RFP 20191104 Warehousing and Transportation

REQUEST FOR PROPOSALS FOR

WAREHOUSING AND TRANSPORTATION SERVICES FOR WESTERN PENNSYLVANIA

ISSUING OFFICE

PENNSYLVANIA LIQUOR CONTROL BOARD BUREAU OF PURCHASING AND CONTRACT ADMINISTRATION ROOM 312, NORTHWEST OFFICE BUILDING HARRISBURG, PENNSYLVANIA 17124

RFP NUMBER: 20191104

DATE OF ISSUANCE

May 11, 2020

i REQUEST FOR PROPOSALS FOR

WAREHOUSING AND TRANSPORTATION SERVICES FOR WESTERN PENNSYLVANIA

TABLE OF CONTENTS

CALENDAR OF EVENTS iv

Part I – GENERAL INFORMATION 1

Part II – CRITERIA SELECTION 10

Part III – TECHNICAL SUBMITTAL 15

Part IV – COST SUBMITTAL 26

Part V – SMALL DIVERSE BUSINESS AND SMALL BUSINESS 28 PARTICIPATION SUBMITTAL

Part VI – CONTRACT 33

ii APPENDICES

APPENDIX A, PROPOSAL COVER SHEET

APPENDIX B, CORPORATE SIGNATORY DELEGATION AUTHORIZATION FORM

APPENDIX C, IRAN FREE PROCUREMENT CERTIFICATION

APPENDIX D, TRADE SECRET CONFIDENTIAL PROPRIETARY INFORMATION NOTICE FORM

APPENDIX E, COST SUBMITTAL

APPENDIX F, SMALL DIVERSE BUSINESS AND SMALL BUSINESS PARTICIPATION SUBMITTAL FORM AND LETTER OF INTENT

APPENDIX G, MODEL FORM OF SMALL DIVERSE BUSINESS AND SMALL BUSINESS SUBCONTRACT AGREEMENT

APPENDIX H, CURRENT OPERATIONS SUMMARY

APPENDIX I, WESTERN PENNSYLVANIA SERVICE REGION

APPENDIX J, SERVICE/OPERATIONAL REQUIREMENTS

APPENDIX K, DISTRIBUTION CENTER FACILITY REQUIREMENTS

APPENDIX L, WAREHOUSE MANAGEMENT SYSTEM SPECIFICATIONS AND REQUIREMENTS

APPENDIX M, REQUIRED REPORTS AND DOCUMENTS

APPENDIX N, BAILMENT PROGRAM

APPENDIX O, EQUIPMENT DETAIL TEMPLATE

APPENDIX P, KEY PERFORMANCE INDICATORS AND SERVICE LEVELS

iii CALENDAR OF EVENTS

The Commonwealth will make every effort to adhere to the following schedule:

Activity Responsibility Date All questions Questions pertaining to this RFP can be submitted as they must be arise via e-mail to Issuing Officer Joshua Greene at Potential submitted by [email protected] from the date of issuance up to, and Offerors 12:00PM ET on including, this date and time. June 3, 2020 Answers to questions from Potential Offerors will be posted All answers will on an ongoing basis to the Department of General Services be provided by eMarketplace website at Issuing Office 5:00PM ET on http://www.emarketplace.state.pa.us/Search.aspx with final June 19, 2020 posting no later than this date.

Regularly until Please monitor website for all communications regarding the Potential proposal due RFP. Offerors date.

Proposals must Sealed proposal must be received by the Issuing Office at: be received at Pennsylvania Liquor Control Board, Purchasing and Offerors PLCB by Contract Administration, Room 312 Northwest Office 1:00PM ET on Building, Harrisburg, PA 17124 August 28, 2020

iv PART I

GENERAL INFORMATION

I-1. Purpose. This request for proposals (“RFP”) provides to those interested in submitting proposals for the subject procurement (“Offerors”) sufficient information to enable them to prepare and submit proposals for the Pennsylvania Liquor Control Board’s (“PLCB”) consideration on behalf of the Commonwealth of Pennsylvania (“Commonwealth”) to satisfy a need for a third-party logistics provider (“3PL”) to provide “Warehousing and Transportation Services for Western Pennsylvania” (“Project”). This RFP contains instructions governing the requested proposals, including the requirements for the information and material to be included; a description of the service to be provided; requirements which Offerors must meet to be eligible for consideration; general evaluation criteria; and other requirements specific to this RFP.

I-2. Issuing Office. The PLCB (“Issuing Office”) has issued this RFP on behalf of the Commonwealth. The sole point of contact in the Commonwealth for this RFP shall be Joshua Greene, Purchasing and Contracting Administration Division, Room 312 Northwest Office Building, Harrisburg, PA 17124, [email protected], who is the Issuing Officer for this RFP. Please refer all inquiries to the Issuing Officer.

I-3. Overview of Project. The PLCB is the Commonwealth’s wholesaler and primary retailer of wine and spirits and the agency responsible for regulatory control of beverage alcohol in Pennsylvania. As such, the PLCB seeks a 3PL specialist to provide warehousing and transportation services – with full operations beginning March 1, 2022 for a term of 12 years, with the potential for additional extension terms – to support more than 200 Fine Wine & Good Spirits stores (“FW&GS”) and 70 licensees in western Pennsylvania receiving direct shipment of wines, spirits and accessories, as well as limited shipments of non-alcohol merchandise.

I-4. Objectives.

A. General. The PLCB seeks a 3PL specialist to provide both warehousing and delivery services. The Offeror will be solely responsible for the acquisition and management of a distribution center (“DC”) located in Allegheny County, Pennsylvania to manage the receipt, storage and order fulfillment of merchandise on behalf of the PLCB. The Offeror will also be expected to provide for and manage transportation from an Allegheny County facility to designated store and licensee locations in western Pennsylvania.

B. Specific. The PLCB wishes to accomplish the following specific objectives as efficiently and cost-effectively as possible, relying on the expertise, leadership, financial stability and innovation of the Selected Offeror:

1. Warehouse and safeguard inventory of alcohol and non-alcohol merchandise in a DC located in Allegheny County.

2. Securely process and execute inbound receipts and outbound shipments of such merchandise. 3. Grow and adapt warehousing and transportation solutions as best practices and PLCB business evolve.

I-5. Type of Contract. The resulting contract of this RFP will be an established price contract with escalation, consisting of the Contract as shown in Part VI. The Issuing Office, in its sole discretion, may undertake negotiations with Offerors whose proposals, in the judgment of the Issuing Office, show them to be qualified, responsible and capable of performing the Project.

I-6. Rejection of Proposals. The Issuing Office reserves the right, in its sole and complete discretion, to reject any proposal received as a result of this RFP.

I-7. Incurring Costs. The Issuing Office is not liable for any costs the Offeror incurs in preparation and submission of its proposal, in participating in the RFP process or in anticipation of award of the contract.

I-8. Questions & Answers. If an Offeror has any questions regarding this RFP, the Offeror must submit the questions by email (with the subject line “RFP 20191104 Question”) to the Issuing Officer named in Part I, Section I-2 of the RFP. If the Offeror has questions, they may be submitted as they arise via email, but no later than the date indicated on the Calendar of Events. The Issuing Officer shall post the answers to the questions to eMarketplace at http://www.emarketplace.state.pa.us/Search.aspx on an ongoing basis until the deadline stated on the Calendar of Events. When an Offeror submits a question after the deadline date for receipt of questions indicated on the Calendar of Events, the Issuing Officer may respond to questions of an administrative nature by directing the questioning Offeror to specific provisions in the RFP. To the extent that the Issuing Office decides to respond to a non-administrative question after the deadline date, the question and answer will be provided to all Offerors through an addendum.

All questions and responses as posted to eMarketplace are considered as an addendum to, and part of, this RFP in accordance with RFP Part I, Section I-9. Each Offeror shall be responsible to monitor eMarketplace for new or revised RFP information. The Issuing Office shall not be bound by any verbal information nor shall it be bound by any written information that is not either contained within the RFP or formally issued as an addendum by the Issuing Office. The Issuing Office does not consider questions to be a protest of the specifications or of the solicitation. The required protest process for Commonwealth procurements is described in Part I, Section I-24.

I-9. Addenda to the RFP. If the Issuing Office deems it necessary to revise any part of this RFP before the proposal response date, the Issuing Office will post an addendum to eMarketplace at http://www.emarketplace.state.pa.us/Search.aspx. It is the Offeror’s responsibility to periodically check eMarketplace for any new information or addenda to the RFP. Answers to the questions asked during the Questions & Answers period also will be posted to eMarketplace as addenda to the RFP. 2

I-10. Response Date. To be considered for selection, proposal submissions as described in Part I, Section I-11 must arrive at the Issuing Office on or before the time and date specified in the RFP Calendar of Events. The Issuing Office will not accept proposals via email or facsimile transmission. Offerors who send proposals by mail or other delivery service should allow sufficient delivery time to ensure timely receipt of their proposals. If, due to inclement weather, natural disaster, or any other cause, the Commonwealth office location to which proposals are to be returned is closed on the proposal response date, the deadline for submission will be automatically extended until the next Commonwealth business day on which the office is open, unless the Issuing Office otherwise notifies Offerors. The hour for submission of proposals shall remain the same. The Issuing Office will reject (unopened) any late proposals.

I-11. Proposal Requirements.

A. Proposal Submission: To be considered, Offerors should submit 15 paper copies of a complete response to this RFP to the Issuing Office, using the format provided in Section I-11B. Offerors must also provide two USB drives having separate files for the Technical Submittal; the Cost Submittal; and the Small Diverse Business and Small Business (SDB/SB) Participation Submittal including related Letter(s) of Intent. The USB drive submissions must be in Microsoft Office or Microsoft-Office- compatible format and any spreadsheets must be in Microsoft Excel. The Offerors may not lock or protect any cells or tabs and the content must be exact copies of the paper submittals. The USB drive should clearly identify the Offeror and include the name and version number of the virus scanning software that was used to scan the USB drive before it was submitted.

The Offeror shall make no other distribution of its proposal to any other Offeror or Commonwealth official or Commonwealth consultant. Each proposal page should be numbered for ease of reference. An official authorized to bind the Offeror to its provisions must sign the Proposal Cover Sheet Appendix A and Corporate Signatory Delegation Authorization Form[Appendix B, if needed. See also Section II-1B.

For this RFP, the proposal must remain valid until a contract is fully executed. If the Issuing Office selects the Offeror’s proposal for award, the contents of the selected Offeror’s proposal will become, except to the extent the contents are changed through Best and Final Offers or negotiations, contractual obligations.

Each Offeror submitting a proposal specifically waives any right to withdraw or modify it, except that the Offeror may withdraw its proposal by written notice received at the Issuing Office’s address for proposal delivery prior to the exact hour and date specified for proposal receipt. An Offeror or its authorized representative may withdraw its proposal in person prior to the exact hour and date set for proposal receipt, provided the withdrawing person provides appropriate identification.

B. Proposal Format: Offerors must submit their proposals in the format, including heading descriptions, outlined below. To be considered, the proposal must respond to all proposal requirements. Offerors should provide any other information thought to be relevant, but not applicable to the enumerated categories, as an appendix to the Proposal. All cost data relating to this proposal and all Small Diverse Business and Small Business cost data should be kept separate from and not included in the Technical Submittal. Offerors should not reiterate technical information in the cost submittal. Each proposal shall consist of the following three separate files:

1. Technical Submittal, in response to Part III:

a. Complete, sign and include Appendix A Proposal Cover Sheet and Appendix B Corporate Signatory Delegation Authorization Form. b. Complete, sign and include Appendix C, Iran Free Procurement Certification Form.

2. Cost Submittal, in response to RFP Part IV; and

3. Small Diverse Business and Small Business (SDB/SB) Participation Submittal, in response to RFP Part V:

a. Complete and include Appendix F - SDB/SB Participation Submittal Form and SDB/SB Letter of Intent. Offeror must provide a Letter of Intent for each SDB and SB listed on the SDB/SB Participation Submittal Form.

The Issuing Office reserves the right to request additional information which, in the Issuing Office’s opinion, is necessary to assure that the Offeror’s competence, number of qualified employees, business organization, and financial resources are adequate to perform according to the RFP.

The Issuing Office may make investigations as deemed necessary to determine the ability of the Offeror to perform the Project, and the Offeror shall furnish to the Issuing Office all requested information and data. The Issuing Office reserves the right to reject any proposal if the evidence submitted by, or investigation of, such Offeror fails to satisfy the Issuing Office that such Offeror is properly qualified to carry out the obligations of the RFP and to complete the Project as specified.

I-12. Economy of Preparation. Offerors should prepare proposals simply and economically, providing a straightforward, concise description of the Offeror’s ability to meet the requirements of the RFP.

I-13. Discussions for Clarification. Offerors may be required to make an oral or written clarification of their proposals to the Issuing Office to ensure thorough mutual understanding and responsiveness to the solicitation requirements. The Issuing Office will

initiate requests for clarification. Clarifications may occur at any stage of the evaluation and selection process prior to contract execution.

I-14. Oral Presentations and Site Visits. In order to aid in the evaluation of the proposal by the Evaluation Committee, the PLCB reserves the right to request that an Offeror provide an oral presentation detailing all or a portion of its proposal. The PLCB may also request that an Offeror host a site visit of an existing site/operation and/or a proposed site/operation to aid in the evaluation of the proposal by the Evaluation Committee. In the event an oral presentation and/or a site visit is requested, the Issuing Officer will contact the applicable Offeror(s) with details concerning the timing and content requirements for the requested oral presentations and/or site visit(s).

I-15. Prime Contractor Responsibilities. The selected Offeror will be solely responsible for all services offered in its proposal whether it produces them itself or by subcontract. Further, the Issuing Office will consider the selected Offeror to be the sole point of contact with regard to all contractual matters.

I-16. Proposal Contents.

A. Confidential Information. The Commonwealth is not requesting, and does not require, confidential proprietary information or trade secrets to be included as part of Offerors’ submissions in order to evaluate proposals submitted in response to this RFP. Accordingly, except as provided herein, Offerors should not label proposal submissions as confidential or proprietary or trade secret protected. Any Offeror who determines that it must divulge such information as part of its proposal must submit the signed written statement described in subsection c. below and must additionally provide a redacted version of its proposal, which removes only the confidential proprietary information and trade secrets, for required public disclosure purposes.

B. Commonwealth Use. All material submitted with the proposal shall be considered the property of the Commonwealth of Pennsylvania. The Commonwealth has the right to use any or all ideas not protected by intellectual property rights that are presented in any proposal regardless of whether the proposal becomes part of a contract. Notwithstanding any Offeror copyright designations contained in proposals, the Commonwealth shall have the right to make copies and distribute proposals internally and to comply with public record or other disclosure requirements under the provisions of any Commonwealth or United States statute or regulation, or rule or order of any court of competent jurisdiction.

C. Public Disclosure. After the award of a contract pursuant to this RFP, all proposal submissions are subject to disclosure in response to a request for public records made under the Pennsylvania Right-to-Know-Law, 65 P.S. § 67.101, et seq. If a proposal submission contains confidential proprietary information or trade secrets, a signed written statement to this effect must be provided with the submission in accordance with 65 P.S. § 67.707(b) for the information to be considered exempt under 65 P.S. § 67.708(b)(11) from public records requests. Refer to Appendix D of the RFP for a

Trade Secret Confidential Proprietary Information Notice Form that may be utilized as the signed written statement, if applicable. If financial capability information is submitted in response to Part III of this RFP, such financial capability information is exempt from public records disclosure under 65 P.S. § 67.708(b)(26).

I-17. Best and Final Offers (BAFO).

A. While not required, the Issuing Office reserves the right to conduct discussions with Offerors for the purpose of obtaining “best and final offers.” To obtain best and final offers from Offerors, the Issuing Office may do one or more of the following, in any combination and order:

1. Schedule oral presentations;

2. Request revised proposals;

3. Conduct site visit(s); and

4. Enter into pre-selection negotiations.

B. The following Offerors will not be invited by the Issuing Office to submit a Best and Final Offer:

1. Those Offerors which the Issuing Office has determined to be not responsible or whose proposals the Issuing Office has determined to be not responsive.

2. Those Offerors which the Issuing Office has determined in accordance with Part II, Section II-5 from the submitted and gathered financial and other information, do not possess the financial capability, experience or qualifications to assure good faith performance of the contract.

3. Those Offerors whose score for their technical submittal of the proposal is less than 75% of the total amount of technical points allotted to the technical criterion.

The Issuing Office may further limit participation in the best and final offers process to those remaining responsible offerors which the Issuing Office has, within its discretion, determined to be within the top competitive range of responsive proposals.

C. The Evaluation Criteria found in Part II, Section II-4, shall also be used to evaluate the Best and Final offers.

D. Price reductions offered through any cost BAFO shall have no effect upon the Offeror’s Technical Submittal.

E. Any reduction to commitments to Small Diverse Businesses and Small Businesses must be proportional to the reduction in the total price offered through any BAFO process or contract negotiations unless approved by BDISBO.

I-18. News Releases. Offerors shall not issue news releases, Internet postings, advertisements or any other public communications pertaining to this Project without prior written approval of the Issuing Office, and then only in coordination with the Issuing Office.

I-19. Restriction of Contact. From the issue date of this RFP until the Issuing Office selects a proposal for award, the Issuing Officer is the sole point of contact concerning this RFP. Any violation of this condition may be cause for the Issuing Office to reject the offending Offeror’s proposal. If the Issuing Office later discovers that the Offeror has engaged in any violations of this condition, the Issuing Office may reject the offending Offeror’s proposal or rescind its contract award. Offerors must agree not to distribute any part of their proposals beyond the Issuing Office. An Offeror who shares information contained in its proposal with other Commonwealth personnel and/or competing Offeror personnel may be disqualified.

I-20. Term of Contract. The term of the contract will commence on the Effective Date and will continue for 12 years with options to extend in single- or multiple-year increments, as mutually agreed upon by PLCB and the selected Offeror, for up to an additional 8 years beyond the base term. The Issuing Office will fix the Effective Date after the contract has been fully executed by the selected Offeror and by the Commonwealth and all approvals required by Commonwealth contracting procedures have been obtained. The selected Offeror shall not start the performance of any work prior to the Effective Date of the contract and the Commonwealth shall not be liable to pay the selected Offeror for any service or work performed or expenses incurred before the Effective Date of the contract.

I-21. Offeror’s Representations and Authorizations. By submitting its proposal, each Offeror understands, represents, and acknowledges that:

A. All of the Offeror’s information and representations in the proposal are material and important, and the Issuing Office may rely upon the contents of the proposal in awarding the contract(s). The Commonwealth shall treat any misstatement, omission or misrepresentation as fraudulent concealment of the true facts relating to the Proposal submission, punishable pursuant to 18 Pa. C.S. § 4904.

B. The Offeror has arrived at the price(s) and amounts in its proposal independently and without consultation, communication, or agreement with any other Offeror or potential offeror.

C. The Offeror has not disclosed the price(s), the amount of the proposal, nor the approximate price(s) or amount(s) of its proposal to any other firm or person who is an Offeror or potential offeror for this RFP, and the Offeror shall not disclose any of these items on or before the proposal submission deadline specified in the Calendar of Events of this RFP.

D. The Offeror has not attempted, nor will it attempt, to induce any firm or person to refrain from submitting a proposal on this contract, or to submit a proposal higher than this proposal, or to submit any intentionally high or noncompetitive proposal or other form of complementary proposal.

E. The Offeror makes its proposal in good faith and not pursuant to any agreement or discussion with, or inducement from, any firm or person to submit a complementary or other noncompetitive proposal.

F. To the best knowledge of the person signing the proposal for the Offeror, the Offeror, its affiliates, subsidiaries, officers, directors, and employees are not currently under investigation by any governmental agency and have not in the last four years been convicted or found liable for any act prohibited by State or Federal law in any jurisdiction, involving conspiracy or collusion with respect to bidding or proposing on any public contract, except as the Offeror has disclosed in its proposal.

G. To the best of the knowledge of the person signing the proposal for the Offeror and except as the Offeror has otherwise disclosed in its proposal, the Offeror has no outstanding, delinquent obligations to the Commonwealth including, but not limited to, any state tax liability not being contested on appeal or other obligation of the Offeror that is owed to the Commonwealth.

H. The Offeror is not currently under suspension or debarment by the Commonwealth, any other state or the federal government, and if the Offeror cannot so certify, then it shall submit along with its proposal a written explanation of why it cannot make such certification.

I. The Offeror has not made, under separate contract with the Issuing Office, any recommendations to the Issuing Office concerning the need for the services described in its proposal or the specifications for the services described in the proposal.

J. Each Offeror, by submitting its proposal, authorizes Commonwealth agencies to release to the Commonwealth information concerning the Offeror's Pennsylvania taxes, unemployment compensation and workers’ compensation liabilities.

K. Until the selected Offeror receives a fully executed and approved written contract from the Issuing Office, there is no legal and valid contract, in law or in equity, and the Offeror shall not begin to perform.

L. The Offeror is not currently engaged and will not during the duration of the contract engage, in a boycott of a person or an entity based in or doing business with a jurisdiction which the Commonwealth is not prohibited by Congressional statute from engaging in trade or commerce.

I-22. Notification of Selection.

A. Contract Negotiations. The Issuing Office will notify all Offerors in writing of the Offeror selected for contract negotiations after the Issuing Office has determined, taking into consideration all of the evaluation factors, the proposal that is the most advantageous to the Issuing Office.

B. Award. Offerors whose proposals are not selected will be notified when contract negotiations have been successfully completed and the Issuing Office has received the final negotiated contract, fully approved and executed by all required signatories.

I-23. Debriefing Conferences. Upon notification of award, Offerors whose proposals were not selected will be given the opportunity to be debriefed. The Issuing Office will schedule the debriefing at a mutually agreeable time. The debriefing will not compare the Offeror with other Offerors, other than the position of the Offeror’s proposal in relation to all other Offeror proposals. An Offeror’s exercise of the opportunity to be debriefed does not constitute nor toll the time for filing a protest (See Section I-24 of this RFP).

I-24. RFP Protest Procedure. The RFP Protest Procedure is on the DGS website at http://www.dgs.pa.gov/Documents/Procurement%20Forms/Handbook/Pt1/Pt%20I%20C h%2058%20Bid%20Protests.pdf. A protest by a party that has not or has not yet submitted a proposal must be filed no later than the proposal submission deadline specified in the Calendar of Events of the RFP. Offerors may file a protest within seven calendar days after the protesting Offeror knew or should have known of the facts giving rise to the protest, but in no event may an Offeror file a protest later than seven calendar days after the date the notice of award of the contract is emailed to the selected Offeror by the Issuing Office. The date of filing is the date of receipt of the protest. A protest must be filed in writing with the Issuing Office. To be timely, the protest must be received by 4:00 p.m. on the seventh day.

I-25. Use of Electronic Versions of this RFP. This RFP is being made available by electronic means. If an Offeror electronically accepts the RFP, the Offeror acknowledges and accepts full responsibility to ensure that no changes are made to the RFP. In the event of a conflict between a version of the RFP in the Offeror’s possession and the Issuing Office’s version of the RFP, the Issuing Office’s version shall govern.

PART II

CRITERIA FOR SELECTION

II-1. Mandatory Responsiveness Requirements. To be eligible for selection, a proposal must:

A. Be timely received from an Offeror (see Part I, Section I-10); and

B. Be properly signed by the Offeror (see Part I, Section I-11A). For guidance on proper signatory protocol in Pennsylvania procurements, see the Pennsylvania Procurement Handbook- Part 1, Chapter 31 Contract Signatures. Appendix B, Corporate Signatory Delegation Authorization, should be used if a resolution exists to grant signature authorization to the person signing the proposal.

II-2. Technical Nonconforming Proposals. The two Mandatory Responsiveness Requirements set forth in Section II-1 above (A-B) are the only RFP requirements that the Commonwealth will consider to be non-waivable. The Issuing Office reserves the right, in its sole discretion, to (1) waive any other technical or immaterial nonconformities in an Offeror’s proposal, (2) allow the Offeror to cure the nonconformity, or (3) consider the nonconformity in the scoring of the Offeror’s proposal.

II-3. Evaluation. The Issuing Office has selected a committee of qualified personnel to review and evaluate timely submitted proposals. Independent of the committee, BDISBO will evaluate the Small Diverse Business and Small Business Participation Submittal and provide the Issuing Office with a rating for this component of each proposal. The Issuing Office will notify in writing of its selection for negotiation the responsible Offeror whose proposal is determined to be the most advantageous to the Commonwealth as determined by the Issuing Office after taking into consideration all of the evaluation factors.

II-4. Evaluation Criteria. The following criteria will be used in evaluating each proposal. The Technical, Cost, and Small Diverse Business and Small Business Participation scores will be calculated in accordance with the methodology set forth by the Commonwealth of Pennsylvania Department of General Services (“DGS”) as described more fully on the DGS website:

A. Technical: The Issuing Office has established the weight for the Technical criterion for this RFP as 50% of the total points. Evaluation will be based upon the following guidelines (listed in order of importance): Soundness of Approach, Infrastructure and Offeror Qualifications. The final Technical scores are determined by giving the maximum number of technical points available to the proposal(s) with the highest raw technical score with the remaining submittals scored in accordance with the DGS methodology.

1. Soundness of Approach. Emphasis here is on the proposed technique for providing warehousing and transportation services and meeting all of the requirements set forth in this RFP and related appendices. An evaluation of the

soundness of approach will consider information such as feasibility of the overall strategy and Offeror’s responsiveness to requirements in this RFP.

2. Infrastructure. Physical and technical infrastructure will be evaluated in this criterion.

a. Physical infrastructure will be evaluated based on, but not limited to, the suitability of the property to support the Project based on facility location and conformance with the specifications identified in Appendix K, Distribution Center Facility Requirements.

b. Infrastructure will also include proposed methodology for protecting and transporting merchandise.

c. Technical infrastructure includes but is not limited to the identification and explanation of systems and business partners to be used; the Offeror’s ability to process orders and track and manage inventory; security of systems and merchandise; and the Offeror’s ability to report on all activities.

3. Offeror Qualifications. This category refers to the ability of the Offeror to meet all requirements of the RFP, including quality, relevancy, and recency of other projects completed by the Offeror and Offeror’s ability to timely and effectively implement of each phase of the Project. The Offeror’s financial ability to undertake a project of this size will also be evaluated in this category. The expected skill set of professional personnel will be evaluated based on experience and education, with particular reference to experience in services similar to that described in this RFP. Particular emphasis is placed on the qualifications of the project and operations manager, and subcontractor qualifications will also be considered.

B. Cost: The Issuing Office has established the weight for the Cost criterion for this RFP as 30% of the total points. The cost criterion is rated by giving the proposal with the lowest total cost the maximum number of Cost points available with the remaining submittals scored in accordance with the DGS methodology.

C. Small Diverse Business and Small Business Participation: BDISBO has established the minimum evaluation weight for the Small Diverse Business and Small Business Participation criterion for this RFP as 20% of the total points.

1. The Small Diverse and Small Business point allocation is based entirely on the percentage of the contract cost committed to Small Diverse Businesses and Small Businesses. If the Offeror is a Small Diverse Business, 100% of the contract cost is allocated to Small Diverse Business participation. If the Offeror is a Small Business, 100% of the contract cost is allocated to Small Business participation.

2. A total combined SDB/SB commitment less than 1% of the total contract cost is considered de minimis and will receive no Small Diverse Business or Small Business points.

3. Based on a maximum total of 200 available points for the Small Diverse Business and Small Business Participation Submittal, the scoring mechanism is as follows:

Small Diverse Business and Small Business Raw Score =

200 (SDB% + (1/3 * SB %))

4. The Small Diverse Business and Small Business Raw Score is capped at 200.

5. The Offeror with the highest raw score will receive 200 points. Each Offeror’s raw score will be pro-rated against the Highest Offeror’s raw score by applying the DGS formula.

6. The Offeror’s prior performance in meeting its contractual obligations to Small Diverse Businesses and Small Businesses will be considered by BDISBO during the scoring process. To the extent the Offeror has failed to meet prior contractual commitments, BDISBO may recommend to the Issuing Office that the Offeror be determined non-responsible for the limited purpose of eligibility to receive Small Diverse Business and Small Business points.

D. Iran Free Procurement Certification and Disclosure. Prior to entering a contract worth at least $1,000,000 or more with a Commonwealth entity, an offeror must: a) certify it is not on the current list of persons engaged in investment activities in Iran created by the Pennsylvania Department of General Services (“DGS”) pursuant to Section 3503 of the Procurement Code and is eligible to contract with the Commonwealth under Sections 3501-3506 of the Procurement Code; or b) demonstrate it has received an exception from the certification requirement for that solicitation or contract pursuant to Section 3503(e). All offerors must complete and return the Iran Free Procurement Certification form, (Appendix C, Iran Free Procurement Certification Form), which is attached hereto and made part of this RFP. The completed and signed Iran Free Procurement Certification form must be submitted as part of the Technical Submittal.

The most current Iran Free Procurement list can be found here.

II-5. Offeror Responsibility. To be responsible, an Offeror must submit a responsive proposal and possess the capability to fully perform the contract requirements in all respects and the integrity and reliability to assure good faith performance of the contract.

In order for an Offeror to be considered responsible for this RFP and therefore eligible for selection for best and final offers or selection for contract negotiations:

A. The total score for the technical submittal of the Offeror’s proposal must be greater than or equal to 75% of the available technical points; and

B. The Offeror’s financial information must demonstrate that the Offeror possesses the financial capability to assure good faith performance of the contract. The Issuing Office will review the Offeror’s previous three financial statements, any additional information received from the Offeror, and any other publicly-available financial information concerning the Offeror, and assess each Offeror’s financial capacity based on calculating and analyzing various financial ratios, and comparison with industry standards and trends.

An Offeror who fails to demonstrate sufficient financial capability to assure good faith performance of the contract as specified herein may be considered by the Issuing Office, in its sole discretion, for Best and Final Offers or contract negotiation contingent upon such Offeror providing contract performance security for the first contract year cost proposed by the Offeror in a form acceptable to the Issuing Office. Based on the financial condition of the Offeror, the Issuing Office may require a certified or bank (cashier’s) check, letter of credit, or a performance bond conditioned upon the faithful performance of the contract by the Offeror. The required performance security must be issued or executed by a bank or surety company authorized to do business in the Commonwealth. The cost of the required performance security will be the sole responsibility of the Offeror and cannot increase the Offeror’s cost proposal or the contract cost to the Commonwealth.

Further, the Issuing Office will award a contract only to an Offeror determined to be responsible in accordance with the most current version of Commonwealth Management Directive 215.9, Contractor Responsibility Program.

II-6. Final Ranking and Award.

A. After any best and final offer process conducted, the Issuing Office will combine the evaluation committee’s final technical scores, BDISBO’s final Small Diverse Business and Small Business Participation Submittal scores, and the final cost scores, in accordance with the relative weights assigned to these areas as set forth in this Part.

B. The Issuing Office will rank responsible offerors according to the total overall score assigned to each, in descending order.

C. The responsible offeror whose proposal is determined in writing to be the most advantageous to the purchasing agency, taking into consideration price and all evaluation factors, shall be selected for contract negotiation.

D. The Issuing Office has the discretion to reject all proposals or cancel the request for proposals at any time prior to the time a contract is fully executed when it is in the best

13 interests of the Commonwealth. The reasons for the rejection or cancellation shall be made part of the contract file.

PART III

TECHNICAL SUBMITTAL

III-1. Work Plan. Describe in narrative form your technical plan for providing warehousing and transportation services as described in this RFP using the Requirements set forth in Section III-2 and Tasks set forth in Section III-3 and all appendices referenced therein as a guide. If more than one approach is apparent, comment on why you chose this approach.

Alternative approaches to the achievement of any of the Requirements set forth in III-3 must be fully explained and justified. Any Offeror proposing such modification should provide extensive detail regarding the suggested modification including, but not limited to: the reason for the modification; a full explanation of its functionality; proof of past successful experience utilizing such method; and evidence that such method can be effectively implemented for this Project.

Details regarding existing PLCB warehousing and transportation operations in Western Pennsylvania are detailed more fully in Appendix H, Current Operations Summary, and Appendix I, Western Pennsylvania Service Region.

III-2. Requirements.

A. Federal and PLCB Licensure. The selected Offeror and/or its contractors must meet federal and state requirements for the transportation and storage of alcohol, including obtaining and maintaining valid Pennsylvania transporter-for-hire and bailee-for-hire licenses, including any additional option years. Individuals or entities requiring licensure by the PLCB are encouraged to seek private legal counsel experienced in Pennsylvania liquor law and licensing matters. Due to the potential for conflicts of interest or other appearances of impropriety, the PLCB cannot provide legal advice to Offerors regarding licensure.

State regulations governing the transportation and storage of alcohol can be found in Chapter 9 of Title 40 of the Pennsylvania Code, and additional information is available at: http://www.lcb.pa.gov/Licensing/ResourcesForLicensees/Pages/Transporters-for- Hire.aspx.

B. Building and Assets. The selected Offeror will be required to own or lease the warehouse, trucks and all other related assets needed to support the Project. This includes: 1. Distribution Center (DC) Facility. The selected Offeror must own or procure (via purchase or lease) a warehouse located in Allegheny County, Pennsylvania. The facility must meet the specifications set forth on Appendix K, Distribution Center Facility Requirements. The selected Offeror will be responsible for the payment of any applicable taxes,

licenses, charges and assessments imposed by any governmental authority upon the DC. The selected Offeror will be responsible for all safety, maintenance, repair and upkeep of the DC.

In response to the RFP, Offeror should provide site plans detailing how proposed DC will meet the aforementioned requirements. Proposals must also identify DC site address, elevation and proximity to any known hazards (environmental or man-made).

The PLCB does not currently require the use of a secondary facility to provide warehousing and delivery services in western Pennsylvania. However, if the use of one or more locations in addition to the primary DC is proposed (to be used immediately or in the future), then all applicable details regarding such facility/ies and the operations taking place thereon must also be provided in response to the RFP. To be clear, the Allegheny County location requirement does not apply to any proposed secondary facility.

2. Equipment. The selected Offeror is responsible for the procurement (via purchase or lease), maintenance, and upkeep of all equipment and furnishings required to provide warehousing and transportation services as described in this RFP.

In response to this RFP, a preliminary list of equipment necessary to provide the services should be provided, utilizing Appendix O, Equipment Detail Template, to provide relevant details including identified equipment, the estimated quantity needed, whether it will be or is currently owned or leased, general specifications, age of any pre-existing equipment and anticipated asset life.

3. Technology. The selected Offeror must also provide its own warehouse management system (WMS) and transportation management system (TMS) technology, inclusive of all hardware, software, licenses and maintenance required to support the Project. The WMS and TMS must be able to fulfill the functional requirements, reports, and interfaces as detailed in Appendix L, Warehouse Management System Requirements and Appendix J, Service/Operational Requirements.

4. Employees. All employees in support of the Project shall be employees or sub-contractors of the selected Offeror. The PLCB will have up to five of its own employees regularly working from the DC, as described in Appendix K, Distribution Center Facility Requirements. Furthermore, it is the responsibility of the selected Offeror to ensure that all employees obtain and maintain the proper certifications, training, and/or licensing for the work being performed. The selected Offeror agrees to comply with all

local, state, and federal regulations governing health, welfare, and occupational safety standards.

C. Handling of Inventory. The selected Offeror is required to maintain operational control of all inventory from the time of receipt until delivery at its final destination at either a FW&GS location or licensee location or until tender to a third-party transporter-for-hire.

The inventory in the DC includes beverage alcohol owned by the PLCB, non-alcohol merchandise sold in or used by FW&GS locations, and beverage alcohol owned by vendors that are part of PLCB’s Bailment (vendor-managed inventory) Program.

Bailment inventory makes up roughly 80% of the inventory that will be stored at the DC, and the selected Offeror will be responsible for the handling and inventory documentation of both bailment and non-bailment inventory stored within the DC. The PLCB Bailment Vendors and the terms of their agreement with the PLCB are provided in Appendix N- Bailment Program.

In response to this RFP, detail the Offeror’s approach to meeting PLCB requirements for the handling of all inventory as set forth in in Appendix J- Service/Operational Requirements.

D. Inventory Control. The selected Offeror will be required to maintain complete records for all inventory received and shipped and provide access to such records to the PLCB as identified in this RFP and its appendices.

Per section III-3 B of this RFP and Appendix J, Service/Operational Requirements and Appendix L, Warehouse Management System Requirements, a full physical inventory of all products will be conducted at the time of their receipt into the DC, with at least annual physical inventories and quarterly cycle counts occurring thereafter as detailed in Appendix J, Service/Operational Requirements.

Additional inventory requirements are identified in Appendix J, Service/Operational Requirements.

In response to this RFP, detail Offeror’s approach to meeting PLCB inventory control requirements identified in Appendix J, Service/Operational Requirements and Appendix L, Warehouse Management System Requirements.

E. Supporting Growth, Expansion and/or Changes to PLCB Warehousing and Transportation Needs. While current western Pennsylvania warehousing and transportation operations are summarized in Appendix H, Current Operations Summary, and Appendix I, Western Pennsylvania Service Area, the PLCB expects its warehousing and transportation needs to evolve over the term of the contract as Pennsylvania’s beverage alcohol marketplace continues to change.

While the PLCB has no ability to predict specifically what changes may impact its warehousing and transportation needs and when, nor does it in any way guarantee or endorse any of the potentials below, the PLCB nonetheless wants to understand the Offeror’s receptiveness to adapting to changing needs. In response to the RFP, discuss Offeror’s ability and willingness to modify and/or grow its operations in response to potential changes including: • Up to 2% annual growth in case volume; • Changing requirements of and integrations with PLCB host system providing and receiving data feeds from the Offeror-provided WMS; • Continued growth and transformation of Pennsylvania’s beverage alcohol marketplace, which could result in additional or specialized warehousing and/or transportation needs related to additional volumes, new packaging trends and/or provision of alcohol merchandise in smaller, single-case volumes to additional licensees; • Geographic expansion of service area eastward to support delivery to additional locations; • Growth of licensee delivery to potentially include new classes of licensees or delivery of new products (spirits) to licensees; and • 3PL services supporting wholesale and/or retail provision of non-alcohol products as the legislature may require.

F. Emergency Preparedness. To support continuity of operations during an emergency, the PLCB needs a strategy for maintaining operations. One part of this strategy is to ensure that essential contracts that provide critical business services to the PLCB have planned for such an emergency and put contingencies in place to provide needed goods and services.

1. Describe your emergency response continuity of operations plan. Please attach a copy of your plan, or at a minimum, summarize how your plan addresses the following aspects of emergency preparedness:

a. Employee safety and training (describe your organization’s safety and training plan, and how frequently your plan will be shared with employees)

b. Identified essential business functions and key employees (within your organization) necessary to carry them out

c. Contingency plans for:

i. Short-term contingency planning – temporary interruption of normal business operations (e.g., electrical power outages or pandemic);

ii. Short-term contingency planning – temporary interruption of information technology operations;

iii. Long-term contingency planning – several months disruption of normal business operations due to a catastrophic event (e.g., fire, tornado, pandemic, etc.);

iv. An assessment of how various crises (e.g., natural disasters, weather conditions, labor strikes, pandemics, etc.) would be managed to reduce the impact on operations; and

v. How employees in your organization will carry out the essential functions if contagion control measures prevent them from coming to the primary workplace.

d. How your organization will communicate with staff and suppliers when primary communications systems are overloaded or otherwise fail, including key contacts, chain of communications (including suppliers), etc.

e. How and when your emergency plan will be tested, and if the plan will be tested by a third-party.

III-3. Tasks. The PLCB anticipates the Project will be comprised of four distinct phases: Facility and Asset Procurement/Preparation, Conversion of Operations, Full Operation, and Wind- Down. The following tasks have been identified as necessary in support of the Project. It should be noted that time is of the essence as full operations must be in place no later than March 1, 2022.

In response to the RFP, provide a workplan for each task identifying the work elements of each task, the resources to be assigned to the tasks and the time allotted to each element and the deliverable items to be produced. Where appropriate, a GANTT chart (or similar method) should be used to show project, task and time relationship.

A. Phase 1: DC and Asset Procurement/Preparation. After the Notice to Proceed has been issued, Phase 1 will begin.

1. Task 1.1 - Develop Detailed Implementation Plan. As the initial task of Phase 1, the selected Offeror will develop a complete, detailed solution design and Implementation Plan, including defined and measurable milestones.

In response to the RFP, provide an Implementation Plan detailing the following, at a minimum:

a. A project timeline for the procurement and/or preparation of the proposed DC to prepare for full operations. This includes the procurement and installation of all capital assets, equipment and technology needed to support the Project.

i. In the case of a new DC, details regarding the purchase or lease of the facility and any plans for building out the structure to suit the needs of the Project.

ii. In the case of an existing DC, details regarding the existing ownership or lease terms, specifications and any renovation or modifications required in support of the Project.

b. A plan and timeline for recruiting and training employees needed to provide warehousing and transportation services. Details regarding the proposed methods of recruitment and training, and, if applicable, details regarding negotiations with labor organizations should be provided.

Deliverable 1.1 – The selected Offeror will be afforded up to 30 days from the Notice to Proceed to update the Implementation Plan provided in response to the RFP for PLCB approval. Such plan must identify and define operating procedures and measurable milestones. The Implementation Plan must be approved in writing and accepted as complete by the PLCB.

2. Task 1.2 – Execution of Implementation Plan. Once the PLCB approves the detailed solution design and implementation plan, the selected Offeror will begin to execute that plan. The PLCB expects the selected Offeror to be prepared to begin receiving inventory at the Facility no later than January 18, 2022. A fully executed Implementation Plan should accomplish the completion of all major milestones identified in the plan, including, but not limited to securing the DC location, completion of construction and/or renovation, installation and testing of all technology, installation of all equipment and fixtures, and acquisition and training of a workforce to support the Project.

Deliverable 1.2 – The selected Offeror shall schedule and conduct weekly progress calls and reports to show progress in and challenges to executing the Implementation Plan, including mitigation plans for resolving risks and detailed progress in achieving each milestone. Each milestone must be approved in writing and accepted as complete by the PLCB.

B. Phase 2: Conversion of Operations. Prior to completion of Phase 1, selected Offeror will submit to PLCB for its review a Phase 2 plan detailing conversion of operations, including operational procedures for scheduling the arrival of inventory, receiving merchandise at the DC and ramping up outbound deliveries. Within five days of PLCB approval of transitioning from Phase 1 to Phase 2 and by January 18, 2022, the selected Offeror must begin receiving merchandise for storage in the DC.

Within the context of the tasks and deliverables identified below, in response to the RFP, detail the Offeror’s plan and timeline for conversion of operations, including

receipt, accounting and storage of initial inventory as well as assumption of delivery responsibilities

1. Task 2.1 – Receipt, Accounting and Storage of Initial Inventory. The selected Offeror must begin receiving inventory directly from PLCB suppliers and consolidators by January 18, 2022. The selected Offeror may also be required to coordinate with PLCB’s existing western Pennsylvania 3PL provider to transfer limited inventory from the existing warehouse to the new DC. All inventory should be received, accounted for and stored in accordance with Appendix J, Service/Operational Requirements and Appendix L, Warehouse Management System Requirements.

The selected Offeror is expected to count the inventory upon first receipt and enter such information into the WMS. The initial inventory count will become the baseline for the first full physical inventory.

Deliverable 2.1.a - The selected Offeror shall develop a detailed plan and timeline for receipt, accounting and storage of initial inventory, as well as for initial deliveries, submitting such plan to the PLCB prior to the completion of Phase 1. Upon the PLCB's written acceptance of the Phase 2 Plan, the selected Offeror may begin conversion of operations.

Deliverable 2.1.b – The selected Offeror, after completing receipt, accounting and storage of initial inventory, shall deliver to the PLCB a final written count for such inventory. This inventory count must be approved in writing by the PLCB and accepted as an accurate baseline inventory before any deliveries commence.

2. Task 2.2 - Beginning Deliveries. Upon completion and PLCB sign off of Deliverable 2.2, the selected Offeror will begin assuming delivery responsibilities in accordance with Appendix J- Service/Operational Requirements.

Deliverable 2.2 – The selected Offeror must deliver to the PLCB a report detailing its conversion of operations, identifying milestones accomplished, and challenges and risks mitigated through the transition. Such report must be approved in writing and accepted as complete by the PLCB.

C. Phase 3: Full Operations. No later than March 1, 2022, the selected Offeror will assume full warehousing and transportation services in support of the Project at its DC. During this multi-year phase comprising the majority of the contract term, the selected Offeror will service all of the PLCB’s FW&GS locations and licensees located in the service area. The selected Offeror will perform all warehousing and transportation services in support of the Project including: the receipt, storage, delivery and any accessorial services as described in Appendix J- Service/Operational Requirements, and Appendix L, Warehouse Management System Requirements, and the security, maintenance and upkeep of the DC as required in Appendix K- Distribution Center Facility Requirements.

Throughout the term of the contract, Offeror performance will be measured through key performance indicators (KPIs) and service levels identified in Appendix P, Key Performance Indicators and Service Levels.

As set forth in Part III-8 Objections and Additions to the Contract, in response to this RFP, Offeror may provide commentary and/or mark-up of the proposed KPIs and service levels, with a request for negotiation of such standards between the PLCB and the selected Offeror.

Deliverable 3.1 – The selected Offeror shall provide comprehensive warehousing and transportation services for western Pennsylvania, with merchandise efficiently and accurately received into the DC and properly and securely stored, picked and transported in accordance with all PLCB requirements identified in this RFP and its appendices. The Offeror shall demonstrate to the PLCB, through ongoing maintenance of inventory and transportation records and integration of the WMS with PLCB systems, its ability to efficiently and securely warehouse and transport merchandise from the DC to FW&GS and licensee locations or to tender to a third-party transporter-for-hire. Such records must be provided to the PLCB as identified in this RFP and its related appendices.

Deliverable 3.2 – On an annual basis, Offeror and PLCB will holistically review all operations to evaluate the successes and failures of the prior year and plan for the upcoming year. This annual review should include but is not limited to: review of procedures and processes, the actual business costs incurred versus those budgeted, budgetary considerations, and extraneous projects that are forthcoming or in process.

The annual review will be conducted each year on the PLCB fiscal year which runs from July 1- June 30. The first annual review will be held after Phase 3 begins. After completion of the initial four-year rate lock, such review will become the basis for annual renegotiation of case rates and/or establishment of additional accessorial charges.

D. Phase 4: Wind Down. Prior to the expiration or termination date of the Contract, the selected Offeror shall be required to wind down its contracted operations, potentially transitioning warehousing and transportation services to another 3PL. During the wind- down period, the selected Offeror shall fully cooperate with the PLCB and any of its contractors to assure the successful transition from the selected Offeror’s service to the services of any other contractor the PLCB may engage. The PLCB will make every attempt to notify the selected Offeror with sufficient advance notice of the commencement of the wind-down period.

Deliverable 4.1 – Upon notification by the PLCB of the wind-down period, the selected Offeror shall participate as needed in development of a plan for transitioning warehousing and delivery services. Such plan must be approved in writing and accepted as complete by the PLCB.

Deliverable 4.2 – The selected Offeror may be required to provide electronic and/or paper copies of relevant data and reports to the PLCB prior to, during and at the conclusion of any transition period. Provision of such data must be approved in writing and accepted as complete by the PLCB.

III-4. Reporting. Periodic meetings will be held throughout the duration of the Contract term to address operational performance, improvement opportunities and suggestions for process changes. Other, yet to be defined, tracking tools may be developed jointly with the PLCB.

During Phase 1, and any other large-scale project undertaken by the parties not yet contemplated by this RFP, there will be frequent meetings/conference calls to address any issues to help understand and correct problems. The selected Offeror will prepare progress reports detailing the progress against the project milestones, key upcoming activities, issues identified and resolved, and issues identified and still unresolved.

Generally, beginning in Phase 2, the selected Offeror shall track and report the information as required by Appendix L- Warehouse Management System Requirements and Appendix M, Required Reports and Documents.

A. Risk and Issue Reporting– During Phases 1 and 2, the selected Offeror’s Project Manager must submit to the PLCB, at least weekly or as otherwise required, a problem identification report detailing requirements, design and development issues, staffing problems and other issues that may materially impact the project scope, schedule and work products. The Issue Report must include: 1. A description of the issue; 2. Resource(s) assigned to resolve the issue; 3. A categorization of the issue (such as technical, procurement, resources, training or communications); 4. An analysis of the likely causes of the issue; 5. Proposed solution(s); and 6. An assessment of the issue’s impact on the schedule and completed work products and services.

III-5. Qualifications.

A. Company Overview. Include the date your company was founded, principal ownership, scope of operations, and general data regarding your company. Also note any special expertise that would enhance your company’s qualifications as a 3PL provider, such as membership in professional organizations and/or certifications, etc. List any current contracts that may present a conflict of interest. An organizational chart should be included that identifies the number of executive and professional personnel who will be engaged in the work.

B. Prior Experience. Include specific organizational 3PL operating experience with emphasis on warehousing, handling, delivering, receiving and securing beverage alcohol and/or other high value or high velocity commodities, such as grocery merchandise. Identify the size of any facility(ies) operated in support of such operations, along with volumes and types of commodities handled. In addition to operational experience, illustrate experience related to the setup and/or transition of business from one 3PL provider to another.

Experience identified in response to the RFP should be work done by individuals who will be assigned to this Project as well as that of your company. Prior projects must be identified by name of customer/client, including address and telephone number of the responsible customer/client official who may be contacted by the PLCB.

C. Personnel. Include the minimum qualifications and expected skill set of the professional personnel (notably, the project manager and the operations manager) who will be engaged in the work. If any key personnel can be identified at the time of response to this RFP, include the resumes of such personnel with evidence of education and experience in providing 3PL services.

D. Subcontractors: Provide a subcontracting plan for all subcontractors, including small diverse business and small business subcontractors, who will be assigned to the Project. The selected Offeror is prohibited from subcontracting or outsourcing any part of this Project without the express written approval from the PLCB. Unless otherwise notified by the PLCB during contract negotiations, upon award of the contract resulting from this RFP, subcontractors included in the proposal submission are deemed approved. For each entity/role included in your subcontracting plan provide: 1. Name of subcontractor; 2. Address of subcontractor; 3. Number of years worked with the subcontractor; 4. Number of employees by job category to work on this project; 5. Description of services to be performed; 6. What percentage of time the staff will be dedicated to this project; 7. Geographical location of staff; and 8. Resumes (if appropriate and available).

III-6. Training. Describe any specialized training program for key personnel. If applicable, detail any training program that will be required for PLCB personnel in order to interact with systems or technology included in your proposal.

III-7. Financial Capability. Describe your company’s financial stability and economic capability to perform the contract requirements. Provide your company’s financial statements (audited, if available) for the past three fiscal years. Financial statements must include: A. the company’s Balance Sheet; B. Income Statement or Profit/Loss Statements; C. a Dun & Bradstreet comprehensive report, if available; and D. applicable financial records if your company is a publicly traded company.

The PLCB reserves the right to request additional information it deems necessary to evaluate an Offeror’s financial capability.

III-8. Objections and Additions to Contract Terms and Conditions. The Offeror should identify which, if any, of the Contract terms and conditions (contained in Part VI) it would like to negotiate and what additional terms and conditions the Offeror would like to add to the Contract. The Offeror’s failure to make a submission under this paragraph will result in its waiving its right to do so later, but the PLCB may consider late objections and requests for additions if to do so, in the PLCB’s sole discretion, would be in the best interest of the Commonwealth.

The PLCB may, in its sole discretion, accept or reject any requested changes to the Contract as posted in Part VI of this RFP. The Offeror shall not request changes to the other provisions of the RFP, nor shall the Offeror request to completely substitute its own terms and conditions for Part VI. All terms and conditions must appear in one integrated contract. The PLCB will not accept references to the Offeror’s, or any other, online guides or online terms and conditions contained in any proposal.

Regardless of any objections set out in its proposal, the Offeror must submit its proposal, including the cost proposal, on the basis of the terms and conditions set out in Part VI. The Issuing Office will reject any proposal that is conditioned on the negotiation of the terms and conditions set out in Part VI or in any other provision of the RFP.

PART IV

COST SUBMITTAL

IV-1. Cost Submittal. The information requested in this Part IV shall constitute the Cost Submittal. The Cost Submittal shall be placed in a separate sealed envelope within the sealed proposal, separated from the Technical Submittal. The total proposed cost should be broken down into the components set forth in Appendix E – Cost Submittal Worksheet. The percentage of commitment to Small Diverse Businesses and Small Businesses should not be stated in the Cost Submittal. Offerors should not include any assumptions in their cost submittals outside the instructions provided within the cost submittal worksheet. If the Offeror includes assumptions in its cost submittal, the Issuing Office may reject the proposal. Offerors should direct in writing to the Issuing Office pursuant to Part I-8 of this RFP any questions about whether a cost or other component is included or applies. All Offerors will then have the benefit of the Issuing Office’s written answer so that all proposals are submitted on the same basis.

IV-2. Reimbursement. The Issuing Office will reimburse the Selected Offeror for work satisfactorily performed after execution of a written contract and the start of the Contract term, in accordance with Contract requirements, and only after the Issuing Office has issued a Notice to Proceed.

IV-3. Invoicing. All services and costs identified above and performed in support of this Contract must be invoiced directly to the assigned PLCB point of contact monthly in arrears. Invoices to the PLCB may only reflect charges as agreed to in the contract unless otherwise approved by the PLCB by a written Change Order or Contract Amendment.

Any questions or problems related to invoicing, bill payment, debits/credits to invoices, or other monetary related topics identified by the Selected Offeror during the duration of the Contract term should be addressed directly to the PLCB point of contact.

IV-4. Supplier Registration. The Selected Offeror will be required to register with PLCB’s Supplier Unit and have their information entered into PLCB’s Oracle systems database. This registration must be completed before a contract can be fully executed and approved. To obtain this supplier number, the Supplier Registration Form PLCB-2348 will need to be completed on the form located at the following link:

https://www.lcb.pa.gov/JoinOurTeam/Pages/Contract-Opportunities.aspx

IV-5. iSupplier Portal. After supplier registration of the Selected Offeror is completed by the PLCB, access to the iSupplier Portal will be automatically granted with the ability to view purchase orders, invoices and payments online. An auto-generated email will be sent from the PLCB’s Supplier Unit granting administrator rights with logon credentials and further instructions. It is the supplier’s responsibility to ensure that the supplier information contained in the Oracle system is accurate and complete and keep the PLCB updated with

any data changes, including bank data. Failure to notify the PLCB of any changes to supplier information may result in delayed payments.

IV-6. State Tax Liability/Debt Obligation. The Commonwealth may set-off the amount of any state tax liability or other debt or obligation of the Selected Offeror or its subsidiaries that is owed to the Commonwealth and is not being contested on appeal against any payments due the Selected Offeror under the resulting Contract or any other contract with the Commonwealth.

PART V

SMALL DIVERSE BUSINESS AND SMALL BUSINESS PARTICIPATION SUBMITTAL

V-1. Small Diverse Business and Small Business General Information. The Issuing Office encourages participation by Small Diverse Businesses and Small Businesses as prime contractors and encourages all prime contractors to make significant commitments to use Small Diverse Businesses and Small Businesses as subcontractors and suppliers.

For credit in the RFP scoring process, a Small Diverse Business must complete the DGS verification process; a Small Business must complete the DGS/BDISBO self-certification process. Information on these processes and forms can be found here.

A Small Business must meet each of the following requirements:

• The business must be a for-profit, United States business; • The business must be independently owned; • The business may not be dominant in its field of operation; • The business may not employ more than 100 full-time or full-time equivalent employees; • The business, by type, may not exceed the following three-year average gross sales: o Procurement Goods and Services: $20 million o Construction: $20 million o Building Design Services: $7 million o Information Technology Goods and Services: $25 million

A Small Diverse Business is a DGS-verified minority-owned small business, woman- owned small business, veteran-owned small business, service-disabled veteran-owned small business, LGBT-owned small business, Disability-owned small business, or other small businesses as approved by DGS, that are owned and controlled by a majority of persons, not limited to members of minority groups, who have been deprived of the opportunity to develop and maintain a competitive position in the economy because of social disadvantages.

An Offeror that qualifies as a Small Diverse Business or a Small Business and submits a proposal as a prime contractor is not prohibited from being included as a subcontractor in separate proposals submitted by other Offerors.

A Small Diverse Business or Small Business may be included as a subcontractor with as many prime contractors as it chooses in separate proposals.

The Department’s directory of self-certified Small Businesses and DGS/BDISBO-verified Small Diverse Businesses can be accessed from: http://www.dgs.internet.state.pa.us/suppliersearch

Questions regarding the Small Diverse Business and Small Business Programs, including questions about the self-certification and verification processes can be directed to:

Department of General Services Bureau of Diversity, Inclusion and Small Business Opportunities (BDISBO) Room 601, North Office Building Harrisburg, PA 17125 Phone: (717) 783-3119 Fax: (717) 787-7052 Email: [email protected] Website: www.dgs.pa.gov

V-2. Small Diverse Business and Small Business (SDB/SB) Participation Submittal. All Offerors are required to submit the Small Diverse Business and Small Business Participation Submittal Form and related Letter(s) of Intent provided in Appendix F and as described in Part I, Section I-11. To receive points for Small Diverse Business or Small Business participation commitments, the Small Diverse Business or Small Business must be listed in the Department’s directory of self-certified Small Businesses and DGS/BDISBO- verified Small Diverse Businesses as of the proposal due date and time. BDISBO reserves the right to adjust overall Small Diverse Business or Small Business commitments to correctly align with the Small Diverse Business or Small Business status of a prime contractor or subcontractor as of the solicitation due date and time, and also to reflect the correct sum of individual subcontracting commitments listed within the Letters of Intent.

A. Offerors must indicate their status as a Small Diverse Business and as a Small Business through selection of the appropriate checkboxes.

B. Offerors must include a numerical percentage which represents the total percentage of the total cost in the Cost Submittal that the Offeror commits to paying to Small Diverse Businesses and Small Businesses as subcontractors.

C. Offerors must include a listing of and required information for each of the Small Diverse Businesses and/or Small Businesses with whom they will subcontract to achieve the participation percentages outlined on the Small Diverse Business and Small Business Participation Submittal.

D. Offerors must include a Letter of Intent signed by both the Offeror and the Small Diverse Business or Small Business for each of the Small Diverse Businesses and Small Businesses identified in the Small Diverse Business and Small Business Participation Submittal form. At minimum, the Letter of Intent must include the following:

1. The fixed numerical percentage commitment and associated estimated dollar value of the commitment made to the Small Diverse Business or Small Business; and

2. A description of the services or supplies the Small Diverse Business or Small Business will provide; and

3. The timeframe during the initial contract term and any extensions, options and renewals when the Small Diverse Business or Small Business will perform or provide the services and/or supplies; and

4. The name and telephone number of the Offeror’s point of contact for Small Diverse Business and Small Business participation; and

5. The name, address, and telephone number of the primary contact person for the Small Diverse Business or Small Business.

E. Each Small Diverse Business and Small Business commitment which is credited by BDISBO along with the overall percentage of Small Diverse Business and Small Business commitments will become contractual obligations of the selected Offeror.

NOTE: Offerors will not receive credit for any commitments for which information as above is not included in the Small Diverse Business and Small Business Participation Submittal. Offerors will not receive credit for stating that after the contract is awarded they will find a Small Diverse Business or Small Business.

NOTE: Equal employment opportunity and contract compliance statements referring to company equal employment opportunity policies or past contract compliance practices do not constitute proof of Small Diverse Business and/or Small Business Status or entitle an Offeror to receive credit for Small Diverse Business or Small Business participation.

V-3. Contract Requirements—Small Diverse Business and Small Business Participation. All contracts containing Small Diverse Business and Small Business Participation must contain the following contract provisions to be maintained through the initial contract term and any subsequent options or renewals:

A. Each Small Diverse Business and Small Business commitment which was credited by BDISBO and the total percentage of such Small Diverse Business and Small Business commitments made at the time of proposal submittal, BAFO or contract negotiations, as applicable, become contractual obligations of the selected Offeror upon execution of its contract with the Commonwealth.

B. All Small Diverse Business and Small Business subcontractors credited by BDISBO must perform at least 50% of the work subcontracted to them.

C. The individual percentage commitments made to Small Diverse Businesses and Small Businesses cannot be altered without written approval from BDISBO.

D. Small Diverse Business and Small Business commitments must be maintained in the event the contract is assigned to another prime contractor.

E. The selected Offeror and each Small Diverse Business and Small Business for which a commitment was credited by BDISBO must submit a final, definitive subcontract agreement signed by the selected Offeror and the Small Diverse Business and/or Small Business to BDISBO within 30 days of the final execution date of the Commonwealth contract. A Model Subcontract Agreement which may be used to satisfy this requirement – Model Form of Small Diverse and Small Business Subcontract Agreement – is provided in Appendix G.

The subcontract must contain:

1. The specific work, supplies or services the Small Diverse Business and/or Small Business will perform; location for work performed; how the work, supplies or services relate to the project; and the specific timeframe during the initial term and any extensions, options and renewals of the prime contract when the work, supplies or services will be provided or performed.

2. The fixed percentage commitment and associated estimated dollar value that each Small Diverse Business and/or Small Business will receive based on the final negotiated cost for the initial term of the prime contract.

3. Payment terms indicating that the Small Diverse Business and/or Small Business will be paid for work satisfactorily completed within 14 days of the selected Offeror’s receipt of payment from the Commonwealth for such work.

4. Commercially reasonable terms for the applicable business/industry that are no less favorable than the terms of the selected Offeror’s contract with the Commonwealth and that do not place disproportionate risk on the Small Diverse Business and/or Small Business relative to the nature and level of the Small Diverse Business’ and/or Small Business’ participation in the project.

F. If the selected Offeror and a Small Diverse Business or Small Business credited by BDISBO cannot agree upon a definitive subcontract within 30 days of the final execution date of the Commonwealth contract, the selected Offeror must notify BDISBO.

G. The Selected Offeror shall complete the Prime Contractor’s Quarterly Utilization Report and submit it to the contracting officer of the Issuing Office and BDISBO within ten (10) business days at the end of each quarter of the contract term and any subsequent options or renewals. This information will be used to track and confirm the actual dollar amount paid to Small Diverse Business and Small Business subcontractors and suppliers and will serve as a record of fulfillment of the contractual commitment. If there was no activity during the quarter, the form must be completed by stating “No activity in this quarter.” A late fee of $100.00 per day may be assessed against the Selected Offeror if the Utilization Report is not submitted in accordance with the schedule above.

H. The Selected Offeror shall notify the Contracting Officer of the Issuing Office and BDISBO when circumstances arise that may negatively impact the selected Offeror’s ability to comply with Small Diverse Business and/or Small Business commitments and to provide a corrective action plan. Disputes will be decided by the Issuing Office and DGS.

I. If the Selected Offeror fails to satisfy its Small Diverse Business and/or Small Business commitment(s), it may be subject to a range of sanctions BDISBO deems appropriate. Such sanctions include, but are not limited to, one or more of the following: a determination that the selected Offeror is not responsible under the Contractor Responsibility Program; withholding of payments; suspension or termination of the contract together with consequential damages; revocation of the selected Offeror’s Small Diverse Business status and/or Small Business status; and/or suspension or debarment from future contracting opportunities with the Commonwealth.

PART VI

CONTRACT FOR WAREHOUSING AND TRANSPORTATION SERVICES

This Contract for Warehousing and Transportation Services (“Contract”) is made and entered into as of ______, 2022 by and between the Pennsylvania Liquor Control Board (“PLCB” or “Customer”), with offices located at 901 Capital Street, Harrisburg, Pennsylvania 17124, and SELECTED OFFEROR (“Contractor”) (each, a “Party” and collectively, the “Parties”).

WHEREAS, PLCB issued RFP#20191104 for Warehousing and Transportation Services in Western Pennsylvania on April 30, 2020 (“RFP”);

WHEREAS, Contractor provides, among other service offerings, warehousing, managed transportation, transportation, and inventory management services;

WHEREAS, PLCB has selected Contractor to be awarded this Contract pursuant to the RFP. The PLCB desires to engage Contractor, and Contractor agrees to perform the services described herein pursuant to the terms and conditions of this Contract.

THEREFORE, in consideration of the covenants and agreements set forth below, Customer and Contractor (herein each a “Party” or collectively the “Parties”), intending to be legally bound, agree as follows:

1. SCOPE OF SERVICES During the term of this Contract, Contractor agrees to provide the Services as set forth in the Appendices attached hereto (collectively, the “Services”) and as described in the RFP. The Appendices to this Contract are as follows:

a. Operational/Service Requirements b. Key Performance Indicators and Service Levels c. Western Pennsylvania Service Region d. Facility Requirements e. WMS Requirements f. Required Reports and Documents g. Bailment Program h. Equipment Detail

The RFP and the Contractor’s Response to the RFP, including the Cost Submittal, are incorporated into this Contract by reference and made a material part thereof. In the event a conflict exists, the order of precedence shall be as follows: This Contract, including the above-referenced appendices; the Contractor’s Cost Submittal; the RFP; and the Contractor’s Technical Submittal to the RFP.

From time to time, the PLCB may request that Contractor provide additional, alternative, or modified Services that will be defined more specifically at the time of request. To the extent additional terms are needed to perform such services, the Parties will use best efforts to define 33 those terms and document them in a Change Order or via an Amendment to this Contract, as necessary.

The PLCB reserves the right to purchase materials and services covered under the Contract through a separate procurement procedure, whenever the PLCB deems it to be in its best interest.

2. TERM OF CONTRACT

The initial term of this Contract shall commence on the Effective Date (as defined below) and continue for twelve years. The Effective Date shall be after the Contract has been fully executed by the Contractor and by the Commonwealth and all approvals required by Commonwealth contracting procedures have been obtained. The Contract shall not be a legally binding contract until after Contractor is issued a Notice to Proceed directing the Contractor to start performance on a date which is on or after the Effective Date. The Contractor shall not start the performance of any work prior to the date set forth in the Notice to Proceed and the Board shall not be liable to pay the Contractor for any service or work performed or expenses incurred before the date set forth in the Notice to Proceed. No PLCB employee has the authority to verbally direct the commencement of any work under this Contract.

3. EXTENSION OF CONTRACT TERM

The PLCB and the Contractor may mutually agree to extend the initial term in single- or multiple- year increments, for up to an additional eight years beyond the initial term.

4. DEFINITIONS

As used in this Contract, these words shall have the following meanings unless otherwise defined in the RFP or Appendices: a. Agency: the Pennsylvania Liquor Control Board (“PLCB”). b. Amendment: amendments are issued for any change to the terms, conditions, requirements, or costs of the Contract and require the signatures of the Contractor and the same Commonwealth officials as the Contract. c. Change Order: change orders are notices of a change which one or both Parties have the option to change under the Contract. They can also be used as a notification of a correction. d. Commonwealth: refers collectively to the government of the Commonwealth of Pennsylvania as a whole, inclusive of the PLCB. e. Contracting Officer: the person authorized to administer this Contract for the PLCB and to make written determinations with respect to the Contract.

f. Contractor: the Offeror selected by the PLCB pursuant to RFP# 20191104.

g. Days: unless specifically indicated otherwise, days mean calendar days.

h. Deliverable: a required Deliverable as set forth in RFP# 20191104.

i. Documentation: all materials required to support and convey information about the services required by this Contract. Documentation includes, but is not necessarily restricted to, written reports and analyses, diagrams, maps, logical and physical designs, system designs, computer programs, flow charts, disks, and/or other machine-readable storage media.

j. Facility: the distribution center from which the Services will be provided, located at [SITE ADDRESS]. The Facility may also be referred to in this Contract or any Appendix as the DC.

k. KPI: Key Performance Indicators as set forth in the Key Performance Indicators and Service Levels Appendix

l. Phase: Phases 1 through 4, either individually or collectively, as described in more detail in Part III-3 of the RFP.

m. PLCB Point of Contact: a designated PLCB employee that is responsible for all administrative matters related to this Contract, including but not limited to receipt of invoices. n. PLCB Project Manager: the designated PLCB employee that will be responsible for making management level decisions related to major projects. o. Selected Offeror: the Contractor. p. Services: all Contractor activity necessary to satisfy the Contract. q. WMS: the Warehouse Management System

5. INDEPENDENT PRIME CONTRACTOR

In performing its obligations under the Contract, the Contractor will act as an independent contractor and not as an employee or agent of the Commonwealth. The Contractor will be responsible for all services in this Contract whether or not Contractor provides them directly. Further, the Contractor is the sole point of contact with regard to all contractual matters, including payment of any and all charges resulting from the Contract.

6. WARRANTY

35 a. Contractor warrants that it will comply with applicable laws, rules, regulations of governmental authorities in performing Services. b. Contractor also warrants that all employees performing the Services shall have the necessary training, experience and skills required to perform the Services and the responsibilities of the position to which such employees are assigned.

7. OWNERSHIP RIGHTS

Contractor shall provide, dedicate, purchase or lease the equipment, software systems, Facility, and any related items required to deliver the Services. Contractor shall at all times be considered the owner or lessee of the equipment and the Facility and be responsible for the maintenance thereof.

8. COMPLIANCE WITH LAW

The Contractor shall comply with all applicable federal and state laws and regulations and local ordinances in the performance of the Contract.

9. ENVIRONMENTAL PROVISIONS

In the performance of the Contract, the Contractor shall minimize pollution and shall strictly comply with all applicable environmental laws and regulations, including, but not limited to, the Clean Streams Law Act of June 22, 1937 (P.L. 1987, No. 394), as amended 35 P.S. § 691.601 et seq.; the Pennsylvania Solid Waste Management Act, Act of July 7, 1980 (P.L. 380, No. 97), as amended, 35 P.S. § 6018.101 et seq.; and the Dam Safety and Encroachment Act, Act of November 26, 1978 (P.L. 1375, No. 325), as amended, 32 P.S. § 693.1.

10. COMPENSATION

The Contractor will be compensated at the rates set forth in the Contractor’s Cost Submittal. The Contractor shall be compensated only for work performed to the standards set forth in Appendix P- Key Performance Indicators and Service Levels and paragraph 13 below.

The rates offered by the Contractor shall be fixed for a period of four years beginning in Phase 2 with the first receipt of goods into the DC, which is expected to be on or before January 18, 2022. Thereafter, Contractor will be compensated at a rate mutually agreed to by the Parties based on the annual review required by Deliverable 3.2. It is understood and agreed that the quantities listed in the Contract are estimates based on PLCB’s historical data and may vary in accordance with the actual requirements of the PLCB.

11. BILLING REQUIREMENTS

The Contractor shall include in all of its invoices the following minimum information: a. Vendor name and "Remit to" address, including Oracle supplier number; b. Ship To Address, including name of PLCB location; c. Description of the supplies/services delivered; d. Quantity provided; e. Unit price; f. Price extension; g. Total price; and h. Date of services. i. Line item charges to include:

1) Receiving (unloading, sorting, putaway) 2) Storing (physical storage, building, rack) 3) Full-case outbound order processing (including returns to vendors) 4) Reconditioning 5) Shipping/Delivery 6) Case labeling 7) Exterior case inspection 8) Interior case inspection 9) Returns to Warehouse

If an invoice does not contain the minimum information set forth in this paragraph, the PLCB may return the invoice as improper. If the PLCB returns an invoice as improper, the time for processing a payment will be suspended until the PLCB receives a correct invoice. The Contractor may not receive payment until the PLCB has received a correct invoice.

In no instance shall any payment be made for services to the Contractor that are not in accordance with the contracted prices.

12. PAYMENT a. The PLCB shall put forth reasonable efforts to make payment of undisputed amounts billed, less applicable credits, within 45 days of receipt of a proper invoice. A “proper” invoice is not received until the PLCB accepts the service as satisfactorily performed.

Payment may be delayed if the payment amount on an invoice is not based upon the price(s) as stated in the Contract. If any payment is not made within 15 days after the required payment date, the PLCB may pay interest as determined by the Secretary of Budget in accordance with Act No. 266 of 1982 and regulations promulgated pursuant thereto. b. The PLCB will make contract payments through Automated Clearing House (ACH).

1) Within 10 days of award of the contract the Contractor must submit or must have already submitted their ACH information within their user profile in the PLCB’s procurement system (Oracle).

2) The Contractor must submit a unique invoice number with each invoice submitted. The unique invoice number will be listed on the PLCB’s ACH remittance advice to enable the Contractor to properly apply the state agency’s payment to the invoice submitted.

3) It is the responsibility of the Contractor to ensure that the ACH information contained in Oracle is accurate and complete. Failure to maintain accurate and complete information may result in delays in payments.

13. CREDIT MEMOS, OFFSETS, AND FEES

In addition to the remedies set forth in this paragraph 13, the PLCB reserves all rights under the terms of this Contract and in accordance with applicable law to impose other remedies, including but not limited to triggering the default provisions in this Contract, should Contractor exhibit a pattern of unexcused inadequate, improper and/or untimely performance. a. Credit Memos

1) If the average of the Contractor’s daily performance over a 30-day rolling consecutive period fails to meet the associated service level as indicated on the Key Performance Indicator and Service Level Appendix, the PLCB may, as liquidated damages, issue and apply a credit memo against the next monthly invoice.

2) If the aggregate of the Offeror’s daily performance over each calendar month evaluation period fails to meet the associated service level for each KPI, the PLCB may issue and apply escalating liquidated damages in the form of a credit memo against the next monthly invoice in the amounts set forth in the Key Performance Indicator and Service Level Appendix.

3) Contractor is liable and financially responsible for the non-promotional retail value of all product damaged or lost while in its control, including but not limited to damage resulting from lack of appropriate temperature controls and/or shrinkage. The PLCB may offset such actual damages from Selected Offeror’s invoices via credit memo as damage or loss is identified.

38 b. Offsets and Fees

1) Should Contractor fail to timely complete labeling services (within two days) or product reconditioning (within one week), the PLCB may, as liquidated damages and not as a penalty, decrement the amount it pays Contractor by a percentage of the established case rate for such work per day that the work remains unfinished beyond established timeframes. Such percentage is set forth in the Key Performance Indicator and Service Level Appendix. Should Contractor fail to complete labelling or product reconditioning services before rate decrementation results in zero payment per case, the PLCB may assess an administrative fee for such delinquent and untimely service.

2) The Commonwealth reserves the right to set-off the amount of any liability or other debt or obligation of the Contractor or its subsidiaries that is owed to the PLCB and is not being contested on appeal against any payments due the Contractor under this Contract or any other contract with the Commonwealth.

14. TAXES

The Contractor will be responsible for the payment of any applicable taxes, licenses, charges and assessments imposed by any governmental authority upon the Contractor in relation to the performance of the Services. This includes, but is not limited to, local property taxes, municipal fees, licensing fees, and all taxes related to the employment of personnel required to perform the Services.

The Commonwealth may set-off the amount of any state tax liability or other debt or obligation of the Contractor or its subsidiaries that is owed to the Commonwealth and is not being contested on appeal against any payments due the Contractor under this Contract or any other contract with the Commonwealth.

15. ASSIGNMENT OF ANTITRUST CLAIMS

The Contractor and the PLCB recognize that in actual economic practice, overcharges by the Contractor’s suppliers resulting from violations of state or federal antitrust laws are in fact borne by the PLCB. As part of the consideration for the award of the Contract, and intending to be legally bound, the Contractor assigns to the PLCB all right, title and interest in and to any claims the Contractor now has, or may acquire, under state or federal antitrust laws relating to the products and services which are the subject of this Contract.

16. HOLD HARMLESS PROVISION a. The Contractor shall hold the PLCB harmless from and indemnify the PLCB against any and all third-party claims, demands and actions based upon or arising out of any activities performed by the Contractor and its employees and agents under this Contract, provided

the PLCB gives Contractor prompt notice of any such claim of which it learns. Pursuant to the Commonwealth Attorneys Act (71 P.S. Section 732-101, et seq.), the Office of Attorney General (OAG) has the sole authority to represent the Commonwealth in actions brought against the Commonwealth. The OAG may, however, in its sole discretion and under such terms as it deems appropriate, delegate its right of defense. If OAG delegates the defense to the Contractor, the Commonwealth will cooperate with all reasonable requests of Contractor made in the defense of such suits. b. Notwithstanding the above, neither party shall enter into any settlement without the other party's written consent, which shall not be unreasonably withheld nor unduly delayed. The PLCB may, in the discretion and at the direction of the OAG, allow the Contractor to control the defense and any related settlement negotiations.

17. AUDIT PROVISIONS

The PLCB shall have the right, at reasonable times and at a site designated by the PLCB, to audit the books, documents and records of the Contractor to the extent that the books, documents and records relate to costs or pricing data for the Contract. The Contractor agrees to maintain records which will support the prices charged and costs incurred for the Contract. The Contractor shall preserve books, documents, and records that relate to costs or pricing data for the Contract for a period of 3 years from date of final payment. The Contractor shall give full and free access to all records to the PLCB and/or their authorized representatives.

18. DEFAULT a. The PLCB may, subject to the Force Majeure provisions of this Contract, and in addition to its other rights under the Contract, declare the Contractor in default by written notice thereof to the Contractor, and terminate (as provided in the Termination Provisions of this Contract) the whole or any part of this Contract for any of the following reasons:

1) Failure to begin work within the time specified in the Contract or as otherwise specified to ensure timely progression through each Phase.

2) Failure to perform the work with sufficient labor, equipment, or material to insure the completion of the specified work in accordance with the Contract.

3) Continued unsatisfactory performance of the work in accordance with the Key Performance Indicators and Service Levels identified in Appendix P.

4) Discontinuance of work without approval and/or failure to resume discontinued work after notice to do so.

5) If the Contractor is adjudicated bankrupt, is determined to be insolvent, files a voluntary petition in bankruptcy, makes an assignment for the benefit of creditors or

seeks protection against creditors under any applicable federal or state laws, or if there is a commencement of any bankruptcy, insolvency, receivership or other similar proceeding against Contractor that is not dismissed within sixty days after such filing.

6) Breach of any material provision of the Contract, including failure to comply with representations made in the Contractor’s bid/proposal.

7) Failure to comply with applicable industry standards, customs, and practice. b. The PLCB will provide written notice to Contractor upon determining that the Contractor is in default pursuant to Subparagraph a above. The notice will include a description of the nature of the default and a reasonable cure period for Contractor to correct the default. Failure by Contractor to cure the default within the time period provided in any such notice may result in termination of this Contract pursuant to the Termination Provisions of paragraph 20. c. In the event that the PLCB terminates this Contract in whole or in part as provided in Subparagraph a. above, the PLCB may procure, upon such terms and in such manner as it determines, services similar or identical to those so terminated, and the Contractor shall be liable to the PLCB for any reasonable excess costs for such similar or identical services included within the terminated part of the Contract. These costs are in the nature of cover damages as set forth in 13 Pa.C.S.A. §§ 2711(a), 2712. d. The rights and remedies of the PLCB provided in this paragraph shall not be exclusive and are in addition to any other rights and remedies provided by law or under this Contract. e. The PLCB's failure to exercise any rights or remedies provided in this paragraph shall not be construed to be a waiver by the PLCB of its rights and remedies in regard to the event of default or any subsequent event of default. f. Following exhaustion of the Contractor's administrative remedies as set forth in the Contract Controversies Provision at paragraph 21 of this Contract, the Contractor's exclusive remedy shall be to seek damages in the Board of Claims.

19. FORCE MAJEURE

Neither party will incur any liability to the other if its performance of any obligation under this Contract is prevented or delayed by causes beyond its control and without the fault or negligence of either party. Causes beyond a party’s control may include, but are not limited to, acts of God or war, changes in controlling law, regulations, orders or the requirements of any governmental entity, severe weather conditions, civil disorders, natural disasters, fire, epidemics and quarantines, general strikes throughout the trade, and freight embargoes.

The Contractor shall notify the PLCB orally within 3 days and in writing within 7 days of the date on which the Contractor becomes aware, or should have reasonably become aware, that such cause would prevent or delay its performance. Such notification shall (i) describe fully such cause(s) and its effect on performance, (ii) state whether performance under the contract is prevented or delayed and (iii) if performance is delayed, state a reasonable estimate of the duration of the delay. The Contractor shall have the burden of proving that such cause(s) delayed or prevented its performance despite its diligent efforts to perform and shall produce such supporting documentation as the PLCB may reasonably request. After receipt of such notification, the PLCB may elect to cancel the Contract or to extend the time for performance as reasonably necessary to compensate for the Contractor’s delay.

In the event of a declared emergency by competent governmental authorities, the PLCB by notice to the Contractor, may: suspend all or a portion of the Contract, or request that the Contractor perform alternative or modified Services to mitigate the effects of the applicable Force Majeure event. In the event that such alternative Services are requested by the PLCB, the Parties will use best efforts to establish agreeable terms for the provision of such Services, which shall be documented in a written Change Order that is approved by both Parties.

20. TERMINATION PROVISIONS

The PLCB has the right to terminate this Contract for any of the following reasons. Termination shall be effective 90 days after written notice to the Contractor except in the event of egregious misconduct whereby such termination will be effective at the discretion of the PLCB. a. TERMINATION FOR CONVENIENCE: The PLCB shall have the right to terminate the Contract in whole or in part for its convenience if the PLCB determines termination to be in its best interest. The Contractor shall be paid for work satisfactorily completed prior to the effective date of the termination, but in no event shall the Contractor be entitled to recover loss of profits. b. NON-APPROPRIATION: The PLCB’s obligation to make payments during any Commonwealth fiscal year succeeding the current fiscal year shall be subject to availability and appropriation of funds. When funds (state and/or federal) are not appropriated or otherwise made available to support continuation of performance in a subsequent fiscal year period, the PLCB shall have the right to terminate the Contract. The Contractor shall be reimbursed for Services rendered, accepted and undisputed up to the date of termination. Such reimbursement shall not include loss of profit, loss of use of money, or administrative or overhead costs. The reimbursement amount may be paid from any appropriations available for that purpose c. TERMINATION FOR CAUSE: The PLCB shall have the right to terminate the Contract for Contractor default under the Default Clause upon written notice to the Contractor. The PLCB shall also have the right, upon written notice to the Contractor, to terminate the Contract for other cause as specified in the Contract or by law. If it is later determined that

the PLCB erred in terminating the Contract for cause, then, at the PLCB’s discretion, the Contract shall be deemed to have been terminated for convenience under Subparagraph a.

21. CONTRACT CONTROVERSIES a. In the event of a controversy or claim arising from the Contract, the Contractor must, within six months after the cause of action accrues, file a written claim with the Contracting Officer for a determination. The claim shall state all grounds upon which the Contractor asserts a controversy exists. If the Contractor fails to file a claim or files an untimely claim, the Contractor is deemed to have waived its right to assert a claim in any forum. At the time the claim is filed, or within 60 days thereafter, either party may request mediation through the Commonwealth Office of General Counsel Dispute Resolution Program. b. If the Contractor or the Contracting Officer requests mediation and the other party agrees, the Contracting Officer shall promptly make arrangements for mediation. Mediation shall be scheduled so as to not delay the issuance of the final determination beyond the required 120 days after receipt of the claim if mediation is unsuccessful. If mediation is not agreed to or if resolution is not reached through mediation, the Contracting Officer shall review timely-filed claims and issue a final determination, in writing, regarding the claim. The final determination shall be issued within 120 days of the receipt of the claim, unless extended by consent of the Contracting Officer and the Contractor. The Contracting Officer shall send his/her written determination to the Contractor. If the Contracting Cfficer fails to issue a final determination within the 120 days (unless extended by consent of the parties), the claim shall be deemed denied. The Contracting Officer's determination shall be the final order of the PLCB. c. Within 15 days of the mailing date of the determination denying a claim or within 135 days of filing a claim if, no extension is agreed to by the parties, whichever occurs first, the Contractor may file a statement of claim with the Commonwealth Board of Claims. Pending a final judicial resolution of a controversy or claim, the Contractor shall proceed diligently with the performance of the Contract in a manner consistent with the determination of the Contracting Officer and the PLCB shall compensate the Contractor for such continuous performance pursuant to the terms of the Contract.

22. ASSIGNABILITY AND SUBCONTRACTING a. Subject to the terms and conditions of this Paragraph, this Contract shall be binding upon the parties and their respective successors and assigns. b. The Contractor shall not subcontract with any person or entity to perform all or any part of the work to be performed under this Contract without the prior written consent of the Contracting Officer, which consent may be withheld at the sole and absolute discretion of the Contracting Officer.

43 c. The Contractor may not assign, in whole or in part, this Contract or its rights, duties, obligations, or responsibilities hereunder without the prior written consent of the Contracting Officer, which consent may be withheld at the sole and absolute discretion of the Contracting Officer. d. Notwithstanding the foregoing, the Contractor may, without the consent of the Contracting Officer, assign its rights to payment to be received under the Contract, provided that the Contractor provides written notice of such assignment to the Contracting Officer together with a written acknowledgement from the assignee that any such payments are subject to all of the terms and conditions of this Contract. e. For the purposes of this Contract, the term “assign” shall include, but shall not be limited to, the sale, gift, assignment, pledge, or other transfer of any ownership interest in the Contractor provided, however, that the term shall not apply to the sale or other transfer of stock of a publicly traded company. f. Any assignment consented to by the Contracting Officer shall be evidenced by a written assignment agreement executed by the Contractor and its assignee in which the assignee agrees to be legally bound by all of the terms and conditions of the Contract and to assume the duties, obligations, and responsibilities being assigned. g. A change of name by the Contractor, following which the Contractor’s federal identification number remains unchanged, shall not be considered to be an assignment hereunder. The Contractor shall give the Contracting Officer written notice of any such change of name.

23. OTHER CONTRACTORS

The PLCB may undertake or award other contracts for additional or related work, and the Contractor shall fully cooperate with other contractors and PLCB employees and coordinate its work with such additional work as may be required. The Contractor shall not commit or permit any act that will interfere with the performance of work by any other contractor or by PLCB employees. This paragraph shall be included in the contracts of all contractors with which this Contractor will be required to cooperate. The PLCB shall equitably enforce this paragraph as to all contractors to prevent the imposition of unreasonable burdens on any contractor.

24. NONDISCRIMINATION/SEXUAL HARASSMENT CLAUSE

The Contractor agrees: a. In the hiring of any employee(s) for the manufacture of supplies, performance of work, or any other activity required under the contract or any subcontract, the Contractor, each subcontractor, or any person acting on behalf of the Contractor or subcontractor shall not discriminate by reason of race, gender, creed, color, sexual orientation, gender identity or

expression, or in violation of the Pennsylvania Human Relations Act (PHRA) and applicable federal laws, against any citizen of this Commonwealth who is qualified and available to perform the work to which the employment relates.

b. Neither the Contractor nor any subcontractor nor any person on their behalf shall in any manner discriminate by reason of race, gender, creed, color, sexual orientation, gender identity or expression, or in violation of the PHRA and applicable federal laws, against or intimidate any employee involved in the manufacture of supplies, the performance of work, or any other activity required under the contract. c. Neither the Contractor nor any subcontractor nor any person on their behalf shall in any manner discriminate by reason of race, gender, creed, color, sexual orientation, gender identity or expression, or in violation of the PHRA and applicable federal laws, in the provision of services under the contract. d. Neither the Contractor nor any subcontractor nor any person on their behalf shall in any manner discriminate against employees by reason of participation in or decision to refrain from participating in labor activities protected under the Public Employee Relations Act, Pennsylvania Labor Relations Act or National Labor Relations Act, as applicable and to the extent determined by entities charged with such Acts’ enforcement, and shall comply with any provision of law establishing organizations as employees’ exclusive representatives.

e. The Contractor and each subcontractor shall establish and maintain a written nondiscrimination and sexual harassment policy and shall inform their employees in writing of the policy. The policy must contain a provision that sexual harassment will not be tolerated and employees who practice it will be disciplined. Posting this Nondiscrimination/Sexual Harassment Clause conspicuously in easily-accessible and well- lighted places customarily frequented by employees and at or near where the contracted services are performed shall satisfy this requirement for employees with an established work site.

f. The Contractor and each subcontractor shall not discriminate by reason of race, gender, creed, color, sexual orientation, gender identity or expression, or in violation of PHRA and applicable federal laws, against any subcontractor or supplier who is qualified to perform the work to which the contract relates.

g. The Contractor and each subcontractor represents that it is presently in compliance with and will maintain compliance with all applicable federal, state, and local laws, regulations and policies relating to nondiscrimination and sexual harassment. The Contractor and each subcontractor further represents that it has filed a Standard Form 100 Employer Information Report (“EEO-1”) with the U.S. Equal Employment Opportunity Commission (“EEOC”) and shall file an annual EEO-1 report with the EEOC as required for employers’ subject to Title VII of the Civil Rights Act of 1964, as amended, that have 100 or more employees and employers that have federal government contracts or first-tier subcontracts

and have 50 or more employees. The Contractor and each subcontractor shall, upon request and within the time periods requested by the Commonwealth, furnish all necessary employment documents and records, including EEO-1 reports, and permit access to their books, records, and accounts by the contracting agency and the Bureau of Diversity, Inclusion and Small Business Opportunities for purpose of ascertaining compliance with provisions of this Nondiscrimination/Sexual Harassment Clause. h. The Contractor shall include the provisions of this Nondiscrimination/Sexual Harassment Clause in every subcontract so that those provisions applicable to subcontractors will be binding upon each subcontractor. i. The Contractor’s and each subcontractor’s obligations pursuant to these provisions are ongoing from and after the effective date of the contract through the termination date thereof. Accordingly, the Contractor and each subcontractor shall have an obligation to inform the Commonwealth if, at any time during the term of the contract, it becomes aware of any actions or occurrences that would result in violation of these provisions. j. The Commonwealth may cancel or terminate the contract and all money due or to become due under the contract may be forfeited for a violation of the terms and conditions of this Nondiscrimination/Sexual Harassment Clause. In addition, the agency may proceed with debarment or suspension and may place the Contractor in the Contractor Responsibility File.

25. CONTRACTOR INTEGRITY PROVISIONS

It is essential that those who seek to contract with the Commonwealth of Pennsylvania (“Commonwealth”) observe high standards of honesty and integrity. They must conduct themselves in a manner that fosters public confidence in the integrity of the Commonwealth contracting and procurement process.

DEFINITIONS. For purposes of these Contractor Integrity Provisions, the following terms shall have the meanings found in this Section: a. “Affiliate” means two or more entities where (a) a parent entity owns more than 50% of the voting stock of each of the entities; or (b) a common shareholder or group of shareholders owns more than 50% of the voting stock of each of the entities; or (c) the entities have a common proprietor or general partner. b. “Consent” means written permission signed by a duly authorized officer or employee of the Commonwealth, provided that where the material facts have been disclosed, in writing, by prequalification, bid, proposal, or contractual terms, the Commonwealth shall be deemed to have consented by virtue of the execution of this contract.

c. “Contractor” means the individual or entity, that has entered into this contract with the Commonwealth.

d. “Contractor Related Parties” means any affiliates of the Contractor and the Contractor’s executive officers, Pennsylvania officers and directors, or owners of 5% or more interest in the Contractor. e. “Financial Interest” means either:

(1) Ownership of more than a 5% interest in any business; or

(2) Holding a position as an officer, director, trustee, partner, employee, or holding any position of management.

f. “Gratuity” means tendering, giving, or providing anything of more than nominal monetary value including, but not limited to, cash, travel, entertainment, gifts, meals, lodging, loans, subscriptions, advances, deposits of money, services, employment, or contracts of any kind. The exceptions set forth in the Governor’s Code of Conduct, Executive Order 1980-18, the 4 Pa. Code §7.153(b), shall apply.

g. “Non-bid Basis” means a contract awarded or executed by the Commonwealth with Contractor without seeking bids or proposals from any other potential bidder or offeror.

In furtherance of this policy, Contractor agrees to the following:

a. Contractor shall maintain the highest standards of honesty and integrity during the performance of this contract and shall take no action in violation of state or federal laws or regulations or any other applicable laws or regulations, or other requirements applicable to Contractor or that govern contracting or procurement with the Commonwealth.

b. Contractor shall establish and implement a written business integrity policy, which includes, at a minimum, the requirements of these provisions as they relate to the Contractor activity with the Commonwealth and Commonwealth employees and which is made known to all Contractor employees. Posting these Contractor Integrity Provisions conspicuously in easily-accessible and well-lighted places customarily frequented by employees and at or near where the contract services are performed shall satisfy this requirement.

c. Contractor, its affiliates, agents, employees and anyone in privity with Contractor shall not accept, agree to give, offer, confer, or agree to confer or promise to confer, directly or indirectly, any gratuity or pecuniary benefit to any person, or to influence or attempt to influence any person in violation of any federal or state law, regulation, executive order of the Governor of Pennsylvania, statement of policy, management directive or any other

published standard of the Commonwealth in connection with performance of work under this contract, except as provided in this contract. d. Contractor shall not have a financial interest in any other contractor, subcontractor, or supplier providing services, labor, or material under this contract, unless the financial interest is disclosed to the Commonwealth in writing and the Commonwealth consents to Contractor’s financial interest prior to Commonwealth execution of the contract. Contractor shall disclose the financial interest to the Commonwealth at the time of bid or proposal submission, or if no bids or proposals are solicited, no later than Contractor’s submission of the contract signed by Contractor. e. Contractor certifies to the best of its knowledge and belief that within the last 5 years Contractor or Contractor Related Parties have not:

(1) been indicted or convicted of a crime involving moral turpitude or business honesty or integrity in any jurisdiction;

(2) been suspended, debarred or otherwise disqualified from entering into any contract with any governmental agency;

(3) had any business license or professional license suspended or revoked;

(4) had any sanction or finding of fact imposed as a result of a judicial or administrative proceeding related to fraud, extortion, bribery, bid rigging, embezzlement, misrepresentation or anti-trust; and

(5) been, and is not currently, the subject of a criminal investigation by any federal, state or local prosecuting or investigative agency and/or civil anti-trust investigation by any federal, state or local prosecuting or investigative agency.

If Contractor cannot so certify to the above, then it must submit along with its bid, proposal or contract a written explanation of why such certification cannot be made and the Commonwealth will determine whether a contract may be entered into with the Contractor. The Contractor’s obligation pursuant to this certification is ongoing from and after the effective date of the contract through the termination date thereof. Accordingly, the Contractor shall have an obligation to immediately notify the Commonwealth in writing if at any time during the term of the contract if becomes aware of any event which would cause the Contractor’s certification or explanation to change. Contractor acknowledges that the Commonwealth may, in its sole discretion, terminate the contract for cause if it learns that any of the certifications made herein are currently false due to intervening factual circumstances or were false or should have been known to be false when entering into the contract. f. Contractor shall comply with the requirements of the Lobbying Disclosure Act (65 Pa.C.S. §13A01 et seq.) regardless of the method of award. If this contract was awarded on a

Non-bid Basis, Contractor must also comply with the requirements of the Section 1641 of the Pennsylvania Election Code (25 P.S. §3260a). g. When Contractor has reason to believe that any breach of ethical standards as set forth in law, the Governor’s Code of Conduct, or these Contractor Integrity Provisions has occurred or may occur, including but not limited to contact by a Commonwealth officer or employee which, if acted upon, would violate such ethical standards, Contractor shall immediately notify the Commonwealth contracting officer or the Office of the State Inspector General in writing. h. Contractor, by submission of its bid or proposal and/or execution of this contract and by the submission of any bills, invoices or requests for payment pursuant to the contract, certifies and represents that it has not violated any of these Contractor Integrity Provisions in connection with the submission of the bid or proposal, during any contract negotiations or during the term of the contract, to include any extensions thereof. Contractor shall immediately notify the Commonwealth in writing of any actions for occurrences that would result in a violation of these Contractor Integrity Provisions. Contractor agrees to reimburse the Commonwealth for the reasonable costs of investigation incurred by the Office of the State Inspector General for investigations of the Contractor’s compliance with the terms of this or any other agreement between the Contractor and the Commonwealth that results in the suspension or debarment of the Contractor. Contractor shall not be responsible for investigative costs for investigations that do not result in the Contractor’s suspension or debarment. i. Contractor shall cooperate with the Office of the State Inspector General in its investigation of any alleged Commonwealth agency or employee breach of ethical standards and any alleged Contractor non-compliance with these Contractor Integrity Provisions. Contractor agrees to make identified Contractor employees available for interviews at reasonable times and places. Contractor, upon the inquiry or request of an Inspector General, shall provide, or if appropriate, make promptly available for inspection or copying, any information of any type or form deemed relevant by the Office of the State Inspector General to Contractor's integrity and compliance with these provisions. Such information may include, but shall not be limited to, Contractor's business or financial records, documents or files of any type or form that refer to or concern this contract. Contractor shall incorporate this paragraph in any agreement, contract or subcontract it enters into in the course of the performance of this contract/agreement solely for the purpose of obtaining subcontractor compliance with this provision. The incorporation of this provision in a subcontract shall not create privity of contract between the Commonwealth and any such subcontractor, and no third-party beneficiaries shall be created thereby. j. For violation of any of these Contractor Integrity Provisions, the Commonwealth may terminate this and any other contract with Contractor, claim liquidated damages in an amount equal to the value of anything received in breach of these Provisions, claim damages for all additional costs and expenses incurred in obtaining another contractor to complete performance under this contract, and debar and suspend Contractor from doing

business with the Commonwealth. These rights and remedies are cumulative, and the use or non-use of any one shall not preclude the use of all or any other. These rights and remedies are in addition to those the Commonwealth may have under law, statute, regulation, or otherwise.

26. CONTRACTOR RESPONSIBILITY PROVISIONS

For the purpose of these provisions, the term contractor is defined as any person, including, but not limited to, a bidder, offeror, loan recipient, grantee or lessor, who has furnished or performed or seeks to furnish or perform, goods, supplies, services, leased space, construction or other activity, under a contract, grant, lease, purchase order or reimbursement agreement with the Commonwealth. The term contractor includes a permittee, licensee, or any agency, political subdivision, instrumentality, public authority, or other public entity in the Commonwealth. a. The Contractor certifies, in writing, for itself and its subcontractors required to be disclosed or approved by the Commonwealth, that as of the date of its execution of this Bid/Contract, that neither the Contractor, nor any such subcontractors, are under suspension or debarment by the Commonwealth or any governmental entity, instrumentality, or authority and, if the Contractor cannot so certify, then it agrees to submit, along with its Bid/Contract, a written explanation of why such certification cannot be made. b. The Contractor also certifies, in writing, that as of the date of its execution of this Bid/Contract it has no tax liabilities or other Commonwealth obligations, or has filed a timely administrative or judicial appeal if such liabilities or obligations exist, or is subject to a duly approved deferred payment plan if such liabilities exist. c. The Contractor's obligations pursuant to these provisions are ongoing from and after the effective date of the Contract through the termination date thereof. Accordingly, the Contractor shall have an obligation to inform the Commonwealth if, at any time during the term of the Contract, it becomes delinquent in the payment of taxes, or other Commonwealth obligations, or if it or, to the best knowledge of the Contractor, any of its subcontractors are suspended or debarred by the Commonwealth, the federal government, or any other state or governmental entity. Such notification shall be made within 15 days of the date of suspension or debarment. d. The failure of the Contractor to notify the Commonwealth of its suspension or debarment by the Commonwealth, any other state, or the federal government shall constitute an event of default of the Contract with the Commonwealth. e. The Contractor agrees to reimburse the Commonwealth for the reasonable costs of investigation incurred by the Office of State Inspector General for investigations of the Contractor's compliance with the terms of this or any other agreement between the Contractor and the Commonwealth that results in the suspension or debarment of the contractor. Such costs shall include, but shall not be limited to, salaries of investigators, including overtime; travel and lodging expenses; and expert witness and documentary fees.

The Contractor shall not be responsible for investigative costs for investigations that do not result in the Contractor's suspension or debarment.

f. The Contractor may obtain a current list of suspended and debarred Commonwealth contractors by either searching the PA Department of General Services website or by contacting:

Department of General Services Office of Chief Counsel 603 North Office Building Harrisburg, PA 17125 Telephone No: (717) 783-6472 FAX No: (717) 787-9138

27. AMERICANS WITH DISABILITIES ACT a. Pursuant to federal regulations promulgated under the authority of The Americans With Disabilities Act, 28 C.F.R. § 35.101 et seq., the Contractor understands and agrees that it shall not cause any individual with a disability to be excluded from participation in this Contract or from activities provided for under this Contract on the basis of the disability. As a condition of accepting this contract, the Contractor agrees to comply with the “General Prohibitions Against Discrimination,” 28 C.F.R. § 35.130, and all other regulations promulgated under Title II of The Americans With Disabilities Act which are applicable to all benefits, services, programs, and activities provided by the Commonwealth of Pennsylvania through contracts with outside contractors. b. The Contractor shall be responsible for and agrees to indemnify and hold harmless the Commonwealth of Pennsylvania from all losses, damages, expenses, claims, demands, suits, and actions brought by any party against the Commonwealth of Pennsylvania as a result of the Contractor’s failure to comply with the provisions of subparagraph a above.

28. COVENANT AGAINST CONTINGENT FEES

The Contractor warrants that no person or selling agency has been employed or retained to solicit or secure the Contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee, except bona fide employees or bona fide established commercial or selling agencies maintained by the Contractor for the purpose of securing business. For breach or violation of this warranty, the Commonwealth shall have the right to terminate the Contract without liability or in its discretion to deduct from the Contract price or consideration, or otherwise recover the full amount of such commission, percentage, brokerage, or contingent fee.

29. APPLICABLE LAW

This Contract shall be governed by and interpreted and enforced in accordance with the laws of the Commonwealth of Pennsylvania (without regard to any conflict of law provisions) and the decisions of the Pennsylvania courts. The Contractor consents to the jurisdiction of any court of the Commonwealth of Pennsylvania and any federal courts in Pennsylvania, waiving any claim or defense that such forum is not convenient or proper. The Contractor agrees that any such court shall have in personam jurisdiction over it, and consents to service of process in any manner authorized by Pennsylvania law.

30. INTEGRATION

This Contract, including all referenced documents, constitutes the entire agreement between the parties. No agent, representative, employee or officer of either the Commonwealth or the Contractor has authority to make, or has made, any statement, agreement or representation, oral or written, in connection with the Contract, which in any way can be deemed to modify, add to or detract from, or otherwise change or alter its terms and conditions. No negotiations between the parties, nor any custom or usage, shall be permitted to modify or contradict any of the terms and conditions of the Contract. No modifications, alterations, changes, or waiver to the Contract or any of its terms shall be valid or binding unless accomplished by a written Change Order or Amendment signed by both parties.

31. CONTROLLING TERMS AND CONDITIONS

The terms and conditions of this Contract shall be the exclusive terms of agreement between the Contractor and the PLCB. Other terms and conditions or additional terms and conditions included or referenced in the Contractor's quotations, invoices, business forms, or other documentation shall not become part of the parties’ agreement and shall be disregarded by the parties, unenforceable by the Contractor and not binding on the PLCB.

32. CHANGE ORDERS AND AMENDMENTS

a. Change Orders: The PLCB reserves the right to make changes at any time during the term of the Contract or any renewals or extensions thereof: 1) to increase or decrease the quantities resulting from variations between any estimated quantities in the Contract and actual quantities; 2) to make changes to the services within the scope of the Contract; 3) to notify the Contractor that the PLCB is exercising any Contract renewal or extension option; or 4) to modify the time of performance, to extend the completion date beyond the Expiration Date of the Contract or any renewals or extensions thereof, as long as the scope of the Contract is not thereby altered. b. Amendments: An Amendment will be required when additional funds or terms increase the monetary value of the original approved amount of this Contract, unless it is appropriate to use a Change Order or funding adjustment. Extensions of this Contract beyond the term and any extension terms contemplated herein will require an Amendment. The PLCB reserves the right to require an Amendment for any change to this Contract in its sole discretion. 52

All changes to this Contract shall be initiated by the PLCB upon notification to the Contractor in writing. The change shall be effective as of the date indicated on the Change Order or Amendment, as applicable. Such increases, decreases, changes, or modifications will not invalidate the Contract, nor, if performance security is being furnished in conjunction with the Contract, release the security obligation. The Contractor agrees to provide the service in accordance with the Change Order or Amendment. Any dispute by the Contractor in regard to the performance required by any notification of change shall be handled through the Contract Controversies Provision.

33. CONFIDENTIALITY

The Contractor agrees to guard the confidentiality of the Commonwealth’s confidential information with the same diligence with which it guards its own proprietary information. If the Contractor needs to disclose all or part of project materials to third parties to assist in the work or service performed for the Commonwealth, it may do so only if such third parties sign agreements containing substantially the same provisions as contained in this Section. The Commonwealth agrees to protect the confidentiality of Contractor's confidential information.

In order for information to be deemed to be confidential, the party claiming confidentiality must designate the information as "confidential" in such a way as to give notice to the other party. The parties agree that such confidential information shall not be copied, in whole or in part, except when essential for authorized use under this Contract. Each copy of such confidential information shall be marked by the party making the copy with all confidentiality notices appearing in the original. Upon termination or cancellation of this Contract or any license granted hereunder, the receiving party will return to the disclosing party all copies of the confidential information in the receiving party's possession, other than one copy, which may be maintained for archival purposes only. Both parties agree that a material breach of these requirements may, after failure to cure within the time frame specified in this Contract, and at the discretion of the non-breaching party, result in termination for default. a. The obligations stated in this Section do not apply to information:

1) already known to the recipient at the time of disclosure other than through the contractual relationship;

2) independently generated by the recipient and not derived from the information supplied by the disclosing party;

3) known or available to the public, except where such knowledge or availability is the result of unauthorized disclosure by the recipient of the proprietary information;

4) disclosed to the recipient without a similar restriction by a third party who has the right to make such disclosure; or

5) required to be disclosed by the recipient by law, regulation, court order, or other legal process.

b. There shall be no restriction with respect to the use or disclosure of any ideas, concepts, know-how, or data processing techniques developed alone or jointly with the Commonwealth in connection with services provided to the Commonwealth under this Contract.

34. NOTICE

Any written notice to any party under this Contract shall be deemed sufficient if delivered personally, or by telecopy, electronic or digital transmission (provided such delivery is confirmed), or by a recognized overnight courier service (e.g., DHL, Federal Express, etc.) with confirmed receipt, or by certified or registered United States mail, postage prepaid, return receipt requested, and sent to following: a. If to the Contractor: [INSERT ADDRESS HERE] b. If to the PLCB:

PLCB Director of Supply Chain Operations 505 Northwest Office Building Harrisburg, Pennsylvania 17124

With a copy to:

PLCB Office of Chief Counsel 401 Northwest Office Building Harrisburg, Pennsylvania 17124 [email protected]

35. RIGHT TO KNOW LAW

a. The Pennsylvania Right-to-Know Law, 65 P.S. §§ 67.101-3104, (“RTKL”) applies to this Contract. For the purpose of these provisions, the term “the Commonwealth” shall refer to the contracting Commonwealth agency.

b. If the Commonwealth needs the Contractor’s assistance in any matter arising out of the RTKL related to this Contract, it shall notify the Contractor using the legal contact information provided in this Contract. The Contractor, at any time, may designate a different contact for such purpose upon reasonable prior written notice to the Commonwealth.

54 c. Upon written notification from the Commonwealth that it requires the Contractor’s assistance in responding to a request under the RTKL for information related to this Contract that may be in the Contractor’s possession, constituting, or alleged to constitute, a public record in accordance with the RTKL (“Requested Information”), the Contractor shall:

1) Provide the Commonwealth, within 10 calendar days after receipt of written notification, access to, and copies of, any document or information in the Contractor’s possession arising out of this Contract that the Commonwealth reasonably believes is Requested Information and may be a public record under the RTKL; and

2) Provide such other assistance as the Commonwealth may reasonably request, in order to comply with the RTKL with respect to this Contract. d. If the Contractor considers the Requested Information to include a request for a Trade Secret or Confidential Proprietary Information, as those terms are defined by the RTKL, or other information that the Contractor considers exempt from production under the RTKL, the Contractor must notify the Commonwealth and provide, within 7 calendar days of receiving the written notification, a written statement signed by a representative of the Contractor explaining why the requested material is exempt from public disclosure under the RTKL. e. The Commonwealth will rely upon the written statement from the Contractor in denying a RTKL request for the Requested Information unless the Commonwealth determines that the Requested Information is clearly not protected from disclosure under the RTKL. Should the Commonwealth determine that the Requested Information is clearly not exempt from disclosure, the Contractor shall provide the Requested Information within 5 business days of receipt of written notification of the Commonwealth’s determination. f. If the Contractor fails to provide the Requested Information within the time period required by these provisions, the Contractor shall indemnify and hold the Commonwealth harmless for any damages, penalties, costs, detriment or harm that the Commonwealth may incur as a result of the Contractor’s failure, including any statutory damages assessed against the Commonwealth. g. The Commonwealth will reimburse the Contractor for any costs associated with complying with these provisions only to the extent allowed under the fee schedule established by the Office of Open Records or as otherwise provided by the RTKL if the fee schedule is inapplicable. h. The Contractor may file a legal challenge to any Commonwealth decision to release a record to the public with the Office of Open Records, or in the Pennsylvania Courts, however, the Contractor shall indemnify the Commonwealth for any legal expenses incurred by the Commonwealth as a result of such a challenge and shall hold the Commonwealth harmless for any damages, penalties, costs, detriment or harm that the 55

Commonwealth may incur as a result of the Contractor’s failure, including any statutory damages assessed against the Commonwealth, regardless of the outcome of such legal challenge. As between the parties, the Contractor agrees to waive all rights or remedies that may be available to it as a result of the Commonwealth’s disclosure of Requested Information pursuant to the RTKL. i. The Contractor’s duties relating to the RTKL are continuing duties that survive the expiration of this Contract and shall continue as long as the Contractor has Requested Information in its possession.

36. ADVERSE INTEREST ACT AND LIQUOR CODE

The Contractor agrees to maintain compliance with the State Adverse Interest Act Sections 776.1 through 776.8 (71 P.S. Sections 776.1 – 776.8), and Liquor Code Sections 210 and 214 (47 P.S. §§ 2-210, 2-214).

37. SIGNATURES

The parties agree that: (1) a record or signature may not be denied legal effect or enforceability solely because it is in electronic form; (2) a contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation; (3) if a law requires a record to be in writing, an electronic record satisfies the law; and (4) if law requires a signature, an electronic signature satisfies the law.

The Parties to this Contract have executed it, through their respective duly authorized representatives.

[CONTRACTOR]: Pennsylvania Liquor Control Board:

Signature Date Signature Date

Printed Name Printed Name

Title Executive Director

APPROVED AS TO FORM AND LEGALITY:

______PLCB Office of Chief Counsel Office of Attorney General Date

APPROVED FOR FISCAL RESPONSIBILITY AND BUDGETARY APPROPRIATENESS:

Comptroller

APPENDIX A PROPOSAL COVER SHEET COMMONWEALTH OF PENNSYLVANIA PENNSYLVANIA LIQUOR CONTROL BOARD RFP #20191104

Enclosed in three separately sealed submittals is the proposal of the Offeror identified below for the above-referenced RFP:

Offeror Information: Offeror Name Offeror Mailing Address

Offeror Website Offeror Contact Person Contact Person’s Phone Number Contact Person’s Facsimile Number Contact Person’s E-Mail Address Offeror Federal ID Number Offeror SAP/SRM Vendor Number

Submittals Enclosed and Separately Sealed:

Technical Submittal Small Diverse Business Submittal Cost Submittal

Signature Signature of an official authorized to bind the Offeror to the provisions contained in the Offeror’s proposal: Printed Name

Title

FAILURE TO COMPLETE, SIGN AND RETURN THIS FORM WITH THE OFFEROR’S PROPOSAL MAY RESULT IN THE REJECTION OF THE OFFEROR’S PROPOSAL

APPENDIX A, PROPOSAL COVER SHEET: Page 1 of 1

APPENDIX B

CORPORATE SIGNATORY DELEGATION AUTHORIZATION

I, ______, of ______, City of ______, (Name) (Address)

County of ______, State of ______, certify that I am the

______of______, a corporation organized (Title/Capacity) (Name of Corporation)

under the laws of the State of______, having its principal office at

______, City of ______, County of ______, (Address)

State of ______; and that the following is a true and complete copy of a resolution duly

adopted by the Board of Directors of ______at a meeting held by (Name of Corporation)

them on _____ day of ______, 20____, at which a quorum was present; and that this resolution has not been altered, amended, repealed, rescinded or otherwise modified and that it is still in full

force and effect. RESOLVED THAT

______of ______, City of ______, (Name) (Address)

County of ______, State of ______is hereby authorized to execute contracts on behalf of the corporation.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the corporation this

______day of ______, 20______.

______(Signature of Certifying Official) (SEAL)

______(Typed or Printed Name)

______(Title)

APPENDIX B - CORPORATE SIGNATORY: Page 1 of 1

APPENDIX C IRAN FREE PROCUREMENT CERTIFICATION FORM

(Pennsylvania’s Procurement Code Sections 3501-3506, 62 Pa.C.S. §§ 3501-3506)

To be eligible for an award of a contract with a Commonwealth entity for goods or services worth at least $1,000,000 or more, a vendor must either: a) certify it is not on the current list of persons engaged in investment activities in Iran created by the Pennsylvania Department of General Services (“DGS”) pursuant to Section 3503 of the Procurement Code and is eligible to contract with the Commonwealth under Sections 3501-3506 of the Procurement Code; or b) demonstrate it has received an exception from the certification requirement for that solicitation or contract pursuant to Section 3503(e).

To comply with this requirement, please insert your vendor or financial institution name and complete one of the options below. Please note: Pennsylvania law establishes penalties for providing false certifications, including civil penalties equal to the greater of $250,000 or twice the amount of the contract for which the false certification was made; contract termination; and three-year ineligibility to bid on contracts. (Section 3503 of the Procurement Code.)

OPTION #1 - CERTIFICATION I, the official named below, certify I am duly authorized to execute this certification on behalf of the vendor/financial institution identified below, and the vendor/financial institution identified below is not on the current list of persons engaged in investment activities in Iran created by DGS and is eligible to contract with the Commonwealth of Pennsylvania Sections 3501-3506 of the Procurement Code.

Vendor Name/Financial Institution (Printed)

By (Authorized Signature)

Printed Name and Title of Person Signing Date Executed

OPTION #2 – EXEMPTION Pursuant to Procurement Code Section 3503(e), DGS may permit a vendor/financial institution engaged in investment activities in Iran, on a case-by-case basis, to enter into a contract for goods and services.

If you have obtained a written exemption from the certification requirement, please fill out the information below, and attach the written documentation demonstrating the exemption approval.

Vendor Name/Financial Institution (Printed)

By (Authorized Signature)

Printed Name and Title of Person Signing Date Executed

APPENDIX C - IRAN FREE PROCUREMENT CERTIFICATION: Page 1 of 1 APPENDIX D Trade Secret/Confidential Proprietary Information Notice

Instructions:

The Commonwealth may not assert on behalf of a third party an exception to the public release of materials that contain trade secrets or confidential proprietary information unless the materials are accompanied, at the time they are submitted, by this form or a document containing similar information. It is the responsibility of the party submitting this form to ensure that all statements and assertions made below are legally defensible and accurate. The Commonwealth will not provide a submitting party any advice with regard to trade secret law.

Name of submitting party:

Contact information for submitting party:

Please provide a brief overview of the materials that you are submitting (e.g. bid proposal, grant application, technical schematics):

Please provide a brief explanation of why the materials are being submitted to the Commonwealth (e.g. response to bid #12345, application for grant XYZ being offered by the PLCB, documents required to be submitted under law ABC)

APPENDIX D, TRADE SECRET: Page 1 of 3 Please provide a list detailing which portions of the material being submitted you believe constitute a trade secret or confidential proprietary information, and please provide an explanation of why you think those materials constitute a trade secret or confidential proprietary information. Also, please mark the submitted material in such a way to allow a reviewer to easily distinguish between the parts referenced below. (You may attach additional pages if needed) Note: The following information will not be considered a trade secret or confidential proprietary information:

• Any information submitted as part of a vendor’s cost proposal • Information submitted as part of a vendor’s technical response that does not pertain to specific business practices or product specification • Information submitted as part of a vendor’s technical or disadvantaged business response that is otherwise publicly available or otherwise easily obtained • Information detailing the name, quantity, and price paid for any product or service being purchased by the Commonwealth

Page Number Description Explanation

APPENDIX D, TRADE SECRET: Page 2 of 3 Acknowledgment

The undersigned party hereby agrees that it has read and completed this form, and has marked the material being submitted in accordance with the instructions above. The undersigned party acknowledges that the Commonwealth is not liable for the use or disclosure of trade secret data or confidential proprietary information that has not been clearly marked as such, and which was not accompanied by a specific explanation included with this form. The undersigned agrees to defend any action seeking release of the materials it believes to be trade secret or confidential, and indemnify and hold harmless the Commonwealth, its agents and employees, from any judgments awarded against the Commonwealth in favor of the party requesting the materials, and any and all costs connected with that defense. This indemnification survives so long as the Commonwealth has possession of the submitted material, and will apply to all costs unless and until the undersigned provides a written statement or similar notice to the Commonwealth stating that it no longer wishes to exempt the submitted material from public disclosure. The undersigned acknowledges that the Commonwealth is required to keep all records for at least as long as specified in its published records retention schedule.

The undersigned acknowledges that the Commonwealth reserves the right to reject the undersigned’s claim of trade secret/confidential proprietary information if the Commonwealth determines that the undersigned has not met the burden of establishing that the information constitutes a trade secret or is confidential. The undersigned also acknowledges that if only a certain part of the submitted material is found to constitute a trade secret or is confidential, the remainder of the submitted material will become public; only the protected information will be removed and remain nonpublic. If being submitted electronically, the undersigned agrees that the mark below is a valid electronic signature.

Signature Title Date

APPENDIX D, TRADE SECRET: Page 3 of 3

APPENDIX F SMALL DIVERSE BUSINESS (SDB) AND SMALL BUSINESS (SB) PARTICIPATION SUBMITTAL AND LETTER OF INTENT

Project: RFP NAME AND DESCRIPTION

Offeror Firm:

Offeror Contact Name: Email:

OFFEROR INFORMATION:

Is your firm a DGS-Verified Small Diverse Business? ☐ Yes ☐ No (MUST check one)

Is your firm a DGS-Self-Certified Small Business? ☐ Yes ☐ No (MUST check one)

SUBCONTRACTING INFORMATION:

Percentage Commitment for SDB and SB Subcontracting Participation

After examination of the contract documents, which are made a part hereof as if fully set forth herein, the Offeror commits to the following percentages of the total contract cost for Small Diverse Business and Small Business subcontracting participation.

Small Diverse Business Subcontracting percentage commitment:

______% ______Percent (Figure) (Written)

Small Business Subcontracting percentage commitment:

______% ______Percent (Figure) (Written)

APPENDIX F, SDB AND SB PARTICIPATION SUBMITTAL: Page 1 of 3

Listing SDB and SB Subcontractors

The Offeror must list in the chart below the SDBs and SBs that will be used to meet the percentage commitments provided above. Include the SDB/SB firm name, SDB or SB designation, SDB/SB Primary Contact Information, a description of the service or supplies the SDB/SB will provide, fixed percent of total contract cost committed, estimated dollar value of each commitment, and an indication as to the Offeror’s intent to utilize the SDB/SB subcontractor for contract options or renewals. Include as many pages as necessary. Offerors must also include a Letter of Intent as indicated in RFP Section V-2 for each SDB/SB listed.

Will SDB/SB

% of total Estimated $ be used SDB or Primary Contact Description of Services or Supplies SDB/SB Name Contract Cost value of for SB Name & Email to be provided Committed Commitment options/

renewals? (yes/no)

APPENDIX F, SDB AND SB PARTICIPATION SUBMITTAL: Page 2 of 3

LETTER OF INTENT [DATE]

[SDB/SB Contact Name Title SDB/SB Company Name Address City, State, Zip]

Dear [SDB/SB Contact Name]:

This letter serves as confirmation of the intent of [Offeror] to utilize [Small Diverse Business (SDB) or Small Business (SB)] on RFP [RFP number and Title] issued by the [Commonwealth agency name].

If [Offeror] is the successful vendor, [SDB or SB] shall provide [identify the specific work, goods or services the SDB/SB will perform] during the initial term of the prime contract and during any extensions, options or renewal periods of the prime contract exercised by the Commonwealth, as more specifically set forth below: [identify the specific time periods during the initial contract term and any extensions, options and renewals when the component work, goods or services will be provided or performed.]

These services represent [identify fixed numerical percentage commitment] of the total cost in the [Offeror’s] cost submittal for the initial term of the contract. Dependent on final negotiated contract pricing and actual contract usage or volume, it is expected that [SDB or SB] will receive an estimated [identify associated estimated dollar value that the fixed percentage commitment represents] during the initial contract term.

[SDB/SB] represents that it meets the small or small diverse business requirements set forth in the RFP and all required documentation has been provided to [Offeror] for its SDB/SB submission.

We look forward to the opportunity to serve the [Commonwealth agency name] on this project. If you have any questions concerning our small business or small diverse business commitment, please feel free to contact me at the number below.

Sincerely, Acknowledged,

Offeror Name SDB or SB Name

Title Title

Company Company

Phone number Phone number

APPENDIX F, SDB AND SB PARTICIPATION SUBMITTAL: Page 3 of 3

APPENDIX G MODEL FORM OF SMALL DIVERSE AND SMALL BUSINESS SUBCONTRACTOR AGREEMENT

This Subcontractor Agreement ("Subcontract") is made effective as of ______, 20__, by and between ______, ("Contractor") and ______, a Small Diverse Business or Small Business ("Subcontractor") (collectively referred to as the “Parties”).

RECITALS

Contractor has entered into a contract dated ______(the "Prime Contract") with the Department of ______of the Commonwealth of Pennsylvania (“Commonwealth”). Under the Prime Contract, Contractor has agreed to provide certain supplies, services or construction (“Services”) to the Commonwealth.

In connection with the Procurement leading to the Prime Contract, Contractor and Subcontractor entered into a letter agreement dated ______(“Letter of Intent”) whereby the Contractor committed a certain percentage of work (“Small Diverse Business or Small Business Commitment”) under the Prime Contract to the Subcontractor.

As contemplated by the Letter of Intent and in accordance with the provisions of the Procurement and Prime Contract, the Parties have agreed to enter into this Subcontract to fulfill the Small Diverse Business or Small Business Commitment expressed in the Letter of Intent and as required by the Prime Contract.

DEFINITIONS

The following words and terms when used in this Subcontract shall have the following meanings:

Bureau – The Department’s Bureau of Diversity, Inclusion and Small Business Opportunities.

Contracting Officer – The person authorized to administer and make written determinations for the Commonwealth with respect to the Prime Contract.

Department – The Department of General Services of the Commonwealth of Pennsylvania.

Issuing Office – The department, board, commission or other agency of the Commonwealth of Pennsylvania that issued the Procurement.

Procurement – The Invitation for Bids, Request for Quotes, Request for Proposals or other solicitation and all associated final procurement documentation issued by the Commonwealth to obtain proposals from firms for award of the Prime Contract.

Small Business – A business in the United States which is independently owned, not dominant in its field of operation, employs no more than 100 full-time or full-time equivalent employees, and earns less than $7 million in gross annual revenues for building design, $20 million in gross annual revenues for sales and services and $25 million in gross annual revenues for those businesses in the information technology sales or service business.

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 1 of 8

Small Diverse Business – A Department-verified minority-owned small business, woman-owned small business, veteran-owned small business, service-disabled veteran-owned small business, LGBT-owned small business, or disability-owned small business.

AGREEMENT

Now, therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the Parties hereby agree as follows:

1. Subcontractor Representations. Subcontractor represents and warrants to Contractor as follows:

(a) Subcontractor is self-certified as a Small Business in accordance with the requirements and procedures established by the Bureau of Diversity, Inclusion and Small Business Opportunities; [Subcontractor is also verified as a Small Diverse Business by the Bureau of Diversity, Inclusion and Small Business Opportunities in accordance with the requirements and procedures established by the Bureau;]

(b) Subcontractor possesses the necessary knowledge, experience, expertise, capital, resources and personnel required to perform the Services it will provide under this Subcontract;

(c) Subcontractor (i) is duly organized, validly existing and in good standing under the laws of its state of incorporation or organization, (ii) has the power and authority to own its properties and to carry on business as now being conducted, and (iii) has the power to execute and deliver this Subcontract;

(d) The execution and performance by Subcontractor of the terms and provisions of this Subcontract have been duly authorized by all requisite action, and neither the execution nor the performance of this Subcontract by Subcontractor will violate any provision of law, any order of any court or other agency of government, the organizational documents of Subcontractor or any indenture, agreement or other instrument to which Subcontractor is a party, or by which Subcontractor is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under, or except as may be provided by this Subcontract, result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of Subcontractor pursuant to, any such indenture agreement or instrument;

(e) Subcontractor has obtained all licenses, permits and approvals required to perform the Services it will provide under this Subcontract; and

(f) Subcontractor is not under suspension or debarment by the Commonwealth or any other governmental entity, instrumentality or authority.

2. Contractor Representations. Contractor represents and warrants to Subcontractor as follows:

(a) Contractor (i) is duly organized, validly existing and in good standing under the laws of its state of incorporation or organization, (ii) has the power and authority to own its properties and to carry on business as now being conducted, and (iii) has the power to execute and deliver this Subcontract;

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 2 of 8

(b) The execution and performance by Contractor of the terms and provisions of this Subcontract by Contractor have been duly authorized by all requisite action, and neither the execution nor the performance of this Subcontract will violate any provision of law, any order of any court or other agency of government, the organizational documents of Contractor or any indenture, agreement or other instrument to which Contractor is a party, or by which Contractor is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under, or except as may be provided by this Subcontract, result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of Contractor pursuant to, any such indenture agreement or instrument;

(c) Contractor has obtained all licenses, permits and approvals required to perform the Services to be provided by Contractor under the Prime Contract; and

(d) Contractor is not under suspension or debarment by the Commonwealth or any other governmental entity, instrumentality or authority.

3. Relationship of the Parties. The provisions of this Subcontract are not intended to create, nor shall be deemed or construed to create, any joint venture, partnership or other relationship between Contractor and Subcontractor, other than that of independent entities contracting with each other solely for the purpose of carrying out the provisions of this Subcontract. Neither of the Parties to this Subcontract, nor any of their respective employees, agents, or other representatives, shall be construed to be the agent, employee or representative of the other party. Neither party shall have the authority to bind the other party, nor shall a party be responsible for the acts or omissions of the other party, unless otherwise stated in this Subcontract. Similarly, the Parties expressly acknowledge that neither the Contractor nor the Subcontractor is an agent, employee or representative of the Commonwealth and each party covenants not to represent itself accordingly.

4. Prime Contract Flow-Down.

(a) General. This agreement is a subcontract under the Prime Contract and all provisions of the Prime Contract and any amendments thereto applicable to the Services being performed by the Subcontractor shall extend to and be binding upon the Parties as part of this Subcontract.

(b) Specific. The Parties agree to comply with the following provisions of the Prime Contract, which are incorporated herein by reference:

(1) The Americans with Disabilities Act Provisions. (2) Nondiscrimination/Sexual Harassment Clause. (3) Contractor Integrity Provisions. (4) Contractor Responsibility Provisions.

(c) Termination. Should the Prime Contract be terminated pursuant to the terms and conditions provided in the Procurement, such termination shall have the same effect on this Subcontract. Payment for Services provided as of the date of termination must be made in accordance with the Section 13 of this Subcontract.

(d) Audit Provisions. The Commonwealth shall have the right, at reasonable times and at a site designated by the Commonwealth, to audit the books, documents, and records of the

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 3 of 8

Parties to the extent that the books, documents, and records relate to the Parties’ compliance with the provisions set forth in subsection (b) above or to the Small Diverse Business or Small Business Commitment effectuated through this Subcontract. The Parties shall preserve such books, documents, and records for a period of three years from the date of final payment hereunder. The Parties shall give full and free access to all such records to the Commonwealth and/or its authorized representatives.

5. Order of Precedence. The Letter of Intent, Procurement and Prime Contract are incorporated herein by reference into this Subcontract. In the event of any conflict or inconsistency among the individual components of this Subcontract, such conflict or inconsistency shall be resolved by observing the following order of precedence:

(a) This Subcontract; (b) The Letter of Intent; (c) The Prime Contract; and (d) The Procurement.

6. Further Action. The Parties shall take such actions and complete, execute and deliver any and all documents or instruments necessary to carry out the terms and provisions of this Subcontract, to effectuate the purpose of this Subcontract, and to fulfill the obligations of each party hereunder.

7. Description of Services. Subcontractor will perform the following Services for the Contractor which Contractor is obligated to provide to the Commonwealth under the Prime Contract:

[DESCRIBE IN DETAIL THE SPECIFIC SUPPLIES, SERVICES OR CONSTRUCTION THE SUBCONTRACTOR WILL PROVIDE OR PERFORM] ______.

8. Small Diverse Business or Small Business Commitment. The above-referenced Services represent __ % of the final negotiated total cost for the initial term of the Prime Contract. Any proposed change to the Small Diverse Business or Small Business Commitment must be submitted in writing to the Bureau which will make a recommendation to the Commonwealth Contracting Officer regarding a course of action.

9. Performance of Services. Subcontractor may not subcontract more than 50% of the work subcontracted to it hereunder without written permission from the Bureau. Subcontractor will perform the Services strictly in accordance with any applicable plans and specifications as contained in the Prime Contract and the reasonable deadlines set by Contractor in view of the requirements of the Prime Contract, and in a good workmanlike manner consistent with industry standards, meeting all applicable local, state and federal laws, regulations and policies.

10. Location of Services. Subcontractor will provide the Services at the following address(es): ______.

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 4 of 8

11. Timeframe for Performance of Services. The Services will be provided by Subcontractor during the initial term of the Prime Contract, and during any extensions, options or renewal periods of the Prime Contract exercised by the Commonwealth, as more specifically set forth below:

[IDENTIFY THE SPECIFIC TIME PERIODS DURING THE INITIAL CONTRACT TERM AND EXTENSIONS, OPTIONS AND RENEWALS WHEN THE SUBCONTRACTOR WILL PERFORM COMPONENT SERVICES] ______.

12. Pricing of Services. Subcontractor shall provide or perform the Services at the pricing specified in Exhibit ___ to this Subcontract. [ATTACH A BILL OF MATERIALS, RATE CARD OR OTHER APPROPRIATE COST SHEET COVERING THE SERVICES TO BE PROVIDED.]

13. Payment for Services. Contractor shall exert reasonable and diligent efforts to collect prompt payment from the Commonwealth. Contractor shall pay Subcontractor in proportion to amounts received from the Commonwealth which are attributable to the Services performed by Subcontractor. Contractor shall pay Subcontractor within fourteen (14) days after the Contractor receives such payment from the Commonwealth, unless the parties expressly agree upon a different payment schedule or structure as set forth below: ______.

14. Utilization Reports. Both the Contractor and Subcontractor shall complete Quarterly Utilization Reports (or similar type documents containing the same information) and submit them to the Contracting Officer and to the Bureau within ten (10) business days at the end of each quarter. This information will be used to determine the actual dollar amount paid to Subcontractor and will also serve as a record of fulfillment of Contractor’s Small Diverse Business and Small Business Commitments. If there was no activity during the quarter, then the form must be completed by stating “No activity in this quarter.” A late fee of $100.00 per day may be assessed against the Contractor if its Utilization Report is not submitted in accordance with the schedule above.

15. Change Orders. If the Commonwealth issues any change order or other formal contract instrument either expanding or limiting the work to be performed under the Prime Contract, the Parties shall accept such Change Orders. Contractor agrees to provide Subcontractor with written notice of any such change orders that affect the Services to be provided by the Subcontractor hereunder as soon as practical after Contractor receives such notice. Any resulting increase or decrease in the Services, Small Diverse Business or Small Business Commitment provided for in Paragraphs 7 or 8 above must be in writing, mutually agreed to, and signed by both Parties and communicated to the Bureau. If the Parties are unable to reach an agreement regarding any adjustment to the Services, Small Diverse Business or Small Business Commitment necessitated by a Commonwealth Change Order, the Parties must submit the matter in writing to the Bureau which will make a recommendation to the Contracting Officer regarding a course of action.

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 5 of 8

16. Force Majeure. Neither party will incur any liability to the other if its performance of any obligation under this Subcontract is prevented or delayed by causes beyond its control and without the fault or negligence of either party. Causes beyond a party’s control may include, but are not limited to, acts of God or war, changes in controlling law, regulations, orders or the requirements of any governmental entity, severe weather conditions, civil disorders, natural disasters, fire, epidemic and quarantines, general strikes throughout the trade, and freight embargoes. The existence of such causes beyond a party’s control shall extend the period for performance to such extent as may be necessary to enable complete performance in the exercise of reasonable diligence after the causes have been removed.

17. Dispute Resolution.

(a) The Parties will attempt to resolve any dispute arising out of or relating to this Subcontract through friendly negotiations.

(1) The Parties expressly acknowledge and confer upon the Bureau and Contracting Officer the authority to adjudicate disputes that the Parties cannot resolve amicably concerning the Parties’ compliance with their Small Diverse Business and Small Business Commitments as provided in the Prime Contract and this Subcontract.

(2) The Bureau may recommend to the Contracting Officer a range of sanctions it deems appropriate if the Bureau determines a party has failed to satisfy or perform its Small Diverse Business or Small Business commitment. Such sanctions include, but are not limited to, one or more of the following: a determination that the party is not responsible under the Contractor Responsibility Program; withholding of Prime Contract and/or Subcontract payments; suspension or termination of the Prime Contract and/or Subcontract together with consequential damages; revocation of the party’s Small Business self-certification status and/or Small Diverse Business verification status; and/or suspension or debarment of one or both parties from future contracting opportunities with the Commonwealth.

(3) The Parties’ acknowledge that their prior performance in meeting their Small Diverse Businesses and Small Businesses contractual obligations will be considered by the Bureau during future procurement scoring processes. To the extent a party has failed to meet prior contractual commitments, the Bureau may recommend to the Issuing Office that the party be determined non-responsible for the limited purpose of eligibility to receive SDB/SB points or consideration as a qualified Small Diverse Business or Small Business.

(b) Nothing herein shall be construed to prevent either party from seeking such relief as provided by law in a court or tribunal of competent jurisdiction.

18. Notices. Any written notice to any party under this Subcontract shall be deemed sufficient if delivered personally, or by facsimile, telecopy, electronic or digital transmission (provided such delivery is confirmed), or by a recognized overnight courier service (e.g., DHL, Federal Express, etc.) with confirmed receipt, or by certified or registered United States mail, postage prepaid, return receipt requested, and sent to the following:

If to Contractor:

______

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 6 of 8

______

If to Subcontractor:

______

19. Waiver. No waiver by either party of any breach of this Subcontract shall be deemed to waive any other breach. No acceptance of payment or performance after any breach shall be deemed a waiver of any breach. No failure or delay to exercise any right by a party upon another's default shall prevent that party from later exercising that right, nor shall such failure or delay operate as a waiver of any default.

20. Severability. If any provision of this Subcontract shall be held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable. If a court finds that any provision of this Subcontract is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited.

21. Assignment. Neither party may assign or transfer this Subcontract without the prior written consent of the Commonwealth. If Contractor’s Prime Contract with the Commonwealth is assigned to another contractor, the new contractor must maintain the Small Diverse Business and Small Business Commitment set forth in the Prime Contract as implemented through this Subcontract.

22. Applicable Law. This Subcontract shall be governed by the laws of the Commonwealth of Pennsylvania.

23. Entire Agreement. This Subcontract constitutes the entire agreement of the Parties regarding the subject of this Subcontract as of the date of execution. No other agreement or understandings, verbal or written, expressed or implied, are a part of this Subcontract unless specified herein.

24. Amendment. This Subcontract may be modified or amended only if made in writing and signed by both Parties. Any proposed change to the Contractor’s Small Diverse Business or Small Business Commitment to Subcontractor must be submitted in writing to the Bureau which will make a recommendation to the Contracting Officer regarding a course of action.

25. Binding Effect. This Subcontract shall be binding upon, and inure to the benefit of, the Parties and their respective heirs, representatives, successors and assigns.

26. Counterparts. This Subcontract may be executed by the Parties in counterparts, each of which together shall be deemed an original but all of which together shall constitute one and the same instrument. A party’s delivery of a duly executed signature page of this Subcontract in electronic format shall have the same force and effect as delivery of an original signature page.

ADDITIONAL TERMS AND CONDITIONS

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 7 of 8

[THE PARTIES MAY INCLUDE ADDITIONAL TERMS AND CONDITIONS APPROPRIATE FOR THE SERVICES TO BE PROVIDED SO LONG AS THEY ARE COMMERCIALLY REASONABLE TERMS FOR THE APPLICABLE BUSINESS OR INDUSTRY, ARE NO LESS FAVORABLE THAN THE TERMS OF THE PRIME CONTRACT, AND DO NOT PLACE DISPROPORTIONATE RISK ON THE SMALL DIVERSE BUSINESS OR SMALL BUSINESS RELATIVE TO THE NATURE AND LEVEL OF THE SMALL DIVERSE BUSINESS’ OR SMALL BUSINESS’ PARTICIPATION IN THE PROJECT. SUCH TERMS MAY INCLUDE:

Background Checks Confidentiality/Disclosure of Information Data Security Insurance Invoicing Requirements Environmental Protection Intellectual Property Rights Record Retention/Audits Service Level Agreements (SLAs) (consistent with Prime Contract SLAs) Public Works Construction Requirements (including Bonding, E-Verify, Prevailing Wage, and Prompt Payment provisions)

IN WITNESS WHEREOF, the Parties hereto have caused this Subcontract to be executed by their duly authorized officers as set forth below.

Contractor Subcontractor

Insert Company Name Insert Company Name

By: ______By: ______Signature Signature

______Printed Name Printed Name

______Title Title

______Date Date

APPENDIX G, MODEL SUBCONTRACTOR AGREEMENT: Page 8 of 8

APPENDIX H, CURRENT OPERATIONS SUMMARY The following information is provided for historic and contextual purposes to assist the Offeror in understanding how warehousing and delivery services are currently provided in western Pennsylvania. Information provided is not to be interpreted as an indication of future volumes or acceptable solutions, rather informs of past practices. 1. Existing Distribution Center (DC) Facility Specifications:

Location Allegheny County Square Footage 350,000 sq. ft. Docks 19 Dock Doors 19 Clear Height 24' Ceiling / 22' Clear Max Case Capacity 780,000 Cases Available Bins 11,250 / variable 20 pallet lifts / 28 Pick Jacks / additional Material Handling Equipment rentals during high-volume months Shift Staffing Inbound 20 / Outbound 28 Inventory Control Personnel 1 supervisor / 1 associate Yard Management Controlled at Guard Shack 24/7 security system with door controls Access control at gate Security Measures Access control at offices On site security guards 24/7

2. Inventory Summary

Calendar Year 2019 Alcohol Merchandise Inventory Levels by Month (inventory reflected is at beginning of each month)

Total Stock on Hand Cases JAN 570,160 FEB 614,040 MAR 649,840 APR 710,317 MAY 647,310 JUNE 667,668 JULY 640,828 AUG 630,325 SEPT 610,710 OCT 645,109 NOV 625,307 DEC 647,983 1 of 4 Appendix H- Current Operations Summary

A review of saleable alcohol and non-alcohol merchandise inventory turns (cases and units) over a recent 12-month period shows an annual turn rate of about 7.7.

Two-year Average Summary of Non-Alcohol Merchandise Inventory

Non-alcohol merchandise is not received and shipped with the same regularity as alcohol merchandise, so the following table shows average receipts and shipments over the last two years.

ITEM Inbound Outbound Poly printed bags 1,400 cases monthly average inbound and outbound Quart paper bags 590 cases monthly average inbound and outbound Taste/Premium Collection Magazine Receive and ship 1,600 cases quarterly

Ship 3,500 cases between Receive by the truckload in advance of Happier Holidays poly bag October and December each November/ December holidays year

One shipment per FW&GS 325 cases received in advance of winter store (on a regular Calcium Chloride season replenishment order) in winter Ship average of 54 cases each Paper Towels, Hard Roll Receive 720 cases by the truckload month Ship average of 140 cases Register Tape Receive 1,000 cases by the truckload each month Additional non-alcohol merchandise may need to be received, stored and shipped in the future.

3. Summary of Inbound Operations Calendar Year 2019 Inbound Shipments by Month

Total Deliveries Total Cases Total Deliveries by Less-Than- Damaged Cases Cases Requiring Received into by Full Truck or Truckload Requiring Relabeling Warehouse Container (usually parcel Reconditioning carrier) JAN 396,598 324 71 4,036 FEB 386,370 307 60 6,078 MAR 407,886 328 79 8,105 APR 347,119 280 66 9,106 MAY 441,412 346 81 4,335 Average of 20 JUNE 395,595 316 83 6,108 daily JULY 364,731 295 78 4,404 AUG 396,275 328 72 4,337 SEPT 455,724 359 85 5,586 OCT 468,267 364 99 4,315

2 of 4 Appendix H- Current Operations Summary NOV 457,993 366 74 7,259 DEC 467,040 375 74 4,797 Total 4,985,010 3,988 922 68,466

4. Summary of Outbound Operations Calendar Year 2019 Outbound Shipments by Month

Total Distinct Trailer Drops Total Total Total Cases Total Orders Total Outbound % of Returns Loaded for Cases Picked and Dropped Deliveries Volume as to Return to Shipped Loaded onto Trailers by 3PL Live Load Vendors Vendor Trailers Filled JAN 388,183 1,679 1,512 9 44% 3 2,034 FEB 352,979 1,514 1,369 9 24% 3 248 MAR 363,485 1,589 1,444 9 0% 9 1,155 APR 384,878 1,650 1,498 11 31% 3 321 MAY 427,239 1,717 1,528 13 22% 41 4,306 JUNE 377,875 1,510 1,352 12 32% 0 0 JULY 408,908 1,698 1,517 13 36% 3 212 AUG 401,833 1,675 1,511 12 33% 17 5,723 SEPT 395,220 1,518 1,367 13 41% 13 2,509 OCT 512,185 1,870 1,680 16 29% 6 1,256 NOV 422,579 1,578 1,422 15 35% 4 937 DEC 485,323 1,568 1,379 21 38% 5 4,207 Total 4,920,687 19,566 17,579 153 32% 107 22,908

5. Additional Operational Details • PLCB-required inspections: Highly variable month to month, outside PLCB control. • Staging for destruction: Average 20 cases daily. • Store returns to the DC: Less than 25 returns over last 12 months (number of cases returned varies), average of 2 returns per month or fewer. • Licensee returns to the DC: 18 in calendar year 2019 at the western Pennsylvania DC facility

6. Multi-Year Operations Summary

Year 2017 2018 2019 Inbound cases 4,665,240 4,422,876 4,985,010 Outbound cases 4,793,662 4,384,146 4,943,117 Lowest Stock on Hand 584,483 410,759 570,160 Highest Stock on Hand 744,416 660,186 710,317 Average Stock on Hand 650,668 524,966 642,256

3 of 4 Appendix H- Current Operations Summary 7. Operational Diagram

Product Suppliers

PLCB Western Other PLCB PA Distribution Distribution Center Centers

Direct Delivery Licensees PLCB FW&GS PLCB Licensee (Grocery & Retail Stores Service Centers Convenience Stores, Casinos)

Retail Licensees Consumers

4 of 4 Appendix H- Current Operations Summary APPENDIX I – WESTERN PENNSYLVANIA SERVICE REGION (as of Feb. 7, 2020) 212 FW&GS delivery locations 30 licensee delivery locations 40 licensees picking up from DC FW&GS Delivery Locations

Page 1 of 14 Appendix I- Western Pennsylvania Service Region STORE # ADDRESS CITY ZIP SPECIAL REQUIREMENTS 503 9613 LINCOLN HWY, STE 105 BEDFORD 15522 Pallet Drop 256 1020 VILLAGE CENTER DR, STE N2B TARENTUM 15084 - 3848 Pallet Drop 286 PINES PLZ PITTSBURGH 15237-2142 Pallet Drop, 7 a.m. Deliveries 2001 DOWNTOWN MALL MEADVILLE 16335-3428 Pallet Drop 2002 126 S MARTIN ST TITUSVILLE 16354-1850 2004 211 E ERIE ST LINESVILLE 16424-0424 2006 19017 PARK AVENUE PLZ MEADVILLE 16335-4008 3701 LAWRENCE VILLAGE PLZ NEW CASTLE 16101-6299 Thursday Deliveries 3702 729 LAWRENCE AVE ELLWOOD CITY 16117-1931 3001 WIDEWATERS CMNS WAYNESBURG 15370-1707 3002 BRODAK CMNS CARMICHAELS 15320-1204 Biweekly Deliveries 3201 215 E MARKET ST BLAIRSVILLE 15717-1120 3202 575 PHILADELPHIA ST INDIANA 15701-3901 3203 560 FRANKLIN ST CLYMER 15728-1183 Biweekly Deliveries 3301 160 MAIN ST BROOKVILLE 15825-1234 3302 567 W MAHONING ST PUNXSUTAWNEY 15767-1909 3303 445 MAIN ST BROCKWAY 15824-1337 Monthly Deliveries 3305 410 MAIN ST REYNOLDSVILLE 15851-1251 Monthly Deliveries 212 959 LIBERTY AVE PITTSBURGH 15222-3701 213 217 ATWOOD ST PITTSBURGH 15213-4001 214 THE WATERWORKS PITTSBURGH 15238-3123 Pallet Drop, 6 a.m. Deliveries 215* 1601 LIBERTY AVE PITTSBURGH 15222-4301 Pallet Drop, 6 a.m. Deliveries 216 102 E MAIN ST CARNEGIE 15106-2429 217 1110 4TH AVE CORAOPOLIS 15108-1616 218 2947 W LIBERTY AVE PITTSBURGH 15216-2543 219 KENNYWOOD SHOPS WEST MIFFLIN 15122-2303 220 624 ALLEGHENY RIVER BLVD OAKMONT 15139-1539 222* 98 VANADIUM RD, BLDG D BRIDGEVILLE 15017-3034 Pallet Drop 223 129 LINCOLN AVE PITTSBURGH 15209-2673 224 1824 MURRAY AVE PITTSBURGH 15217-1606 7 a.m. Deliveries

Page 2 of 14 Appendix I- Western Pennsylvania Service Region 226 132 BEN AVON HEIGHTS RD PITTSBURGH 15237-1202 228 EDGEWOOD TOWNE CENTRE PITTSBURGH 15218-1865 2513 EAST ERIE PLZ ERIE 16507-1808 2514 YORKTOWN CENTRE ERIE 16505-4507 2515 PERRY PLZ ERIE 16503-2513 2516 LIBERTY PLZ ERIE 16508-2537 2517 3412 W LAKE RD ERIE 16505-3612 231 ROBINSON PLAZA TOWN CTR PITTSBURGH 15205-4808 Pallet Drop 234 WEST VIEW PARK SHOPPING CTR PITTSBURGH 15229-1771 236 820 MCKEESPORT RD ELIZABETH 15037-1917 238 SHADY HILL CTR PITTSBURGH 15206-4013 242 HAYMAKER VILLAGE SHOPS MONROEVILLE 15146-4745 Pallet Drop 244 739 MONONGAHELA AVE GLASSPORT 15045-1624 247 5956 CENTRE AVE, STE 201 PITTSBURGH 15206-3815 6 a.m. Deliveries 249 519 TOWNE SQUARE WAY PITTSBURGH 15227-3256 263 418 E OHIO ST PITTSBURGH 15212-5558 6 a.m. Deliveries 264 SHALER PLZ PITTSBURGH 15223-1338 265 DEER LAKES PLZ RUSSELLTON 15076-0295 Pallet Drop 266 521 BEAVER ST SEWICKLEY 15143-1701 6 a.m. Deliveries 267 MOON PLZ CORAOPOLIS 15108-4229 270 3643 CALIFORNIA AVE PITTSBURGH 15212-1869 271 3408 MAIN ST MUNHALL 15120-3257 272 233 SHILOH ST PITTSBURGH 15211-1623 273 3202 BRIGHTON RD PITTSBURGH 15212-2340 274 LEBANON SHOPS PITTSBURGH 15234-1577 7 a.m. Deliveries 279 722 BROOKLINE BLVD PITTSBURGH 15226-2102 280 2800 ROBINSON BLVD PITTSBURGH 15235-1461 Pallet Drop 4301 SHARON CENTER CITY SHOPPING CTR SHARON 16146-1356 4303 GREENVILLE PLZ GREENVILLE 16125-1240 4304 535 GREENVILLE RD MERCER 16137-0300 4306 HERMITAGE TOWNE PLZ HERMITAGE 16148-2725

Page 3 of 14 Appendix I- Western Pennsylvania Service Region 4308 33 PINE GROVE SQUARE DR GROVE CITY 16127-9735 201 3239 WASHINGTON PIKE BRIDGEVILLE 15017-1460 202 RIVER TOWN SHOPS VERONA 15147-1046 203 BRADDOCK HILLS SHOPPING CTR PITTSBURGH 15221-4818 205 149 5TH AVE MCKEESPORT 15132-2721 206 136 MCKEES ROCKS PLZ MCKEES ROCKS 15136-3801 210 THE BAVARIAN VLG SOUTH PARK 15129-8522 Pallet Drop 211 354 NORTH TOWNE SQ GIBSONIA 15044-9552 252 4643 CENTRE AVE PITTSBURGH 15213-1552 260 1955 WHARTON ST PITTSBURGH 15203-1915 Pallet Drop, 7 a.m. Deliveries 261 2629 BROWNSVILLE RD PITTSBURGH 15227-2005 7 a.m. Deliveries 2501 SUMMIT TOWNE CTR ERIE 16509-4759 2502 105 W 18TH ST ERIE 16501-2103 2503 ASBURY SQ ERIE 16506-1403 2504 10720 W MAIN ST NORTH EAST 16428-2228 2506 CORRY PLZ CORRY 16407-1002 2509 GIANT EAGLE PLZ ERIE 16510-2228 2511 737 E 38TH ST ERIE 16504-1763 1111 3670 PORTAGE ST, STE 3 PORTAGE 15946-6540 Biweekly Deliveries 1115 20TH WARD SHOPPING CTR JOHNSTOWN 15906-1643 6523 1038 LATROBE 30 PLZ, STE 311 LATROBE 15650-2855 6524 321 TRI-COUNTY LN BELLE VERNON 15012-1991 6525 6041 RTE 30, STE 55 GREENSBURG 15601-1587 6503 925 DONNER AVE MONESSEN 15062-1002 6504 114 S 5TH ST JEANNETTE 15644-2112 1118 GEISTOWN SHOPPING CTR JOHNSTOWN 15904-1438 Pallet Drop 1002 9 NORTHGATE PLZ, UNIT 5 HARMONY 16037-9207 1003 608 MORAINE POINTE PLZ BUTLER 16001-2414 1004 102 MAIN ST PETROLIA 16050-0263 Biweekly Deliveries 1005 110 BON AIRE PLZ BUTLER 16001-1944 1006 340 GREATER BUTLER MART BUTLER 16001-3284

Page 4 of 14 Appendix I- Western Pennsylvania Service Region 1007 CRANBERRY MALL 20111 RTE 19 CRANBERRY TWP 16066-6207 Pallet Drop 1008 SLIPPERY ROCK PLZ, SLIPPERY ROCK 16057-8524 1009 240 BUFFALO PLZ SARVER 16055-8302 1010 206 SEVEN FIELDS BLVD SEVEN FIELDS 16046-4346 Pallet Drop 1101 426 MAIN ST JOHNSTOWN 15901-1802 1102 EAST HILLS PLZ JOHNSTOWN 15904-3315 1103 910 PHILADELPHIA AVE, STE 1 NORTHERN CAMBRIA 15714-1321 9205 1602 COCHRAN RD PITTSBURGH 15220-1001 6312 524 FRONT ST FREDERICKTOWN 15333-0874 Biweekly Deliveries 6314 980 JEFFERSON AVE WASHINGTON 15301-3868 DONALDSON'S CROSSROADS SHOPPING Pallet Drop 6315 CTR MCMURRAY 15317-2532 6316 WASHINGTON MALL WASHINGTON 15301-2966 6501 105 HARRISON AVE GREENSBURG 15601-2304 6502 313 DEPOT ST LATROBE 15650-1556 6505 328 CENTRAL CITY PLZ NEW KENSINGTON 15068-6441 6506 656 W MAIN ST MOUNT PLEASANT 15666-1815 6507 613 W MAIN ST LIGONIER 15658-1017 6508 310 MAIN ST IRWIN 15642-3439 1104 101 PARK AVE CRESSON 16630-1166 1107 513 CHESTNUT ST CONEMAUGH 15909-1920 Biweekly Deliveries 6509 208 COUNTRYSIDE PLZ MOUNT PLEASANT 15666-2122 6510 HILLCREST SHOPPING CTR LOWER BURRELL 15068-3506 6511 WILLOWBROOK PLZ ROSTRAVER TOWNSHIP 15012-4016 6513 214 5TH ST, PO BOX 38 AVONMORE 15618-0038 Biweekly Deliveries 6514 147 COLUMBIA AVE VANDERGRIFT 15690-1101 6516 PENN CROSSING SHOPPING CTR JEANNETTE 15644-4304 6517 WESTMORELAND MALL GREENSBURG 15601-3546 Pallet Drop 6518 NORWIN HILLS SHOPPING CTR IRWIN 15642-2744 Pallet Drop 6201 44 MARKET ST WARREN 16365-2508 6202 212 S MAIN ST SHEFFIELD 16347-0372 Monthly Deliveries 6302 43 E PIKE ST CANONSBURG 15317-1311 Page 5 of 14 Appendix I- Western Pennsylvania Service Region 6304 105 3RD ST CHARLEROI 15022-1425 6305 MCDONALD PLZ MCDONALD 15057-1423 6306 245 W MAIN ST MONONGAHELA 15063-2442 6307 KWIK STOP PLZ BURGETTSTOWN 15021-9703 Biweekly Deliveries by 11 a.m. 6311 327 3RD ST CALIFORNIA 15419-1133 7 a.m. Deliveries 9203 3 QUAKER VILLAGE SHOPPING CTR LEETSDALE 15056-1206 5601 686 MARKET SQ MEYERSDALE 15552-1180 Monthly Deliveries 5602 SOMERSET CMNS, STE 110 SOMERSET 15501-7041 5603 1607 JEFFERSON AVE WINDBER 15963-1737 5606 212 OHIO ST BOSWELL 15531-1233 Biweekly Deliveries 3206 TOWNFAIR PLZ INDIANA 15701-2347 Pallet Drop 6101 SENECA STREET PLZ OIL CITY 16301-1314 Pallet Drop 6102 541 ALLEGHENY BLVD FRANKLIN 16323-2919 6103 17 KIMBERLY LANE CRANBERRY 16319-3141 281 1706 MOUNT ROYAL BLVD GLENSHAW 15116-2115 282 OAK PARK MALL WHITE OAK 15131-2419 284 BILL GREEN'S SHOPPING CTR PITTSBURGH 15236-3905 Pallet Drop 285 HAMPTON HOME CENTER ALLISON PARK 15101-2413 288 CASTE VILLAGE SHOPPING CTR PITTSBURGH 15236-1514 290 NOBLE MANOR SHOPPING CTR PITTSBURGH 15205-4148 292 NORTH HILLS VILLAGE MALL PITTSBURGH 15237-3412 Pallet Drop 294 OLYMPIA SHOPPING CTR MCKEESPORT 15132-6128 295 GREAT VALLEY MART NORTH VERSAILLES 15137-1524 296 5249 LIBRARY RD BETHEL PARK 15102-2714 Pallet Drop 297 THE VILLAGE SHOPPING CTR WEST MIFFLIN 15122-3650 298 CHARTIERS VALLEY SHOPPING CTR BRIDGEVILLE 15017-2702 Pallet Drop 9251 PLCB EVENT STORE PITTSBURGH 15262 704 1260 PENNSYLVANIA AVE TYRONE 16686-1618 705 CHESTNUT PLZ ALTOONA 16601-5204 707 VALLEY VIEW SHOPPING CTR ALTOONA 16602-4803 709 PLEASANT VALLEY SHOPPING CTR ALTOONA 16602-6413 Pallet Drop

Page 6 of 14 Appendix I- Western Pennsylvania Service Region 9206 KENMAWR PLZ MCKEES ROCKS 15136-1659 9210 COMMUNITY PLZ VERONA 15147-3716 9211 VILLAGE SQ BETHEL PARK 15102-1824 7 a.m. Deliveries 6519 CROSSROADS PLZ LOWER BURRELL 15068-3060 2606 140 WALNUT HILL RD UNIONTOWN 15401-5090 Pallet Drop 227 3845 NORTHERN PIKE MONROEVILLE 15146-2132 Pallet Drop 9208 125 TOWNE CENTRE DR, STE 500 WEXFORD 15090-5090 9212 PENN LINCOLN CTR IMPERIAL 15126-9781 9213 2356 GOLDEN MILE HWY PITTSBURGH 15239-2710 2512 66 N MAIN ST UNION CITY 16438-1032 703 202 HOLLIDAYSBURG PLZ DUNCANSVILLE 16635-9345 Pallet Drop 299 PENN HILLS CTR PITTSBURGH 15235-3329 302 137 S JEFFERSON ST KITTANNING 16201-2409 303 163 3RD ST LEECHBURG 15656-1261 308 FRANKLIN VLG KITTANNING 16201-8803 402 GREEN GARDEN SHOPPING CTR HOPEWELL TOWNSHIP 15001-1000 403 999 MERCHANT ST AMBRIDGE 15003-2327 405 508 MIDLAND AVE MIDLAND 15059-1313 Biweekly Deliveries 408 816 3RD AVE NEW BRIGHTON 15066-1915 409 CHIPPEWA CTR BEAVER FALLS 15010-1252 410 ALIQUIPPA SHOPPING CTR ALIQUIPPA 15001-2793 7 a.m. Deliveries 9250 Pittsburgh Area Pittsburgh 15262 2518 WASHINGTON TOWNE PLZ EDINBORO 16412-1254 2520 IMPERIAL POINT GIRARD 16417-9625 2601 111 W FAYETTE ST UNIONTOWN 15401-3207 2603 808 VANDERBILT RD CONNELLSVILLE 15425-6241 2604 1890 MCCLELLANDTOWN RD MASONTOWN 15461-2508 Biweekly Deliveries 2605 213 PENN ST POINT MARION 15474-1235 Monthly Deliveries 2608 3532 PITTSBURGH RD, STE A PERRYOPOLIS 15473-1306 Biweekly Deliveries 2610 FAYETTE PLAZA SHOPPING CTR UNIONTOWN 15401-2200 10 a.m. Deliveries 2701 121 CHESTNUT ST MARIENVILLE 16239-0433 Biweekly Deliveries

Page 7 of 14 Appendix I- Western Pennsylvania Service Region 2702 644 ELM ST TIONESTA 16353-0055 Biweekly Deliveries 412 NORTHERN LIGHTS SHOPPERS CITY BADEN 15005-1218 Pallet Drop 414 1476 OLD BRODHEAD RD MONACA 15061-2315 502 600 MAIN ST SAXTON 16678-1024 Biweekly Deliveries 1601 800 CENTER CLARION 16214-1124 1602 452 BROAD ST NEW BETHLEHEM 16242-1103 Biweekly Deliveries 1603 78 CLARION PLZ CLARION 16214-8575 1604 506 MAIN ST KNOX 16232-0460 Biweekly Deliveries 1702 5720 SHAFFER RD DUBOIS 15801-3872 Pallet Drop 1703 821 CENTENNIAL ST HOUTZDALE 16651-1317 Monthly Deliveries 1704 449 STATE ST CURWENSVILLE 16833-1240 Monthly Deliveries 1705 CLEARFIELD MALL CLEARFIELD 16830-3209 1706 PEEBLES PLZ PHILIPSBURG 16866-3001 6526 109 BLUE SPRUCE WAY MURRYSVILLE 15668-1801 Pallet Drop 6527 HOLLYWOOD SQ DELMONT 15626-2400 Pallet Drop 1108 300 WALMART DR, STE 130 EBENSBURG 15931-4212 Pallet Drop 6528 250 S THIRD ST, STE 1000 YOUNGWOOD 15697 Pallet Drop 1120 1910 MINNO DR, STE 280 JOHNSTOWN 15905-1142 Pallet Drop 245 330 E WATERFRONT DR HOMESTEAD 15120-5004 Pallet Drop 250 56 HIGHLANDS MALL NATRONA HEIGHTS 15065-1972 Pallet Drop 3711 UNION SQUARE SHOPPING CTR NEW CASTLE 16101-1240 Pallet Drop 237 339 FIFTH AVE PITTSBURGH 15222 Pallet Drop, 5 a.m. Deliveries 232 MCINTYRE SQUARE PITTSBURGH 15237 Pallet Drop 6308* 102 FOUR COINS DRIVE CANONSBURG 15317 Pallet Drop 3710 3326 WILMINGTON RD, UNIT 4 NEW CASTLE 16105-1039 Pallet Drop 415 ROCHESTER PLZ ROCHESTER 15074-1413 Pallet Drop 278 4065 BUTLER ST PITTSBURGH 15201

* Licensee Service Center: Truck docks are guaranteed at these non-retail locations.

Page 8 of 14 Appendix I- Western Pennsylvania Service Region

Licensee Delivery Locations

Page 9 of 14 Appendix I- Western Pennsylvania Service Region

HEINZ FIELD 100 ART ROONEY DR Pittsburgh 15212 GIANT EAGLE 1025 Washington Pike Bridgeville 15017 WHOLE FOODS MARKET GROUP INC 10576 Perry HIghway Wexford 15090 MARTINOS BILO 1200 Main Street Brockway 15824 SHOP N SAVE 125 West Beau Street Washington 15301 FISHER HEIGHTS GIANT EAGLE 1300 Country Club Road Monongahela 15063 GIANT EAGLE 1521 North Main Street EXT Butler 16001 GIANT EAGLE 155 Wilson Rd Bentleyville 15314 FRESH THYME FARMERS MARKET 1717 Route 228, Suite E Cranberry Township 16066 WHOLE FOODS MARKET GROUP INC 1800 WASHINGTON RD PITTSBURGH 15241 GIANT EAGLE 2001 lincoin way white oak pa. 15131 PUNXSY SHOP N SAVE 201N Hampton Avenue Punxsutawney 15767 CCR PENNSYLVANIA FOOD SERVICE INC 210 Racetrack Road Washington 15301 SHOP N SAVE 3335 William Penn Hwy. Pittsburgh 15235 WALMART #2019 355 Walmart Dr Uniontown 15401 FINLEYVILLE GIANT EAGLE 3701 Route 88 Finleyville 15332 SUPER 8 CORPORATION 400 Northtowne Square Gibsonia 15044 ALTAGHENY INC 475 Ben Franklin Road South indiana 15701 SB CHARTERS GROCERY INC 4935 Tuscarawas Road Beaver 15009 WEGMANS FOOD MARKETS INC 5028 West Ridge Road Erie 16506 ROMARK FOODS INC 51 walsh rd crafton 15205 FRESH THYME FARMERS MARKET 600 Clairton Blvd. Pleasant Hills 15236 GIANT EAGLE INC 606 Erie Street Edinboro 16412 WEGMANS FOOD MARKETS INC 6143 Peach Street Erie 16509 TOPS PT LLC 712 W 38th Street Erie 16508 SHOP N SAVE 730 East Pittsburgh St. Greensburg, Pa 15601 TOPS MARKETS 603 74 Market St. Warren 16365 RIVERS CASINO 777 CASINO DR Pittsburgh 15212

Page 10 of 14 Appendix I- Western Pennsylvania Service Region TOPS MARKETS 670 880 Water St Meadville 16335 SUPERSALE CORPORATION Giant Eagle #665 20111 Route 19 Cranberry Township 16066

Page 11 of 14 Appendix I- Western Pennsylvania Service Region Licensee Locations Picking up at Warehouse

Page 12 of 14 Appendix I- Western Pennsylvania Service Region

GIANT EAGLE INC 100 SETTLERS RIDGE CENTER DR PITTSBURGH 15205 GIANT EAGLE INC 1050 MT LAUREL PLAZA LATROBE 15650 GIANT EAGLE INC 111 W MADISON ST ROCHESTER 15074 GIANT EAGLE INC 1356 HOFFMAN BLVD WEST MIFFLIN 15122 GIANT EAGLE INC 1451 SCALP AVE JOHNSTOWN 15904 GIANT EAGLE INC 155 TOWNE CENTRE DR WEXFORD 15090 GIANT EAGLE INC 1600 W STATE ST BADEN 15005 GIANT EAGLE INC 1671 BUTLER PLANK RD GLENSHAW 15116 GIANT EAGLE INC 1800 MCKEES ROCKS RD MCKEES ROCKS 15136 GIANT EAGLE INC 181 SOPHIRA LN ALTOONA 16602 GIANT EAGLE INC 18511 SMOCK HWY MEADVILLE 16335 GIANT EAGLE INC 200 TARENTUM BRIDGE RD NEW KENSINGTON 15068 GIANT EAGLE INC 2021 WHARTON ST PITTSBURGH 15203 GIANT EAGLE INC 2067 INTERCHANGE RD ERIE 16509 GIANT EAGLE INC 2365 EAST STATE ST HERMITAGE 16148 GIANT EAGLE INC 2501 W 12TH ST ERIE 16505 GIANT EAGLE INC 2611 FREEPORT RD PITTSBURGH 15238 GIANT EAGLE INC 2840 WASHINGTON RD MCMURRAY 15317 GIANT EAGLE INC 331 WASHINGTON RD WASHINGTON 15301 GIANT EAGLE INC 4007 WASHINGTON RD MCMURRAY 15317 GIANT EAGLE INC 4010 MONROEVILLE BLVD MONROEVILLE 15146 GIANT EAGLE INC 41 TOWNE CENTER DR LEECHBURG 15656 GIANT EAGLE INC 420 E WATERFRONT DR HOMESTEAD 15120 GIANT EAGLE INC 4265 BUFFALO RD ERIE 16510 GIANT EAGLE INC 5 QUAKER VILLAGE SHOPPING CENTER LEETSDALE 15056 GIANT EAGLE INC 5055 LIBRARY RD BETHEL PARK 15102 GIANT EAGLE INC 5142 RTE 30 STE 140 GREENSBURG 15601 GIANT EAGLE INC 5550 CENTRE AVE PITTSBURGH 15232 GIANT EAGLE INC 5990 UNIVERSITY BLVD STE 4 CORAOPOLIS 15108 GIANT EAGLE INC 600 TOWNE SQ WAY PITTSBURGH 15227 Page 13 of 14 Appendix I- Western Pennsylvania Service Region GIANT EAGLE INC 6204 RTE 30 GREENSBURG 15601 GIANT EAGLE INC 7000 OXFORD DR BETHEL PARK 15102 GIANT EAGLE INC 8901 STATE RTE 30 NORTH HUNTINGDON 15642 GIANT EAGLE INC 910 FREEPORT RD PITTSBURGH 15238 GIANT EAGLE INC 9805 MCKNIGHT RD PITTSBURGH 15237 GIANT EAGLE INC 9901 MOUNTAIN VIEW DR WEST MIFFLIN 15122 GIANT EAGLE INC 8080 MCINTYRE SQ DR Pittsburgh 15237 GIANT EAGLE INC 1606 N CENTER AVE SOMERSET 15501 SHEETZ #11 700 CHESTNUT AVE ALTOONA 16601 GIANT EAGLE INC 4250 MURRAY AVE Pittsburgh 15217

Page 14 of 14 Appendix I- Western Pennsylvania Service Region APPENDIX J – SERVICE/OPERATIONAL REQUREMENTS (as of March 2020) Offeror shall provide, dedicate, purchase and/or lease all equipment and resources in support of the services identified herein, except where identified otherwise.

Offeror’s performance with regard to service/operational requirements will be measured by and held accountable through Key Performance Indicators and Service Levels identified in Appendix P.

Any and all automation solutions and significant changes to Offeror’s standard operating procedures must be reviewed with and approved by the PLCB in advance of implementation of such solutions and/or changes. 1. Service Days/Times and Holidays

a. Typical business operations anticipate pick and pack operations Sunday through Friday and receipts Monday through Saturday. Special circumstances may necessitate work on non-standard days and/or hours. b. Offeror is expected to deliver Monday through Friday with the option for Saturday and Sunday deliveries at the PLCB’s request. c. Offeror will not be expected to operate on the following holidays: New Year’s Day, Easter Sunday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day and Christmas Day.

2. Inventory Management

PLCB alcohol merchandise is manufactured in a variety of sizes and packaging. Package types include various sizes (50 mL to 20 gallons) of alcohol merchandise in packaging consisting of glass, plastic, aluminum cans, tetra packs, bladders within cartons (boxed wine/spirits) and specialized custom packaging (wooden boxes, holiday packages, plastic buckets, etc). Most merchandise is shipped to PLCB in sealed cardboard cases. Canned and boxed wine may be shipped on shrink wrapped trays. Non-alcohol merchandise stored in the warehouse includes full-size barrels, consumer magazines, printers, rock salt, toilet paper, bags (single-use plastic, paper sleeves, totes, gift) and accessories such as corkscrews, glassware, barware, mixers and garnishes. a. Inventory in the warehouse will consist of both PLCB-owned (non-bailment) and supplier- owned (bailment) alcohol merchandise. Offeror operational requirements and responsibilities are the same for bailment and non-bailment inventory.

b. Offeror shall maintain and provide accurate detailed inventory records including quantities received and shipped, inventory on hand, damaged and lost products. Offeror shall maintain a perpetual record of inventory by item.

c. Offeror must provide an associate knowledgeable with inventory control functions.

Page 1 of 9 Appendix J- Service/Operational Requirements d. Inventory Counts i. Quarterly Cycle Counts. All items and locations in the warehouse, including empty locations, must be cycle counted at least once per quarter as part of regular operations. Expiration dates must be captured for all fresh-dated product. Commonwealth personnel must be granted access and permission to witness such cycle counts. The PLCB may share results of the cycle counts with bailment vendors. The Offeror WMS system will be the system of record for cycle count data. ii. Vendor Inventories. Offeror must provide reasonable access to vendors to allow them to count their merchandise. The PLCB will require any supplier or vendor requiring a physical count to provide adequate notice. Such inventories will be billed by the Offeror to the PLCB. iii. PLCB Full Physical Inventories: Offeror will furnish the necessary employees and equipment to enable the Commonwealth or its designated third-party to conduct at least one full physical inventory per year, to be scheduled minimizing operational impact. Offeror and PLCB will agree on an estimated cost, which will be billed by the Offeror to the PLCB. PLCB may share the results of this inventory with bailment vendors. Each full physical inventory will require verifying the item and quantity in all locations set up in the WMS; utilizing the WMS to execute the inventory; providing a method for recount; and cessation of any other operations during the count.

e. Fresh-Dated Merchandise. i. Offeror shall monitor the aging of fresh-dated or expiration-dated merchandise to ensure (1) no such product with less than six months shelf life remaining is received into the DC, and (2) no such product with less than 60 days shelf life remaining is shipped to stores or licensees. ii. Offeror must notify PLCB in writing when fresh-dated merchandise is within 60 days of its expiration date. PLCB may generate a claim to Offeror if product expires and PLCB was not notified 60 days in advance.

3. Receiving a. WMS must be able to accept purchase orders (POs) for PLCB-owned merchandise and advance shipping notices (ASNs) for bailment inventory, as well as the PLCB-assigned permit number associated with each order. A permit is generally the equivalent of a delivery appointment, and while one ASN will be associated with a single permit, one PO can be spread over multiple permits (deliveries), or one permit can have multiple POs. b. Shipments will be received from vendors/suppliers, consolidators (consolidator shipments will include multiple POs often from multiple vendors) and/or other distribution centers. c. The receiving process at the DC is the same regardless of whether the delivery is PO, ASN, consolidator or direct delivery.

Page 2 of 9 Appendix J- Service/Operational Requirements d. Offeror shall make mutually beneficial arrangements with suppliers and delivering carriers for the temporary storage and return of reusable thermal protective covers and monitoring devices. e. Appointments i. Offeror shall provide sufficient personnel between the hours of 6 a.m. and 5 p.m. Monday through Friday to respond to telephonic and electronic delivery appointment scheduling requests. Any changes to this schedule must be approved in advance by the PLCB. ii. While the PLCB will generally defer to Offeror’s expertise in scheduling inbound deliveries, it reserves the right to direct the receipt of priority inbounds. f. Unloading Merchandise i. The standard operating schedule for receipt of merchandise will be five days per week, 6 a.m. to 5 p.m. The PLCB may request and pay for additional hours or days of service to accommodate business needs. ii. Offeror will be responsible for unloading trailers and the breakdown of mixed pallets. iii. Inbound product will be palletized or slip-sheeted. 1. Vendors are not to ship inbound product in a floor-loaded fashion. 2. If a vendor ships product in a floor-loaded fashion, Offeror will secure PLCB’s direction to either 1) refuse the inbound load; or 2) unload it. 3. Offeror will record all instances of any vendor shipping product in a non- palletized or slip-sheeted manner and provide to PLCB as soon as possible by event. iv. Merchandise shall be unloaded and properly stored within 24 hours of initial unloading to ensure regular rotation of stock on a FIFO (first in, first out) or FEFO (first expiration, first out) basis. v. Offeror will verify by signature the delivery agent’s bill of lading (BOL) and the WMS receipt document and also secure the delivering agent’s signature on the BOL and WMS receipt document. vi. The inbound driver will be required to remain at the DC for the duration of unloading and until Offeror completes inspection of the unloaded merchandise. In cases of inbound damage or shortage, the driver and DC associate will be required to sign PLCB receiving and over/short/damage documentation. The driver will be provided a copy. vii. Offeror shall handle and store product on four-way, 48-inch by 40-inch pallets. viii. Seals 1. Offeror will record seal numbers on in-bound trailers. 2. Offeror will apply new seals to any partial shipping container received for on carriage to another PLCB facility. Occasionally, a trailer will require

Page 3 of 9 Appendix J- Service/Operational Requirements only partial unloading. Once the PLCB portion has been unloaded, Offeror must ensure that the trailer has a new seal installed and that the seal number is recorded prior to dispatch. g. Validating Merchandise at Receipt i. Offeror shall ensure that each unloaded pallet and its product(s) are uniquely identified in the WMS, capturing the quantity and manufacturer’s SCC number. ii. Offeror must verify case quantities against a packing slip and carrier BOL, ensuring that the item and quantity received in the WMS matches the physical quantity delivered. Any differences in item or quantity among the inbound receiving paperwork, the WMS and/or what is physically present will be documented in the WMS, and orders including variances or discrepancies in excess of 10 percent of case volume must be approved by the PLCB before the order is received. iii. If inbound case SCC labels are incorrect or missing, Offeror shall obtain approval from the PLCB to print and apply new labels to the cases prior to putaway. iv. If noticeable damage is identified once a trailer is opened, Offeror personnel shall contact the onsite PLCB manager to verify the damaged load. Offeror must isolate, record and track all damages. In the case of excessive damage, the onsite PLCB manager may authorize Offeror to reject receipt of individual loads. h. Receiving inbound returns. Offeror is required to receive, appropriately document and put away returns from FW&GS locations and licensees to the warehouse as authorized by the PLCB. Offeror will notify the PLCB prior to receiving if returned product is received in a damaged or non-sellable state.

4. Order Processing a. Overview: i. The PLCB inventory management system will review WMS inventory availability before transmitting orders only for available inventory to the WMS. ii. WMS must be capable of accepting and processing multiple orders per day for a given delivery location. iii. Delivery and pickup orders for licensees and/or a third-party delivery service may be full truckload orders or multiple orders for a single licensee per truckload, as well as orders for multiple licensees picked up by a single third-party transporter. Offeror must be capable of fulfilling all options. iv. PLCB will transmit orders to the WMS one day prior to the scheduled delivery date.

b. Offeror will pick orders, palletize, stage and load onto delivery trucks in sufficient time to ensure transportation and delivery to FW&GS locations and licensees in accordance with the daily delivery schedule established by the PLCB. Alternatively, and only as requested by the PLCB, orders may be tendered to a third-party transporter-for-hire. c. All Product must ship FIFO (first in, first out) or FEFO (first expiration, first out), ensuring no product is shipped with less than 60 days shelf life remaining.

Page 4 of 9 Appendix J- Service/Operational Requirements d. Routing. i. Offeror will create effective and efficient routes based upon volume, restrictions and delivery profile as communicated by the PLCB. ii. Special requests such as specific delivery windows or unique delivery requirements will be discussed and agreed to by the parties on a case-by-case basis. e. Picking / Staging i. Picking shall occur Sunday through Thursday for Monday through Friday deliveries. ii. Offeror must be capable of picking full pallet, full case or less than full case quantity. The WMS must be capable of breaking up an order quantity across pick areas for pick efficiency. iii. All outbound pallets must be chimney stacked. iv. All orders must be consolidated by delivery location prior to shipment. v. All orders/pallets and mixed bottle cases must labeled to PLCB specifications. vi. All cases will be placed on 48-inch by 40-inch four-way Grade A pallet, shrink- wrapped. Bands may be utilized. It is the Offeror’s responsibility to ensure the stability of the pallet to avoid damage during transportation. vii. Each pallet must have a pallet label generated from the WMS identifying the item(s) and case quantity(ies) on the pallet. viii. All loads shall be inspected for accuracy prior to loading onto the delivery truck. ix. Pallets will be scanned to the truck as it is loaded. Trailer shall be loaded such that all pallets are stable. f. Return to vendor i. On occasion, PLCB will provide authorization to Offeror to pick and ship product for return to vendor. ii. Vendor carriers shall set appointments with Offeror to pick up a return.

5. Transportation and Delivery

a. The PLCB requires that Offeror supply its own industry-recognized transportation management system (TMS), inclusive of all hardware, software, licenses and maintenance required to support transportation services and fulfill the functional requirements, interfaces and reports as identified in the RFP and related appendices. In addition to the specific requirements provided herein, the Offeror is responsible for the configuration and/or setup of the TMS needed to meet operational needs. b. Drivers must be proficient in reading, writing and speaking English. c. Offeror shall provide and manage all transportation assets, labor, technology and maintenance to provide the transportation services hereunder and shall maintain all equipment in good repair and condition.

Page 5 of 9 Appendix J- Service/Operational Requirements d. Offeror shall employ for its transportation services only competent and properly licensed personnel. e. Offeror must maintain a Satisfactory rating with the Federal Motor Carrier Safety Administration (FMCSA). Should Offeror drop below this rating, Offeror must notify the PLCB immediately. f. Offeror trailers must have the equipment required to unload merchandise off the trailer. g. Merchandise which is shipped but is not on the order shall be returned to the DC at Offeror’s sole cost and expense. h. PLCB reserves the right to hire a transporter other than Offeror to pick up and deliver merchandise at the DC due to special circumstances. Offeror will allow an appointment to be scheduled and the load to be placed in a staging area until pickup. Special circumstances include but are not limited to special events, high-value merchandise and PLCB equipment (printers, rugs, etc.). i. Offeror shall pick up and transport pallets and empty cases from FW&GS stores to the DC. The PLCB may also ask for occasional pick up and transport of other merchandise or equipment on a case-by-case basis. j. Delivery schedules i. Offeror is expected to deliver Monday through Friday with the option for Saturday and Sunday deliveries at the PLCB’s request. All deliveries must be complete by 4 p.m. ii. Any recommended changes to the PLCB-established daily delivery schedules must be approved in advance by the PLCB. iii. All locations on each route shall be notified by the Offeror of the approximate time of delivery one day in advance of delivery by email or other PLCB-approved method. iv. A special delivery schedule shall be established when a holiday or other occurrence disrupts normal delivery operations. k. Unloading: i. Every delivery truck must be equipped with a lift-gate capable of unloading full pallets from the truck. ii. Dependent upon the unique needs of each delivery location (see Appendix I, Western Pennsylvania Service Region), it will be the Offeror’s responsibility to determine the most secure and efficient means to transfer product to the receiving location, including the provision of rollers on an as needed basis. iii. In cases of full pallet offloading, Offeror must unload the pallet using Offeror- supplied pallet jack and deposit the pallet in the backroom or designated location within the receiving FW&GS store or licensee location.

Page 6 of 9 Appendix J- Service/Operational Requirements l. Licensee pickup orders. i. Licensee pickup orders may be dropped trailers or live loads. Offeror must offer and use appointments for live loads, while dropped trailer fulfillment will follow a PLCB-designated schedule. ii. Offeror will load each Licensee pickup order onto a licensee-provided trailer or other vehicle. Offeror must be able to fulfill all licensee pickup orders, which may, in the future, include vehicles smaller than tractor trailers. iii. The licensee’s contracted driver must sign the BOL generated by the WMS. m. Temperature control: i. Offeror shall ensure that all merchandise is protected from temperature extremes or weather-related damage during the delivery process. ii. Any damage that occurs in the delivery process due to Offeror failure to take reasonable steps to protect merchandise from temperature extremes will be the financial responsibility of the offeror. n. Delivery times. i. Deliveries to FW&GS stores must arrive on the day stated on the WMS order. ii. Deliveries to licensee locations must conform to the specific dock time arranged with each such location. o. Delivery over/short/damage process (O/S/D). i. Transportation damage. Offeror will be held responsible for the loss of any product due to transportation damage reported by FW&GS stores and licensees. ii. Offeror must document, in a manner acceptable to the PLCB any O/S/D identified during transport. iii. FW&GS stores: 1. Before leaving the store, the Offeror driver must notify a store representative that delivery is complete. The driver and PLCB store representative shall conduct a total case count for the delivery and record any O/S/D on the BOL. The BOL must be signed by the Offeror driver and store receiver. 2. The Offeror driver must sign the PLCB store-generated warehouse variance report which documents O/S/D as recorded by the PLCB store associate. The Offeror driver signature indicates that Offeror is in agreement with the O/S/D quantities documented on the report. 3. If an overage or shortage is discovered in the store receipt process, Offeror must immediately perform a count of the item in the warehouse and make appropriate adjustment(s) within 24 hours. 4. If an unacceptable overage or mis-shipped product is discovered, at the PLCB’s discretion, Offeror may be required to retrieve and return the product to the DC at its own expense, receiving it back into inventory.

Page 7 of 9 Appendix J- Service/Operational Requirements iv. Licensee Deliveries: 1. Before leaving the location, the Offeror driver must notify a licensee representative that delivery is complete. The driver and licensee representative shall conduct a total case count for the delivery and record any O/S/D on the BOL. The BOL must be signed by the Offeror driver and licensee receiver. 2. If an unacceptable overage or mis-shipped product is discovered by a Licensee, Offeror must retrieve and return the product to the DC at its own cost, receiving it back into inventory.

3. Damaged cases discovered during delivery will generally be disposed of by the receiving licensee, and the PLCB will bill the Offeror for such disposition. v. Licensee Pickups: 1. Offeror shall provide licensee driver safe and reasonable access to the interior of the trailer for purposes of securing the load and applying the seal. 2. Before leaving the DC, the licensee driver will sign the BOL accepting the order as is.

6. Transfers to and from other PLCB-Designated Locations

a. Upon notification by PLCB of an inbound transfer, Offeror will receive shipments from another PLCB distribution center or designated location. b. Upon notification by PLCB of an outbound transfer, Offeror will ship to another PLCB distribution center or designated location.

7. Cross-Docking. While the PLCB does not currently require cross-docking capabilities, it anticipates requiring receipt, storage (staging) and shipment of pre-palletized merchandise in the future. Offeror must be capable of providing such services following reasonable notification by the PLCB.

8. Additional Services

a. Relabeling cases i. PLCB requires consolidators and suppliers to apply a PLCB item label on each case. Sometimes the label is incorrect or missing. Upon authorization from the PLCB, the Offeror will print PLCB item labels from the WMS and apply them to cases. ii. Such labels must meet PLCB-prescribed labeling specifications. iii. Offeror will complete the relabeling within two working days of notification or as otherwise directed by the PLCB. iv. PLCB will not request Offeror to relabel individual bottles or retail units.

Page 8 of 9 Appendix J- Service/Operational Requirements b. Reconditioning product i. PLCB will provide authorization for Offeror to recondition merchandise, which entails repacking sellable bottles from a damaged case into a new case, re-taping cases and similar functions. ii. Offeror must be capable of applying UPC stickers to individual bottles, should such a need be identified in the future. iii. Offeror will complete the requested reconditioning within one work week of notification or as otherwise directed by the PLCB. iv. Offeror will dispose of empty cartons, packaging and empty bottles. c. Inspections i. Upon request by the PLCB, Offeror shall physically weigh and measure a case and check the pallet configuration. If any value does not match what is in the WMS, the WMS will be updated and Offeror will notify the PLCB of such changes. ii. Upon request by the PLCB, Offeror shall physically weigh and measure individual bottles or products. If any value does not match what is in the WMS, the WMS will be updated and Offeror will notify the PLCB of such changes. iii. Upon request by the PLCB, Offeror will perform inspection of the exterior of cases. Generally, external inspection is requested to verify information on the case label, lot code and/or UPC; verify condition of the physical case; and/or report on the freshness date printed on the case. iv. Upon request by the PLCB, Offeror will perform inspection of the retail units inside a case. Generally, internal inspection is requested to verify the product inside the case and/or the physical condition of the product. v. Photos of external and internal inspections must be provided at the PLCB’s request. d. Destruction. Offeror will not be responsible for destruction, however Offeror will be required to stage product designated by the PLCB for destruction and assist with loading onto destruction transport service provider trailer as needed. e. Returns to Warehouse. Special circumstances including product recalls/withdrawals and egregious error orders on the part of receiving locations may infrequently require the Offeror to retrieve merchandise from FW&GS stores and/or licensees and return it to the warehouse, receiving it back into inventory.

Page 9 of 9 Appendix J- Service/Operational Requirements APPENDIX K- DISTRIBUTION CENTER FACILITY REQUIREMENTS 1. Physical characteristics. a. The DC must be located on a lot with full perimeter fencing which supports parking of transportation assets and employee vehicles, including those of at least five PLCB employees. The DC must be able to store loaded trucks or trailers securely on the site. b. The DC must have fire protection and suppression systems which meet or exceed federal, state and local regulatory standards. The DC must have a sprinkler system, which Offeror shall have checked/tested and certified prior to receiving Product, and annually thereafter, through the length of the Agreement. A copy of the certification of the sprinkler system shall be forwarded to the PLCB within 30 days following the test. c. The DC must also provide sufficient fire suppression protections meeting or exceeding federal, state and local regulatory standards for high-proof alcohol. d. The DC must have a temperature- and humidity-controlled cooler approximately 2,000 sq. ft. in the primary facility. The cooler shall be maintained at approximately 58 degrees Fahrenheit and at approximately 68% humidity levels for storage of merchandise at the direction of the PLCB. Such space must also provide the option for securing high-value merchandise within it upon PLCB request. e. All products stored outside the temperature- and humidity-controlled cooler will be stored at ambient temperature and humidity conditions. f. The DC must also have an area of approximately 1,000 square feet large to secure high value items designated for storage in such space by the PLCB.

2. Office Areas a. The PLCB requires access to a wifi-enabled conference room accommodating at least 12 people for meetings. b. PLCB Offices. Offeror shall provide at least 500 square feet of office space at the DC for up to five PLCB employees and office equipment. i. The office space must include one private office plus a shared office area for four employees, including wiring and electrical power for computer access, Internet access, and printers. ii. The PLCB office space should be adjacent to the Offeror’s main office. iii. The office space shall have readily available access to adequate restroom facilities for both genders/sexes. iv. The PLCB office space shall be temperature controlled, and the PLCB shall have access to temperature controls in this space. v. Offeror shall provide lighting adequate for office work purposes and at least equivalent to that in Offeror’s office space. vi. The PLCB will install a telephone system to support the PLCB offices and workspaces.

Page 1 of 2 Appendix K – Distribution Center Facility Requirements vii. The PLCB will supply computers, printer(s), and copier(s) needed by PLCB employees, and it will install access for PLCB employees to PLCB network(s) and systems. The Offeror must provide PLCB with a slot in the Offeror network rack for the PLCB switch. viii. PLCB will provide office furniture for its employees. c. A room must be provided, as well as restroom access, for use by drivers not employed by the Offeror but visiting the DC in support of PLCB business (e.g., supplier and licensee drivers).

3. DC Maintenance and Repair a. Offeror will be responsible for the maintenance and repair of the DC and all other obligations of Offeror under any lease for the DC. Offeror shall be responsible for the maintenance and working condition of the DC 24 hours per day, seven days per week, 365 days per year (24/7/365). b. Offeror will perform its maintenance activities in a good and workmanlike manner, as measured by standards that are appropriate for warehouse buildings of similar age and quality. Copies of certifications required by federal, state or local law or regulation – as well as HVAC, pest control and security certifications – must be provided to the PLCB site manager upon certification completion. c. Offeror will perform regular and routine cleaning of the DC, including but not limited to storage areas, office facilities (including all office space utilized by the PLCB), docks, lunchroom, building service area and restrooms. d. Offeror will perform collection and removal of all trash, including that of the PLCB office staff, as well as pallets, shrink wrap, disposable thermal blankets and corrugate. e. Offeror will perform snow removal for all paved areas of the facility and the maintenance of surrounding ground, lawn and landscaped areas.

4. Security and Safety a. Offeror must provide security coverage 24/7/365 around the campus and facility to safeguard all site personnel, product, equipment, and PLCB property. b. CCTV will use digital video recording and is a mandatory requirement with at least 12 months of storage. The CCTV system will include monitoring of both interior and exterior areas and include the following: associate entrance, emergency exit doors and other doors accessing sensitive areas, dock doors, ramp doors, etc., interior dock staging area, parcel shipping and packaging area, driver entrance, exterior dock area and/or traffic entrance/exit onto the dock area and grounds. c. An inspection of each and every person exiting the DC must be conducted to ensure no product leaves the facility unauthorized. d. All personnel in the building, regardless of employer, must be visibly identifiable by position/name of both the employee and the employer. Visitors must also be registered and granted temporary ID badges while on site. e. Offeror must provide a plan to ensure area managed on behalf of the PLCB is properly identified and secured if space is shared with another entity or on the same campus. f. Offeror is required to develop and maintain emergency operations plans that account for and protect all individuals on the Offeror’s premises.

Page 2 of 2 Appendix K – Distribution Center Facility Requirements APPENDIX L, WAREHOUSE MANAGEMENT SYSTEM SPECIFICATIONS AND REQUIREMENTS

1. Provision of WMS, PLCB access and escalation procedures a. The PLCB requires that Offeror supply its own systems technology, inclusive of all hardware, software, licenses and maintenance required to support warehousing and transportation services and fulfill the functional requirements, interfaces and reports as identified in the RFP and related appendices. In addition to the specific requirements provided herein, the Offeror is responsible for the configuration and/or setup of the WMS needed to meet operational needs. b. PLCB shall be provided access to the WMS enabling PLCB to view, export and print. WMS access should provide real-time data and responsiveness within 5 seconds. c. Offeror must provide PLCB with contacts and escalation procedures to promptly and effectively resolve WMS issues including interface failures, report failures, poor response time and requests for development.

2. WMS interfaces to PLCB a. Communication protocols i. PLCB utilizes sftp for file transfer. ii. For security purposes, the PLCB utilizes a server outside the PLCB firewall as an intermediary server for sending and receiving files. b. PLCB host system data feeds to WMS i. PLCB data will be sent at least once a day, at scheduled intervals. ii. Any record that is sent from PLCB that does not insert or update in the WMS should report an error. iii. The error report should be emailed at a minimum once per day to a designated PLCB email group. iv. Errors should also be available in a standard WMS report v. PLCB will send the following data files to the WMS: 1. Item Maintenance. Daily incremental file. 2. Vendors. Daily, all vendors. 3. Inbound orders. Daily, new, updates, cancels. 4. Customer. Weekly, all customers. 5. Outbound orders. At least daily, new only. 6. Return to warehouse authorization. Daily. New only. 7. Over/Short data. Daily, for reporting. 8. Order Cancellation. Only the header record will be sent, as processed. vi. All data sent to the WMS from the PLCB host will follow a fixed-length flat file format.

Page 1 of 7 Appendix L- Warehouse Management System Specifications and Requirements vii. Files will be named using a prefix followed by a sequential number and file type suffix.

b. WMS data feeds to PLCB host system i. PLCB will pick up files generated by the WMS at least hourly, Monday through Saturday. The schedule may differ on Sunday. ii. The WMS must balance against the PLCB host system at least daily, prior to the start of the next business day. iii. The WMS must send the following data to PLCB host: 1. Inventory balance. As processed in the WMS. 2. Inventory status change. As processed in the WMS. 3. Inventory adjustments. As processed in the WMS. 4. Receipts. As processed in the WMS. 5. Ship verification. As processed in the WMS. 6. Licensee direct returns. As processed in the WMS. 7. Emergency Orders. As processed in the WMS

3. WMS Receiving Requirements a. WMS must be able to accept purchase orders (POs) for PLCB-owned merchandise, advance shipping notices (ASNs) for bailment inventory and transfers from PLCB- designated locations, as well as the PLCB-assigned permit number associated with each order. A permit is generally the equivalent of a delivery appointment, and while one ASN will be associated with a single permit, one PO can be spread over multiple permits (deliveries), or one permit can have multiple POs. b. The WMS must have the capability to property mark (for a specific store or customer, for example) any merchandise in the DC at any time the merchandise is under Offeror’s control.

c. Inbound Orders i. Vendor advanced shipping notices (ASNs), PLCB purchase orders (POs) and transfers from PLCB-designated locations will be sent from the PLCB as three separate data feeds at least once daily. WMS must be capable of processing additional files at any time. ii. Each PLCB data feed will contain new, updated and cancelled orders. iii. If a modified order is sent to the WMS before receiving has begun, the WMS must update the order to reflect added and cancelled items. iv. If the PLCB host sends a cancel record, the WMS must update the order status to cancel or similar status. v. WMS must have capability to accommodate electronic data interchange (EDI), should PLCB expand EDI capabilities in the future.

Page 2 of 7 Appendix L- Warehouse Management System Specifications and Requirements

d. Appointments. i. Offeror must have the ability to systematically schedule and track inbound delivery appointments, associating the appropriate order numbers with each delivery. ii. Access to such records must be available to the PLCB upon request. d. General receiving protocols i. All items must be received against an open order. ii. The WMS must validate the SCC against the PLCB-provided item maintenance data file during the receiving process. If the SCC does not exist in the WMS, the WMS must error and not allow receipt. iii. The WMS must be able to receive orders that include overages, shorts, damages and incorrect product and appropriately record such order discrepancies at time of receipt. iv. Orders including variances or discrepancies in excess of 10 percent of case volume must be approved by the PLCB before the order is received. v. At receiving, if an item is fresh-dated the WMS must capture the freshness date and retain that date throughout the receipt, inventory control, order processing and transportation and delivery processes identified in Appendix J, Service/Operational Requirements. e. Damaged product. i. The WMS must allow for input of a PLCB-designated code relative to damage. ii. The receipt confirmation to the PLCB host must indicate damage quantity per the inventory adjustment interface specification herein. iii. The PLCB receiving report (see section g below) must include a column for damaged product received. f. Receipt adjustments/corrections. If a receipt adjustment is made in the WMS and receipt confirmation has not been sent to the PLCB host, the WMS should not send an adjustment record to the host. g. Receipt acceptance paperwork (PLCB receiving report) i. When the WMS order receipt process is complete and the receiving associate has verified the receipt quantities and items are correct, the order should be closed or completed in the WMS. At that time, the PLCB receiving report should print automatically at the DC so it may be signed by the driver/carrier representative. ii. The WMS must also allow reprint of the PLCB receiving report in WMS as well as for PLCB team.

Page 3 of 7 Appendix L- Warehouse Management System Specifications and Requirements iii. The WMS must send a daily electronic feed to PLCB of all PLCB receiving reports generated that day. Ideally this would be a .pdf file.

h. Transfers from other PLCB-designated locations i. Transfers from other PLCB-designated locations will be sent by the PLCB host to the WMS in the inbound order interface. ii. The order type will be “DC.” iii. Regular order receiving process shall then be followed.

i. DC Returns from FW&GS stores and licensees i. The WMS must be capable of accepting return authorizations for returns from FW&GS stores and licensees. ii. After the return is received and closed, the WMS will send a confirmation record to the PLCB host using the return confirmation file format. iii. Returns must be included in the receipt confirmation interface.

4. WMS Shipping Requirements a. WMS must have capability to accommodate electronic data interchange (EDI), should PLCB expand EDI capabilities in the future. b. Shipment types. The PLCB currently supports the following types of outbound shipments. Additional operational scenarios or types may be added in the future. i. FW&GS – Shipments to PLCB-owned stores. Order type is CO (case order). ii. Licensee direct – Shipments to licensees, including to stores, warehouses and trailer drop. Order type is LD (licensee direct). Orders that are getting picked up at the DC must have a pickup flag in the interface file. iii. Transfer to another PLCB-designated location. Order type is DC. iv. Return to vendor. Returns to a bailment vendor will be sent to the DC as an order. Order type is VD. c. Inventory Allocation i. WMS must allocate product on a FIFO (first in, first out) or FEFO (first expiration, first out) basis. ii. PLCB does not allow item substitution. iii. The order quantity from the host is sent in units. d. Order cancellation. Full and partial order cancellations must be accommodated by the WMS. The ship confirmation interface must send the cancelled item in the file with a ship quantity = 0. e. Routing. Offeror must provide a systematic method for routing orders based on delivery location, driver work time requirements and delivery site requirements. f. Shipment confirmation

Page 4 of 7 Appendix L- Warehouse Management System Specifications and Requirements i. Ship confirmation data must be based on a closed or shipped order when no further changes can be made. ii. If an item could not be allocated in the WMS or was not picked, a zero must be reflected in the ship confirmation field. iii. Control processes must be in place in the WMS interface processing to ensure an order is not sent twice to the PLCB. 5. WMS Inventory management requirements a. Inventory adjustment i. The WMS must send inventory adjustment information when the on-hand quantity is adjusted. iii. This record must provide the status of the item location at the time it is adjusted. b. Inventory status. The inventory status interface is for inventory status changes only, with no stock-on-hand adjustment. c. Weekly stock on hand i. Once a week on Saturday before 11 PM EST the WMS must send the PLCB a file which contains stock on hand information for all items in the WMS item master. ii. If an item does not have any stock on hand it must be sent with a SOH value of zero. iii. If an item has a negative inventory value in the WMS, a value of zero must be sent to PLCB. d. Inventory storage i. The WMS must accurately track and record inventory location by SCC. ii. Items stored in a location containing multiple SCCs must all have the same status (i.e., all damaged product, all QA hold, etc.). iii. Freshness dated product can only have one expiration date per location. e. Inventory status i. The WMS must allow the status of an item in a location to be changed. ii. The WMS must not allow putaway to a location where the item currently in the location is in a different status. iii. The WMS must not allow a pick or move from a location where the item is in an unavailable status. iv. When sending data regarding inventory adjustment and receipt confirmation, the appropriate PLCB-designated status must be used. v. The following inventory statuses must be available in the WMS.

Page 5 of 7 Appendix L- Warehouse Management System Specifications and Requirements WMS Inventory Available to Definition Status to be PLCB Host Status pick in the Communicated Inventory WMS ? to PLCB Status Available Yes Available to pick GOOD Available RTV No Supports existing bailment GOOD Available RTV process to secure inventory until time of shipment Cycle Count No Hold awaiting cycle count GOOD Available Expired No Expired freshness dated DONTUSE Non-Sellable product QA Hold No Product issues related to DONTUSE Non-Sellable quality/safety Damaged No Product awaiting destruction DAMCOUP Non-Sellable or disposition Recoup No Rework of damaged product DAMCOUP Non-Sellable Short Coded No Freshness dated product GOOD Available within 60 days of expiration

f. Inventory Adjustments i. Following are the only adjustment codes allowed by the PLCB host. If the Offeror chooses to use an additional code, it must be mapped to a one of the following codes. ii. The WMS must accommodate all the following codes and associated PLCB data requirements.

Adjustment Definition Offeror must record the following in code the WMS upon usage of corresponding code 825 Shipment adjustment for FW&GS Invoice number (NNNN-NN). Must be a store. Correct inventory due to an valid order number. over/short shipment. Store number (NNNNN). Must be the store for the invoice number input. FAIL Only to be used upon direction of PLCB to adjust inventory in the WMS but not PLCB host. INVA Adjustment for missing or found inventory, including cycle count adjustments. NOPE Code to be used upon destruction. Requires PLCB-provided tracking number for validation PHYS Only to be used upon direction of PLCB for special situations like auditor cycle count.

Page 6 of 7 Appendix L- Warehouse Management System Specifications and Requirements RCDE Recode Adjustment. When the SCC needs to be changed for an item. RCPT Only to be used upon direction of PLCB Adjustment cannot be made on closed for receipt correction adjustment. orders. TVPA Only to be used upon direction of PLCB to adjust inventory upon return to vendor.

g. Cycle & Inventory Counting i. WMS must accommodate cycle counting of all locations within each PLCB fiscal year quarter. ii. WMS cycle count records must include verification expiration dates for freshness dated product. iii. WMS must facilitate inventory counts by suppliers. iv. WMS must facilitate full physical inventory upon PLCB request, receiving inventory files from a third party to update the WMS.

Page 7 of 7 Appendix L- Warehouse Management System Specifications and Requirements APPENDIX M - REQUIRED REPORTS AND DOCUMENTS

1. Reports. In addition to WMS access allowing PLCB to view, export and print and the WMS data feeds to the PLCB host, the PLCB may require the following reports and documents on the following delivery schedules. Such reports shall be sent to the PLCB by noon on the Offeror’s following business day. a. Daily Inbound Receiving, providing appointment information and expected and actual receipt data by item. b. Forward-Looking Delivery Appointment Schedule identifying future shipments to be received c. Fill Rate, showing cases ordered and cases shipped by item. d. Outbound BOL Summary Report, showing daily shipment numbers, total cases expected and total cases delivered, as well as additional information as required. e. Records of a receiving day’s inbound receipts must be made available electronically to the PLCB. f. Daily Audit Trail Report detailing all transactions for the day. g. Daily Cycle Count Report summarizing daily and cumulative cycle count progress and detailing location count, variances, locations not counted, expected and actual quantity. h. Weekly QA Status report identifying each item not in available status and therefore unavailable for picking, detailing item, location, quantity, date status was assigned and cumulative days on hold. i. Weekly report by Offeror to the PLCB of WMS changes relative to bottle sizes, case dimensions and pallet configurations. j. Daily Error Report showing file errors, transmission errors, interface errors, etc. k. Weekly, monthly and annual KPI Status Reports demonstrating Offeror’s compliance with established key performance indicators. l. As needed service failure report identifying service failures and corrective actions. m. On demand expiration report detailing freshness-dated product per item and per freshness date

2. Documents. a. Scanned copies of all bills of lading shall be sent daily to PLCB. b. WMS must produce and send to the PLCB a bill of lading for every shipment completed c. As needs arise, the PLCB and the selected Offeror will work together to structure a reporting system to provide timely information useful to both parties. d. The PLCB reserves the right to require ad-hoc reports and/or documents to supplement normal reporting standards whenever needed.

Page 1 of 1 Appendix M – Required Reports and Documents Appendix N – Bailment Program Active Vendor List As of 2/19/2020

Bacardi North America Corporation MHW, Ltd. Banfi Products Corporation Moet Hennessy USA, Inc. Brown-Forman Corporation Montebello Brands, Inc. Capital Wine & Spirits* Palm Bay International, Inc. Capital Wine & Spirits dba North Paterno Imports Ltd. Wales Wines Pernod-Ricard USA, Inc. Carriage House Imports, Ltd. Pio Imports Constellation Brands, Inc. Proximo Spirits, Inc. Deutsch Family Wine & Spirits Sazerac Company, Inc. Diageo Americas, Inc. Sazerac North America Fetzer Vineyards Southern Glazer’s Wine and Spirits of Fifth Generation, Inc. Pennsylvania, LLC Heaven Hill Sales Co. dba Heaven Stoli Group USA, LLC Hill Brands Sutter Home Winery, Inc. dba Jackson Family Enterprises, Inc. dba Trinchero Family Estates Jackson Family Fine Wines The Wine Group Jim Beam Brands Co. The Wine Merchant, Ltd. Kobrand Corporation Treasury Wine Estates Limited Laird Wine & Spirits of PA Vintage Imports Luxco Inc. Western Spirits Beverage Company, Majestic Wine & Spirits USA, Inc.* LLC Mast-Jagermeister US, Inc. William Grant and Sons, Inc. McCormick Distilling Company

*Denotes those vendors that have Bailment Agreements with effective dates that are subsequent to the posting of this RFP but will be in effect at the time services are to be provided.

Page 1 of 17 Appendix N- Bailment Program

SAMPLE BAILMENT AGREEMENT BETWEEN THE PENNSYLVANIA LIQUOR CONTROL BOARD AND [VENDOR NAME]

The Pennsylvania Liquor Control Board (“PLCB”), headquartered at Northwest Office Building, 910 Capital Street, Harrisburg, Pennsylvania, and [VENDOR NAME], (“Vendor”), headquartered at [VENDOR ADDRESS] (collectively, “the Parties”) enter into this Agreement for the purpose of operating a Bailment Warehouse Program. This Agreement will be effective on [EFFECTIVE DATE] and will remain in effect until cancelled in writing by the PLCB or by the Vendor with thirty calendar days’ prior written notice to the other party.

A Bailment Warehouse Program is defined as one party storing or housing property owned by another party. The parties agree that the PLCB will store or house, in its contracted Distribution Centers (“DCs”), product that is owned by the Vendor.

The following definitions shall apply to this Agreement: 1. ASN – Advance Shipping Notice, the notice that Vendor shall provide the PLCB prior to sending a shipment of bailment product to a PLCB DC.

2. Damage – When merchandise has, through the perils of transportation, handling, or natural occurrences, attained a condition that prevents its sale at full retail price through the PLCB’s wine and spirits store system.

3. DC – Distribution Center, a third-party warehouse where the PLCB shall store bailment and non-bailment product.

4. Delisted – Product that the PLCB decides to no longer offer for sale in the PLCB’s wine and spirits stores.

5. EDI – Electronic data interchange, a method of transmitting data or information electronically.

6. Incorrect Product – Product that the Vendor has shipped to the PLCB that was not indicated on the ASN.

7. Luxury Merchandise – Non-stock merchandise that is allocated among the PLCB’s wine and spirits stores and generally is not replenished as it is consumed.

8. Overage – A physical quantity of a product which is greater than ASN or PLCB records indicate.

9. Private Account – A separate location in the DC where bailment product will be held pending disposition when, for whatever reason, the product cannot be put away in the DC.

Page 2 of 17 Appendix N- Bailment Program

10. Product Code/Warehouse/Week – The format used by the PLCB to express various supply chain values related to a particular product: the PLCB Code (item number), the specific DC where the product will be stored, and one calendar week.

11. Recoup – Any handling or reworking of product necessary to repair or correct damage or deficiency to render the product fit for resale.

12. Salable Product – Product that can be sold at full retail price. 13. Shortage – A physical quantity of a product which is less than ASN or PLCB records indicate.

14. SO – Special Order, an order for a liquor product that is not listed for sale in the PLCB’s wine and spirits stores. Such orders are placed by the consumer and accepted by the Vendor. 15. Stock Merchandise – Product that has been listed by the PLCB for sale in its wine and spirits stores and is replenished as it is consumed.

16. Substantial Damage – A quantity of damage sustained by the contents of a trailer or other container such that a visual review leads to a reasonable conclusion that recouping the number of damaged cases will require a significant investment of time and/or effort.

17. Unsalable Product – Product that is not fit for retail sale as determined by the PLCB. The term shall also include product that has been delisted by the PLCB, or product that is not sold by the PLCB.

18. Vendor Collaboration Portal – An interactive internet tool that will provide the Vendor with a means to send ASN information and invoice information to the PLCB, as well as to provide the following information: Point of Sale (“POS”) forecast information, warehouse inventory information, historic sales information, purchase order information and vendor shipment information.

The PLCB and the Vendor agree to the following:

1. The Vendor agrees to place into bailment, and the PLCB agrees to store at PLCB DCs, Stock Merchandise.

2. As agreed by the Vendor and the PLCB, the Vendor may place into bailment, and the PLCB may agree to store at PLCB DCs, Luxury Merchandise.

3. As agreed by the Vendor and the PLCB, the Vendor may place into bailment, and the PLCB may agree to store at PLCB DCs, product that may be used to fulfill Special Orders.

4. The Vendor understands that the PLCB currently utilizes multiple logistics providers to operate the third-party Distribution Centers. Each DC has a PLCB DC Manager and a DC

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Operator Manager. The Vendor further understands that bailed product may be housed at the following locations, or at any other suitable location(s) identified by the PLCB as a “PLCB DC:”

DC 1: Philadelphia: 8201 Enterprise Avenue Philadelphia, PA 19153-3896

DC 2: Scranton: Kane Warehouse Inc. 24 Stauffer Drive Taylor, PA 18517-9694

DC 4: Pittsburgh: Papercraft Building 100 Papercraft Park Pittsburgh, PA 15238-3218

5. The Vendor agrees that all Merchandise Purchase Orders are subject to the PLCB’s Standard Contract Terms and Conditions for Wine, Spirits and Accessories Purchase Orders, Form 54-FA-1.1, a copy of which is attached hereto as Appendix E and incorporated herein by reference.

6. The Vendor agrees to give the PLCB standing authorization to remove bailed product stored in a PLCB DC for shipment to any retail outlet or licensee location. The Vendor is required to complete the “Bailment Authorization

Form” provided by the PLCB. (See Appendix A). This form grants the PLCB the authority to effectuate the removal of the Vendor’s product from bailment on a shipment-by- shipment basis. The Vendor agrees that its designated representative will indicate its rejection, in whole or in part, of a PLCB order for products maintained in a DC within two hours of receipt of the order, or the PLCB’s order will be deemed to have been accepted.

The Vendor agrees that, in the event that the Vendor decides to rescind, on a permanent or temporary basis, the PLCB’s standing authorization to remove bailed product, its designated representative will provide written notice to the PLCB at least three business days prior to the effective date of such rescission. In the event that the Vendor needs to rescind the PLCB’s standing authorization to remove bailed product for reasons of product quality or safety, the PLCB shall not require three business days written notice.

7. At least two business days before the anticipated date of receipt, the Vendor will send to the PLCB DC an ASN detailing the product it is shipping to the PLCB DC. The ASN may be sent either by entering the information on the Vendor Collaboration Portal (see

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Paragraphs 22 and 23) or by industry standard EDI. The entry of an ASN into the PLCB system will create a shipment number used for scheduling inbound shipments to the DC. The Vendor shall contact the receiving scheduler at the DC to schedule the delivery to the DC. The shipment number must be shown on shipping paperwork. The granting of delivery appointments is dependent upon the PLCB DC’s schedule. Appropriate lead time should be provided when planning replenishment shipments so that receiving constraints do not impact product availability for shipment to PLCB stores.

8. Receiving hours at the PLCB DCs are designated by the PLCB. There will be no receiving on Saturdays, Sundays, or designated holidays. (See Appendix B). The PLCB reserves the right to change receiving hours to better suit its needs and will provide the Vendor with thirty calendar days’ advance notice of any changes made to receiving hours. Any issues with delivery scheduling should be addressed to the PLCB DC Manager at the receiving DC.

9. Receiving: Overages, Shortages, Incorrect Product and Damages

a. All units of each shipment must be shipped on slip-sheets, unitized for clamp truck, or palletized on forty-eight inch by forty inch four-way pallets. The PLCB will notify the Vendor of improperly palletized, unitized, or slip-sheeted products, and may assess charges commensurate with placing the material onto forty-eight inch by forty inch four-way pallets.

b. Floor loads are not permitted. Any floor loads may be rejected or accepted by the PLCB’s DC Manager or designee at its discretion. If the PLCB’s DC Manager or designee accepts the delivery of floor-loaded product, the Vendor’s carrier driver shall be responsible for the unloading of any floorloaded product.

c. Slip sheets (preferred) or pallets must be used to separate layers on pallets with mixed product. PLCB DC personnel will unload all full-pallet unitized loads. The Vendor’s carrier driver is required to witness the unloading. Carrier drivers are also required to separate any mixed-tier unitized loads onto individual pallets. Both the carrier driver and the PLCB DC personnel will sign the receiving report form and the Bill of Lading. Overage of product, shortage of product, and damage will be noted on the paperwork.

d. Upon receipt of product, PLCB DC personnel will complete a receiving report form for each load delivered and give the completed form to the transportation driver before he or she departs from the DC. The DC shall update the inventory records of the Vendor’s bailed product daily.

e. Overage

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1. In the event that there is an Overage on a shipment received at a PLCB DC, the PLCB will note the Overage on the Bill of Lading and will place the Overage in the Vendor’s inventory.

2. The actual quantity received will be used to update inventory records. f. Shortage

1. In the event that there is a Shortage on a shipment received at a PLCB DC, the PLCB will note the Shortage on the Bill of Lading.

2. The actual quantity received will be used to update inventory records. g. Incorrect Product

1. If Incorrect Product is received in a shipment to a PLCB DC, and the Incorrect Product is Stock Merchandise or Luxury Merchandise, the product will be receipted and added to either the bailment inventory of the vendor or the luxury inventory of the vendor, whichever is appropriate.

2. If the Incorrect Product is not Stock Merchandise or Luxury Merchandise, the product may be refused to the delivering carrier. Alternatively, the product may be placed into Private Account on behalf of the Vendor and the Vendor will be notified via e-mail. The Vendor shall have five business days to remove such product from Private Account. If the Vendor fails to provide reasonable disposition instructions within five business days, the PLCB may, in its sole discretion, return or dispose of such product and invoice the Vendor for handling charges. h. Damage

1. When product is received with any amount of Damage, the PLCB will notify the Vendor within two business days. The PLCB will recoup the damaged merchandise and will charge the Vendor for such services. The Vendor agrees to pay all applicable charges related to recouping. The PLCB reserves the sole right to determine if merchandise is damaged.

2. When the PLCB discovers substantial Damage to a shipment of cases, the truck will be sealed, and the Vendor will be notified. Photographic evidence will be obtained by the PLCB and provided to the vendor. The Vendor will be responsible for determining how the damaged cases are to be handled. No cases from the damaged shipment will be received into the PLCB DC until the PLCB is satisfied with the Vendor’s determination.

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3. It will be the sole responsibility of the Vendor to file claims with the carrier to recover the cost of any Damages that occurred during the transportation of the bailed product.

10. Only Salable Product shall be received into the bailment inventory for the Vendor. The PLCB reserves the right to refuse receipt of Unsalable Product at the PLCB DC.

11. Unsalable Product received at a PLCB DC shall be placed in Private Account, where it shall be held until a disposition determination is made. Any Unsalable Product received or warehoused at a PLCB DC will be disposed of in accordance with instructions provided by the Vendor. Such disposition instructions must be provided by the Vendor within ten business days after

the Vendor is notified of the receipt of Unsalable Product or of the PLCB’s decision to delist the product.

a. If the Vendor fails to provide reasonable disposition instructions within ten business days, the PLCB may, in its sole discretion, destroy the Unsalable Product and invoice the Vendor for charges related to such destruction, or ship the product to the Vendor at the Vendor’s sole expense, or ship the product to the Vendor’s domestic importation warehouse at the Vendor’s sole expense.

b. The PLCB will not be deemed to have purchased any Unsalable Product provided out of bailment stock except under the circumstances set forth in Paragraph 19.

12. The Vendor Collaboration Portal shall be updated regularly to provide information regarding the bailed product that the PLCB intends to withdraw from bailment for each day’s activity.

13. The PLCB will take ownership of the bailed product when it is loaded onto a delivery vehicle for delivery.

14. At the end of each week, the PLCB will generate a Purchase Order (“PO”) based on the sum of all withdrawals made against the vendor’s bailed product inventory from each DC. The PO will be posted on the Vendor Collaboration Portal or sent to the Vendor via an industry standard EDI transaction, depending on the vendor’s preference. The Vendor will submit to the PLCB an invoice for each PO. The PLCB will pay the invoice pursuant to the Standard Contract Terms and Conditions (Appendix E).

15. When the PLCB needs to provide product to a retail sales outlet or to a licensee, PLCB- owned inventory will be depleted first. Bailment inventory will then be used to complete shipments.

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16. Once the PLCB has purchased and acquired title to the product (see Appendix E Standard Terms and Conditions), title will remain with the PLCB until such time that it is sold to a consumer, including product that is ultimately delisted by the PLCB. The PLCB will not require the Vendor to reacquire delisted or any other product from the PLCB, although the Vendor may reacquire title to the product if it so chooses. Delisted product that remains in bailment inventory will be treated in the same manner as Unsalable Product. (See Paragraph 11).

17. Except for damage caused by the PLCB’s DC operators and their employees that occurs in the ordinary course of business while the product is stored in a PLCB DC, Vendor agrees to assume all storage risks and to acquire any necessary insurance on its product held at each of the PLCB DCs. Vendor further agrees to hold harmless the PLCB, its officers and employees, as well as the Commonwealth of Pennsylvania, for all damage or loss to the Vendor’s inventory stored at the PLCB DCs, and hereby does release the PLCB, its officers and employees, and the Commonwealth of Pennsylvania from liability for any and all such inventory losses, except as otherwise provided herein.

18. The PLCB shall require its DC operators to insure product stored at the Distribution Center and to name the Vendor as an additional insured on such insurance policy.

19. In the event that the PLCB’s DC operators and/or their employees damage Vendor-owned product in the ordinary course of business while the product is stored in a PLCB DC, the PLCB will take ownership of the damaged product and the PLCB will add the amount (cost and quantity) of the damaged product onto the PLCB’s weekly Purchase Order for consumed products. (See Paragraph 14).

20. The operator for the PLCB DC shall maintain a perpetual record, by item, of inventory held for distribution. The PLCB will take cycle counts of inventory on a quarterly basis.

a. Discrepancies discovered after a cycle count has been taken will be resolved as follows:

1. In the event of a physical inventory Shortage of the Vendor’s product, the PLCB will pay the Vendor for the missing product at the currently quoted PLCB cost on the date of the physical inventory or cycle count.

2. In the event of a physical inventory Overage of the Vendor’s product, the PLCB will take possession of the surplus inventory.

b. In the event that a physical inventory is scheduled to be taken, the PLCB will provide the Vendor with thirty calendar days’ advance notice.

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21. The Vendor may conduct physical counts of its bailed product in a DC for its own purposes after providing adequate notice to the PLCB Bureau of Distribution and Logistics of its intent to do so. The date and time of the count will be at the discretion of the PLCB, subject to business considerations. Costs for conducting the physical counts will be the responsibility of the Vendor. Discrepancies discovered in these counts shall be resolved as provided above in Paragraph 20.

22. The Vendor will have secure access via the Internet to the Vendor Collaboration Portal (“Portal”), which will allow the Vendor to access information regarding the Vendor’s product that is stored in each PLCB DC.

23. The Vendor will use the portal to view the following planning information:

a. Forecast: The Vendor will be given visibility to at least twenty-six weeks of POS Sales Forecast.

b. Sales History: The Vendor will be given visibility to at least thirteen weeks of sales history.

c. Inventory: The Vendor will be given visibility to current DC inventory and aggregate store on-hand inventory.

d. Planned Bailment Withdrawals: The Vendor will be given visibility to the items and quantities which PLCB plans to transfer from bailment to PLCBowned inventory; these represent the “planned withdrawals.”

24. It is understood and agreed between the parties that the PLCB will provide forecasting information that will be updated on a weekly basis. A forecast shall be provided for each PLCB DC at the “Product Code/Warehouse/Week” level. If the Vendor, based on its own forecasting, believes the PLCB forecast should be adjusted, the Vendor may contact the PLCB to discuss the projected forecast. The PLCB expects a collaborative forecasting effort between the PLCB and the Vendor. The PLCB forecast may be manually adjusted, in a timely manner, to reflect the agreed-upon changes. Forecasts notwithstanding, the Vendor is solely responsible for maintaining bailment inventories in the DC to meet business requirements.

25. The Vendor will be responsible for replenishing its supply of bailed product in the PLCB DCs. The Vendor will manage the DC replenishment so that sufficient DC inventory is available to meet consumer and store demand, while staying within the maximum inventory guidelines established by the PLCB. (See Appendix C).

26. The PLCB reserves the right to charge penalties against the Vendor for failure to maintain an appropriate level of inventory. (See Appendix C). Penalties will be structured based on

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the “ABC velocity inventory classification” of the items and will be assessed for performance at the velocity category level, not at the individual product code level. In other words, a vendor may be assessed a penalty if its inventory of velocity A products, as a whole, fail to meet the required standards. The PLCB reserves the right, at its sole discretion, to determine the velocity inventory classification of all product, which classification may change from time to time according to the needs of the PLCB.

a. Penalty levels will be reviewed by the PLCB on a periodic basis and may be adjusted by the PLCB in its sole discretion. Any changes to the penalty structure, or to applicable penalty levels, will be announced a minimum of sixty calendar days before they become effective, to allow the Vendor time to adjust inventory levels to meet the PLCB’s targets.

b. Penalties will be assessed against the Vendor when the PLCB determines that the Vendor has failed to provide product in sufficient quantities to meet DC-to-retail store service level targets.

c. Penalties will be assessed against the Vendor for allowing DC inventory quantities to exceed the forecasted maximum allowable weeks of supply.

d. In addition, the PLCB will impose an administrative charge under the conditions set forth in Appendix C.

27. Should the Vendor elect to remove bailed product from a PLCB DC, the product move will be handled as a “Return to Vendor.” The Vendor will arrange and pay for the freight carriers and bear all other costs for the return of product. PLCB DC personnel will load the freight carriers with the Vendor’s product; the Vendor will be charged a handling fee for this service.

(See Appendix D). If the product is being moved from one PLCB DC to another, the product shall be shipped to the receiving DC against an ASN, following the standard receiving procedure for bailed product. The PLCB reserves the right to assess a penalty against the Vendor if, in the PLCB’s opinion, the Vendor is abusing the “Return to Vendor” process.

28. The Vendor must give the PLCB two business days written notice in advance of the withdrawal of any bailed product, unless the withdrawal of product is for safety or health reasons, in which case the Vendor shall give the PLCB prompt notice regarding the reason(s) for such a withdrawal of product.

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29. As set forth in the Standard Contract Terms and Conditions (Appendix E at paragraph 6), the PLCB reserves the right to either invoice the Vendor for any penalties incurred by the Vendor, or to deduct such penalties from payments remitted to the Vendor.

30. For purposes of penalty invoices only, any objection by the Vendor to the invoice issued or deduction made by the PLCB for assessed penalties must be submitted, in writing, to BOTH of the following addresses:

Office of the Comptroller PLCB LCBS Accounting – AR Director of Planning and Procurement 555 Walnut Street – 9th Floor Room 301, Northwest Office Building Harrisburg, PA 17101-1925 Harrisburg, PA 17124

Objections by the Vendor must be received by the PLCB Director of Planning and Procurement and by the Office of the Comptroller within twenty business days of the date of the invoice or deduction. A timely objection by the Vendor shall include evidence in support of its objection. Failure by the Vendor to submit a timely objection shall be considered the Vendor’s agreement to the propriety of the penalty.

31. For purposes of penalty invoices only, in the event that the PLCB and the Vendor cannot reach an agreement regarding a disputed penalty, the Director of Planning and Procurement shall send his/her written determination to the Vendor. The decision of the Director of Planning and Procurement shall be final and conclusive unless, within thirty days after receipt of such written determination, the Vendor files a claim with the Commonwealth Board of Claims. Pending a final judicial resolution of the controversy, the Vendor shall proceed diligently with the performance of the Agreement in a manner consistent with the interpretation of the Director of Planning and Procurement and the PLCB shall compensate the Vendor pursuant to the terms of the Agreement. All other contract controversies are subject to Standard Contract Terms and Conditions (Appendix E at paragraph 18).

32. The Vendor agrees to secure any applicable state and/or federal basic permits and federal special occupational tax stamps that may be needed before any alcoholic beverages are shipped into the DC under the Bailment Warehouse Program.

33. In the event that the ownership of the product changes from the Vendor to another outside entity (i.e., another potential Vendor), the PLCB will assume that the original Vendor owns the product until the PLCB has been informed in writing by the original Vendor that the ownership of the product has changed. See also, Standard Contract Terms and Conditions (Appendix E at paragraph 19).

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Vendor Signature PLCB Signature

Date Date

(717) 772-3714 Vendor FAX Number FAX Location

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APPENDIX A BAILMENT

AUTHORIZATION FORM

1. Vendor’s Company name: Street: City, State, Zip:

Telephone: E- mail: The Vendor designates the following representative(s) to authorize the PLCB to purchase products from those maintained in the PLCB’s Distribution Centers (“DC”s). Products shipped to the DCs by the Vendor are consigned to the Vendor’s representative(s) for the purpose of making sales at the DCs to the PLCB. The Vendor agrees that its designated representative will indicate its acceptance or rejection, in whole or in part, of a PLCB order for products maintained in the DC within two hours of receipt of the order, or the PLCB’s order will be deemed to have been accepted.

The Vendor is responsible for updating this document as needed.

2. Representative’s Name: Street: City, State, Zip: ______Telephone: ______e-mail:______

3. Alternate Representative’s Name:______Street: City, State, Zip:

Telephone: e- mail:

Signature of person authorized by Vendor to sign and execute documents

Signature:______Print Name:______Title:______Date: ______

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APPENDIX B

HOLIDAYS

The following is a list of holidays and operational days observed by the Distribution Center Operators.

Key: A = Warehouse CLOSED – No store deliveries B = Warehouse OPEN – No store deliveries C = Normal operating day D = Warehouse OPEN – Receiving only (no picking or deliveries) E = Warehouse CLOSED – Store deliveries only F = Warehouse OPEN – Shipping/receiving only (no picking)

Holiday Day Stores Closed DC1 DC2 DC4 New Year’s Day Yes A A A

Dr. M. L. King Jr. Day Mon No C C C

Presidents Day Mon No C C C

Good Friday Fri No A A C

Memorial Day Mon No A A A

Independence Day No A A A

Labor Day Mon Yes A A A

Columbus Day Mon No C C C

Veterans Day No C C C

Thanksgiving Eve Wed No B D D

Thanksgiving Thu Yes A A A

Black Friday Fri No C E F

1st Day of Buck Season Mon No C C C

Christmas Eve No A A A

Christmas Day Yes A A A

New Year’s Eve No A A A

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APPENDIX C

PLCB PENALTY STRUCTURE

The penalty structure has been designed to align penalty incentives to vendor performance, and to meet the needs and requirements of the PLCB. Penalties will only be assessed against the aggregate of the Vendor’s SKUs that fall into a particular Velocity Code by DC, not against individual SKUs. The PLCB reserves the right to institute operational policies from time to time, including but not limited to waiver of monthly bailment penalties under certain circumstances, parameters of assignment of specific product to a specific velocity code, as well as removal of sale codes from the monthly bailment penalty assessment for a defined period, which policies will be provided to all Vendors in writing prior to the effective date of the policy.

Service Level Penalty Structure: If Monthly Fill Rate is Monthly Penalty (Per Case Velocity Code Below: Below Target)

A 99.0% $8.00

B 95.0% $4.00

C 90.0% $3.00 Excess Inventory Penalty Structure: Weeks of Stock on Hand by Velocity Code Monthly Penalty (Per Case Threshold Above Threshold) A B C

Threshold 1 5 wks 6 wks 8 wks $1.00 per Case

Threshold 2 6 wks 7 wks 9 wks $2.00 per Case

Threshold 3 7 wks 8 wks 10 wks $4.00 per Case

The PLCB will take into account inventory levels required for monthly promotions, in calculating weeks of supply.

Administrative Charge:

Every month, Vendor performance will be measured against the Penalty Structures, above. In any month where Vendor performance fails to meet the expected service levels or exceeds inventory Page 15 of 17 Appendix N- Bailment Program

thresholds, the appropriate per case penalty will be calculated and assessed. In addition, there will be a $250.00 administrative charge added to the total of the monthly per case penalties. This administrative charge will only be assessed when any service level or excess inventory penalty is incurred. If performance standards are met, no per case penalty or administrative charge will be assessed. In the event that the PLCB obtains payment of the penalty by way of a deduction from a payment owed by the PLCB to the Vendor, the PLCB may, in its discretion, reduce or eliminate the administrative charge related to that penalty.

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APPENDIX D

PLCB RETURN TO VENDOR CHARGES

The PLCB will assess a charge for all bailment cases returned to the Vendor for any reason. This fee covers the costs of receiving, put-away, storage, retrieval from storage, preparation for shipping, loading on a Vendor-provided truck, and any associated paperwork preparation.

A per-case charge will be assessed for all cases returned to the Vendor where the shipping quantity is not an even, full pallet quantity. In lieu of the per-case charge, a per-pallet charge will be assessed for full pallets of a single item returned to the Vendor.

The PLCB will not provide transportation or export documentation. The Vendor is responsible for arranging transportation for this return and arranging any paperwork required for international shipments.

Charge per case for each case returned: $4.00 Charge per pallet for each full pallet of a single item: $155.00

APPENDIX E - STANDARD CONTRACT TERMS AND CONDITIONS FOR WINE, SPIRITS AND ACCESSORIES PURCHASE ORDERS (Form 54-FA-1.1)

Page 17 of 17 Appendix N- Bailment Program APPENDIX P KEY PERFORMANCE INDICATORS, SERVICE LEVELS, LIQUIDATED DAMAGES AND ADMINISTRATIVE FEES

Offeror agrees to meet the performance standards and requirements as set forth in the Contract generally and this Appendix particularly, understanding that failure to do so will interfere with the PLCB’s business obligations. In accordance with Pennsylvania common law and unless otherwise set forth within the Contract, the Offeror is presumed to undertake the burden of an unanticipated event unless the event rises to the level of a Force Majeure event, is caused or created by the PLCB, or is otherwise excused by law.

The Offeror agrees that, in the event of such an unexcused failure, it would be impractical and extremely difficult to establish the actual monetary damage for which the Offeror is the material cause. The Offeror therefore agrees that the PLCB may assess liquidated damages in the amounts and in the manner as set forth in this Appendix. Such liquidated damages do not constitute penalties.

Key Performance Indicators and Service Levels The following key performance indicators (KPIs) and service levels, effective and applicable as of March 1, 2022, will be used to evaluate Offeror’s performance and assess liquidated damages if/when Offeror’s performance falls below expected service levels.

1. In the event of significant service failure, Offeror shall promptly notify the PLCB (or PLCB will notify Offeror) of such failure and advise the PLCB as to the course of action to be taken to correct such failure. PLCB will review the proposed corrective measures and approve or advise Offeror if alternative measures should be taken. Offeror shall act to resolve such issues, as swiftly as possible, to the satisfaction of the PLCB.

2. As set forth in paragraph 13 of the Contract, the PLCB may issue and apply escalating liquidated damages in the form of a credit memo against the next monthly invoice for each KPI described herein equal to:

a. 0.25 percent of Offeror’s monthly revenue in the first month of sub-standard performance;

b. 0.5 percent of Offeror’s monthly revenue in second consecutive month of sub-standard performance;

c. 0.75 percent of Offeror’s monthly revenue in third consecutive month of sub-standard performance;

d. 1 percent of Offeror’s monthly revenue each consecutive month thereafter that Offeror fails to meet one or more target levels.

3. At any time during the contract term, the PLCB and Offeror may, upon agreement in writing in the form of a Change Order, revise or remove a KPI, or add one or more new KPIs.

Page 1 of 2 Appendix P - Key Performance Indicators, Service Levels, Liquidated Damages & Administrative Fees Key Performance Service Goal Indicator Level Goods received by 3 p.m. will be available for Goods available for 1 shipment before 11 p.m. the same day, with the 100 percent shipment on time exception of product requiring special handling

In case of licensee pickup, product is loaded by the Goods loaded for 2 time mutually agreed upon with transportation 100 percent shipment on time provider

For each cycle count, quantity counted matches 3 Inventory accuracy 100 percent quantity identified in WMS

For each item in an order, product and quantity picked 4 Order accuracy 100 percent match product and quantity ordered

FW&GS stores and licensees receive delivery on the 5 On time delivery day of scheduled delivery, within an agreed-upon 100 percent window of delivery hours

Additional Damages and Administrative Fees In addition to the liquidated damages associated with KPIs and service levels, the PLCB reserves the right to assess additional damages and administrative fees as follows: 1. Selected Offeror is liable and financially responsible for the non-promotional retail value of all product damaged or lost while in Offeror’s control, including but not limited to damage resulting from lack of appropriate temperature controls and/or shrinkage. The PLCB may offset such actual damages from Selected Offeror’s invoices via credit memo as damage or loss is identified.

2. Should Selected Offeror fail to timely complete labeling services (within two days) or product reconditioning (within one week), the PLCB may, as liquidated damages and not as a penalty, decrement the amount it pays Selected Offeror by 25 percent of the established case rate for such work per day that the work remains unfinished beyond established timeframes. Should Selected Offeror fail to complete labelling or product reconditioning services before rate decrementation results in zero payment per case, the PLCB may assess an administrative fee of $50 per case for such delinquent and untimely service.

Page 2 of 2 Appendix P - Key Performance Indicators, Service Levels, Liquidated Damages & Administrative Fees