-7712 or via email at Meg@uspis.gov

	  
  
 1007
	  	
	1008	  	 4.      Certification and Transmittal Cover Sheet documenting Criminal History records
check

	1009	  	 as required by subsection (b) below. The Certification and Transmittal cover
sheet



  
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	1010	  	 must include the administrative officer’s name, telephone number, facility name, email

	1011	  	 address and mailing address.

	1012	  	
	1013	  	 The aviation supplier is required to maintain all certifications required in sections a., b., and c

	1014	  	 for the length of the contract.

	1015	  	
	1016	  	 a.      Drug Screening: The aviation supplier must certify that individuals providing
service

	1017	  	 under this contract have passed a screening test for those substances identified by the

	1018	  	 Substance Abuse and Mental Health Services Administration (SAMHSA) as the five (5)

	1019	  	 most abused substances which are cocaine, marijuana, amphetamine /

	1020	  	 methamphetamine, opiates, and phencyclidine (PCP). The tests must be performed by a

	1021	  	 SAMHSA approved certified laboratory. The drug test must meet the cut-off levels

	1022	  	 established by SAMHSA. All drug screening tests must be completed within ninety (90)

	1023	  	 days prior to having access to the mail since drug tests older than ninety (90) days are

	1024	  	 invalid and must be redone. The prime aviation suppliers and all subcontractors must

	1025	  	 maintain the name of the institution conducting the test and a document indicating if the

	1026	  	 employee passed or tested positive.

	1027	  	
	1028	  	 b.      Criminal History: The aviation supplier must certify, based upon a criminal
records

	1029	  	 check (a state records check) of each employee through local agencies (state, county, or

	1030	  	 city) where the applicant has resided and worked for the past five (5) years (this may

	1031	  	 require multiple checks for applicants who live in one location and work in another

	1032	  	 location, or for applicants who have moved within that time period), that each individual:

	1033	  	
	1034	  	 i.       Has not been convicted of a felony criminal violation in the past five (5)
years;

	1035	  	
	1036	  	 ii.      Has not been convicted of serious criminal charges (e.g. murder, rape,
robbery,

	1037	  	 burglary, physical assaults, weapons violations, or drug charges [felony or

	1038	  	 misdemeanor]);

	1039	  	
	1040	  	 iii.    Does not have any pending felony or serious criminal charges; and

	1041	  	
	1042	  	 iv.     Is not on parole for or probation for any felony or serious criminal
charges.

	1043	  	
	1044	  	 This will be documented on the Certification and Transmittal Cover Sheet. This form is

	1045	  	 provided under Personnel Security Administrative Instructions, and may be reproduced by

	1046	  	 the aviation supplier.

	1047	  	
	1048	  	 c.      Citizenship: Certification of U.S. citizenship must be documented on PS Form
2025,

	1049	  	 Contract Personnel Questionnaire, or legal work status authorizing the individual to work

	1050	  	 in the United States is required. (I-9 Form, Employment Eligibility Verification, is to be

	1051	  	 used for non-citizens).

	1052	  	
	1053	  	 2.      Processing:

	1054	  	 a.      The Postal Service agrees to use reasonable efforts to insure that security
clearance

	1055	  	 decisions are issued within thirty (30) days after the aviation supplier submits the required

	1056	  	 documents and information to the SISC. The Postal Service, however, cannot guarantee

	1057	  	 that processing will be complete within thirty (30) days due to circumstances beyond its

	1058	  	 control.

	1059	  	
	1060	  	 b.      For each individual employed by the aviation supplier or any subcontractor, the
aviation

	1061	  	 supplier will submit to the SISC:

	1062	  	 •    Full name

	1063	  	 •    Social security number

	1064	  	 •    Drug screening data (1.a)

	1065	  	 •    Criminal history certifications (1.b)

	1066	  	 •    Both sets of fingerprints
(1.c)



  
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	1067	  	 •    Citizenship certifications (1.d)

	1068	  	
	1069	  	 Upon receipt of the required documentation, the SISC will submit the fingerprint cards

	1070	  	 (1.c) to the Federal Bureau of Investigation, and perform a search of the National Crime

	1071	  	 Information Center (NCIC) Wants and Warrants and Inspection Service databases at its

	1072	  	 cost.

	1073	  	
	1074	  	 c.      In cases where an individual business entity is predominant at a given airport,
the

	1075	  	 Contracting Officer in consultation with the Inspection Service may approve the receipt of

	1076	  	 screening documents from that entity.

	1077	  	
	1078	  	 d.      The aviation supplier shall maintain supporting documentation for the drug
screening

	1079	  	 (1.a), criminal history inquiries (1.b), and citizenship verifications (1.d) subject to review by

	1080	  	 the Postal Service, for the life of this contract in accordance with its internal procedures,

	1081	  	 advising the Inspection Service SISC on the Certification and Transmittal Cover Sheet.

	1082	  	
	1083	  	 At the employee’s local station, aviation suppliers are only required to maintain a copy of

	1084	  	 the Certification and Transmittal Cover Sheet. The Certification and Transmittal Cover

	1085	  	 Sheet is provided under Personnel Security Administrative Instructions and may be

	1086	  	 reproduced by the aviation supplier, as needed.

	1087	  	
	1088	  	 Aviation suppliers currently maintaining security screening files under existing Postal

	1089	  	 Service contracts shall continue to maintain those files.

	1090	  	
	1091	  	 Submit all forms and certifications to:

	1092	  	
	1093	  	 Memphis SISC

	1094	  	 Security Investigations Service Center

	1095	  	 225 North Humphreys Boulevard

	1096	  	 Fourth Floor, South

	1097	  	 Memphis, TN 38161-0008

	1098	  	
	1099	  	 The Postal Service intends to make its best efforts to position itself to eliminate the

	1100	  	 requirement for its set of FD-258 forms, and other submissions to be determined, through

	1101	  	 cooperation with the Federal Aviation Administration, Transportation Security

	1102	  	 Administration, and other agencies or associations to share relevant information for its

	1103	  	 regulatory purposes.

	1104	  	
	1105	  	 3.      Access to the Mail – Screening Requirements:

	1106	  	 “Access to the mail” refers to individuals who scan, transport, sort, load, and unload mail to

	1107	  	 and from ground equipment and to and from the aircraft. This includes employees handling

	1108	  	 sealed ULDs. This includes individuals who have direct supervisory duties in directing the

	1109	  	 transporting, sorting, loading, and unloading of mail to and from ground equipment and

	1110	  	 aircraft. Individuals providing services to the Postal Service under this contract (including

	1111	  	 aviation suppliers, employees of aviation suppliers, and subcontractors and their employees at

	1112	  	 any tier), hereinafter, “individuals,” who have access to the mail, must obtain a security

	1113	  	 clearance from the Postal Service before such access to the mail is granted.

	1114	  	
	1115	  	 4.      Denial:

	1116	  	 Persons who meet the following criteria are not permitted to have access to the mail under this

	1117	  	 contract:

	1118	  	
	1119	  	 a.      An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1120	  	 who has not received a security screening in accordance with the criteria listed above

	1121	  	 under Personnel Screening.

	1122	  	


  
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	1123	  	 b.      An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1124	  	 who has been convicted of, or is on probation or parole for, or under suspended sentence

	1125	  	 for assault, theft, or weapons charges or for the illegal use, possession, sale, or transfer of

	1126	  	 controlled substances during the past five (5) years.

	1127	  	
	1128	  	 c.      An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1129	  	 who has been convicted of any criminal felony violation during the past five (5) years, who

	1130	  	 is on parole, probation, or suspended sentence for commission of a criminal felony during

	1131	  	 the past five (5) years.

	1132	  	
	1133	  	 d.      An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1134	  	 who has ever been convicted of theft of mail or other Postal offense.

	1135	  	
	1136	  	 e.      An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1137	  	 who has an active warrant or is on probation or is on parole.

	1138	  	
	1139	  	 f.       An aviation supplier, subcontractor, or employee of an aviation supplier or
subcontractor

	1140	  	 who has any pending felony or serious criminal charges.

	1141	  	
	1142	  	 g.      Any other circumstance that in the determination of the Postal Service makes
the

	1143	  	 individual unfit to provide services under this contract.

	1144	  	
	1145	  	 In the event an employee is disqualified under the above criteria, the aviation supplier has the

	1146	  	 responsibility to insure that the employee’s duties no longer involve handling mail.

	1147	  	
	1148	  	 5.      Appeal Process:

	1149	  	 An individual may appeal a decision to deny access made by the Postal Inspection Service

	1150	  	 SISC by sending a letter to the Inspector In Charge, Security and Crime Prevention,

	1151	  	 Washington, DC, within three (3) weeks of the date of the denial letter. An individual may not

	1152	  	 handle the mail during the appeal process. The letter must contain the following information:

	1153	  	
	1154	  	 a.      A statement that reconsideration of the decision is requested and the basis on which it
is

	1155	  	 sought.

	1156	  	
	1157	  	 b.      Additional information on the appellant’s behalf.

	1158	  	
	1159	  	 c.      A copy of the denial letter.

	1160	  	
	1161	  	 6.      Training: The Postal Service may, but is not required to, provide orientation /
training for

	1162	  	 aviation suppliers during the term of this contract to clarify security clearance requirements,

	1163	  	 processes, and procedures necessary to fully implement this program.

	1164	  	
	1165	  	
	1166	  	Payment Procedures
	1167	  	
	1168	  	Rates and Payment General
	1169	  	The aviation supplier will be compensated based upon properly scanned ULDs and Handling Units.
	1170	  	The payment for each ULD and Handling Unit will be based on the network (i.e., Day or Night) to
	1171	  	which the mail is assigned by the Postal Service. This process will allow for automated payment.
	1172	  	
	1173	  	[*]
	1174	  	
	1175	  	
	1176	  	
	1177	  	
	1178	  	Scan Requirements
	1179	  	All scan requirements listed below are specified in the Scanning and Data Transmission section.

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	1180	  	
	1181	  	Night Turn Scan Requirements
	1182	  	 a.      Possession Scan of all ULDs and Handling Units at the origin

	1183	  	
	1184	  	 b.      Delivery Scan of all ULDs and Handling Units delivered at destination

	1185	  	
	1186	  	Day Turn Scan Requirements
	1187	  	 a.      The aviation supplier will conduct a Possession Scan of all ULDs and Handling Units at
the

	1188	  	 origin.

	1189	  	
	1190	  	 b.      The aviation supplier will conduct a Nest Scan associating the Handling Unit with a ULD at
the

	1191	  	 hub.

	1192	  	
	1193	  	 c.      The aviation supplier will conduct a Delivery Scan of all ULDs and Handling Units delivered
at

	1194	  	 destination.

	1195	  	
	1196	  	The Hub Sort Scans will be paid in accordance with the pricing listed in Attachment 10: Pricing for
	1197	  	Handling Units sorted at the hub on the Day Network for which scans are provided. Hub Sort Scans
	1198	  	will not be paid for Handling Units assigned to a Bypass ULD or for the Night Network.
	1199	  	
	1200	  	[*]
	1201	  	
	1202	  	
	1203	  	
	1204	  	
	1205	  	
	1206	  	The base and tier pricing from Attachment 10: Pricing will be applied to the volume measured in each
	1207	  	Operating Period as follows. Volume within the base will be paid at the Base Rate. The portion of
	1208	  	volume exceeding the base volume and falling within the Tier 1 volume will be paid at the Tier 1 rate.
	1209	  	A similar incremental process will be applied to volume that falls within subsequent tiers.
	1210	  	
	1211	  	Payments will be made by Electronic Funds Transfer (EFT).
	1212	  	
	1213	  	[*]
	1214	  	
	1215	  	
	1216	  	
	1217	  	The aviation supplier will bill additional charges not covered within the automated payments system on
	1218	  	a weekly basis. For correct and sufficient invoices received by noon Wednesday of a given week, the
	1219	  	Postal Service will process them so as to generate a payment by Wednesday, three (3) weeks
	1220	  	following the receipt of the invoice through the EFT process.
	1221	  	
	1222	  	
	1223	  	Payment Processing - Day Network - Per Cube
	1224	  	
	1225	  	Invoicing
	1226	  	All invoices for the transportation of Handling Units or ULDs under this contract will be paid by the
	1227	  	cubic foot and payment will be based on completing the required scans.
	1228	  	
	1229	  	Mail Tendered in ULDs
	1230	  	The Line Haul rate for each ULD will be comprised of two components: Non-Fuel Line Haul and Fuel
	1231	  	Line Haul. The Non-Fuel Line Haul rate will include all of the transportation and handling associated
	1232	  	with a ULD. Hub Sort Scanning rates are separate from the Non-Fuel Line Haul rate.
	1233	  	
	1234	  	ULD cubic feet will be paid at the agreed cubic feet size for each ULD type described in Attachment
	1235	  	10: Pricing.
	1236	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	1237	  	The cubic feet paid will be based on the Postal assigned ULD type. If the Postal ULD type is missing,
	1238	  	the aviation supplier’s ULD type will be used for invoicing. Any discrepancies between the types of
	1239	  	ULD processed will be resolved during the Reconciliation Process.
	1240	  	
	1241	  	The transportation payment for mixed ULDs will be based on the applicable cubic feet of the
	1242	  	originating ULD. These transportation payments will be reduced for Handling Units not receiving a
	1243	  	Delivery Scan by converting the weight of the Handling Units without a Delivery Scan at the correct
	1244	  	destination to cubic feet by the applicable contract density.
	1245	  	
	1246	  	The transportation payment for bypass ULDs will be based on the applicable cubic feet of the
	1247	  	originating ULD. These transportation payments will not be made for Bypass ULDs without a Delivery
	1248	  	Scan at the correct destination.
	1249	  	
	1250	  	Recognizing operational inefficiencies filling the last ULD at every location, the Postal Service will
	1251	  	incorporate within the daily invoice a daily credit of [*] cubic feet for each origin air stop per day. The
	1252	  	rate used will be the applicable base or tier cubic foot rate used at the beginning of the invoice day.
	1253	  	
	1254	  	Mail Tendered from Surface Trucks
	1255	  	If mail is tendered to the aviation supplier from a defined truck location as identified in Attachments 3
	1256	  	and 4 at contract award, the invoiced cubic feet will be calculated by dividing the Handling Unit’s
	1257	  	Postal Service assigned rounded weight by the applicable contract density.
	1258	  	
	1259	  	
	1260	  	Mail Tendered from Ad Hoc Trucks into the Aviation Supplier Hub
	1261	  	The aviation supplier will accept ad hoc trucks from the Postal Service at the proposed hub locations.
	1262	  	The Postal Service will incorporate ad hoc truck payments in the weekly electronic payment.
	1263	  	
	1264	  	FedEx will accept up to a total of fifteen (15) Ad Hoc Trucks per day on the Day Network at the
	1265	  	Memphis Hub.
	1266	  	
	1267	  	 a.      All ad hoc trucks must arrive at the Memphis Hub before 10:00 a.m. local time and must
be

	1268	  	 coordinated with FedEx in advance. Required Delivery Time (RDT) will be established in

	1269	  	 accordance with Attachment 3, Operating Plan, Day Network contingent on the ad hoc trucks

	1270	  	 arriving at the Memphis Hub before 10:00 a.m. local time. Late arriving trucks (after 10:00

	1271	  	 a.m. local time) will be assigned an RDT based on arrival on the next operational day. All

	1272	  	 RDT’s will be adjusted to reflect the first FedEx operational scan at the Memphis Hub.

	1273	  	
	1274	  	 b.      Initial Payment for ad hoc trucks will be made in the amount of 3,000 cubic feet per truck
on

	1275	  	 an Operating Period basis, no later than 30 days after the last day of each Operating Period.

	1276	  	 Final payment for ad hoc trucks will be adjusted, if applicable, for any reductions of payment

	1277	  	 under Part 1: Statement of Work Reduction of Payment and will also be adjusted, if applicable,

	1278	  	 based upon the Day Turn Scan Requirements under contract section Payment Procedures,

	1279	  	 Rates and Payment General (with the exception that the volumes moving via ad hoc trucks

	1280	  	 will not require a Possession Scan). Any adjustments described here, if applicable, will be

	1281	  	 made through the reconciliation process.

	1282	  	
	1283	  	Aviation Supplier Surface Transportation – Not Included in the Transportation Payment
	1284	  	The aviation supplier will include a separate rate per mile for Highway Transportation in Attachment
	1285	  	10: Pricing which will be applied when the Postal Service requires the aviation supplier to operate
	1286	  	unplanned surface transportation of mail.
	1287	  	
	1288	  	Hub Sort Scan Charge
	1289	  	The Postal Service will pay a Hub Sort Scan charge for mail sorted and scanned at a hub per Handling
	1290	  	Unit (i.e., D&R Tag) as shown in Attachment 10: Pricing. This rate will not be subject to an increase
	1291	  	for the full term of the contract.
	1292	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	1293	  	Handling Units sorted at a hub must receive a Hub Sort Scan for payment purposes. The Postal
	1294	  	Service will not pay a Hub Sort Scan charge for sorts not supported by EDI scan information. The
	1295	  	pieces scanned into a tendered Bypass container are not eligible to receive Hub Sort Scan charges.
	1296	  	
	1297	  	Re-Labeling Charge
	1298	  	The Postal Service will pay an additional charge to the aviation supplier for re-labeling Postal Service
	1299	  	Handling Units at the hub for which the D&R tag is missing or becomes illegible. The Postal Service
	1300	  	will also provide all equipment necessary to perform this function. The re-labeling charge per Handling
	1301	  	Unit is shown in Attachment 10: Pricing.
	1302	  	
	1303	  	This rate will not be subject to an increase for the full term of the contract.
	1304	  	
	1305	  	Payment to the aviation supplier for the transport of re-labeled Handling Units will be based upon data
	1306	  	received from the Hub Scan plus (combined and matched with) the Delivery Scan for the Handling
	1307	  	Unit. An average weight per Handling Unit will be established based upon the previous month’s data
	1308	  	for average weight per Handling Unit, and for Handling Units that are not properly scanned due to
	1309	  	conditions beyond the aviation supplier’s control.
	1310	  	
	1311	  	The average weight process is detailed in Attachment 15, Average Weights.
	1312	  	
	1313	  	The equipment to be supplied by the Postal Service for this function will be listed in Attachment 6:
	1314	  	Postal Furnished Property, and will be covered by Clause 2-22, Postal Service Property. Attachment
	1315	  	6: Postal Furnished Property will be created upon successful installation of the equipment. Upon
	1316	  	reasonable advance notice to the aviation supplier, the Postal Service shall be permitted to perform
	1317	  	maintenance on any of the equipment located in an aviation supplier’s facility listed in Attachment 6:
	1318	  	Postal Service Furnished Property.
	1319	  	
	1320	  	The Re-Labeling Process is described in Attachment 16, Re-labeling / Type M Matching Process.
	1321	  	
	1322	  	Fuel Adjustment
	1323	  	There will be a monthly fuel adjustment to the Fuel Line Haul rate. Each “month” is defined in
	1324	  	Attachment 1: Postal Service Operating Periods. The adjustment will become effective on the first
	1325	  	operating day of each operating period after contract commencement. The adjustment may be
	1326	  	upward or downward.
	1327	  	
	1328	  	The adjustment will be based on the U.S. Gulf Coast (USGC) prices for Kerosene-type jet fuel
	1329	  	reported by the U.S. Department of Energy for the month that is two (2) months prior to the
	1330	  	adjustment. The adjustment will be calculated and applied monthly.
	1331	  	
	1332	  	For example, assume the Fuel Line Haul rate is $0.10. If the June 20XX USGC price for Kerosene-
	1333	  	type jet fuel is $2.68 per gallon and the July 20XX price is $3.00 per gallon, then the adjustment for
	1334	  	September XX would be calculated as follows:
	1335	  	
	1336	  	 ($3.00 / $2.68) = 1.12

	1337	  	 1.12 x $0.10 = $0.11

	1338	  	
	1339	  	The new Fuel Line Haul rate would be $0.11 per cubic foot.
	1340	  	
	1341	  	In August 20XX, if the USGC price is $2.70 per gallon, the calculation for the October 20XX rate would
	1342	  	be:
	1343	  	
	1344	  	 ($2.70 / $3.00) = 0.90

	1345	  	 0.90 X $0.11 = $0.10 per cubic foot

	1346	  	
	1347	  	This calculation will be rounded after the decimal to four digits.
	1348	  	


  
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	1349	  	The proposal pricing should be based on the August 2012 U.S. Gulf Coast Kerosene-type jet fuel
	1350	  	reported by the U.S. Department of Energy ($3.156 per gallon).
	1351	  	
	1352	  	Fuel will be adjusted for October 2013 based on the August 2013 U.S. Gulf Coast Kerosene-type jet
	1353	  	fuel reported by the U.S. Department of Energy.
	1354	  	
	1355	  	
	1356	  	Payment Processing - Night Network - Per Pound
	1357	  	
	1358	  	Invoicing
	1359	  	All Handling Units tendered to the aviation supplier for the Night Network will be paid by the pound and
	1360	  	payment will be based on required scanning. The weight will be derived from the assigned rounded
	1361	  	weight of the Handling Unit. The Non-Fuel Line Haul rate will include all of the transportation and
	1362	  	handling associated with a Handling Unit. The Fuel Line Haul rate for the Night Network will not be
	1363	  	subject to a fuel adjustment.
	1364	  	
	1365	  	Re-Labeling Charge
	1366	  	The Postal Service will pay an additional charge to the aviation supplier for re-labeling Postal Service
	1367	  	Handling Units for which the D&R tag is missing or becomes illegible. The Postal Service will also
	1368	  	provide all equipment necessary to perform this function. The re-labeling charge per Handling Unit is
	1369	  	shown in Attachment 10: Pricing. This rate will not be subject to an increase for the full term of the
	1370	  	contract.
	1371	  	
	1372	  	Payment to the aviation supplier for transport of re-labeled Handling Units will be based upon data
	1373	  	received from the Hub Scan plus (combined and matched with) the Delivery Scan for the Handling
	1374	  	Unit. An average weight per Handling Unit will be established based upon the previous month’s data
	1375	  	for average weight per Handling Unit and for Handling Units that are not properly scanned due to
	1376	  	conditions beyond the aviation supplier’s control.
	1377	  	
	1378	  	The equipment to be supplied by the Postal Service for this function will be listed in Attachment 6:
	1379	  	Postal Furnished Property, and will be covered by Clause 2-22, Postal Service Property. Attachment
	1380	  	6 will be created upon successful installation of the equipment. Upon reasonable advance notice to
	1381	  	the aviation supplier, the Postal Service shall be permitted to perform maintenance on any of the
	1382	  	equipment located in an aviation supplier’s facility listed in Attachment 6.
	1383	  	
	1384	  	The payment for the Night Network re-labeled Handling Units will be adjusted to reflect the percentage
	1385	  	of re-labeled Handling Units that have already been scanned. This percentage of previously scanned
	1386	  	Handling Units will be mutually agreed upon by the Postal Service and the aviation supplier through an
	1387	  	audit sampling of re-labeled Handling Units. Contingency Handling Units are excluded from this
	1388	  	adjustment.
	1389	  	
	1390	  	The average weight process is detailed in Attachment 15, Average Weights.
	1391	  	
	1392	  	
	1393	  	Reconciliation Process
	1394	  	Reconciliation of scanning and payment records between the Postal Service and the aviation supplier
	1395	  	will be conducted in a scheduled meeting attended by the Postal Service and the aviation supplier on
	1396	  	an Operating Period basis not more than ninety (90) days after the close of an Operating Period, or a
	1397	  	time frame as agreed mutually by the parties. The following procedures will be observed for the
	1398	  	reconciliation process:
	1399	  	
	1400	  	 a.      All data exchanges between the aviation supplier and the Postal Service for the
reconciliation

	1401	  	 process will be performed electronically and sent to specified mailboxes operated by each

	1402	  	 organization. Each file will have an individually specified transmission interval.

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	1404	  	 b.      For all files exchanged between the aviation supplier and the Postal Service, any changes
to

	1405	  	 layout or data definition must be communicated to the receiving party at a minimum of sixty

	1406	  	 (60) calendar days prior to implementation, or sooner if mutually agreed.

	1407	  	
	1408	  	 c.      All file transfers must adhere to Postal Service Security and Privacy
rules.

	1409	  	
	1410	  	 d.      Supplemental Charges / Assessments may be assessed each Operating Period. The
charges

	1411	  	 shall include but not be limited to the following:

	1412	  	 i.       Operating Period Volume Minimum and Contract Volume Minimum

	1413	  	 ii.      Non-achievement of performance standards

	1414	  	
	1415	  	 e.      Once the parties have mutually agreed on the Operating Period reconciliation, both
parties

	1416	  	 agree that neither can re-open the Operating Period for further adjustments. By mutually

	1417	  	 agreeing to the Operating Period reconciliation, the parties thereby agree to waive their right

	1418	  	 to pursue a claim under the Contract Disputes Act based upon the Operating Period

	1419	  	 reconciliation.

	1420	  	
	1421	  	In the event there is a catastrophic equipment or information system failure, the aviation supplier will
	1422	  	provide electronic files to the Postal Service identifying all D&R Tags the aviation supplier scanned
	1423	  	that were lost. The aviation supplier will notify the Contracting Officer and the COR as soon as the
	1424	  	aviation supplier becomes aware of such a failure.
	1425	  	
	1426	  	If the Postal Service cannot produce D&R Tags, an emergency contingency will be developed and
	1427	  	implemented. Such a plan will include specifications for operational and information technology
	1428	  	issues, as well as payment.
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	1430	  	Part 3: Contract Clauses
	1431	  	
	1432	  	
	1433	  	Clause B-1: Definitions (March 2006) (Tailored)
	1434	  	For purposes of this Contract, the following terms shall have the following meanings:
	1435	  	
	1436	  	 1.      Acceptable Dangerous Goods and Acceptable Hazardous Material: Those articles
or

	1437	  	 substances which satisfy the air transportation requirements for the transportation of

	1438	  	 Hazardous Goods set forth in Chapter 601.10.0 of the Domestic Mail Manual and which are

	1439	  	 not required by applicable federal regulation to be accessible to crew members during flight.

	1440	  	
	1441	  	 2.      Advertisement: A free or paid mass or targeted communication under the control of a
party

	1442	  	 intended for the general public or a specific potential or existing customer, the ultimate

	1443	  	 purpose of which is to promote the sale of such party’s products or services, including, but not

	1444	  	 limited to, television, radio and internet commercials, out-of-home ads (e.g., billboards, sports

	1445	  	 stadium displays, transit signs), direct mail ads, print ads and free standing inserts in

	1446	  	 newspapers, magazines, and electronic media.

	1447	  	
	1448	  	 3.      All Mail Due Aviation Supplier: A designated time predetermined when the Postal
Service

	1449	  	 provides all mail to the aviation supplier as shown in Attachments 3: Operating Plan, Day

	1450	  	 Network, and Attachment 4: Operating Plan, Night Network

	1451	  	
	1452	  	 4.      Aviation Supplier: The person or persons, partnership, or corporation named that has
been

	1453	  	 awarded the contract.

	1454	  	
	1455	  	 5.      Bypass Container: A ULD of mail designated for delivery to destination Service Point
on the

	1456	  	 network which is transferred directly from one aircraft to another without going through the sort

	1457	  	 operation.

	1458	  	
	1459	  	 6.      Con-Con: (Convoy and Conveyance) The concentration in a container of Registered Mail
for

	1460	  	 single, daily, daylight, or authorized night air dispatch

	1461	  	
	1462	  	 7.      Contract Volume Minimum: The volume (in cubic feet) per operational day,
averaged

	1463	  	 across six (6) days per week, and measured across each Operating Period that is guaranteed

	1464	  	 by the Postal Service for the Day Network

	1465	  	
	1466	  	 8.      Contracting Officer: The person executing this contract on behalf of the Postal
Service and

	1467	  	 any other officer or employee who is a properly designated Contracting Officer; the term

	1468	  	 includes, except as otherwise provided in the contract, the authorized representative of a

	1469	  	 Contracting Officer acting within the limits of the authority conferred upon that person.

	1470	  	
	1471	  	 9.      Contracting Officer’s Representative (COR): A person who acts within the limits
of

	1472	  	 authority delegated by the Contracting Officer.

	1473	  	
	1474	  	 10.    Contingency Handling Units: Handling Units entered into the transportation network
without

	1475	  	 an appropriate D&R tag. These Handling Units are subsequently processed at the aviation

	1476	  	 supplier’s hub through the re-labeling process.

	1477	  	
	1478	  	 11.    Dangerous Goods (Hazardous Material): Articles or substances which are capable
of

	1479	  	 posing a significant risk to health, safety or to property when transported by air and which are

	1480	  	 classified according to Section 3 (Classification) of the International Air Transport Association

	1481	  	 (IATA) Dangerous Good Regulations, regardless of variations, exceptions, exemptions, or

	1482	  	 limited quantity allowances.

	1483	  	
	1484	  	 12.    Day Network: Planned network that operates Tuesday through Sunday primarily for
the

	1485	  	 transportation of the Priority and First Class Mail.

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	1487	  	 13.    Delivery: The hand-off, at a destination Service Point, of all mail to the Postal Service
in

	1488	  	 accordance with contract requirements.

	1489	  	
	1490	  	 14.    Delivery Scan: A scan performed by the aviation supplier that indicates that the
aviation

	1491	  	 supplier has tendered volume to the Postal Service. In instances where a Delivery Scan is

	1492	  	 indicated by a combination of evidence of any scan performed by the aviation supplier and a

	1493	  	 CARDIT 3 from the THS indicating delivery of the Handling Unit to the third party ground

	1494	  	 handler, the time indicated for the latest ULD tendered on that Operating Day will be used for

	1495	  	 the purposes of determining service performance and associated payment reductions

	1496	  	 described in Part 1: Statement of Work; Performance Requirements and Measurement and

	1497	  	 Part 1: Statement of Work; Reduction of Payment.

	1498	  	
	1499	  	 15.    D&R (Dispatch and Routing) Tag: Bar coded tag that identifies the origin and
destination

	1500	  	 airports, mail class, Handling Unit weight, and the assigned network air carrier.

	1501	  	
	1502	  	 16.    Exception Sort Scan: A Hub Scan performed on mail Handling Units that require
re-labeling

	1503	  	 due to a missing or unreadable D&R tag.

	1504	  	
	1505	  	 17.    Express Mail: As defined in the U.S. Postal Service Domestic Mail Manual.

	1506	  	
	1507	  	 18.    Failure to Load: A failure to accept and load mail as specified in the
contract.

	1508	  	
	1509	  	 19.    Failure to Protect: Is a failure to protect and safeguard mail from depredation,
rifling,

	1510	  	 inclement weather, mistreatment, or other hazard while in the aviation supplier’s control.

	1511	  	
	1512	  	 20.    Failure to Protect Postal Service Equipment: A failure to protect, return or
safeguard

	1513	  	 Postal Service provided equipment. This includes MTE and Postal provided scanning

	1514	  	 equipment (if supplied by the Postal Service).

	1515	  	
	1516	  	 21.    First-Class Mail: As defined in the U.S. Postal Service Domestic Mail
Manual.

	1517	  	
	1518	  	 22.    Feeder: An aircraft normally used for local transport (for carriage of cargo and / or
containers)

	1519	  	 to and from locations not scheduled to be serviced by primary aircraft from a hub, directly

	1520	  	 connecting these locations to a hub.

	1521	  	
	1522	  	 23.    Ground Handling: Handling of mail, including unloading of mail from aircraft or
ground

	1523	  	 vehicles, drayage, staging of mail, and loading of mail on receiving aircraft or ground vehicles.

	1524	  	
	1525	  	 24.    Handling Unit: A piece of mail (an outside) or a receptacle (such as loose sacks,
pouches,

	1526	  	 trays, flat tubs) that contains multiple pieces of mail which is individually processed.

	1527	  	
	1528	  	 25.    Hub: A central sort facility that supports multiple markets via air and ground networks on
a

	1529	  	 regional or national level by means of connecting flights and ground transportation.

	1530	  	
	1531	  	 26.    Hub Sort Scan: A scan performed by the aviation supplier at a hub
location.

	1532	  	
	1533	  	 27.    Line Haul: Transporting mail by air between origin and destination
locations.

	1534	  	
	1535	  	 28.    Live Animals: Animals accepted by the Postal Service in accordance with Chapter 601.9.3
of

	1536	  	 the Domestic Mail Manual.

	1537	  	
	1538	  	 29.    Mail: Product that carries U.S. postage and the receptacles in which it is tendered
for

	1539	  	 transportation. The term includes supplies and empty mail transportation equipment of the

	1540	  	 U.S. Postal Service.

	1541	  	
	1542	  	 30.    Mail Bags: Postal Service bags which are used by the Postal Service in the transportation
of

	1543	  	 mail.



  
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	1544	  	
	1545	  	 31.    Mis-delivered: Any mail delivered to the wrong destination. This includes, but is not
limited

	1546	  	 to, mail placed in the wrong ULD, ULDs loaded onto an incorrect flight or truck, and ULDs

	1547	  	 incorrectly placarded.

	1548	  	
	1549	  	 32.    Mixed Container: A Unit Load Device (ULD) containing mail for multiple destinations
that

	1550	  	 requires sortation at the aviation supplier hub.

	1551	  	
	1552	  	 33.    Nest Scan: The scan that associates the Handling Unit with the ULD (air
container).

	1553	  	
	1554	  	 34.    Night Network: Planned network that operates Monday through Friday, primarily for
the

	1555	  	 transportation of Express Mail.

	1556	  	
	1557	  	 35.    Operating Period: A scheduled period ranging from four (4) to five (5) weeks as
agreed

	1558	  	 between the Postal Service and aviation supplier.

	1559	  	
	1560	  	 36.    Operating Period Volume Minimum: The volume minimum resulting from the
Planned

	1561	  	 Capacity established through the Ordering Process for the Day and Night Networks.

	1562	  	
	1563	  	 37.    Overflow Mail: Mail that is tendered in excess of the Planned Capacity.

	1564	  	
	1565	  	 38.    Outsides: Individual mail piece, with dimensions no greater than 108 inches in
combined

	1566	  	 length and girth and with no single dimension greater than 84 inches which is not otherwise

	1567	  	 containerized and must be processed as a Handling Unit.

	1568	  	
	1569	  	 39.    Package: Any box or envelope that is accepted by the Postal Service for delivery to
a

	1570	  	 consignee.

	1571	  	
	1572	  	 40.    Payment Week: The period each week of an Operating Period between 00:00 Saturday
and

	1573	  	 23:59 Friday.

	1574	  	
	1575	  	 41.    Perishables: Those items which are susceptible to decay, spoilage or
destruction.

	1576	  	
	1577	  	 42.    Planned Capacity: Volume that the parties have agreed to by way of the Ordering
Process

	1578	  	 for the Day and Night Networks.

	1579	  	
	1580	  	 43.    Possession Scan: A scan performed by the aviation supplier that indicates the
aviation

	1581	  	 supplier has accepted the volume from the Postal Service.

	1582	  	
	1583	  	 44.    Priority Mail: Priority Mail and First-Class zone rated (Priority) mail as defined in the
U.S.

	1584	  	 Postal Service Domestic Mail Manual, Chapter 3, Section 314.

	1585	  	
	1586	  	 45.    Registered Mail: A mail piece which is mailed in accordance with the requirements
of

	1587	  	 Chapter 501.2.0 of the Domestic Mail Manual. Registered Mail provides added protection for

	1588	  	 valuable or important mail. Registered Mail provides a receipt to the sender, special security

	1589	  	 between shipment points, a record of acceptance and delivery maintained by the Postal

	1590	  	 Service and, at the option of the mailer and for an additional fee, indemnity in case of loss or

	1591	  	 damage.

	1592	  	
	1593	  	 46.    Re-Possessed: Regain possession of assigned mail.

	1594	  	
	1595	  	 47.    Required Delivery Time (RDT): The latest delivery time to the Postal Service as indicated
in

	1596	  	 Attachment 3: Operating Plan, Day Network, and Attachment 4: Operating Plan, Night

	1597	  	 Network.

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	1599	  	 48.    Service Point: The physical location at which the aviation supplier must hand-off mail to
the

	1600	  	 Postal Service or its duly appointed agent as specified in Attachment 3: Operating Plan, Day

	1601	  	 Network, and Attachment 4: Operating Plan, Night Network.

	1602	  	
	1603	  	 49.    Tender: The drop-off, at an origin Service Point, of mail assigned by the Postal Service to
the

	1604	  	 aviation supplier.

	1605	  	
	1606	  	 50.    Tender Point: The physical location at which the Postal Service or its duly appointed
agent

	1607	  	 provides mail to the aviation supplier.

	1608	  	
	1609	  	 51.    Tender Time: The latest time at which the aviation supplier is required to accept mail
from

	1610	  	 the Postal Service at an origin Service Point in accordance with contract requirements.

	1611	  	
	1612	  	 52.    Terminal Handling: The receipt, scanning, sorting, delivery and / or tug and
dolly

	1613	  	 transportation of mail tendered under this contract.

	1614	  	
	1615	  	 53.    Trans Log File: The Postal Service data file that contains, for each D&R Tag, the
actual

	1616	  	 weight, origin, and destination market for each Handling Unit.

	1617	  	
	1618	  	 54.    Transportation Payment:: Four items are included in the Transportation
Payment:

	1619	  	 a.      Non-Fuel Line Haul

	1620	  	 b.      Fuel Line Haul

	1621	  	 c.      Aircraft Ground Handling

	1622	  	 d.      Scanning

	1623	  	
	1624	  	 55.    Trucking Location: Those Service Points to which mail volume is transported via
highway.

	1625	  	
	1626	  	 56.    Unit Load Device (ULD): Airline container or pallet provided by the aviation
supplier

	1627	  	
	1628	  	
	1629	  	Clause B-3: Contract Type (March 2006) (Tailored)
	1630	  	This Contract is a fixed-price, indefinite quantity with adjustments contract for the purchase of
	1631	  	commercial services pursuant to 39 Code of Federal Regulations, Part 601 et seq.
	1632	  	
	1633	  	This is not a requirements-type contract.
	1634	  	
	1635	  	
	1636	  	Clause B-9: Claims and Disputes (March 2006) (Tailored)
	1637	  	 a.      This contract is subject to the Contract Disputes Act of 1978 (41 U.S.C. 601-613)
(“the Act” or

	1638	  	 “CDA”).

	1639	  	
	1640	  	 b.      Except as provided in the Act, all disputes arising under or relating to this contract must
be

	1641	  	 resolved under this clause.

	1642	  	
	1643	  	 c.      “Claim,” as used in this clause, means a written demand or written assertion by
one of the

	1644	  	 contracting parties seeking, as a matter of right, the payment of money in a sum certain, the

	1645	  	 adjustment or interpretation of contract terms, or other relief arising under or relating to this

	1646	  	 contract. However, a written demand or written assertion by the aviation supplier seeking the

	1647	  	 payment of money exceeding $100,000 is not a claim under the Act until certified as required

	1648	  	 by subparagraph d.2 below. A voucher, invoice, or other routine request for payment that is

	1649	  	 not in dispute when submitted is not a claim under the Act. The submission may be converted

	1650	  	 to a claim under the Act by complying with the submission and certification requirements of

	1651	  	 this clause, if it is disputed either as to liability or amount is not acted upon in a reasonable

	1652	  	 time.

	1653	  	
	1654	  	 d.      



  
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	1655	  	 1.      A claim by the aviation supplier must be made in writing and submitted to
the

	1656	  	 Contracting Officer for a written decision. A claim by the Postal Service against the

	1657	  	 aviation supplier is subject to a written decision by the Contracting Officer.

	1658	  	
	1659	  	 2.      For aviation supplier claims exceeding $100,000, the aviation supplier must
submit

	1660	  	 with the claim the following certification:

	1661	  	
	1662	  	 “I certify that the claim is made in good faith, that the supporting data are

	1663	  	 accurate and complete to the best of my knowledge and belief, that the

	1664	  	 amount requested accurately reflects the contract adjustment for which the

	1665	  	 aviation supplier believes the Postal Service is liable, and that I am duly

	1666	  	 authorized to certify the claim on behalf of the aviation supplier.”

	1667	  	
	1668	  	 3.      The certification may be executed by any person duly authorized to bind the
aviation

	1669	  	 supplier with respect to the claim.

	1670	  	
	1671	  	 e.      For aviation supplier claims of $100,000 or less, the Contracting Officer must, if
requested in

	1672	  	 writing by the aviation supplier, render a decision within 60 days of the request. For aviation

	1673	  	 supplier-certified claims over $100,000, the Contracting Officer must, within 60 days, decide

	1674	  	 the claim or notify the aviation supplier of the date by which the decision will be made.

	1675	  	
	1676	  	 f.       The Contracting Officer’s decision is final unless the aviation supplier appeals
or files a suit as

	1677	  	 provided in the Act.

	1678	  	
	1679	  	 g.      When a CDA claim is submitted by or against an aviation supplier, the parties shall make
a

	1680	  	 good faith attempt to resolve the dispute, including an exchange of relevant information toward

	1681	  	 a mutual resolution. Accordingly, by mutual consent, the parties may agree to use an

	1682	  	 alternative dispute resolution (ADR) process to assist in resolving the claim. A certification as

	1683	  	 described in d (2) of this clause must be provided for any claim, regardless of dollar amount,

	1684	  	 before ADR is used. If either party declares the matter to be at an impasse, the dispute will be

	1685	  	 resolved through the CDA process as contemplated by Clause B-9.

	1686	  	
	1687	  	 h.      The Postal Service will pay interest in the amount found due and unpaid
from:

	1688	  	 1.      The date the Contracting Officer receives the claim (properly certified, if required);
or

	1689	  	
	1690	  	 2.      The date payment otherwise would be due, if that date is later, until the date
of

	1691	  	 payment.

	1692	  	
	1693	  	 i.       Simple interest on claims will be paid at a rate determined in accordance with the
Interest

	1694	  	 clause.

	1695	  	
	1696	  	 j.       The aviation supplier must proceed diligently with performance of this contract,
pending final

	1697	  	 resolution of any request for relief, claim, appeal, or action arising under the contract

	1698	  	 regardless of the initiating party, and comply with any decision of the Contracting Officer.

	1699	  	
	1700	  	
	1701	  	Clause B-10: Pricing of Adjustments (March 2006) (Tailored)
	1702	  	When costs are a factor in determining any contract price adjustment under the Changes clause, the
	1703	  	process set forth in Clause 4-1.c will be followed. For any other provision of this contract, the parties
	1704	  	agree to use the process set forth in Attachment 10: Pricing and in the Payment Processing sections
	1705	  	of Part 1 for negotiating the adjustment.
	1706	  	
	1707	  	
	1708	  	Clause B-15: Notice of Delay (March 2006) (Tailored)
	1709	  	Immediately upon becoming aware of any difficulties that might delay deliveries under this contract,
	1710	  	the aviation supplier will notify the Postal Service in writing. The notification must identify the


  
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	1711	  	difficulties, the reasons for them, and the estimated period of delay anticipated. Failure to give notice
	1712	  	may preclude later consideration of any request for an extension of contract time.
	1713	  	
	1714	  	
	1715	  	Clause B-22: Interest (March 2006) (Tailored)
	1716	  	The Postal Service will pay interest on late payments and unearned prompt payment discounts in
	1717	  	accordance with the Prompt Payment Act, 31 U.S.C. 3901 et. seq., as amended by the Prompt
	1718	  	Payment Act Amendments of 1988, P.L. 100-496. The aviation supplier will pay interest on any
	1719	  	payment to the Postal Service at a rate equivalent to the prevailing Contract Disputes Act interest rate.
	1720	  	
	1721	  	
	1722	  	Clause B-25: Advertising of Contract Awards (March 2006)
	1723	  	Except with the Contracting Officer’s prior approval, the aviation supplier agrees not to refer in its
	1724	  	commercial advertising to the fact that it was awarded a Postal Service contract or to imply in any
	1725	  	manner that the Postal Service endorses its products.
	1726	  	
	1727	  	
	1728	  	Clause B-30: Permits and Responsibilities (March 2006) (Tailored)
	1729	  	The aviation supplier is responsible, without additional expense to the Postal Service, for obtaining
	1730	  	any necessary licenses and permits, and for complying with any applicable federal, state, and
	1731	  	municipal laws, codes, and regulations in connection with the performance of the contract. The
	1732	  	aviation supplier is responsible for all damage to persons or property, including environmental damage
	1733	  	that occurs as a result of its omission(s) or negligence. While in performance of the contract, the
	1734	  	aviation supplier must take proper safety and health precautions to protect the work, the workers, the
	1735	  	public, the environment, and the property of others.
	1736	  	
	1737	  	
	1738	  	Clause B-39: Indemnification (March 2006) (Tailored)
	1739	  	The aviation supplier must save harmless and indemnify the Postal Service and its officers, agents,
	1740	  	representatives, and employees from all claims, losses, damage, actions, causes of action, expenses,
	1741	  	and/or liability resulting from, brought forth, or on account of any personal injury or property damage
	1742	  	received or sustained by any person, persons, or property growing out of, occurring, or attributable to
	1743	  	any work performed under or related to this contract, resulting in whole or in part from negligent acts or
	1744	  	omissions of the aviation supplier, any subcontractor of the aviation supplier, or any employee, agent,
	1745	  	or representative of the aviation supplier or of the aviation supplier’s subcontractor.
	1746	  	
	1747	  	The Postal Service must save harmless and indemnify the aviation supplier and its officers, agents,
	1748	  	representatives, and employees from all claims, losses, damage, actions, causes of action, expenses,
	1749	  	and / or liability resulting from, brought forth, or on account of any personal injury or property damage
	1750	  	received or sustained by any person, persons, or property growing out of, occurring, or attributable to
	1751	  	any work performed under or related to this contract, resulting in whole or in part from negligent acts or
	1752	  	omissions of the Postal Service, or any employee, agent, or representative of the Postal Service.
	1753	  	
	1754	  	
	1755	  	Clause B-45: Other Contracts (March 2006) (Tailored)
	1756	  	The Postal Service may award other contracts for additional work, and the aviation supplier must
	1757	  	cooperate fully with the other aviation suppliers and Postal Service employees. The aviation supplier
	1758	  	must not commit or permit any act that will interfere with the performance of work by any other aviation
	1759	  	supplier or by Postal Service employees.
	1760	  	
	1761	  	
	1762	  	Clause B-65: Adjustments to Compensation (March 2006) (Tailored)
	1763	  	Contract compensation may be adjusted, from time to time, by mutual agreement of the aviation
	1764	  	supplier and the Contracting Officer. No adjustment to compensation will be made for changes arising
	1765	  	from Clause 9-10: Service Contract Act or from Clause 9-12: Fair Labor Standards Act and Service


  
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	1766	  	Contract Act – Price Adjustment. Adjustments in compensation pursuant to this clause shall be
	1767	  	memorialized by formal modification to the contract. All negotiations between the parties shall be
	1768	  	conducted with respect to the implied covenant of good faith and fair dealing.
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	1770	  	
	1771	  	Clause B-69: Events of Default (March 2006) (Tailored)
	1772 1773 1774	  	The aviation supplier’s right to perform this contract is subject to termination, in whole or in part, in the
event of any of the following events of
default.
	1775 1776	  	 a.      The aviation supplier’s failure to perform service according to the terms of the
contract;

	1777 1778 1779	  	 b.      If the aviation supplier has been administratively determined to have violated Postal laws
and
regulations and other laws related to the performance of the service;

	1780 1781 1782	  	 c.      Failure to follow the instructions of the Contracting Officer that fall within the scope of
the
contract;

	1783 1784 1785 1786 1787	  	 d.      If the aviation supplier transfers or assigns his contract, except as authorized herein,
or
sublets the whole or a portion of this contract contrary to the applicable provisions of the U.S.
Postal Service Supplying Principles and Practices or without any required approval of the
Contracting Officer;

	1788 1789 1790	  	 e.      If the aviation supplier combines to prevent others from proposing for the performance
of
Postal Service contracts;

	1791 1792 1793 1794 1795	  	 f.       If the aviation supplier or corporate officer has been or is, during the term of the
contract,
convicted of a crime affecting his or her reliability or trustworthiness as a mail transportation
aviation supplier, such as any form of fraud or embezzlement that has impacted the Postal
Service or the U.S.
Government;

	1796 1797 1798 1799	  	 g.      If at any time the aviation supplier, its principal owners, corporate officers or personnel
are
disqualified by law or regulation from performing services under this contract, and upon notice
thereof, the aviation supplier fails to remove any such disqualification;

	1800 1801 1802	  	 h.      If the aviation supplier fails to provide any notification of a change in corporate
officers which
this contract may require; or

	1803 1804 1805	  	 i.       If the aviation supplier materially breaches any other requirement or clause of this
contract.

	1806 1807	  	Clause B-75: Accountability of the Aviation Supplier (Non-Highway) (March
2006) (Tailored)
	1808 1809 1810 1811 1812	  	 a.      The aviation supplier shall supervise its operations and the operations of its
subcontractors
that provide services under this contract personally or through representatives. The aviation
supplier or its supervising representatives must be easily accessible in the event of
emergencies or interruptions in
service.

	1813 1814 1815 1816 1817 1818 1819 1820	  	 b.      In all cases, the aviation supplier shall be liable to the Postal Service for the Postal
Service’s
damages if mail is subject to loss, rifling, damage, wrong delivery, depredation, and other
mistreatment while in the custody and control of the aviation supplier or its subcontractors.
The aviation supplier shall also be
accountable and answerable in damages for the faithful
performance of all other obligations assumed under this contract, whether or not it has
entrusted part or all of its performance to another, except for any failure to perform that
is
excused by the Force Majeure clause of this contract.

	1821	  	 c.      The aviation supplier shall faithfully account for and deliver to the Postal Service
all:

	1822	  	 1.      Mail,

	1823	  	 2.      Moneys, and

	1824 1825	  	 3.      Other property of any kind belonging to or entrusted to the care of the Postal
Service,
that come into the possession of the aviation supplier during the term of this contract.



  
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	1826	  	
	1827	  	 d.      The aviation supplier shall, promptly upon discovery, refund (i) any overpayment made by
the

	1828	  	 Postal Service for service performed, or (ii) any payment made by the Postal Service for

	1829	  	 service not rendered.



					
	1830	  		  	
	1831	  		  	
	1832	  	Clause B-77: Protection of the Mail (Non-Highway) (March 2006) (Tailored)
	1833	  	The aviation supplier must protect and safeguard the mail from loss, theft, or damage while it is in the
	1834	  	aviation supplier’s custody or control, and prevent unauthorized persons from having access to the
	1835	  	mail.	  	
	1836	  		  	
	1837	  	 a.      Classification of Irregularities

	1838	  	 The following classifications of irregularities are those that preclude the Postal Service from

	1839	  	 accomplishing its mission. The damage caused from these irregularities result in actual

	1840	  	 damage and degradation to its brand, and therefore, is associated with liquidated damages as

	1841	  	 stated:
	  	
	1842	  		  	
	1843	  	 1.      Failure to Protect
	  	
	1844	  	 Failure to protect the mail consists of: failure to protect or safeguard the mail from

	1845	  	 inclement weather, from damage caused by the mechanized sort, from acts of the

	1846	  	 aviation supplier’s employees or contractors, and from loss, depredation, or other

	1847	  	 hazards while in the control or custody of the aviation supplier.

	1848	  		  	
	1849	  	 2.      Theft of Mail
	  	
	1850	  	 The theft of mail can cause immeasurable damage to the Postal Service, both in

	1851	  	 terms of actual economic loss to our customers and to the competitive standing of our

	1852	  	 products and services. The aviation supplier will support law enforcement efforts to

	1853	  	 prevent theft of mail, and will support enforcement officials in the apprehension of

	1854	  	 those who may be perpetrating such crimes.

	1855	  		  	
	1856	  	 b.      Damages and Liquidated Damages

	1857	  	 The following liquidated damages for damaged and unprotected mail are applicable to the

	1858	  	 associated classifications of irregularities:

	1859	  		  	
	1860	  	 1.      Damaged and Unprotected Mail
	  	
	1861	  	 Liquidated damages may be assessed for damaged and unprotected mail. For

	1862	  	 purposes of this section, damaged mail will consist of mail pieces whether inside or

	1863	  	 outside of Postal Service MTE. This category includes but may not be limited to:

	1864	  		  	
	1865	  	 i.       Failure to Protect – Causing Damage to Mail

	1866	  	 Failure to protect causing physical damage to the U.S. Mail or MTE for which

	1867	  	 there may be damage assessed equal to the actual costs incurred by the

	1868	  	 Postal Service necessary to remedy the situation and forward the mail onward

	1869	  	 to its next processing or delivery operation. Such actual costs may include

	1870	  	 items such as administrative time at an appropriate hourly rate for

	1871	  	 documenting the irregular condition and implementing the damage, labor time

	1872	  	 used to repossess the mail, unpack, sort, dry, repack / repackage, and re-

	1873	  	 dispatch to a subsequent destination or processing operation.

	1874	  		  	
	1875	  	 If actual damages are not ascertainable, a liquidated damage may be

	1876	  	 assessed as follows, taking into account the actual damage that may typically

	1877	  	 result from such situations:

	1878	  		  	
	1879	  	 Per Letter Tray:
	  	[*] per letter tray
	1880	  	 Per Flat Tub:
	  	[*] per flat tub
	1881	  	 Per Mail Sack or Pouch:
	  	[*] per sack or pouch
	1882	  	 Per Outside Parcel:
	  	[*] per piece

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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	1883	  		  	
	1884	  	 ii.      Failure to Protect - Dropped or Abandoned Pouch or Piece

	1885	  	 When U.S. Mail is discovered unprotected in an unsecured location or on the

	1886	  	 airport ramp, Liquidated Damages may be assessed at $50.00 per incident.



			
	1887	  	
	1888	  	 c.      Investigative Costs for Theft of Mail

	1889	  	 In cases where a mail theft is committed by the aviation supplier’s or its subcontractor’s

	1890	  	 personnel, actual investigative costs to the U.S. Postal Inspection Service and/or the Office of

	1891	  	 the Inspector General may be assessed as actual damages. These costs will be reasonably

	1892	  	 determined and may begin accruing only when a specific investigation begins on the basis of

	1893	  	 probable cause. The costs of routine surveillance not associated with a specific theft or series

	1894	  	 of thefts will not be assessed. In addition to allocable investigative expenses, the Postal

	1895	  	 Service may assess actual damages for loss of product value resulting from insurance claims

	1896	  	 where payouts to postal customers can be traced to the incident(s).

	1897	  	
	1898	  	 In addition to the above, in cases where mail theft occurs and the Postal Service determines

	1899	  	 that the aviation supplier’s failure to properly execute the mail handling employee screening

	1900	  	 requirements set forth in the Contract was a proximate cause of the theft, and that by reason

	1901	  	 of the theft it is necessary to conduct a complete audit of the aviation supplier’s adherence to

	1902	  	 the screening requirements with respect to the employment of other employees subject to

	1903	  	 those requirements, the Postal Service may assess an administrative damage in the amount

	1904	  	 of $5,000 in lieu of actual costs associated with that audit.

	1905	  	
	1906	  	 Depending upon the circumstances of the incident, the Vice President, Network Operations, in

	1907	  	 consultation with the Postal Inspection Service or Office of the Inspector General, and the

	1908	  	 Contracting Officer, may determine that damages pursuant to this section are not appropriate,

	1909	  	 and may waive all or a portion of the amounts that may otherwise be due the Postal Service

	1910	  	 hereunder. Factors such as the seriousness of the misconduct, the aviation supplier’s level of

	1911	  	 cooperation in investigations, implementing corrective actions, and efforts directed at loss

	1912	  	 recovery will be considered in reaching that determination.

	1913	  	
	1914	  	
	1915	  	Clause B-80: Laws and Regulations Applicable (March 2006) (Tailored)
	1916	  	This contract and the services performed under it are subject to all applicable federal, state, and local
	1917	  	laws and regulations. The aviation supplier assumes sole responsibility to faithfully discharge all
	1918	  	duties and obligations imposed by such laws and regulations, and shall obtain and pay for all permits,
	1919	  	licenses, and other authorities required to perform this contract. The aviation supplier shall hold
	1920	  	harmless, save, and defend the Postal Service from any consequence of the aviation supplier’s failure
	1921	  	to abide by all applicable federal, state, and local laws and regulations (including but not limited to
	1922	  	regulations promulgated by the DOL and IRS) relating to the contract and throughout the term of the
	1923	  	contract and any subsequent renewal periods.
	1924	  	
	1925	  	
	1926	  	Clause B-81: Information or Access by Third Parties (March 2006) (Tailored)
	1927	  	The Postal Service retains exclusive authority to release any or all information about mail matter in the
	1928	  	custody of the aviation supplier and to permit access to that mail in the custody of the aviation
	1929	  	supplier. All requests by non-postal individuals for information about mail matter in the custody of the
	1930	  	aviation supplier or for access to mail in the custody of the aviation supplier must be referred to the
	1931	  	Contracting Officer or his or her designee.
	1932	  	
	1933	  	
	1934	  	Clause B-82: Access by Officials (March 2006) (Tailored)
	1935	  	The aviation supplier shall deny access to the cargo compartment of aircrafts or a vehicle containing
	1936	  	mail therein to state or local officials except at a postal facility or in the presence of a postal employee
	1937	  	or a Postal Inspection Service officer, unless to prevent immediate damage to the aircraft, vehicle, or
	1938	  	their contents. If authorized Federal law enforcement seeks access to the cargo compartment of


  
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	1939	  	aircrafts or vehicles contained mail therein, the aviation supplier shall notify the Postal Inspection
	1940	  	Service before permitting access, unless to prevent immediate damage to the aircraft, vehicle, or their
	1941	  	contents.
	1942	  	
	1943	  	
	1944	  	Clause 1-1: Privacy Protection (July 2007)
	1945	  	In addition to other provisions of this contract, the aviation supplier agrees to the following:
	1946	  	 a.      Privacy Act. If the aviation supplier operates a system of records on behalf of the
Postal

	1947	  	 Service, the Privacy Act (5 U.S.C. 522a) and Postal Service regulations at 39 CFR Parts 266-

	1948	  	 267 apply to those records. The aviation supplier is considered to operate a system of

	1949	  	 records if it manages records (including collecting, revising, or disseminating records) from

	1950	  	 which information is retrieved by the name of an individual or by some number, symbol, or

	1951	  	 other identifier assigned to the individual. The aviation supplier agrees to comply with the Act

	1952	  	 and the Postal Service regulations in designing, developing, and operating the system of

	1953	  	 records, including ensuring that records are current and accurate for their intended use, and

	1954	  	 incorporating adequate safeguards to prevent misuse or improper disclosure of personal

	1955	  	 information. Violations of the Act may subject the violator to criminal penalties.

	1956	  	
	1957	  	 b.      Customer or Employee Information. If the aviation supplier has access to Postal
Service

	1958	  	 customer or employee information, including address information, whether collected online or

	1959	  	 offline by the Postal Service or by a aviation supplier acting on its behalf, the aviation supplier

	1960	  	 must comply with the following:

	1961	  	
	1962	  	 1.      General. With regard to the Postal Service customer information to which it has
access

	1963	  	 pursuant to this contract, the aviation supplier has that access as an agent of the Postal

	1964	  	 Service and must adhere to its postal privacy policy at

	1965	  	 www.usps.com/common/docs/privpol.htm.

	1966	  	
	1967	  	 2.      Use, Ownership, and Nondisclosure. The aviation supplier may use Postal
Service

	1968	  	 customer or employee information solely for purposes of this contract, and may not collect

	1969	  	 or use such information for non-Postal Service marketing, promotion, or any other

	1970	  	 purpose without the prior written approval of the Contracting Officer. The aviation supplier

	1971	  	 must restrict access to such information to those employees who need the information to

	1972	  	 perform work under this contract, and must ensure that each such employee (including

	1973	  	 subcontractors’ employees) sign a nondisclosure agreement, in a form suitable to the

	1974	  	 Contracting Officer, prior to being granted access to the information. The Postal Service

	1975	  	 retains sole ownership and rights to its customer or employee information. Unless the

	1976	  	 contract states otherwise, upon completion of the contract, the aviation supplier must turn

	1977	  	 over all Postal Service customer or employee information in its possession to the Postal

	1978	  	 Service, and must certify that no Postal Service customer or employee information has

	1979	  	 been retained unless otherwise authorized in writing by the Contracting Officer.

	1980	  	
	1981	  	 3.      Security Plan. When applicable, and unless waived in writing by the Contracting
Officer,

	1982	  	 the aviation supplier must work with the Postal Service to develop and implement a

	1983	  	 security plan that addresses the protection of customer or employee information. The

	1984	  	 plan will be incorporated into the contract and followed by the aviation supplier, and must,

	1985	  	 at a minimum, address notification to the Postal Service of any security breach. If the

	1986	  	 contract does not include a security plan at the time of contract award, it must be added

	1987	  	 within 60 days after contract award.

	1988	  	
	1989	  	 4.      Breach Notification. If there is a breach of any nature in the security of Postal
Service

	1990	  	 data, including customer or employee data, the aviation supplier must follow the breach

	1991	  	 notification requirements included in the security plan discussed in (3) above. The aviation

	1992	  	 supplier will be required to follow Postal Service policies regarding breach notification to

	1993	  	 customers and/or employees.

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	1995	  	 5.      Legal Demands for Information. If a legal demand is made for Postal Service customer
or

	1996	  	 employee information (such as by subpoena), the aviation supplier must immediately

	1997	  	 notify the Contracting Officer and the nearest office of the Postal Inspection Service. After

	1998	  	 notification, the Postal Service will determine whether and to what extent to comply with

	1999	  	 the legal demand. Should the Postal Service agree to or unsuccessfully resist a legal

	2000	  	 demand, the aviation supplier may, with the written permission of the Contracting Officer,

	2001	  	 release the information specifically demanded.

	2002	  	
	2003	  	 c.      Online Assistance. If the aviation supplier assists in the design, development, or
operation of

	2004	  	 a Postal Service customer Web site, or if it designs or places an ad banner, button, or link on

	2005	  	 a Postal Service Web site or any Web site on the Postal Service’s behalf, the aviation supplier

	2006	  	 must comply with the limitations in subparagraph b (1) above relating to ad banners, buttons,

	2007	  	 or links, and the use of cookies, web beacons, or other web analysis tools. Exceptions to

	2008	  	 these limitations require the prior written approval of the Contracting Officer and the Postal

	2009	  	 Service’s chief privacy officer.

	2010	  	
	2011	  	 d.      Marketing E-Mail. If the aviation supplier assists the Postal Service in conducting
a marketing

	2012	  	 e-mail campaign, the aviation supplier does so as an agent of the Postal Service and must

	2013	  	 adhere to the Postal Service policies set out in Postal Service Management Instruction AS-

	2014	  	 350-2004-4, Marketing E-mail. Aviation suppliers wishing to conduct marketing email

	2015	  	 campaigns to postal employees must first obtain the prior written approval of the Contracting

	2016	  	 Officer.

	2017	  	
	2018	  	 e.      Audits. The Postal Service may audit the aviation supplier’s compliance with
the requirements

	2019	  	 of this clause, including through the use of online compliance software.

	2020	  	
	2021	  	 f.       Indemnification. The aviation supplier will indemnify the Postal Service
against all liability

	2022	  	 (including costs and fees) for damages arising out of violations of this clause.

	2023	  	
	2024	  	 g.      Flow-down. The aviation supplier will flow this clause down to subcontractors that
would be

	2025	  	 covered by any portion of this clause if they were the aviation supplier.

	2026	  	
	2027	  	
	2028	  	Clause 1-5: Gratuities or Gifts (March 2006)
	2029	  	 a.      The Postal Service may terminate this contract for default if, after notice and a hearing,
the

	2030	  	 Postal Service Board of Contract Appeals determines that the aviation supplier or the aviation

	2031	  	 supplier’s agent or other representative:

	2032	  	 1.      Offered or gave a gratuity or gift (as defined in 5 CFR 2635) to an officer or
employee

	2033	  	 of the Postal Service; and

	2034	  	 2.      Intended by the gratuity or gift to obtain a contract or favorable treatment under
a

	2035	  	 contract.

	2036	  	
	2037	  	 b.      The rights and remedies of the Postal Service provided in this clause are in addition to
any

	2038	  	 other rights and remedies provided by law or under this contract.

	2039	  	
	2040	  	
	2041	  	Clause 1-6: Contingent Fees (March 2006)
	2042	  	 a.      The aviation supplier warrants that no person or selling agency has been employed
or

	2043	  	 retained to solicit or obtain this contract for a commission, percentage, brokerage, or

	2044	  	 contingent fee, except bona fide employees or bona fide, established commercial or selling

	2045	  	 agencies employed by the aviation supplier for the purpose of obtaining business.

	2046	  	
	2047	  	 b.      For breach or violation of this warranty, the Postal Service has the right to annul this
contract

	2048	  	 without liability or to deduct from the contract price or otherwise recover the full amount of the

	2049	  	 commission, percentage, brokerage fee, or contingent fee.

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	2051	  	
	2052	  	Clause 1-11: Prohibition Against Contracting with Former Officers or PCES
	2053	  	Executives (March 2006) (Tailored)
	2054	  	During the performance of this contract, former Postal officers or Postal Career Executive Service
	2055	  	(PCES) executives are prohibited from employment by the contractor as key personnel, experts or
	2056	  	consultants, if such individuals, within two years after their retirement from the Postal Service, would
	2057	  	be performing substantially the same duties as they performed during their career with the Postal
	2058	  	Service.
	2059	  	
	2060	  	
	2061	  	Clause 1-12: Use of Former Postal Service Employees (March 2006) (Tailored)
	2062	  	During the term of this contract, the aviation supplier must identify any former Postal Service officers
	2063	  	or Postal Career Executive Service (PCES) employees it proposes to be engaged, directly or
	2064	  	indirectly, in contract performance. Such individuals may not commence performance without the
	2065	  	Contracting Officer’s prior approval. If the Contracting Officer does not provide such approval, the
	2066	  	aviation supplier must replace the proposed individual former employee with another individual equally
	2067	  	qualified to provide the services called for in the contract.
	2068	  	
	2069	  	
	2070	  	Clause 2-11: Postal Service Property - Fixed-Price (March 2006) (Tailored)
	2071	  	 a.      Postal Service-Furnished Property

	2072	  	 1.      The Postal Service will deliver to the aviation supplier, for use in connection with
and

	2073	  	 under the terms of this contract, the property described as Postal Service-furnished

	2074	  	 property in the Schedule or specifications, together with any related information the

	2075	  	 aviation supplier may request that may reasonably be required for the intended use of

	2076	  	 the property (hereinafter referred to as “Postal Service-furnished property”).

	2077	  	
	2078	  	 2.      The contract delivery or performance dates are based on the expectation that
Postal

	2079	  	 Service-furnished property suitable for use (except for property furnished “as is”) will

	2080	  	 be delivered at the times stated in the Schedule or, if not so stated, in sufficient time to

	2081	  	 enable the aviation supplier to meet these delivery or performance dates. If Postal

	2082	  	 Service-furnished property is not delivered by these times, the Contracting Officer will,

	2083	  	 upon timely written request from the aviation supplier, make a determination of any

	2084	  	 delay occasioned the aviation supplier and will equitably adjust the delivery or

	2085	  	 performance dates or the contract price, or both, and any other contractual provision

	2086	  	 affected by the delay, in accordance with the Changes clause.

	2087	  	
	2088	  	 3.      Except for Postal Service-furnished property furnished “as is,” if the Postal
Service-

	2089	  	 furnished property is received in a condition not suitable for its intended use, the

	2090	  	 aviation supplier must notify the Contracting Officer and (as directed by the

	2091	  	 Contracting Officer) either (a) return it at the expense of the Postal Service or

	2092	  	 otherwise dispose of it, or (b) effect repairs or modifications. Upon the completion of

	2093	  	 (a) or (b), the Contracting Officer (upon written request from the aviation supplier) will

	2094	  	 equitably adjust the delivery or performance dates or the contract price, or both, and

	2095	  	 any other affected contractual provision, in accordance with the Changes clause.

	2096	  	
	2097	  	 4.      The provisions for adjustment in this paragraph a are exclusive, and the
Postal

	2098	  	 Service is not liable to suit for breach of contract by reason of any delay in delivery of

	2099	  	 Postal Service-furnished property or its delivery in a condition not suitable for its

	2100	  	 intended use.

	2101	  	
	2102	  	 b.      Changes in Postal Service-Furnished Property

	2103	  	 1.      By written notice, the Contracting Officer may (a) decrease the property provided or
to

	2104	  	 be provided by the Postal Service under this contract, or (b) substitute other Postal

	2105	  	 Service-owned property for the property to be provided by the Postal Service, or to be

	2106	  	 acquired by the aviation supplier for the Postal Service under this contract.
The



  
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	2107	  	 aviation supplier must promptly take any action the Contracting Officer may direct

	2108	  	 regarding the removal and shipping of the property covered by this notice.

	2109	  	
	2110	  	 2.      In the event of any decrease in or substitution of property pursuant to
subparagraph

	2111	  	 b.1 above, or any withdrawal of authority to use property provided under any other

	2112	  	 contract or lease, which property the Postal Service had agreed in the Schedule to

	2113	  	 make available for the performance of this contract, the Contracting Officer, upon the

	2114	  	 aviation supplier’s written request (or - if substitution causes a decrease in the cost of

	2115	  	 performance - on the Contracting Officer’s own initiative), will equitably adjust any

	2116	  	 contractual provisions affected by the decrease, substitution, or withdrawal, in

	2117	  	 accordance with the Changes clause.

	2118	  	
	2119	  	 c.      Use of Postal Service Property. The Postal Service property, unless otherwise
provided in

	2120	  	 this contract or approved by the Contracting Officer, must be used only for performing this

	2121	  	 contract.

	2122	  	
	2123	  	 d.      Utilization, Maintenance, and Repair of Postal Service Property. The aviation
supplier must

	2124	  	 maintain and administer, in accordance with sound industrial practice, a program or system for

	2125	  	 the utilization, maintenance, repair, protection, and preservation of Postal Service property

	2126	  	 until it is disposed of in accordance with this clause. If any damage occurs to Postal Service

	2127	  	 property, the risk of which has been assumed by the Postal Service under this contract, the

	2128	  	 Postal Service will replace the items or the aviation supplier must make such repairs as the

	2129	  	 Postal Service directs; provided, however, that if the aviation supplier cannot effect these

	2130	  	 repairs within the time required, the aviation supplier will dispose of the property in the manner

	2131	  	 directed by the Contracting Officer. The contract price includes no compensation to the

	2132	  	 aviation supplier for performing any repair or replacement for which the Postal Service is

	2133	  	 responsible, and an equitable adjustment will be made in any contractual provisions affected

	2134	  	 by such repair or replacement made at the direction of the Postal Service, in accordance with

	2135	  	 the Changes clause. Any repair or replacement for which the aviation supplier is responsible

	2136	  	 under the provisions of this contract must be accomplished by the aviation supplier at the

	2137	  	 aviation supplier’s own expense.

	2138	  	
	2139	  	 e.      Risk of Loss. Unless otherwise provided in this contract, the aviation supplier
assumes the

	2140	  	 risk of, and becomes responsible for, any loss or damage to Postal Service property provided

	2141	  	 under this contract upon its delivery to the aviation supplier or upon passage of title to the

	2142	  	 Postal Service as provided in paragraph i below, except for reasonable wear and tear and

	2143	  	 except to the extent that it is consumed in performing this contract.

	2144	  	
	2145	  	 f.       Access. The Postal Service, and any persons designated by it, must at
reasonable times

	2146	  	 have access to premises where any Postal Service property is located, for the purpose of

	2147	  	 inspecting it.

	2148	  	
	2149	  	 g.      Final Accounting for and Disposition of Postal Service Property. Upon completion, or
at such

	2150	  	 earlier dates as may be fixed by the Contracting Officer, the aviation supplier must submit, in a

	2151	  	 form acceptable to the Contracting Officer, inventory schedules covering all items of Postal

	2152	  	 Service property not consumed in performing this contract (including any resulting scrap) or

	2153	  	 not previously delivered to the Postal Service, and will prepare for shipment, deliver f.o.b.

	2154	  	 origin, or dispose of this property, as the Contracting Officer may direct or authorize. The net

	2155	  	 proceeds of disposal will be credited to the contract price or will be paid in such other manner

	2156	  	 as the Contracting Officer may direct.

	2157	  	
	2158	  	 h.      Restoration of Aviation Supplier’s Premises and Abandonment. Unless otherwise
provided in

	2159	  	 this contract, the Postal Service:

	2160	  	 1.      May abandon any Postal Service property in place, whereupon all obligations of
the

	2161	  	 Postal Service regarding it will cease; and

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	2163	  	 2.      Has no obligation with regard to restoration or rehabilitation of the aviation
supplier’s

	2164	  	 premises, either in case of abandonment, disposition on completion of need or of the

	2165	  	 contract, or otherwise, except for restoration or rehabilitation costs properly included

	2166	  	 in an equitable adjustment under paragraph b or e above.

	2167	  	
	2168	  	 i.       Title.

	2169	  	 1.      Title to all Postal Service-furnished property remains in the Postal Service. To
define

	2170	  	 the obligations of the parties under this clause, title to each item of facilities, special

	2171	  	 test equipment, or special tooling (other than that subject to a special-tooling clause)

	2172	  	 acquired by the aviation supplier on behalf of the Postal Service under this contract

	2173	  	 will pass to and vest in the Postal Service when its use in the performance of this

	2174	  	 contract begins, or upon payment for it by the Postal Service, whichever is earlier,

	2175	  	 whether or not title was previously vested.

	2176	  	
	2177	  	 2.      Title to all material purchased by the aviation supplier for whose cost the
aviation

	2178	  	 supplier is entitled to be reimbursed as a direct item of cost under this contract will

	2179	  	 pass to and vest in the Postal Service upon delivery of the material to the aviation

	2180	  	 supplier by the vendor.

	2181	  	
	2182	  	 3.      Title to other material whose cost is reimbursable to the aviation supplier under
this

	2183	  	 contract will pass to and vest in the Postal Service upon:

	2184	  	 a)      Its issuance for use in the performance of this contract; or

	2185	  	 b)      Reimbursement of its cost by the Postal Service, whichever occurs
first.

	2186	  	
	2187	  	 4.      All Postal Service-furnished property, together with all property acquired by
the

	2188	  	 aviation supplier, title to which vests in the Postal Service under this subsection i, is

	2189	  	 subject to the provisions of this clause and is hereinafter collectively referred to as

	2190	  	 “Postal Service property.” Title to Postal Service property is not affected by its

	2191	  	 incorporation into or attachment to any property not owned by the Postal Service, nor

	2192	  	 does Postal Service property become a fixture or lose its identity as personal property

	2193	  	 by being attached to any real property.

	2194	  	
	2195	  	
	2196	  	Clause 2-22: Value Engineering Incentive (March 2006)
	2197	  	 a.      General.

	2198	  	 The right of each party to improve its own methods for its own benefit, absent a change to the

	2199	  	 obligations of the other party which requires an modification to this Contract, and to retain

	2200	  	 such savings for itself is not affected by this clause.

	2201	  	
	2202	  	 The aviation supplier is encouraged to develop and submit Value Engineering Change

	2203	  	 Proposals (VECPs) voluntarily. The aviation supplier will share in savings realized from an

	2204	  	 accepted VECP as provided in paragraph (h) below. No document submitted by the aviation

	2205	  	 supplier shall be considered to be a VECP unless the aviation supplier specifically marks on

	2206	  	 the document that it is to be considered a VECP and contains a statement that the aviation

	2207	  	 supplier intends the document to be a VECP subject to the provisions of this Clause of the

	2208	  	 Contract.

	2209	  	
	2210	  	 b.      Definitions

	2211	  	 1.      Value Engineering Change Proposal (VECP). A proposal that:

	2212	  	 i.       Requires a change to the instant contract;

	2213	  	 ii.      Results in savings to the instant contract; and

	2214	  	 iii.     Does not involve a change in:

	2215	  	 a)      Deliverable end items only;

	2216	  	 b)      Test quantities due solely to results of previous testing under the
instant

	2217	  	 contract;or

	2218	  	 c)      Contract type only.

	2219	  	


  
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	 2220
 2221
	  	 2.      Instant Contract. The contract under which a VECP is submitted. It does not
include
additional contract quantities.

	2222	  	
	 2223
 2224
 2225
	  	 3.      Additional Contract Quantity. An increase in quantity after acceptance of a VECP
due
to contract modification, exercise of an option, or additional orders (except orders
under indefinite-delivery contracts within the original maximum quantity limitations).

	2226	  	
	 2227
 2228
 2229
 2230
	  	 4.      Postal Service Costs. Costs to the Postal Service resulting from developing
and
implementing a VECP, such as net increases in the cost of testing, operations,
maintenance, logistics support, or property furnished. Normal administrative costs of
processing the VECP are excluded.

	2231	  	
	 2232
 2233
 2234
	  	 5.      Instant Contract Savings. The estimated cost of performing the instant
contract
without implementing a VECP minus the sum of: (a) the estimated cost of
performance after implementing the VECP, and (b) Postal Service costs.

	2235	  	
	 2236
 2237
 2238
 2239
	  	 6.      Additional Contract Savings. The estimated cost of performance or
delivering
additional quantities without the implementation of a VECP minus the sum of (a) the
estimated cost of performance after the VECP is implemented and (b) Postal Service
cost.

	2240	  	
	 2241
 2242
 2243
 2244
	  	 7.      Aviation Supplier’s Development and Implementation Costs. Aviation
supplier’s cost
in developing, testing, preparing, and submitting a VECP. Also included are the
aviation supplier’s cost to make the contractual changes resulting from the Postal
Service acceptance of the
VECP.

	2245	  	
	2246	  	 c.      Content. A VECP must include the following:

	2247	  	
	 2248
 2249
 2250
 2251
	  	 1.      A description of the difference between the existing contract requirement and
that
proposed, the comparative advantages and disadvantages of each, a justification
when an item’s function or characteristics are being altered, the effect of the change
on the end item’s performance, and any pertinent objective
test data.

	2252	  	
	 2253
 2254
	  	 2.      A list and analysis of the contract requirements that must be changed if the VECP
is
accepted, including any suggested specification revisions.

	2255	  	
	 2256
 2257
 2258
 2259
	  	 3.      A separate, detailed cost estimate for: (a) the affected portions of the existing
contract
requirement and, (b) the VECP. The cost reduction associated with the VECP must
take into account the aviation supplier’s allowable development and implementation
costs.

	2260	  	
	 2261
 2262
	  	 4.      A description and estimate of costs the Postal Service may incur in implementing
the
VECP, such as test and evaluation and operating and support costs.

	2263	  	
	2264	  	 5.      A prediction of any effects the proposed change would have on Postal Service
costs.

	2265	  	
	 2266
 2267
 2268
	  	 6.      A statement of the time by which a contract modification accepting the VECP must
be
issued in order to achieve the maximum cost reduction, noting any effect on the
contract completion time or delivery schedule.

	2269	  	
	 2270
 2271
 2272
	  	 7.      Identification of any previous submissions of the VECP to the Postal Service,
including
the dates submitted, purchasing offices, contract numbers, and actions
taken.

	2273	  	
	2274	  	 d.      Submission. The aviation supplier must submit VECPs to the Contracting
Officer.

	2275	  	


			
	2276	  	 e.      Postal Service
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	2277	  	
	 2278
 2279
 2280
 2281
 2282
	  	 1.      The Contracting Officer will give the aviation supplier written notification of
action
taken on a VECP within 60 days after receipt. If additional time is needed, the
Contracting Officer will notify the aviation supplier, within the 60-day period, of the
expected date of a decision. The Postal Service will process
VECPs expeditiously but
will not be liable for any delay in acting upon a VECP.

	2283	  	
	 2284
 2285
	  	 2.      If a VECP is not accepted, the Contracting Officer will so notify the aviation
supplier,
explaining the reasons for rejection.

	2286	  	
	 2287
 2288
	  	 f.       Withdrawal. The aviation supplier may withdraw a VECP, in whole or in part, at
any time
before its acceptance.

	2289	  	
	2290	  	 g.      Acceptance

	2291	  	
	 2292
 2293
 2294
 2295
 2296
 2297
	  	 1.      Acceptance of a VECP, in whole or in part, will be by execution of a
supplemental
agreement modifying this contract and citing this clause. If agreement on price (see
paragraph h below) is reserved for a later supplemental agreement, and if such
agreement cannot be reached, the disagreement is subject to the
Claims and
Disputes clause of this contract, or another clause of the contract dealing with
disputes.

	2298	  	
	 2299
 2300
	  	 2.      Until a VECP is accepted by contract modification, both parties must perform
in
accordance with the existing contract.

	2301	  	
	 2302
 2303
 2304
	  	 3.      The Contracting Officer’s decision to accept or reject all or any part of a VECP is
final
and not subject to the Claims and Disputes clause or otherwise subject to litigation
under the Contract Disputes Act of 1978.

	2305	  	
	 2306
 2307
 2308
 2309
 2310
 2311
	  	 h.      Sharing. If a VECP is accepted, the aviation supplier and the Postal Service shall
negotiate
their respective shares of the contract savings. The contract savings are calculated by
subtracting the estimated cost of performing the contract with the VECP, Postal Service costs,
and the allowable development and
implementation costs from the estimated cost of
performing the contract without the VECP. Profit is excluded when calculating contract
savings.

	2312	  	
	2313	  	 i.       Data

	2314	  	
	 2315
 2316
	  	 1.      The aviation supplier may restrict the Postal Service’s right to use any part of a
VECP
or the supporting data by marking the following legend on the affected parts:

	2317	  	
	 2318
 2319
 2320
 2321
 2322
 2323
 2324
	  	 “These data, furnished under the Value Engineering Incentive clause of contract,
may not be disclosed outside the Postal Service or
duplicated, used, or disclosed,
in whole or in part, for any purpose other than to evaluate a value engineering
change proposal submitted under the clause. This restriction does not limit the
Postal Service’s right to use information
contained in these data if it has been
obtained or is otherwise available from the aviation supplier or from another
source without limitation.”

	2325	  	
	 2326
 2327
 2328
 2329
 2330
	  	 2.      If a VECP is accepted, the aviation supplier hereby grants the Postal Service
unlimited
rights in the VECP and supporting data, except that, with respect to data
qualifying and submitted as limited rights technical data, the Postal Service will have
the rights specified in the contract modification implementing the VECP and
will
appropriately mark the data.

	2331	  	
	2332	  	


  
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	 2333
 2334
	  	Clause 3-1: Small, Minority, and Woman-owned Business Subcontracting
Requirements (March 2006)
	 2335
 2336
 2337
 2338
 2339
 2340
 2341
 2342
	  	 a.      All aviation suppliers, except small businesses, must submit a subcontracting plan that
is
specific to this contract and that separately addresses subcontracting with small, minority, and
woman-owned businesses. A plan approved by the Postal Service must be included in and
made a part of the contract. Lack of an approved plan
may make the aviation supplier
ineligible for award. A subcontract is defined as any agreement (other than one involving an
employer-employee relationship) entered into by a Postal Service aviation supplier or
subcontractor calling for
supplies or services required for performance of the contract or
subcontract.

	2343	  	
	2344	  	 b.      The aviation supplier’s subcontracting plan must include the
following:

	 2345
 2346
 2347
 2348
 2349
	  	 1.      Goals, in terms of percentages of the total amount of this contract that the
aviation
supplier will endeavor to subcontract to small, minority, and woman-owned
businesses. The aviation supplier must include all subcontracts that contribute to
contract performance, and may include a proportionate share of supplies
and services
that are normally allocated as indirect costs.

	2350	  	
	2351	  	 2.      A statement of the:

	2352	  	 i.       Total dollars planned to be subcontracted under this contract;
and

	 2353
 2354
	  	 ii.      Total of that amount planned to be subcontracted to small, minority, and
woman-owned
businesses.

	2355	  	
	 2356
 2357
 2358
	  	 3.      A description of the principal types of supplies and services to be subcontracted
under
this contract, identifying the types planned for subcontracting to small, minority, and
woman-owned businesses.

	2359	  	
	2360	  	 4.      A description of the method used to develop the subcontracting goals for this
contract.

	2361	  	
	 2362
 2363
 2364
 2365
	  	 5.      A description of the method used to identify potential sources for solicitation
purposes
and a description of efforts the aviation supplier will make to ensure that small,
minority, and woman-owned businesses have an equitable opportunity to compete for
subcontracts.

	2366	  	
	 2367
 2368
 2369
 2370
	  	 6.      A statement as to whether the offer included indirect costs in
establishing
subcontracting goals for this contract and a description of the method used to
determine the proportionate share of indirect costs to be incurred with small, minority,
and woman-owned businesses.

	2371	  	
	 2372
 2373
	  	 7.      The name of the individual employed by the aviation supplier who will administer
the
subcontracting program and a description of the individual’s duties.

	2374	  	
	 2375
 2376
 2377
	  	 8.      Assurances that the aviation supplier will require all subcontractors
receiving
subcontracts in excess of $1,000,000 to adopt a plan similar to the plan agreed to by
the aviation supplier.

	2378	  	
	 2379
 2380
 2381
	  	 9.      A description of the types of records the aviation supplier will maintain to
demonstrate
compliance with the requirements and goals in the plan for this contract. The records
must include at least the following:

	 2382
 2383
	  	  i.     Source lists, guides, and other data identifying small, minority, and woman-
owned
businesses;

	 2384
 2385
	  	 ii.      Organizations contacted in an attempt to locate sources that are small,
minority, and
woman-owned businesses;

	 2386
 2387
 2388
	  	 iii.    Records on each subcontract solicitation resulting in an award of more than
$100,000, indicating
whether small, minority, or woman-owned businesses
were solicited and if not, why not; and



  
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	 2389
 2390
	  	 iv.     Records to support subcontract award data, including the name, address, and
business size of
each subcontractor.

	2391	  	
	 2392
 2393
 2394
	  	 c.      Reports. The aviation supplier must provide reports on subcontracting activity under
this
contract on a calendar-quarter basis. The report must be one of the types described in Clause
3-2, Participation of Small, Minority, and Woman-owned Businesses.

	2395	  	
	2396	  	
	 2397
 2398
	  	Clause 3-2: Participation of Small, Minority, and Woman-owned Businesses
(March 2006)
	 2399
 2400
 2401
 2402
	  	 a.      The policy of the Postal Service is to encourage the participation of small, minority,
and
woman-owned business in its purchases of supplies and services to the maximum extent
practicable consistent with efficient contract performance. The aviation supplier agrees to
follow the same policy in performing this
contract.

	2403	  	
	 2404
 2405
	  	 b.      Subject to the agreement of the aviation supplier and the Postal Service, the aviation
supplier
will report subcontracting activity on one of the following bases:

	2406	  	 1.      Showing the amount of money paid to subcontractors during the reporting
period;

	 2407
 2408
	  	 2.      Showing subcontracting activity that is allocable to this contract using
generally
accepted accounting practices; or

	2409	  	 3.      A combination of the methods listed above.

	2410	  	
	 2411
 2412
 2413
 2414
	  	 c.      The aviation supplier will submit a report to the Contracting Officer within 15 calendar
days
after the end of each calendar-year quarter, describing all subcontract awards to small,
minority, or woman-owned businesses. The Contracting Officer may require more frequent
reports.

	2415	  	
	2416	  	
	2417	  	Clause 4-1: General Terms and Conditions (July 2007) (Tailored)
	2418	  	 a.      Inspection and Acceptance. Not applicable

	2419	  	
	 2420
 2421
 2422
 2423
 2424
 2425
 2426
 2427
 2428
 2429
	  	 b.      Assignment. If this contract provides for payments aggregating $10,000 or more,
claims for
monies due or to become due from the Postal Service under it may be assigned to a bank,
trust company, or other financing institution, including any federal lending agency, and may
thereafter be further assigned and reassigned to
any such institution. Any assignment or
reassignment must cover all amounts payable and must not be made to more than one party,
except that assignment or reassignment may be made to one party as agent or trustee for two
or more parties
participating in financing this contract. No assignment or reassignment will be
recognized as valid and binding upon the Postal Service unless a written notice of the
assignment or reassignment, together with a true copy of the instrument of
assignment, is filed
with:

	2430	  	 1.      The Contracting Officer;

	2431	  	 2.      The surety or sureties upon any bond; and

	 2432
 2433
	  	 3.      The office, if any, designated to make payment, and the Contracting Officer
has
acknowledged the assignment in writing.

	 2434
 2435
 2436
	  	 4.      Assignment of this contract or any interest in this contract other than in
accordance
with the provisions of this clause will be grounds for termination of the contract for
default at the option of the Postal Service.

	2437	  	
	2438	  	 c.      Changes

	2439 2440	  	 1.      The Contracting Officer may, in writing, without notice to any sureties, order
changes
within the general scope of this contract in the following:

	 2441
 2442
	  	   i.    Drawings, designs, or specifications when supplies to be furnished are to be
specially
manufactured for the Postal Service in accordance with them;

	2443	  	  ii.    Statement of work or description of services;

	2444	  	 iii.    Method of shipment or packing;



  
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	2445	  	 iv.     Places of delivery of supplies or performance of services;

	2446	  	  v.     Delivery or performance schedule;

	2447	  	 vi.     Postal Service furnished property or facilities.

	2448	  	
	 2449
 2450
	  	 2.      Changes pursuant to the Ordering Process and the Operating Period
Volume
Minimum sections in Part 1- Statement of Work are not applicable under this clause.

	2451	  	
	 2452
 2453
 2454
 2455
 2456
	  	 3.      Any other written or oral order (including direction, instruction, interpretation,
or
determination) from the Contracting Officer that causes a change will be treated as a
change order under this paragraph, provided that the aviation supplier gives the
Contracting Officer written notice stating: (a) the date,
circumstances, and source of
the order and (b) that the aviation supplier regards the order as a change order.

	2457	  	
	 2458
 2459
	  	 4.      If any such change affects the cost of performance or the delivery schedule,
the
contract may be modified to effect an equitable adjustment.

	2460	  	
	 2461
 2462
 2463
 2464
	  	 5.      The aviation supplier’s claim for equitable adjustment must be asserted within 60
days
of receiving a written change order, or on a date otherwise agreed to by the parties in
writing. A later claim may be acted upon — but not after final payment under this
contract — if the Contracting Officer decides that the
facts justify such action.

	2465	  	
	 2466
 2467
	  	 6.      Failure to agree to any adjustment is a dispute under Clause B-9, Claims
and
Disputes.

	2468	  	
	2469	  	 d.      Reserved

	2470	  	
	2471	  	 e.      Reserved

	2472	  	
	2473	  	 f.       Reserved

	2474	  	
	2475	  	 g.      Invoices

	 2476
 2477
 2478
 2479
 2480
 2481
	  	 The Postal Service intends to certify payment for services based, in part, upon collected
scanned data. For services based upon scanned data, the
aviation supplier need not submit
an invoice for payment. Rather, payment will be automatically processed, on a weekly basis,
based on the scan data. In addition, certain supplemental charges (including, but not limited
to, charges related
to minimum guaranteed volumes, surface transportation, and non-
achievement of performance standards) may be assessed under the contract.

	2482	  	
	 2483
 2484
 2485
 2486
 2487
 2488
 2489
 2490
	  	 Any service requiring invoicing must meet the requirements specified herein. The aviation
supplier shall submit an original invoice (or electronic
invoice if authorized) to the Contracting
Officer’s Representative. All invoices must be submitted within ninety (90) days from
completion of the service or the applicable Operating Period to be eligible for payment.
Invoices received
after ninety (90) days from completion of the service or Operating Period will
be subject to a 10% deduction or a deduction of $10,000, whichever is less, as a liquidated
damage. The aviation supplier shall allow at least twenty-eight (28)
calendar days before
submitting a second invoice to the Postal Service for the same service.

	2491	  	
	 2492
 2493
	  	 To ensure prompt payment, an original paper invoice (or electronic invoice, if authorized) must
contain:

	 2494
 2495
	  	 1.      Aviation supplier’s name, remit to address (including ZIP+4), contact person
and
phone number;

	2496	  	 2.      Unique invoice number and invoice date;

	2497	  	 3.      Contract number;

	2498	  	 4.      A description of the supplies or services and the dates delivered or
performed;

	2499	  	 5.      Points (air stops or facility) of shipment tender and delivery; if
applicable;

	 2500
 2501
	  	 6.      Quantity, unit of measure, unit price(s) and extension(s) of the items delivered;
if
applicable;



  
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	2502	  	 7.      Payment terms, including any discounts offered;

	2503 2504	  	 8.      Name, title, and phone number of the person to be notified in the event of a
defective
invoice; and

	2505 2506	  	 9.      Any additional information required by the contract or specified by the
Contracting
Officer.

	2507	  	
	2508 2509 2510 2511	  	 Invoices will be handled in accordance with the Prompt Payment Act (31 U.S.C. 3903) and
Office of Management and Budget (OMB) Circular A-125,
Prompt Payment. Further
guidelines may be found in the Payment Processing and Reconciliation Process sections of
Part I – Statement of Work.

	2512	  	
	2513 2514 2515 2516 2517	  	 h.      Patent Indemnity. The aviation supplier will indemnify the Postal Service and its
officers,
employees and agents against liability, including costs for actual or alleged direct or
contributory infringement of, or inducement to infringe, any United States or foreign patent,
trademark, or copyright, arising out of the
performance of this contract, provided the aviation
supplier is reasonably notified of such claims and proceedings.

	2518	  	
	2519	  	 i.       Payment

	2520	  	 Payment will only be made for:

	2521 2522	  	 1.      Items that have been properly scanned and delivered to the correct delivery
destination
Service Points set forth in this contract, and

	2523	  	
	2524	  	 2.      Other services and charges agreed upon by the parties.

	2525	  	
	2526 2527 2528	  	 The Postal Service will make payment in accordance with the Prompt Payment Act (31 U.S.C.
3903) and 5 CFR 1315. Payments under this contract may be
made by the Postal Service
either by electronic funds transfer or other method agreed upon by the parties.

	2529	  	
	2530 2531 2532 2533 2534	  	 j.       Risk of Loss. The Postal Service shall be liable for all third-party customer
claims arising from
or in connection with the loss, damage, or delay of any mail transported under this contract,
except to the extent of any insurance proceeds received by the aviation supplier as a result of
a catastrophic loss of an
aircraft or other transport vehicle and attributable to Postal Service
mail.

	2535	  	
	2536 2537 2538 2539 2540 2541 2542 2543	  	 k.      Taxes. The contract price includes all applicable federal, state, and local taxes
and duties
except the applicable Federal excise tax on the transportation of property via air. The aviation
supplier is required to report to the Postal Service on an annual basis (October 1), the portion
of the rates listed in
Attachment 10: Pricing that are subject to federal excise tax. The Postal
Service shall hold harmless, save, and defend the aviation supplier from any demand or claim
of, or on behalf of, the IRS or the United States based on the
application of federal excise
taxes applicable to the transportation services performed by the aviation supplier under this
contract.

	2544	  	
	2545	  	 l.       Termination on Notice.

	2546	  	
	2547 2548 2549 2550	  	 1.      This contract does not contain a Termination for Convenience clause. In lieu of
a
Termination for Convenience, either party may terminate this contract without cause
by providing advanced written notice to the non-terminating party and a termination
fee as follows:

	2551	  	


  
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	2552	  	


									
	  	 	 Advanced Notice

Provided
	 	 Postal Service

Termination Fee
	 	 Aviation Supplier
Termination Fee
	  	  
		 	[*]	 	[*]	 	[*]	  	
		 	[*]	 	[*]	 	[*]	  	
		 	[*]	 	[*]	 	[*]	  	
		 	[*]	 	[*]	 	[*]	  	


			
	2553	  	
	2554	  	
	2555	  	
	2556 2557	  	 2.      The terminating party must pay the termination fee corresponding to the advanced
written
notice within ninety (90) of the written notice of termination.

	2558	  	
	2559 2560 2561 2562 2563 2564 2565 2566	  	 3.      If the aviation supplier terminates the contract under this provision, the
aviation
supplier guarantees to provide the Postal Service a daily average capacity through the
effective date of the termination of not less than the daily average capacity offered in
the two most recently completed Operating Periods prior
to the date of the receipt of
the notice of termination, or, if two Operating Periods have not been completed when
the notice of termination is received, the daily average capacity offered shall be at
least equal to the average daily
capacity transported prior to the receipt of the written
notice of termination.

	2567	  	
	2568 2569 2570 2571	  	 4.      Either party’s termination under this provision shall not prejudice the
aviation
supplier’s right to payment for services rendered, but neither party shall be liable to
the other for any other damages, fees, or payment except for the termination fee
above.

	2572	  	
	2573 2574 2575	  	 5.      This clause does not apply to changes in service resulting from the Postal
Service
changing from six (6) days to less than six (6) days of delivery per week. If such a
scenario should occur, refer to the Frequency Adjustment clause of this contract.

	2576	  	
	2577 2578 2579 2580 2581 2582 2583 2584 2585 2586 2587	  	 m.     Termination for Default. The Postal Service may terminate this contract, or any part
hereof,
for default if the aviation supplier fails to cure such default within thirty (30) days of being
advised in writing of such by the Postal Service, or if the aviation supplier fails to provide the
Postal Service, upon request, with
adequate assurances of future performance. In the event
of termination for default, the Postal Service will not be liable to the aviation supplier for any
amount for supplies or services not provided, and the Postal Service shall have any and
all
rights and remedies provided by law, including the right to assess reasonable excess re-
procurement costs. The Postal Service may withhold payment otherwise due the aviation
supplier for services already performed in order to protect
its interest in recouping excess re-
procurement costs, and will promptly determine such costs so as to mitigate damage to the
aviation supplier.

	2588	  	
	2589	  	 n.      Title. Not applicable

	2590	  	
	2591 2592 2593 2594 2595 2596 2597 2598	  	 o.      Warranty. The aviation supplier warrants and represents that the services delivered
under this
contract shall be in accordance with the requirements and performance standards set forth in
the contract. With respect to services for which performance standards are set forth in the
contract, the Postal Service’s
exclusive remedy (other than termination for default) shall be
price adjustments as provided in this contract. With respect to all other services, the Postal
Service’s exclusive remedy (other than termination for default) shall be for the
aviation
supplier to promptly correct, replace, or otherwise cure such performance at no cost to the
Postal Service.


 * Blank spaces contained confidential information which has been filed separately with the Securities and Exchange
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	2599 2600 2601	  	 p.      Limitation of Liability. Except as otherwise provided by an express or
implied warranty, the
supplier will not be liable to the Postal Service for consequential damages resulting from any
defect or deficiencies in accepted items or services.

	2602	  	
	2603 2604 2605	  	 q.      Other Compliance Requirements. The aviation supplier will comply with all
applicable
Federal, State, and local laws, executive orders, rules and regulations applicable to its
performance under this contract.

	2606	  	
	2607 2608	  	 r.       Order of Precedence. Any inconsistencies in this solicitation or contract will
be resolved by
giving precedence in the following order:

	2609	  	 1.      Contract clauses;

	2610	  	 2.      Statement of Work;

	2611	  	 3.      Attachments to the Statement of Work;

	2612	  	 4.      Solicitation provisions

	2613	  	 5.      Form 8203;

	2614	  	 6.      Other documents and attachments associated with the contract.

	2615	  	
	2616	  	 s.      Incorporation by Reference. Not applicable

	2617	  	
	2618	  	 t.       Shipping. Not applicable

	2619	  	
	2620	  	
	2621 2622	  	Clause 4-2: Contract Terms and Conditions Required to Implement Policies,
Statutes, or Executive Orders (July 2009) (Tailored)
	2623	  	 a.      Incorporation by Reference. Not applicable

	2624	  	
	2625	  	 b.      Examination of Records.

	2626 2627 2628	  	 1.      Records. “Records” includes books, documents, accounting procedures
and
practices, and other data, regardless of type and regardless of whether such items are
in written form, in the form of computer data, or in any other form.

	2629	  	
	2630 2631 2632 2633 2634 2635 2636	  	 2.      Examination of Costs. If this is a cost-type contract, the aviation supplier
must
maintain, and the Postal Service will have the right to examine and audit all records
and other evidence sufficient to reflect properly all costs claimed to have been
incurred or anticipated to be incurred directly or indirectly in
performance of this
contract. This right of examination includes inspection at all reasonable times of the
aviation supplier’s plants, or parts of them, engaged in the performance of this
contract.

	2637	  	
	2638 2639 2640 2641 2642	  	 3.      Cost or Pricing Data. If the aviation supplier is required to submit cost or pricing
data
in connection with any pricing action relating to this contract, the Postal Service, in
order to evaluate the accuracy, completeness, and currency of the cost or pricing
data, will have the right to examine and audit all of the
aviation supplier’s records,
including computations and projections directly, related to:

	2643	  	 a.      The proposal for the contract, subcontract, or modification;

	2644	  	 b.      Pricing of the contract, subcontract, or modification; or

	2645	  	 c.      Performance of the contract, subcontract or modification.

	2646	  	
	2647 2648 2649 2650	  	 4.      Reports. If the aviation supplier is required to furnish cost, funding or
performance
reports, the Contracting Officer or any authorized representative of the Postal Service
will have the right to examine and audit the supporting records and materials, for the
purposes of evaluating:

	2651 2652	  	 a.      The effectiveness of the aviation supplier’s policies and procedures to
produce
data compatible with the objectives of these reports; and

	2653	  	 b.      The data reported.

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	2655 2656 2657 2658 2659	  	 5.      Availability. The aviation supplier must maintain and make available at its office
at all
reasonable times the records, materials, and other evidence described in (b)(1)-(4) of
this clause, for examination, audit, or reproduction, until three years after final
payment under this contract or any longer period required by
statute or other clauses
in this contract. In addition:

	2660 2661 2662	  	 a.      If this contract is completely or partially terminated, the aviation supplier must
make
available the records related to the work terminated until three years
after any resulting final termination settlement; and

	2663	  	
	2664 2665 2666 2667	  	 b.      The aviation supplier must make available records relating to appeals under
the claims
and disputes clause or to litigation or the settlement of claims
arising under or related to this contract. Such records must be made
available until such appeals, litigation or claims are finally resolved.

	2668	  	
	2669	  	
	2670	  	Clause 4-7: Records Ownership (March 2006)
	2671 2672 2673 2674	  	Notwithstanding any state law providing for retention of rights in the records, the aviation supplier
agrees that the Postal Service may, at its option, demand and take without
additional compensation all
records relating to the services provided under this agreement. The aviation supplier must turn over
all such records upon request but may retain copies of documents produced by the aviation
supplier.
	2675	  	
	2676	  	
	2677	  	Clause 6-1: Contracting Officer’s Representative (March 2006)
	2678 2679 2680 2681	  	The Contracting Officer will appoint a Contracting Officer’s representative (COR), responsible for the
day-to-day administration of the contract, who will serve as the
Postal Service’s point of contact with
the aviation supplier on all routine matters. A copy of the notice of appointment defining the COR’s
authority will be furnished to the aviation supplier upon award of the
contract.
	2682	  	
	2683 2684 2685 2686	  	 a.      The COR may be changed at any time by the Postal Service without prior notice to
the
aviation supplier, but notification of the change, including the name and address of the
successor COR, will be promptly provided to the aviation supplier by the Contracting Officer in
writing.

	2687	  	
	2688	  	 b.      The responsibilities and limitations of the COR are as follows:

	2689 2690 2691 2692	  	 1.      The COR is responsible for the operational and administrative aspects of the
contract
and technical liaison with the aviation supplier. The COR is responsible also for the
final inspection and acceptance of aviation supplier performance and submitted
reports and has other responsibilities as specified by the
contract.

	2693	  	
	2694 2695 2696 2697 2698	  	 2.      The COR is not authorized to make any commitments or otherwise obligate the
Postal
Service or authorize any changes affecting the contract price, terms, or conditions.
Any aviation supplier request for changes must be referred to the Contracting Officer
directly or through the COR. No such changes may be made
without the Contracting
Officer’s express prior authorization.

	2699	  	
	2700 2701	  	 3.      The COR may place orders for the aviation supplier to transport and process mail
in
accordance with the provisions of the contract at the agreed-upon rate only.

	2702	  	
	2703	  	
	2704	  	Clause 9-1: Convict Labor (March 2006)
	2705 2706 2707	  	In connection with the work under this contract, the aviation supplier agrees not to employ any person
undergoing sentence of imprisonment, except as provided by E.O. 11755,
December 28, 1973, as
amended and 18 USC 3621 and 3622.
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	2710 2711	  	Clause 9-2: Contract Work Hours and Safety Standards Act - Overtime
Compensation (March 2006)
	2712 2713 2714 2715 2716	  	 a.      No aviation supplier or subcontractor contracting for any part of the contract work may
require
or permit any laborer or mechanic to work more than 40 hours in any workweek on work
subject to the provisions of the Contract Work Hours and Safety Standards Act, unless the
laborer or mechanic receives compensation at a rate not
less than one-and-one-half times the
laborer’s or mechanic’s basic rate of pay for all such hours worked in excess of 40 hours.

	2717	  	
	2718 2719 2720 2721 2722 2723	  	 b.      Violation, Liability for Unpaid Wages, and Liquidated Damages. In the event of any
violation
of paragraph a above, the aviation supplier and any subcontractor responsible for the violation
are liable to any affected employee for unpaid wages. The aviation supplier and subcontractor
are also liable to the Postal Service
for liquidated damages, which will be computed for each
laborer or mechanic at $10 for each day on which the employee was required or permitted to
work in violation of paragraph a above.

	2724	  	
	2725 2726 2727 2728 2729 2730 2731	  	 c.      Withholding for Unpaid Wages and Liquidated Damages. The Contracting Officer
may
withhold from the aviation supplier, from any moneys payable to the aviation supplier or
subcontractor under this or any other contract with the same aviation supplier, or any other
federally assisted contract subject to the Contract
Work Hours and Safety Standards Act held
by the same aviation supplier, sums as may administratively be determined necessary to
satisfy any liabilities of the aviation supplier or subcontractor for unpaid wages and liquidated
damages
pursuant to paragraph b above.

	2732	  	
	2733 2734 2735 2736 2737 2738 2739 2740 2741 2742 2743	  	 d.      Records. The aviation supplier or subcontractor must maintain for 3 years from
the
completion of the contract for each laborer and mechanic (including watchmen and guards)
working on the contract payroll records which contain the name, address, social security
number, and classification(s) of each such employee,
hourly rates of wages paid, number of
daily and weekly hours worked, deductions made, and actual wages paid. The aviation
supplier or subcontractor must make these records available for inspection, copying, or
transcription by authorized
representatives of the Contracting Officer and the Department of
Labor, and must permit such representatives to interview employees during working hours on
the job. (The Department of Labor information collection and record keeping
requirements in
this paragraph d have been approved by the Office of Management and Budget under OMB
control numbers 1215-0140 and 1215-0017.)

	2744	  	
	2745 2746	  	 e.      Subcontracts. The aviation supplier must insert paragraphs a through d of this
clause in all
subcontracts, and must require their inclusion in all subcontracts at any tier.

	2747	  	
	2748	  	
	2749	  	Clause 9-7: Equal Opportunity (March 2006) (Tailored)
	2750	  	During the performance of this contract, the contractor agrees as follows:
	2751 2752 2753 2754 2755 2756 2757 2758 2759	  	 1.      The contractor may not discriminate against employees or applicants for employment
because
of race, color, religion, sex, or national origin. The contractor will take affirmative action to
ensure that applicants are employed, and that employees are treated during employment,
without regard to race, color, religion, sex,
or national origin. Such action shall include, but not
be limited to the following: Employment, upgrading, demotion, or transfer; recruitment or
recruitment advertising; layoff or termination; rates of pay or other forms of compensation;
and
selection for training, including apprenticeship. The contractor agrees to post in conspicuous
places, available to employees and applicants for employment, notices to be provided by the
Contracting Officer setting forth the provisions
of this nondiscrimination clause.

	2760	  	
	2761 2762 2763	  	 2.      The contractor, in all solicitations or advertisements for employees placed by or on behalf
of
the contractor, state that all qualified applicants will receive consideration for employment
without regard to race, color, religion, sex, or national origin.

	2764	  	
	2765 2766	  	 3.      The contractor will send to each labor union or representative of workers with which he has
a
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	2767 2768 2769 2770	  	 agency Contracting Officer, advising the labor union or workers’ representative of the
contractor’s commitments under section 202 of
Executive Order 11246 of September 24,
1965, and must post copies of the notice in conspicuous places available to employees and
applicants for employment.

	2771	  	
	2772 2773 2774	  	 4.      The contractor will comply with all provisions of Executive Order (EO) 11246 of September
24,
1965, as amended, and of the rules, regulations, and relevant orders of the Secretary of
Labor.

	2775	  	
	2776 2777 2778 2779 2780	  	 5.      The contractor will furnish all information and reports required by Executive Order, 11246
of
September 24, 1964, and by the rules, regulations, and orders of the Secretary of Labor, or
pursuant thereto, and will permit access to his books, records, and accounts by the
contracting agency and the Secretary of Labor for purposes of
investigation to ascertain
compliance with such rules, regulations, and orders.

	2781	  	
	2782 2783 2784 2785 2786 2787 2788	  	 6.      In the event of the contractor’s non-compliance with the non-discrimination clauses of
this
contract or with any of such rules, regulations, or orders, this contract may be canceled,
terminated, or suspended, in whole or in part and the contractor may be declared ineligible for
further Government contracts in accordance with
procedures authorized in Executive Order
11246 of September 24, 1965, and such other sanctions may be imposed and remedies
invoked as provided in Executive Order 11246 of September 24, 1965, or by rule, regulation,
or order of the Secretary
of Labor, or as otherwise provided by law.

	2789	  	
	2790 2791 2792 2793 2794 2795 2796 2797 2798 2799	  	 7.      The contractor will include the provisions of paragraphs (1) through (7) in every
subcontract or
purchase order under this contract unless exempted by rules, regulations, or orders of the
Secretary of Labor issued pursuant to section 204 of Executive Order 11246 of September 24,
1965, so that such provisions will be
binding upon each subcontractor or vendor. The
contractor will take such action with respect to any subcontract or purchase order as may be
directed by the Secretary of Labor as a means of enforcing such provisions including
sanctions for
noncompliance, provided, however, that in the event the contractor becomes
involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such
direction, the contractor may request the United States
to enter into such litigation to protect
the interest of the United States.

	2800	  	
	2801	  	
	2802 2803	  	Clause 9-9: Equal Opportunity Preaward Compliance of Subcontracts (March
2006) (Tailored)
	2804 2805 2806	  	The aviation supplier may not enter into a first-tier subcontract for an estimated or actual amount of $1
million or more without obtaining in writing from the Contracting
Officer a clearance that the proposed
subcontractor is in compliance with equal opportunity requirements and therefore eligible for award.
	2807	  	
	2808	  	
	2809	  	Clause 9-10: Service Contract Act (March 2006)
	2810 2811 2812	  	 a.      This contract is subject to the Service Contract Act of 1965, as amended (41 U.S.C. 351
et
seq.), and to the following provisions and all other applicable provisions of the Act and
regulations of the Secretary of Labor issued under the Act (29 CFR Part 4).

	2813	  	
	2814	  	 b.      

	2815 2816 2817 2818 2819	  	 1)      Each service employee employed in the performance of this contract by the
aviation
supplier or any subcontractor must be: a) paid not less than the minimum monetary
wages and b) furnished fringe benefits in accordance with the wages and fringe
benefits determined by the Secretary of Labor or an authorized
representative, as
specified in any wage determination attached to this contract.

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	2821	  	
	2822	  	 2)      

	2823 2824 2825 2826 2827 2828 2829 2830 2831 2832 2833 2834	  	 a)      If a wage determination is attached to this contract, the Contracting Officer
must
require that any class of service employees not listed in it and to be
employed under the contract (that is, the work to be performed is not
performed by any classification listed in the wage determination) be
classified by the aviation
supplier so as to provide a reasonable relationship
(that is, appropriate level of skill comparison) between the unlisted
classifications and the classifications in the wage determination. The
conformed class of employees must be paid the
monetary wages and
furnished the fringe benefits determined under this clause. (The information
collection requirements contained in this paragraph b have been approved
by the Office of Management and Budget under OMB control number
1215-
0150.)

	2835	  	
	2836 2837 2838 2839 2840 2841 2842 2843 2844 2845 2846 2847 2848 2849 2850 2851	  	 b)      The conforming procedure must be initiated by the aviation supplier before
the
performance of contract work by the unlisted class of employees. A
written report of the proposed conforming action, including information
regarding the agreement or disagreement of the authorized representative
of the employees involved
or, if there is no authorized representative, the
employees themselves, must be submitted by the aviation supplier to the
Contracting Officer no later than 30 days after the unlisted class of
employees performs any contract work. The
Contracting Officer must
review the proposed action and promptly submit a report of it, together with
the agency’s recommendation and all pertinent information, including the
position of the aviation supplier and the employees, to the
Wage and Hour
Division, Employment Standards Administration, U.S. Department of Labor,
for review. Within 30 days of receipt, the Wage and Hour Division will
approve, modify, or disapprove the action, render a final determination in
the
event of disagreement, or notify the Contracting Officer that additional
time is necessary.

	2852	  	
	2853 2854 2855 2856 2857	  	 c)      The final determination of the conformance action by the Wage and Hour
Division will be
transmitted to the Contracting Officer, who must promptly
notify the aviation supplier of the action taken. The aviation supplier must
give each affected employee a written copy of this determination, or it must
be posted as a part of the
wage determination.

	2858	  	
	2859	  	 d)      

	2860 2861 2862 2863 2864 2865 2866 2867 2868 2869 2870 2871 2872 2873	  	 i.       The process of establishing wage and fringe benefit rates bearing a
reasonable
relationship to those listed in a wage determination
cannot be reduced to any single formula. The approach used may
vary from determination to determination, depending on the
circumstances. Standard wage and salary administration
practices
ranking various job classifications by pay grade pursuant to point
schemes or other job factors may, for example, be relied upon.
Guidance may also be obtained from the way various jobs are rated
under federal pay systems
(Federal Wage Board Pay System and the
General Schedule) or from other wage determinations issued in the
same locality. Basic to the establishment of conformable wage rates
is the concept that a pay relationship should be maintained
between
job classifications on the basis of the skill required and the duties
performed.

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	2875	  	
	2876 2877 2878 2879 2880 2881 2882 2883 2884 2885 2886 2887 2888 2889	  	 ii.      If a contract is modified or extended or an option is exercised, or if a
contract
succeeds a contract under which the classification in
question was previously conformed pursuant to this clause, a new
conformed wage rate and fringe benefits may be assigned to the
conformed classification by indexing (that is, adjusting)
the previous
conformed rate and fringe benefits by an amount equal to the
average (mean) percentage increase change in the wages and fringe
benefits specified for all classifications to be used on the contract that
are listed in the
current wage determination, and those specified for
the corresponding classifications in the previously applicable wage
determination. If these conforming actions are accomplished before
the performance of contract work by the unlisted
class of employees,
the aviation supplier must advise the Contracting Officer of the action
taken, but the other procedures in b.2(c) above need not be followed.

	2890	  	
	2891 2892 2893	  	 iii.    No employee engaged in performing work on this contract may be
paid less than the currently
applicable minimum wage specified under
section 6(a)(1) of the Fair Labor Standards Act of 1938, as amended.

	2894	  	
	2895 2896 2897 2898 2899 2900 2901	  	 e)      The wage rate and fringe benefits finally determined pursuant to b.2 (a) and
(b) above
must be paid to all employees performing in the classification
from the first day on which contract work is performed by them in the
classification. Failure to pay unlisted employees the compensation agreed
upon by the interested parties
and/or finally determined by the Wage and
Hour Division retroactive to the date the class of employees began contract
work is a violation of the Service Contract Act and this contract.

	2902	  	
	2903 2904 2905 2906	  	 f)      Upon discovery of failure to comply with b.2 (a) through (e) above, the
Wage and Hour
Division will make a final determination of conformed
classification, wage rate, and / or fringe benefits that will be retroactive to
the date the class of employees commenced contract work.

	2907	  	
	2908 2909 2910 2911 2912 2913	  	 3)      If, as authorized pursuant to section 4(d) of the Service Contract Act, the term of
this
contract is more than one year, the minimum monetary wages and fringe benefits
required to be paid or furnished to service employees will be subject to adjustment
after one year and not less often than once every two years, pursuant to
wage
determinations to be issued by the Wage and Hour Division, Employment Standards
Administration of the Department of Labor.

	2914	  	
	2915 2916 2917 2918 2919	  	 c.      The aviation supplier or subcontractor may discharge the obligation to furnish fringe
benefits
specified in the attachment or determined conformably to it by furnishing any equivalent
combinations of bona fide fringe benefits, or by making equivalent or differential payments in
cash in accordance with the applicable rules
set forth in Subpart D of 29 CFR Part 4, and not
otherwise.

	2920	  	
	2921	  	 d.      

	2922 2923 2924 2925 2926 2927 2928	  	 1)      In the absence of a minimum-wage attachment for this contract, neither the
aviation
supplier nor any subcontractor under this contract may pay any person performing
work under the contract (regardless of whether they are service employees) less than the
minimum wage specified by section 6(a)(1) of the Fair Labor
Standards Act of 1938.
Nothing in this provision relieves the aviation supplier or any subcontractor of any other
obligation under law or contract for the payment of a higher wage to any
employee.

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	2930	  	
	2931	  	 2)      

	2932 2933 2934 2935 2936 2937 2938 2939 2940 2941 2942 2943 2944	  	 a)      If this contract succeeds a contract subject to the Service Contract Act,
under which
substantially the same services were furnished in the same
locality, and service employees were paid wages and fringe benefits
provided for in a collective bargaining agreement, in the absence of a
minimum wage attachment for this contract
setting forth collectively
bargained wage rates and fringe benefits, neither the aviation supplier nor
any subcontractor under this contract may pay any service employee
performing any of the contract work (regardless of whether or not
the
employee was employed under the predecessor contract), less than the
wages and fringe benefits provided for in the agreement, to which the
employee would have been entitled if employed under the predecessor
contract, including
accrued wages and fringe benefits and any prospective
increases in wages and fringe benefits provided for under the agreement.

	2945	  	
	2946 2947 2948 2949 2950 2951 2952 2953 2954	  	 b)      No aviation supplier or subcontractor under this contract may be relieved of
the
foregoing obligation unless the limitations of section 4.1(b) of 29 CFR
Part 4 apply or unless the Secretary of Labor or an authorized
representative finds, after a hearing as provided in section 4.10 of 29 CFR
Part 4, that the wages and/or
fringe benefits provided for in the agreement
vary substantially from those prevailing for services of a similar character in
the locality, or determines, as provided in section 4.11 of 29 CFR Part 4,
that the agreement applicable to
service employees under the predecessor
contract was not entered into as a result of arm’s-length negotiations.

	2955	  	
	2956 2957 2958 2959 2960 2961 2962 2963 2964 2965 2966 2967 2968 2969 2970	  	 c)      If it is found in accordance with the review procedures in 29 CFR 4.10
and/or 4.11 and
Parts 6 and 8 that wages and/or fringe benefits in a
predecessor aviation supplier’s collective bargaining agreement vary
substantially from those prevailing for services of a similar character in the
locality, and/or that the
agreement applicable to service employees under
the predecessor contract was not entered into as a result of arm’s-length
negotiations, the Department will issue a new or revised wage
determination setting forth the applicable wage
rates and fringe benefits.
This determination will be made part of the contract or subcontract, in
accordance with the decision of the Administrator, the Administrative Law
Judge, or the Board of Service Contract Appeals, as the case may
be,
irrespective of whether its issuance occurs before or after award (53 Comp.
Gen. 401 (1973)). In the case of a wage determination issued solely as a
result of a finding of substantial variance, it will be effective as of the date
of
the final administrative decision.

	2971	  	
	2972 2973 2974 2975 2976 2977 2978	  	 e.      The aviation supplier and any subcontractor under this contract must notify each
service
employee starting work on the contract of the minimum monetary wage and any fringe
benefits required to be paid pursuant to the contract, or must post the wage determination
attached to this contract. The poster provided by the
Department of Labor (Publication WH
1313) must be posted in a prominent and accessible place at the worksite. Failure to comply
with this requirement is a violation of section 2(a) (4) of the Act and of this contract.
(Approved by the
Office of Management and Budget under OMB control number 1215-0150.)

	2979	  	
	2980 2981 2982 2983 2984 2985	  	 f.       The aviation supplier or subcontractor may not permit services called for by this
contract to be
performed in buildings or surroundings or under working conditions provided by or under the
control or supervision of the aviation supplier or subcontractor that are unsanitary or
hazardous or dangerous to the health or
safety of service employees engaged to furnish these
services, and the aviation supplier or subcontractor must comply with the safety and health
standards applied under 29 CFR Part 1925.

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	2987	  	 g.      

	2988 2989 2990 2991 2992 2993 2994	  	 1)      The aviation supplier and each subcontractor performing work subject to the Act
must
maintain for 3 years from the completion of the work records containing the
information specified in (a) through (f) following for each employee subject to the
Service Contract Act and must make them available for inspection and
transcription
by authorized representatives of the Wage and Hour Division, Employment Standards
Administration of the U.S. Department of Labor (approved by the Office of
Management and Budget under OMB control numbers 1215-0017 and
1215-0150):

	2995	  	 a)      Name, address, and social security number of each employee.

	2996	  	
	2997 2998 2999	  	 b)      The correct work classification, rate or rates of monetary wages paid and
fringe
benefits provided, rate or rates of fringe benefit payments in lieu
thereof, and total daily and weekly compensation of each employee.

	3000	  	
	3001	  	 c)      The number of daily and weekly hours so worked by each employee.

	3002	  	
	3003 3004	  	 d)      Any deductions, rebates, or refunds from the total daily or weekly
compensation of each
employee.

	3005	  	
	3006 3007 3008 3009 3010 3011	  	 e)      A list of monetary wages and fringe benefits for those classes of service
employees not
included in the wage determination attached to this contract
but for whom wage rates or fringe benefits have been determined by the
interested parties or by the Administrator or authorized representative
pursuant to paragraph b above. A
copy of the report required by b.2 (b)
above is such a list.

	3012	  	
	3013 3014	  	 f)      Any list of the predecessor aviation supplier’s employees furnished to
the
aviation supplier pursuant to section 4.6(1) (2) of 29 CFR Part 4.

	3015	  	
	3016 3017	  	 2)      The aviation supplier must also make available a copy of this contract for inspection
or
transcription by authorized representatives of the Wage and Hour Division.

	3018	  	
	3019 3020 3021 3022 3023 3024	  	 3)      Failure to make and maintain or to make available the records specified in
this
paragraph g for inspection and transcription is a violation of the regulations and this
contract, and in the case of failure to produce these records, the Contracting Officer,
upon direction of the Department of Labor and notification
of the aviation supplier,
must take action to suspend any further payment or advance of funds until the
violation ceases.

	3025	  	
	3026 3027 3028	  	 4)      The aviation supplier must permit authorized representatives of the Wage and
Hour
Division to conduct interviews with employees at the worksite during normal working
hours.

	3029	  	
	3030 3031 3032 3033 3034 3035	  	 h.      The aviation supplier must unconditionally pay to each employee subject to the
Service
Contract Act all wages due free and clear and without subsequent deduction (except as
otherwise provided by law or regulations, 29 CFR Part 4), rebate, or kickback on any account.
Payments must be made no later than one pay period
following the end of the regular pay
period in which the wages were earned or accrued. A pay period under the Act may not be of
any duration longer than semimonthly.

	3036	  	
	3037 3038 3039 3040 3041 3042 3043	  	 i.       The Contracting Officer must withhold or cause to be withheld from the Postal Service
aviation
supplier under this or any other contract with the aviation supplier such sums as an
appropriate official of the Department of Labor requests or the Contracting Officer decides
may be necessary to pay underpaid employees employed
by the aviation supplier or
subcontractor. In the event of failure to pay employees subject to the Act wages or fringe
benefits due under the Act, the Postal Service may, after authorization or by direction of the
Department of Labor and
written notification to the aviation supplier, suspend any further



  
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	3044 3045 3046 3047	  	 payment or advance of funds until the violations cease. Additionally, any failure to comply with
the requirements of this clause may be grounds for
termination of the right to proceed with the
contract work. In this event, the Postal Service may enter into other contracts or arrangements
for completion of the work, charging the aviation supplier in default with any additional
cost.

	3048	  	
	3049 3050 3051	  	 j.       The aviation supplier agrees to insert this clause in all subcontracts subject to the
Act. The
term “aviation supplier,” as used in this clause in any subcontract, is deemed to refer to the
subcontractor, except in the term “aviation supplier.”

	3052	  	
	3053 3054 3055 3056 3057 3058	  	 k.      Service employee means any person engaged in the performance of this contract other
than
any person employed in a bona fide executive, administrative, or professional capacity, as
those terms are defined in Part 541 of Title 29, Code of Federal Regulations, as of July 30,
1976, and any subsequent revision of those
regulations. The term includes all such persons
regardless of any contractual relationship that may be alleged to exist between an aviation
supplier or subcontractor and them.

	3059	  	
	3060	  	 l.       

	3061 3062 3063 3064 3065 3066 3067 3068 3069 3070 3071 3072 3073	  	 1)      If wages to be paid or fringe benefits to be furnished service employees employed by
the
aviation supplier or a subcontractor under the contract are provided for in a
collective bargaining agreement that is or will be effective during any period in which
the contract is being performed, the aviation supplier must report this fact
to the
Contracting Officer, together with full information as to the application and accrual of
these wages and fringe benefits, including any prospective increases, to service
employees engaged in work on the contract, and furnish a copy
of the agreement.
The report must be made upon starting performance of the contract, in the case of
collective bargaining agreements effective at the time. In the case of agreements or
provisions or amendments thereof effective at a later
time during the period of
contract performance, they must be reported promptly after their negotiation.
(Approved by the Office of Management and Budget under OMB control number
1215-0150.)

	3074	  	
	3075 3076 3077 3078 3079 3080 3081 3082 3083 3084 3085 3086 3087	  	 2)      Not less than 10 days before completion of any contract being performed at a
Postal
facility where service employees may be retained in the performance of a succeeding
contract and subject to a wage determination containing vacation or other benefit
provisions based upon length of service with a aviation supplier
(predecessor) or
successor (section 4.173 of Regulations, 29 CFR Part 4), the incumbent aviation
supplier must furnish to the Contracting Officer a certified list of the names of all
service employees on the aviation supplier’s or
subcontractor’s payroll during the last
month of contract performance. The list must also contain anniversary dates of
employment on the contract, either with the current or predecessor aviation suppliers
of each such service employee.
The Contracting Officer must turn over this list to the
successor aviation supplier at the commencement of the succeeding contract.
(Approved by the Office of Management and Budget under OMB control number
1215-0150.)

	3088	  	
	3089 3090	  	 m.     Rulings and interpretations of the Service Contract Act of 1965, as amended, are contained
in
Regulations, 29 CFR Part 4.

	3091	  	
	3092	  	 n.      

	3093 3094 3095 3096	  	 1)      By entering into this contract, the aviation supplier and its officials certify that
neither
they nor any person or firm with a substantial interest in the aviation supplier’s firm are
ineligible to be awarded government contracts by virtue of the sanctions imposed
pursuant to section 5 of the Act.

	3097	  	
	3098 3099	  	 2)      No part of this contract may be subcontracted to any person or firm ineligible for
award
of a government contract pursuant to section 5 of the Act.

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	3101	  	 3)      The penalty for making false statements is prescribed in the U.S. Criminal Code,
18

	3102	  	 U.S.C. 1001.



			
	3103	  	
	3104	  	 o.      Notwithstanding any of the other provisions of this clause, the following employees may
be

	3105	  	 employed in accordance with the following variations, tolerances, and exemptions, which the

	3106	  	 Secretary of Labor, pursuant to section 4(b) of the Act before its amendment by Public Law

	3107	  	 92-473, found to be necessary and proper in the public interest or to avoid serious impairment

	3108	  	 of the conduct of government business:

	3109	  	
	3110	  	 1)      Apprentices, student-learners, and workers whose earning capacity is impaired
by

	3111	  	 age, or physical or mental deficiency or injury may be employed at wages lower than

	3112	  	 the minimum wages otherwise required by section 2(a)(1) or 2(b)(1) of the Service

	3113	  	 Contract Act without diminishing any fringe benefits or cash payments in lieu thereof

	3114	  	 required under section 2(a)(2) of the Act, in accordance with the conditions and

	3115	  	 procedures prescribed for the employment of apprentices, student-learners,

	3116	  	 handicapped persons, and handicapped clients of sheltered workshops under section

	3117	  	 14 of the Fair Labor Standards Act of 1938, in the regulations issued by the

	3118	  	 Administrator (29 CFR Parts 520, 521, 524, and 525).

	3119	  	
	3120	  	 2)      The Administrator will issue certificates under the Service Contract Act for
the

	3121	  	 employment of apprentices, student-learners, handicapped persons, or handicapped

	3122	  	 clients of sheltered workshops not subject to the Fair Labor Standards Act of 1938, or

	3123	  	 subject to different minimum rates of pay under the two Acts, authorizing appropriate

	3124	  	 rates of minimum wages (but without changing requirements concerning fringe

	3125	  	 benefits or supplementary cash payments in lieu thereof), applying procedures

	3126	  	 prescribed by the applicable regulations issued under the Fair Labor Standards Act of

	3127	  	 1938 (29 CFR Parts 520, 521, 524, and 525).

	3128	  	
	3129	  	 3)      The Administrator will also withdraw, annul, or cancel such certificates in
accordance

	3130	  	 with the regulations in Parts 525 and 528 of Title 29 of the Code of Federal

	3131	  	 Regulations.

	3132	  	
	3133	  	 p.      Apprentices will be permitted to work at less than the predetermined rate for the work
they

	3134	  	 perform when they are employed and individually registered in a bona fide apprenticeship

	3135	  	 program registered with a State Apprenticeship Agency recognized by the U.S. Department of

	3136	  	 Labor, or if no such recognized agency exists in a state, under a program registered with the

	3137	  	 Bureau of Apprenticeship and Training, Employment and Training Administration, U.S.

	3138	  	 Department of Labor. Any employee not registered as an apprentice in an approved program

	3139	  	 must be paid the wage rate and fringe benefits contained in the applicable wage determination

	3140	  	 for the journeyman classification of work actually performed. The wage rates paid apprentices

	3141	  	 may not be less than the wage rate for their level of progress set forth in the registered

	3142	  	 program, expressed as the appropriate percentage of the journeyman’s rate contained in the

	3143	  	 applicable wage determination. The allowable ratio of apprentices to journeymen employed

	3144	  	 on the contract work in any craft classification may not be greater than the ratio permitted to

	3145	  	 the aviation supplier for its entire workforce under the registered program.

	3146	  	
	3147	  	 q.      An employee engaged in an occupation in which he or she customarily and regularly
receives

	3148	  	 more than $30 a month tips may have the amount of tips credited by the employer against the

	3149	  	 minimum wage required by section 2(a) (1) or section 2(b) (1) of the Act in accordance with

	3150	  	 section 3(m) of the Fair Labor Standards Act and Regulations, 29 CFR Part 531. However, the

	3151	  	 amount of this credit may not exceed $1.24 per hour beginning January 1, 1980, and $1.34

	3152	  	 per hour after December 31, 1980. To utilize this proviso:

	3153	  	 1)      The employer must inform tipped employees about this tip credit allowance before
the

	3154	  	 credit is utilized;

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	3156	  	 2)      The employees must be allowed to retain all tips (individually or through a
pooling

	3157	  	 arrangement and regardless of whether the employer elects to take a credit for tips

	3158	  	 received);

	3159	  	
	3160	  	 3)      The employer must be able to show by records that the employee receives at
least

	3161	  	 the applicable Service Contract Act minimum wage through the combination of direct

	3162	  	 wages and tip credit (approved by the Office of Management and Budget under OMB

	3163	  	 control number 1214-0017); and

	3164	  	
	3165	  	 4)      The use of tip credit must have been permitted under any predecessor
collective

	3166	  	 bargaining agreement applicable by virtue of section 4(c) of the Act.

	3167	  	
	3168	  	 r.       Disputes arising out of the labor standards provisions of this contract are not
subject to the

	3169	  	 Claims and Disputes clause but must be resolved in accordance with the procedures of the

	3170	  	 Department of Labor set forth in 29 CFR Parts 4, 6, and 8. Disputes within the meaning of this

	3171	  	 clause include disputes between the aviation supplier (or any of its subcontractors) and the

	3172	  	 Postal Service, the U.S. Department of Labor, or the employees or their representatives.

	3173	  	
	3174	  	
	3175	  	Clause 9-12: Fair Labor Standards Act and Service Contract Act - Price
	3176	  	Adjustment (February 2010)
	3177	  	 a.      The aviation supplier warrants that the contract prices do not include allowance for
any

	3178	  	 contingency to cover increased costs for which adjustment is provided under this clause.

	3179	  	
	3180	  	 b.      The minimum prevailing wage determination, including fringe benefits, issued under
the

	3181	  	 Service Contract Act of 1965 by the Department of Labor (DOL), current at least every two

	3182	  	 years after the original award date, current at the beginning of any option or renewal period, or

	3183	  	 in the case of a significant change in labor requirements, applies to this contract and any

	3184	  	 exercise of an option or renewal of this contract. When no such determination has been made

	3185	  	 as applied to this contract, the minimum wage established in accordance with the Fair Labor

	3186	  	 Standards Act applies to any exercise of an option or renewal of this contract.

	3187	  	
	3188	  	 c.      When, as a result of the determination of minimum prevailing wages and fringe
benefits

	3189	  	 applicable (1) every two years after original award date, (2) at the beginning of any option or

	3190	  	 renewal period, or (3) in the case of a significant change in labor requirements, an increased

	3191	  	 or decreased wage determination is applied to this contract, or when as a result of any

	3192	  	 amendment to the Fair Labor Standards Act enacted after award that affects minimum wage,

	3193	  	 and whenever such a determination becomes applicable to this contract under law, the

	3194	  	 aviation supplier increases or decreases wages or fringe benefits of employees working on the

	3195	  	 contract to comply, the aviation supplier and the Contracting Officer will negotiate whether and

	3196	  	 to what extent either party will absorb the costs of the wage change. Any resulting change in

	3197	  	 contract price is limited to increases or decreases in wages or fringe benefits, and the

	3198	  	 concomitant increases or decreases in Social Security, unemployment taxes, and workers’

	3199	  	 compensation insurance, but may not otherwise include any amount for general and

	3200	  	 administrative costs, overhead, or profit.

	3201	  	
	3202	  	 d.      The aviation supplier or Contracting Officer may request a contract price adjustment within
30

	3203	  	 days of the effective date of a wage change. If a request for contract price adjustment has

	3204	  	 been made, and the parties have not reached an agreement within thirty days of that request,

	3205	  	 the Contracting Officer should issue a unilateral change order in the amount considered to be

	3206	  	 a fair and equitable adjustment. The aviation supplier may then either accept the amount, or

	3207	  	 the aviation supplier may file a claim under Clause B-9: Claims and Disputes unless the

	3208	  	 Contracting Officer and aviation supplier extend this period in writing. Upon agreement of the

	3209	  	 parties, the contract price or unit price labor rates will be modified in writing. Pending

	3210	  	 agreement on or determination of any such adjustment and its effective date, the aviation

	3211	  	 supplier must continue performance.

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	3213	  	 e.      The Contracting Officer or the Contracting Officer’s authorized representative must,
for 3

	3214	  	 years after final payment under the contract, be given access to and the right to examine any

	3215	  	 directly pertinent books, papers, and records of the aviation supplier.


  

			
	3216	  	
	3217	  	
	3218	  	Clause 9-13: Affirmative Action for Workers with Disabilities (March 2006)
	3219	  	(Tailored)
	3220	  	 a.      The contractor will not discriminate against any employee or applicant for
employment

	3221	  	 because of physical or mental disability in regard to any position for which the employee or

	3222	  	 applicant for employment is qualified. The contractor agrees to take affirmative action to

	3223	  	 employ, advance in employment, and otherwise treat qualified individuals with disabilities

	3224	  	 without discrimination based on their physical or mental disability in all employment practices,

	3225	  	 including the following:

	3226	  	 1.      Recruitment, advertising, and job application procedures;

	3227	  	
	3228	  	 2.      Hiring, upgrading, promotion, award of tenure, demotion, transfer, layoff,
termination,

	3229	  	 right of return from layoff and rehiring

	3230	  	
	3231	  	 3.      Rates of pay or any other form of compensation and changes in
compensation

	3232	  	
	3233	  	 4.      Job assignments, job classifications, organizational structures, position
descriptions,

	3234	  	 lines of progression, and seniority lists

	3235	  	
	3236	  	 5.      Leaves of absence, sick leave, or any other leave

	3237	  	 6.      Fringe benefits available by virtue of employment, whether or not administered by
the

	3238	  	 contractor

	3239	  	
	3240	  	 7.      Selection and financial support for training, including apprenticeship,
professional

	3241	  	 meetings, conferences, and other related activities, and selection for leaves of

	3242	  	 absence to pursue training

	3243	  	
	3244	  	 8.      Activities sponsored by the contractor including social or recreational programs;
and

	3245	  	
	3246	  	 9.      Any other term, condition, or privilege of employment.

	3247	  	
	3248	  	 b.      The contractor agrees to comply with the rules, regulations, and relevant orders of
the

	3249	  	 Secretary of Labor issued pursuant to the Rehabilitation Act of 1973, as amended.

	3250	  	
	3251	  	 c.      In the event of the contractor’s noncompliance with the requirements, actions
for

	3252	  	 noncompliance may be taken in accordance with the rules, regulations, and relevant orders of

	3253	  	 the Secretary of Labor issued pursuant to the act.

	3254	  	
	3255	  	 d.      The contractor agrees to post in conspicuous places, available to employees and
applicants

	3256	  	 for employment, notices in a form to be prescribed by the Deputy Assistant Secretary for

	3257	  	 Federal Contract Compliance Programs, provided by or through the Contracting Officer. Such

	3258	  	 notices shall state the rights of applicants and employees as well as the contractor’s obligation

	3259	  	 under the law to take affirmative action to employ and advance in employment qualified

	3260	  	 employees and applicants with disabilities. The contractor must ensure that applicants and

	3261	  	 employees with disabilities are informed of the contents of the notice (e.g., the contractor may

	3262	  	 have the notice read to a visually disabled individual, or may lower the posted notice so that it

	3263	  	 might be read by a person in a wheelchair).

	3264	  	
	3265	  	 e.      The contractor will notify each labor organization or representative of workers with which
it has

	3266	  	 a collective bargaining agreement or other understanding that the contractor is bound by the

	3267	  	 terms of section 503 of the Rehabilitation Act of 1973, as amended, and is committed to take

	3268	  	 affirmative action to employ and advance in employment individuals with physical or mental

	3269	  	 disabilities.



  
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	3270	  	
	3271	  	 f.       The contractor must include the provisions of this clause in every subcontract or
purchase

	3272	  	 order in excess of $10,000, unless exempted by the rules, regulations, or orders of the

	3273	  	 Secretary issued pursuant to section 503 of the Act, as amended, so that such provisions will

	3274	  	 be binding upon each subcontractor or vendor. The contractor will take such action with

	3275	  	 respect to any subcontract or purchase order as the Deputy Assistant Secretary for Federal

	3276	  	 Contract Compliance Programs may direct to enforce such provisions, including action for

	3277	  	 noncompliance.

	3278	  	
	3279	  	
	3280	  	Clause 9-14: Equal Opportunity for Disabled Veterans, Recently Separated
	3281	  	Veterans, Other Protected Veterans, and Armed Forces Service Medal Veterans
	3282	  	(February 2010) (Tailored)
	3283	  	 a.      The contractor will not discriminate against any employee or applicant for
employment

	3284	  	 because he or she is a disabled veteran, recently separated veteran, other protected veteran,

	3285	  	 or Armed Forces service medal veteran in regard to any position for which the employee or

	3286	  	 applicant for employment is qualified. The contractor agrees to take affirmative action to

	3287	  	 employ, advance in employment and otherwise treat qualified individuals without

	3288	  	 discrimination based on their status as a disabled veteran, recently separated veteran, other

	3289	  	 protected veteran, or Armed Forces service medal veteran in all employment practices,

	3290	  	 including the following:

	3291	  	
	3292	  	 1.      Recruitment, advertising, and job application procedures;

	3293	  	
	3294	  	 2.      Hiring, upgrading, promotion, award of tenure, demotion, transfer, layoff,
termination,

	3295	  	 right of return from layoff and rehiring;

	3296	  	
	3297	  	 3.      Rates of pay or any other form of compensation and changes in
compensation;

	3298	  	
	3299	  	 4.      Job assignments, job classifications, organizational structures, position
descriptions,

	3300	  	 lines of progression, and seniority lists;

	3301	  	
	3302	  	 5.      Leaves of absence, sick leave, or any other leave;

	3303	  	
	3304	  	 6.      Fringe benefits available by virtue of employment, whether or not administered by
the

	3305	  	 contractor;

	3306	  	
	3307	  	 7.      Selection and financial support for training, including apprenticeship, and
on-the-job

	3308	  	 training under 38 U.S.C. 3687, professional meetings, conferences, and other related

	3309	  	 activities, and selection for leaves of absence to pursue training;

	3310	  	
	3311	  	 8.      Activities sponsored by the contractor including social or recreational programs;
and

	3312	  	
	3313	  	 9.      Any other term, condition, or privilege of employment.

	3314	  	
	3315	  	 b.      The contractor agrees to immediately list all employment openings which exist at the time
of

	3316	  	 the execution of this contract and those which occur during the performance of this contract,

	3317	  	 including those not generated by this contract and including those occurring at an

	3318	  	 establishment of the contractor other than the one where the contract is being performed, but

	3319	  	 excluding those of independently operated corporate affiliates, with the appropriate

	3320	  	 employment service delivery system where the opening occurs. Listing employment openings

	3321	  	 with the state workforce agency job bank or with the local employment service delivery system

	3322	  	 where the opening occurs will satisfy the requirement to list jobs with the appropriate

	3323	  	 employment service delivery system.

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	3325	  	
	3326	  	 c.      Listing of employment openings with the appropriate employment service delivery
system

	3327	  	 pursuant to this clause shall be made at least concurrently with the use of any other

	3328	  	 recruitment source or effort and shall involve the normal obligations which attach to the

	3329	  	 placing of a bona fide job order, including the acceptance of referrals of veterans and

	3330	  	 nonveterans. The listing of employment openings does not require the hiring of any particular

	3331	  	 job applicants or from any particular group of job applicants, and nothing herein is intended to

	3332	  	 relieve the contractor from any requirements in Executive orders or regulations regarding

	3333	  	 nondiscrimination in employment.

	3334	  	
	3335	  	 d.      Whenever a contractor, other than a state or local governmental contractor,
becomes

	3336	  	 contractually bound to the listing provisions in paragraphs 2 and 3 of this clause, it shall advise

	3337	  	 the state workforce agency in each state where it has establishments of the name and location

	3338	  	 of each hiring location in the state. As long as the contractor is contractually bound to these

	3339	  	 provisions and has so advised the state agency, there is no need to advise the state agency of

	3340	  	 subsequent contracts. The contractor may advise the state agency when it is no longer bound

	3341	  	 by this contract clause.

	3342	  	
	3343	  	 e.      The provisions of paragraphs 2 and 3 of this clause do not apply to the listing of
employment

	3344	  	 openings which occur and are filled outside of the 50 states, the District of Columbia, the

	3345	  	 Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa, the

	3346	  	 Commonwealth of the Northern Mariana Islands, Wake Island, and the Trust Territories of the

	3347	  	 Pacific Islands.

	3348	  	
	3349	  	 f.       As used in this clause:

	3350	  	
	3351	  	 1.      All employment openings includes all positions except executive and
senior

	3352	  	 management, those positions that will be filled from within the contractor’s

	3353	  	 organization, and positions lasting three days or less. This term includes full-time

	3354	  	 employment, temporary employment of more than three days’ duration, and part-time

	3355	  	 employment.

	3356	  	
	3357	  	 2.      Executive and senior management means: (1) Any employee (a) compensated on
a

	3358	  	 salary basis at a rate of not less than $455 per week (or $380 per week, if employed

	3359	  	 in American Samoa by employers other than the Federal Government), exclusive of

	3360	  	 board, lodging or other facilities; (b) whose primary duty is management of the

	3361	  	 enterprise in which the employee is employed or of a customarily recognized

	3362	  	 department or subdivision thereof; (c) who customarily and regularly directs the work

	3363	  	 of two or more other employees; and (d) who has the authority to hire or fire other

	3364	  	 employees or whose suggestions and recommendations as to the hiring, firing,

	3365	  	 advancement, promotion or any other change of status of other employees are given

	3366	  	 particular weight; or (2) any employee who owns at least a bona fide 20-percent

	3367	  	 equity interest in the enterprise in which the employee is employed, regardless of

	3368	  	 whether the business is a corporate or other type of organization, and who is actively

	3369	  	 engaged in its management.

	3370	  	
	3371	  	 3.      Positions that will be filled from within the contractor’s organization
means

	3372	  	 employment openings for which no consideration will be given to persons outside the

	3373	  	 contractor’s organization (including any affiliates, subsidiaries, and parent companies)

	3374	  	 and includes any openings which the contractor proposes to fill from regularly

	3375	  	 established “recall” lists. The exception does not apply to a particular opening once

	3376	  	 an employer decides to consider applicants outside of his or her own organization.

	3377	  	
	3378	  	 g.      The contractor agrees to comply with the rules, regulations, and relevant orders of
the

	3379	  	 Secretary of Labor issued pursuant to the Act.

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	3381	  	 h.      In the event of the contractor’s noncompliance with the requirements of this clause,
actions for

	3382	  	 noncompliance may be taken in accordance with the rules, regulations, and relevant orders of

	3383	  	 the Secretary of Labor issued pursuant to the Act.

	3384	  	
	3385	  	 i.       The contractor agrees to post in conspicuous places, available to employees and
applicants

	3386	  	 for employment, notices in a form to be prescribed by the Deputy Assistant Secretary for

	3387	  	 Federal Contract Compliance, provided by or through the Contracting Officer. Such notices

	3388	  	 shall state the rights of applicants and employees as well as the contractor’s obligation under

	3389	  	 the law to take affirmative action to employ and advance in employment qualified employees

	3390	  	 and applicants who are disabled veterans, recently separated veterans, other protected

	3391	  	 veterans, or Armed Forces service medal veterans. The contractor must ensure that

	3392	  	 applicants or employees who are disabled veterans are informed of the contents of the notice

	3393	  	 (e.g., the contractor may have the notice read to a visually disabled individual, or may lower

	3394	  	 the posted notice so that it might be read by a person in a wheelchair).

	3395	  	
	3396	  	 j.       The contractor will notify each labor organization or representative of workers with
which it has

	3397	  	 a collective bargaining agreement or other contract understanding, that the contractor is

	3398	  	 bound by the terms of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as

	3399	  	 amended, and is committed to take affirmative action to employ and advance in employment

	3400	  	 qualified disabled veterans, recently separated veterans, other protected veterans, and Armed

	3401	  	 Forces service medal veterans.

	3402	  	
	3403	  	 k.      The contractor will include the provisions of this clause in every subcontract or purchase
order

	3404	  	 of $100,000 or more, unless exempted by the rules, regulations, or orders of the Secretary

	3405	  	 issued pursuant to the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as

	3406	  	 amended, so that such provisions will be binding upon each subcontractor or vendor. The

	3407	  	 contractor will take such action with respect to any subcontract or purchase order as the

	3408	  	 Deputy Assistant Secretary for Federal Contract Compliance may direct to enforce such

	3409	  	 provisions, including action for noncompliance.

	3410	  	
	3411	  	
	3412	  	Contract Term
	3413	  	The contract base period of performance will be October 1, 2013, through September 30, 2020, with
	3414	  	two, five year renewal periods to be exercised by mutual agreement of the parties. The Night Network
	3415	  	will begin operation on September 30, 2013; the Day Network will begin operation on October 1, 2013.
	3416	  	
	3417	  	
	3418	  	Renewal Process
	3419	  	[*]
	3420	  	
	3421	  	
	3422	  	
	3423	  	
	3424	  	Amendments or Modifications
	3425	  	In order to be binding upon the Postal Service or the aviation supplier, any amendment or modification
	3426	  	of this Contract must be in writing signed by the Contracting Officer on behalf of the Postal Service
	3427	  	and an officer of the aviation supplier authorized to bind the company.
	3428	  	
	3429	  	
	3430	  	Assignment
	3431	  	Neither Party shall, directly or indirectly (whether by succession, merger, or otherwise) assign,
	3432	  	delegate, novate, or otherwise transfer this Contract or any of its rights or obligations hereunder,
	3433	  	without the prior written approval of the other. However, the aviation supplier may assign this contract
	3434	  	to any of its internal business affiliates upon written notice to the Postal Service.
	3435	  	
	3436	  	

  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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Contract ACN-13-FX 
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	3437	  	Bankruptcy
	3438	  	In the event the aviation supplier enters into proceedings relating to bankruptcy, whether voluntary or
	3439	  	involuntary, the aviation supplier will furnish, by certified mail, written notification of the bankruptcy to
	3440	  	the Contracting Officer responsible for administering the contract. The notification must be furnished
	3441	  	within five days of the initiation of the bankruptcy proceedings. The notification must include the date
	3442	  	on which the bankruptcy petition was filed, the court in which the petition was filed, and a list of Postal
	3443	  	Service contracts and Contracting Officers for all Postal Service contracts for which final payment has
	3444	  	not yet been made. This obligation remains in effect until final payment under this contract.
	3445	  	
	3446	  	
	3447	  	Confidentiality
	3448	  	 a.      During the term of this contract and until the earlier of five (5) years after such
termination or

	3449	  	 until such time as the information is no longer confidential as described below, each party

	3450	  	 shall treat as confidential and appropriately safeguard and shall not use for the benefit of any

	3451	  	 person or corporation other than the other party:

	3452	  	
	3453	  	 1.      Written information identified in writing as confidential or oral information
promptly

	3454	  	 confirmed in writing as being confidential;

	3455	  	
	3456	  	 2.      Written information or oral information disclosed by the parties during the
negotiation

	3457	  	 of this contract and written information or oral information promptly confirmed in

	3458	  	 writing as confidential pertaining to a party’s pricing, business or assets which is

	3459	  	 received at any time from a party that is identified in writing; or

	3460	  	
	3461	  	 3.      Any information or knowledge concerning the methods of operation, promotion,
sale,

	3462	  	 or distribution used by a party which may be communicated to the other party or which

	3463	  	 a party may otherwise acquire by virtue of its performance of this Agreement.

	3464	  	
	3465	  	 b.      Notwithstanding the provisions of subparagraphs 1 through 3, above, neither party shall
be

	3466	  	 required to obtain prior written approval before providing information regarding this contract:

	3467	  	
	3468	  	 1.       To Members of Congress serving on a committee or subcommittee with
oversight

	3469	  	 responsibility of the Postal Service;

	3470	  	
	3471	  	 2.       In response to legal process or otherwise required by law;

	3472	  	
	3473	  	 3.       In response to a request from the Department of Justice Antitrust Division attorneys
or

	3474	  	 economists in pursuit of a non-public investigation; or

	3475	  	
	3476	  	 4.       In response to requests submitted to the Postal Service under the Freedom
of

	3477	  	 Information Act. In this regard, the Postal Service shall follow the procedures

	3478	  	 promulgated at 39 CFR Section 265.8.

	3479	  	
	3480	  	 c.      Information shall not be considered confidential if it is:

	3481	  	 1.       Generally known to the trade or public;

	3482	  	 2.       Rightfully possessed by a party prior to the effective date of this
contract;

	3483	  	 3.       Received by a party from a third party which rightfully possesses
it;

	3484	  	 4.       Independently developed by the other party; or

	3485	  	 5.       Releasable pursuant to Postal Service regulations addressing how information
is

	3486	  	 maintained by the Postal Service.

	3487	  	
	3488	  	
	3489	  	Entire Agreement
	3490	  	This Contract, together with all Attachments, constitutes the entire agreement and understanding
	3491	  	between the Parties in connection with the subject matter described, and supersedes and cancels all
	3492	  	previous negotiations, commitments, and writings related to the subject matter.


  
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Contract ACN-13-FX 
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	3493	  	
	3494	  	
	3495	  	Force Majeure
	3496	  	Both the Postal Service and the aviation supplier shall be excused from their obligations for volume
	3497	  	guarantees or service performance, respectively, under this Contract, and neither Party shall be liable
	3498	  	to the other or any other person or entity for loss, damage, delay, mis-delivery or non-delivery of
	3499	  	shipments transported pursuant to this Contract, resulting in whole or in part from any of the following:
	3500	  	
	3501	  	 a.      When there occurs a State or Federal government-declared State of Emergency and /
or

	3502	  	 instructions by a government agency that has actual or apparent powers or authority

	3503	  	 (including, but not limited to, the Federal Aviation Administration (FAA) or the Transportation

	3504	  	 Security Administration (TSA)) to order airport closures or limitations on airport activity;

	3505	  	
	3506	  	 b.      When the failure to meet contractual obligations results in whole or in part from
public

	3507	  	 enemies, terrorist acts, criminal acts of any person or entity, public authorities acting with

	3508	  	 actual or apparent authority (including U.S. Postal Inspectors), civil commotion, hazards

	3509	  	 incident to a state of war, national disruptions in transportation networks or operations (of any

	3510	  	 mode) of the aviation supplier, Postal Service, or any other entity, strikes, natural disasters, or

	3511	  	 disruption or failure of third-party communication and information systems; or

	3512	  	
	3513	  	 c.      When there exist any conditions that present a danger to each Party’s
personnel.

	3514	  	
	3515	  	 d.      In every case the failure to perform must be beyond the control and without the fault
or

	3516	  	 negligence of the party claiming that its performance is excused. Each Party is required to

	3517	  	 continue and attempt to recommence performance to the greatest extent possible without

	3518	  	 delay.

	3519	  	
	3520	  	It is the responsibility of the Party asserting the Force Majeure event to formally declare that a Force
	3521	  	Majeure event has taken place within twenty-four (24) hours of the event, except when the event
	3522	  	occurs on a Friday, Saturday or Sunday. Declaration of a Force Majeure event that occurs on a Friday,
	3523	  	Saturday, or Sunday must be made by the close of business on the following Monday, except when
	3524	  	the Monday falls on a holiday, then it must be declared by the close of business on the following
	3525	  	Tuesday. The party declaring the Force Majeure event must document the circumstances of the event
	3526	  	in writing to the Contracting Officer’s Representative, who will review the information with the
	3527	  	Manager, Air Transportation Operations, and relevant aviation supplier officials. In the absence of a
	3528	  	formal request for relief under this clause, all appropriate volume guarantees and performance
	3529	  	standards will remain in force. Except for the calculation of the service levels, nothing in this section
	3530	  	shall relieve or excuse the aviation supplier of its service obligations. Subsequent to a Force Majeure
	3531	  	event being declared, the declaring party must provide reasonable, written documentation with
	3532	  	sufficient detail to support the declaration.
	3533	  	
	3534	  	If, as a result of the occurrence of one of the foregoing events, the aviation supplier is excused from
	3535	  	performance, and the Postal Service is excused from meeting its minimum volume commitment for the
	3536	  	identified period, the Parties will meet to agree upon the pro-rata adjustments to be made.
	3537	  	
	3538	  	On days where mail volume is withdrawn, withheld, or not transported under this provision, the
	3539	  	minimum volume commitment for the identified period will be reduced for that period by the amount of
	3540	  	that volume.
	3541	  	
	3542	  	
	3543	  	Frequency Adjustment
	3544	  	If, during the term of this contract, the Postal Service decides to reduce, in whole or in part, the
	3545	  	number of delivery days, for any mail type it provides, to fewer than six (6) per week, the Postal
	3546	  	Service reserves the right to effectuate a change in delivery days by adjusting the Statement of Work
	3547	  	of this contract, including, but not limited to, the annual number of operating days or the frequency of
	3548	  	service hereunder. The parties agree that such an adjustment does not constitute a partial termination
	3549	  	of the contract, nor will it give rise to an equitable adjustment.


  
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Contract ACN-13-FX 
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	3550	  	
	3551	  	If the number of delivery days is reduced, in whole or in part, to five (5) and the Postal Service decides
	3552	  	to reduce the number of operating days under this contract, in whole or in part, to five (5), the parties
	3553	  	agree to reduce the Contract Volume Minimum calculation. The Contract Volume Minimum calculation
	3554	  	will be reduced by the average daily volume for the previous twelve (12) months excluding the weeks
	3555	  	of Peak associated with the removed day of service without adjustment to the tier structure, the
	3556	  	contract rate, or be subject to any other price-related adjustment. The monies associated with the
	3557	  	volume removed from the calculation will be eliminated.
	3558	  	
	3559	  	If the number of delivery days is reduced to fewer than five (5), and the Postal Service decides to
	3560	  	reduce the number of operating days under this contract, in whole or in part, to fewer than five (5), the
	3561	  	parties will negotiate an equitable adjustment if necessary.
	3562	  	
	3563	  	No later than 120 days prior to the effective date of such reduction in delivery days, the parties shall
	3564	  	commence discussions as to how to implement the change. Within 90 days of such notice, the
	3565	  	supplier must implement the changes outlined above.
	3566	  	
	3567	  	
	3568	  	Notices
	3569	  	Any notice, report, demand, acknowledgement or other communication which under the terms of this
	3570	  	Contract or otherwise must be given or made by either Party, unless specifically otherwise provided in
	3571	  	this Contract, shall be in the English language and in writing, and shall be given or made by express
	3572	  	delivery service with proof of delivery, certified air mail (return receipt requested). The parties may
	3573	  	also send a copy of the same communication through electronic mail, facsimile with acknowledgement
	3574	  	of receipt/proof of receipt, or personal delivery. If a party sends a copy of the official correspondence
	3575	  	by electronic mail or facsimile, the correspondence shall not be deemed received until the receiving
	3576	  	party confirms receipt.
	3577	  	
	3578	  	Such notice, report, demand, acknowledgement or other communication shall be deemed to have
	3579	  	been given or made in the case of express delivery service with tracking and tracing capability on the
	3580	  	date of signature of the proof of delivery, and in the case of certified mail on the fifth business day in
	3581	  	the place of receipt after the date sent.
	3582	  	
	3583	  	The notice address for the Postal Service shall be:
	3584	  	 U.S. Postal Service

	3585	  	 Air Transportation CMC

	3586	  	 Attention: Manager

	3587	  	 475 L’Enfant Plaza SW, Room 1P 650

	3588	  	 Washington, DC 20260-0650

	3589	  	
	3590	  	The notice address for the aviation supplier shall be:
	3591	  	 Federal Express Corporation

	3592	  	 Attention: Vice President, Postal Transportation Management

	3593	  	 3610 Hacks Cross Road

	3594	  	 Building A 1st Floor

	3595	  	 Memphis, TN 38125-8800

	3596	  	
	3597	  	
	3598	  	Severability
	3599 3600 3601 3602 3603 3604 3605	  	 a.      If any term, provision, covenant or condition of this Contract is held by a court or Board
of
competent jurisdiction or by a request, direction or indication of an agency or department of a
Governmental Body having subject matter jurisdiction to be invalid or unenforceable, the
remainder of the provisions shall continue in full
force and effect unless the rights and
obligations of the parties have been materially altered or abridged by such invalidation or
unenforceability.



  
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Contract ACN-13-FX 
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	3606 3607 3608 3609 3610 3611	  	 b.      If a material provision of this Contract is materially altered or abridged as the result of
a final
and binding order of a Governmental Body having subject matter jurisdiction, then the Postal
Service and the aviation supplier will meet to negotiate in good faith to reach a mutually
satisfactory modification to this Contract. If
the Parties are unable to reach a mutually
satisfactory resolution, then either Party may declare the negotiations to be at an impasse and
the parties shall resolve the dispute in accordance with the provisions of this
contract.

	3612	  	
	3613 3614	  	 c.      Notwithstanding the foregoing, the Parties agree to make their best efforts to oppose
any
changes requested by a Governmental Body to any material provision of this Contract.

	3615	  	
	3616	  	
	3617	  	Third Party Governmental Delays
	3618	  	If, during the term of this contract, a governmental entity with subject matter jurisdiction enacts laws,
	3619	  	promulgates regulations, or issues orders mandating that the aviation supplier screen mail dispatched
	3620	  	for transportation by aircraft within the United States for bombs, explosives, or other hazardous
	3621	  	materials, and aviation supplier does not have a method for otherwise complying at no additional cost
	3622	  	to the Postal Service, either party may, at no cost to the other party, suspend performance under the
	3623	  	contract during the period in which such screening is actually required to be accomplished.
	3624	  	
	3625	  	Within fourteen (14) days of the enactment of any law, promulgation of any regulation, or issuance of
	3626	  	any order referenced above, the parties shall commence negotiations in an attempt to modify this
	3627	  	contract to address any adverse impacts and / or other concerns asserted by one or both parties that
	3628	  	may arise as a result of additional screening requirements.
	3629	  	
	3630	  	If the parties cannot agree upon such a modification within 180 days, or within such longer period as
	3631	  	the parties may mutually agree, the contract and all orders hereunder may be terminated at no cost to
	3632	  	either party.
	3633	  	
	3634	  	
	3635	  	Waiver of Breach
	3636	  	No waiver of breach of any of the provisions of this Contract shall be construed to be a waiver of any
	3637	  	succeeding breach of the same or any other provision.
	3638	  	


  
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Contract ACN-13-FX 
 Part 4: List of Attachments 
  

 Part 4 - List of Attachments and Forms 

 

					
	Attachments:	 	
			
		 	Attachment 1	 	Postal Service Operating Periods, dated June 27, 2014
			
		 	Attachment 2	 	Air Stops & Projected Volumes, dated January 8, 2013
			
		 	Attachment 3	 	Operating Plan, Day Network, dated June 27, 2014
			
		 	Attachment 4	 	Operating Plan, Night Network, dated June 27, 2014
			
		 	Attachment 5	 	Reserved
			
		 	Attachment 6	 	Postal Furnished Property, April 16, 2013
			
		 	Attachment 7	 	Electronic Data Interchange Service Requirements, dated September 1, 2012
			
		 	Attachment 8	 	Investigative / Security Protocol and Guidelines, dated July 2012
			
		 	Attachment 9	 	Wage Determination, dated October 31, 2012
			
		 	Attachment 10	 	Pricing, dated September 29, 20141
			
		 	Attachment 11	 	Perishable Mail and Lives, April 22, 2013
			
		 	Attachment 12	 	Reserved
			
		 	Attachment 13	 	Service Contract Act Wage Determinations, dated April 17, 2013
			
		 	Attachment 14	 	Contract Density, dated June 27, 2014
			
		 	Attachment 15	 	Average Weight Process, dated June 27, 2014
			
		 	Attachment 16	 	Re-labeling Process, dated June 27, 2014
			
		 	Attachment 17	 	Handling Unit Types, dated June 27, 2014


					
		
	Forms:	  	
			
		 	DOT Form F 5800.1	  	Hazardous Materials Incident Report
			
		 	I-9 Form	  	Employment Eligibility Verification
			
		 	PS Form 2025	  	Contract Personnel Questionnaire
			
		 	PS Form 8203	  	Order / Solicitation / Offer / Award
			
		 	US Treasury Form 941	  	Quarterly Federal Tax Return

  

	1 	 Included herein 



  
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Contract ACN-13-FX 
 Attachment 10: Pricing 
  

 Exercised Option 1, 2, and 3 

Attachment 10 
 Pricing 
 January 13, 2015 

 

			
	Attachment 10 – Pricing Day Network (Proposal 2F)	  	1/13/2015

 [*] 
  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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Contract ACN-13-FX 
 Attachment 10: Pricing 
  


			
	Attachment 10 – Pricing Night Network (Proposal 2B)	  	18-Apr-13

 [*] 
  

			
	Attachment 10 – Pricing	  	6/27/2014

 [*] 
  

	*	Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended. 


  
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