Teaming Agreements

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Teaming Agreements

• Terry McCune
• Chief, Business Oversight
• US Army Medical Research Acquisition Activity

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Teaming Agreements

• Definition (FAR Part 9.601)
• Two or more companies form a partnership or joint
  venture to act as a potential prime contractor
  or
• A potential prime contractor agrees with one or
  more other companies to have them act as its
  subcontractors under a specified Government
  Contract or Acquisition Program
• Purpose
• To document the current and subsequent
  relationship of the parties
• Share core competencies to make the team more
  valuable to the Government

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Teaming Agreements

• Teaming agreements should
• Be in writing
• Define roles and responsibilities in proposal
  writing
• Should address confidentiality and non-disclosure
• Protection of Intellectual Property
• Expressed Intent
• Should contain termination clauses
• How to handle disputes

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Pitfalls

• Scenario Incumbent small business competing for
  the follow-on contract..
• Ostensible Subcontract Rule
• To prevent large businesses from forming
  relationships with small businesses to evade SBA
  size requirements
• A Contractor and its ostensible sub are treated
  as Joint Ventures for size determinations
• SBA Area Office makes determinations of size
  issues

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Ostensible Subcontract Rule

• SBA reviews totality of the contract
• Which contractor has the necessary background and
  expertise to perform the contract
• What is the relative amount of work to be
  performed by each party
• Which contractor is performing the primary and
  vital requirements of the contract
• Is the prime contractor unusually reliant on the
  sub
• Status of the Subcontractor is the sub the
  incumbent contractor and is the sub ineligible
  because it exceeds the size standards

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What about Large Primes?

• For negotiated contracts exceeding 550K (FAR
  Part 19.702)
• If there are subcontracting opportunities
• Successful offeror must submit a subcontracting
  plan
• Primes must submit individual subcontract and
  summary subcontract reports via eSRS
• Contractors failing to comply in good faith with
  the requirements of their subcontract plan can be
  found in breach of contract and result in the
  imposition of liquidated damages.

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Teaming Agreements

• Questions??