WL/MTPD, Building 22B, 2700 D Street, Suite 2, Wright-Patterson AFB, OH 45433-7405

A -- DEFENSE PRODUCTION ACT,TITLE III SILICON ON INSULATOR (SOI) WAFER PROJECT SOL BAA-97-03-MTPD DUE 081397 POC Willa M. Eichelman, Contracting Officer, (937) 255-9665, Ext 225 E-MAIL: eichelwm@wlmta.wpafb.af.mil, eichelwm@wlmta.wpafb.af.mil. A -- INTRODUCTION: The Title III Program Office of the Wright Laboratory Manufacturing Directorate is soliciting proposals for the creation of a long term, financially viable, domestic Silicon on Insulator (SOI) wafer production capacity. The Air Force, as the Executive Agent for the Defense Production Act (DPA) Title III Program, is authorized to provide appropriate incentives to establish, maintain, modernize, and expand domestic production capacities for critical technology items and industrial resources essential for national defense. It should be noted that the production capacity for these SOI wafers must be a domestic source. The DPA defines domestic source as: a business concern that performs substantially all of the research and development, engineering, manufacturing and production activities in the U.S. or Canada. While Title III projects are concentrating on technical aspects, the overall objective is to find and fund a business solution. The current critical production demand for SOI substrates has been classified as either thick or thin SOI wafers. This classification is important only when considering if analog or digital devices are to be produced. DoD has the need for both analog and digital devices. Device manufacturers currently specify SOI wafers by stating the buried oxide (BOX) layer thickness and device silicon layer thickness. Current production specifications for thick SOI wafers are greater than 1.0 microns device layer and greater than 1.0 microns BOX, as defined by large scale commercial applications. Thin SOI wafers are less than 1.0 microns for both device layer and BOX thickness. It is the government's expectation that this effort will establish a source capable of meeting these current specifications. Many device applications have dual (military and commercial) usage and have not been fully exploited due to the non-availability of high volume on-shore SOI suppliers. The Government's interest in this industry is to form a partnership with the potential (larger) commercial market. Inherent benefits of operating state-of-the-art facilities would ensure material availability for DoD and potentially lower weapon system procurement costs. Electronic devices of direct interest to the military have high performance, low power and radiation hardened (RAD HARD) attributes, in aggregate or combination, i.e.- power integrated circuits, analog bipolar circuits for wide dynamic range analog to digital converters (ADC) and digital to analog converters (DAC), smart power, memory and processing. These devices will be needed to maintain current military systems, procure upgrades or build new systems, ranging from portable communication equipment, radar, electronic countermeasures, defense and counter-strike missiles to satellites. Commercial applications mirror military requirements, due to the similar need for high speed and wide dynamic range analog, ADC and DAC, smart power, and lower cost devices to support the burgeoning commercial satellite communications market. Due to the potential large commercial market with its possible profit potential, some level of cost sharing is required. Proposals in response to this BAA shall be received by 13 AUG 97, 1500 hours Eastern Daylight Time (EDT), addressed to WL/MTPD, Building 22B, 2700 D Street, Suite 2, Wright-Patterson AFB OH 45433-7405, Attention: Ms Willa Eichelman, Procurement Contracting Officer. This is an unrestricted solicitation. Small businesses are encouraged to propose on this solicitation. Proposals submitted shall be in accordance with this announcement. Proposal receipt after the cutoff date and time specified herein shall be treated in accordance with restrictions of FAR 52.215-10. A copy of this provision may be obtained from the contracting point of contact. Offerors should request a copy of the Wright Laboratory (WL) Guide entitled, "PRDA and BAA Guide for Industry" dated Nov 92 (see section "D-Proposal Preparation Instructions" below). This guide was specifically designed to assist offerors in understanding the PRDA/BAA proposal process. Copies may be requested from the Procurement Contracting Officer, stated herein, or directly from the Internet, at http://www.wl.wpafb.af.mil/contract/prdag.htm B-REQUIREMENTS: (1) Technical/Business Description: The purpose of this effort is to establish a long term, viable production capacity capable of producing consistent, high quality and cost effective Silicon-on-Insulator (SOI) wafers. Title III presently intends to establish at least one on-shore supplier with the capacity of at least 1.4 million square inches per year (50,000 six inch diameter wafer/year equivalent). A Title III contract is anticipated to include some teaming arrangement that consists of at least a wafer supplier and one or more electronic device manufacturers. This contract shall contain a set of work statements' for only that work deemed necessary to strengthen the contractor's business, while positioning the contractor to supply DoD markets. A current business plan should be enhanced by identifying potential areas for assistance from a government partner, Title III. The proposal should focus on efforts that will reduce risks and costs, eliminate technical and market barriers, and accelerate market penetration. The proposals shall clearly state the range of wafer specifications (i.e. BOX, device layer, etc.) to be produced. Appropriate areas for Title III assistance are shared work efforts focused on capacity expansion, quality and yield improvement, cost reduction, qualification assistance, working beta sites and marketing. The role of the device manufacturer would be both as a beta site and a future customer. Universities and government laboratories would also qualify as beta sites. Each proposal must address annual capacity, capacity expansion, technical maturity, beta sites, production requirements, wafer specifications, markets to be penetrated, windows of opportunity, portfolio of products, past sales history, prices, sales cost and sales methodology. Another unique and appropriate area for Title III to provide assistanceis in the area of a negotiated purchase commitment phase, which would center around production and sales. This purchase commitment phase would start only after the successful completion of the other technical efforts (i.e.- facility upgrades, quality improvements, etc.). Title III would enter this business arrangement as a partner or buyer of last resort' for those wafers not sold to prime customers. If this assistance is contemplated, the proposal must include the following: the proposed quantity and price of wafers to be considered; the rationale, justification and benefits for including a purchase commitment. The total proposal cost must include the sum of all work and all purchase commitment costs (note: all contracts will be fully funded when awarded). (2) Deliverable Items: The following deliverable items shall be proposed: (a) Status Report, DI-MGMT-80386/T, quarterly, (b) Funds and Man-Hour Cost Report, DI-FNCL-80331/T, monthly, (c) Scientific and Technical Reports, Business Plan, DI-MISC-80711/T, annually, (d) Presentation Materials, DI-ADMIN-81373/T, as required, (e) Scientific Technical Reports, Project Final Report, DI-MISC-80711/T, draft and final. (3) Security Requirements: The work performed as a result of this BAA will be unclassified. (4) Other Special Requirements: Data generated by the resulting contract(s) will be subject to export control and/or subject to International Traffic in Arms Regulations. United States (US) organizations are asked to contact the Procurement Contracting Officer immediately if they anticipate employment of foreign nationals on this program. C-ADDITIONAL INFORMATION: (1) Anticipated Period of Performance: The total period of performance is not anticipated to exceed 48 months. The purchase commitment phase should not exceed 24 months. Each proposal must ascertain the appropriate periods to perform the technical and business efforts, as well as, the purchase commitment phase. The Government reserves the right to fund any or all of the potential phases based upon end-of-phase technical results and/or the business and market environment. (2) Expected Award Date: October 1997. (3) Government Funding Estimate: The Government anticipates one or more contract awards with total Government funding not to exceed $7M. (4) Type of Contract: Cost Sharing. Due to the portion and size of the potential commercial market, some level of cost sharing will be required. Appropriate areas for cost sharing are: labor hours, process improvement, sample wafers, quality improvements, ISO 9000 certification, and wafer qualification. Inappropriate areas are: past capital investments, planned capital investments, or subsidizing sales. (5) Government Furnished Property: None contemplated. (6) Size Status: For the purpose of this acquisition, the size standard is 500 employees (SIC 3674). (7) Notice to Foreign-Owned Firms: Such firms are asked to immediately notify the Air Force point cited below upon deciding to respond to this announcement. Foreign contractors should be aware that restrictions may apply which could preclude their participation in this acquisition. D-PROPOSAL PREPARATION INSTRUCTIONS: (1) General Instructions: Offerors should apply the restrictive notice prescribed in the provision at FAR 52.215-12, Restriction on Disclosure and Use of Data to trade secrets or privileged commercial and financial information contained in their proposals. Proposal questions should be directed to one of the points of contact listed elsewhere herein. A Wright Laboratory (WL) guide entitled "PRDA and BAA Guide for Industry" is available to assist offerors in proposal preparation. Copies may be requested from WL/PKO, Wright-Patterson AFB, OH 45433-6503, telephone (937) 255-6969. Reference for the DPA is: Section 303, Title III of the DPA of 1950, as amended (50 U.S.C. app 2093). Technical and cost proposals, submitted in separate volumes, are required and must be valid for 180 days. Proposals must reference the above PRDA number. All responsible sources may submit a proposal which shall be considered against thecriteria set forth herein. Offerors are advised that only contracting officers are legally authorized to contractually bind or otherwise commit the government. (2) Cost Proposal: The cost proposal shall be prepared in accordance with FAR 15.804-6 and shall include a Standard Form 1411, Contract Pricing Proposal Cover Sheet, with all supporting data, in order to allow for a complete review by the Government. The cost proposal shall include all supporting information including breakdown of labor hours by category, materials, travel, computer, subcontracting, and other direct and indirect costs. An analysis of each major subcontractor must be performed by the offeror in accordance with FAR 15.806-1 and included in the cost proposal. Details of the cost sharing to be undertaken by the offeror should be included in the cost proposal. A total of 7 copies shall be provided and one digital copy that is Microsoft Office for Windows compatible. (3) Technical Proposal: The technical proposal shall address how the offeror proposes to meet the technical and business requirements, focusing around a concise narrative business plan that highlights Title III assistance. The proposed work tasks shall include both time and materials: man-hours, number and mix of personnel (technical, managerial and marketing), calendar time, and materials (wafers consumed in test or distributed as samples, etc.). These work tasks will be formalized and compiled into the Statement of Work (SOW). Additional background information to be included in the technical proposal are: prior work in this area, descriptions of available equipment, data, facilities and resumes of personnel who will be participating in this effort. Therefore, the technical proposal shall include: (1) Statement of Work (SOW) detailing the technical/business tasks proposed and must be suitable for contract incorporation, (2) Statement of Intention, if any, to use foreign nationals, (3) Break out of man-hours for each task in the SOW and (4) Identification of all subcontractors and the level of effort proposed (5) Schedule showing each major SOW task, total period of performance, contract deliverables and milestones. Offerors should refer to Section A of the WL Guide referenced to assist in SOW preparation. Any questions concerning the technical proposal or SOW preparation shall be referred to the Technical Point of Contact cited in this announcement. Offerors are hereby notified that the SOW may be incorporated, in total or any part thereof, by reference, in any resulting award. The paragraph numbering used in the Technical Proposal for the technical approach discussion, SOW tasks, and the Cost Proposal shall all correlate. Travel is projected to include, but not limited to, semi-annual reviews at locations selected by the Government. A total of 10 copies are required and one digital copy of the statement of work (SOW) that is Microsoft Office for Windows compatible. (4) Page Limitations: Technical proposals shall not exceed 200 pages, double spaced, single-sided on 8.5" x 11" paper using 12 point or larger type. The page limitation includes all information including indexes, photographs, fold-outs, and appendices, etc. Pages in excess of this limitation will not be considered by the Government. There are no page limitations for the cost proposal. (5) Preparation Cost: The cost of preparing proposals in response to this BAA is not considered an allowable direct charge to any resulting or any other contract. However, it may be an allowable expense to the normal bid and proposal indirect cost as specified in FAR 31.205-18. E-BASIS FOR AWARD: The selection of one or more sources for award will be based on a complete evaluation of offeror's proposals to determine the overall merit of each in response to this announcement. The proposals shall be evaluated based upon the following criteria which are listed in descending order of importance. (1) Business Viability: (a) The extent to which this market fits unto the corporate strategic plan, utilizing core competencies. (b) The extent to which there is stakeholder involvement in the project, demonstrated by teaming arrangements, where stakeholders are defined as OEM and military users. (c) The effectiveness and completeness of the proposal in demonstrating a thorough understanding of the factors necessary to achieve an economically-viable production capability. (d) The extent to which the offeror possesses the business capability, experience, and willingness to become a competitive merchant supplier of SOI substrates. (e) The extent to which the offeror's proposal communicates a credible strategy for overcoming existing barriers, both business and technical, to successfully address North American markets for SOI wafers. (f) The extent to which the offeror's Business Plan is structured to ensure viable business and soundness of Title III assistance. (2) Technical/Business Merit and Soundness of Approach: (a) Extent to which the offeror proposes a solid, constructive plan of technological achievement. (b) Extent to which the offeror's technical approach reflects a thorough understanding of the critical technical/business issues affecting the potential long term viability. (c) Extent to which the proposed solutions have the potential for making a significant impact on the SOI customer base. (d) Extent to which Beta sites are selected and used. (e) Extent to which the proposed technical approach will lead to improved material quality, increased wafer yield and reduced production costs. (f) Level and use of a strong quality system. (g) Organization, clarity and thoroughness of the proposed Statement of Work (SOW). (3) Offeror's Capability and Experience: (a) The extent to which the offeror demonstrates a proven capability to produce similar products at production rates. (b) Extent to which the offeror possesses the capability and experience to complete the proposed work. (c) Degree to which the analyses, approaches, staffing methodology and planning considerations demonstrate that the offeror has identified and understood the Government requirements. (d) Degreeto which the proposal shows a high probability of success. (4) Cost Realism: (a) Extent to which the proposed cost bears a reasonable relationship to the proposed scope of work. (b) Amount of cost share dollars proposed. No other evaluation criteria will be used. The technical and cost information will be evaluated at the same time. The Air Force reserves the right to select for award of a contract, any, all, part, or none of the proposals received. F-POINTS OF CONTACT: (1) Contracting/Cost: Ms. Willa Eichelman, Wright Laboratory, Manufacturing Technology Directorate, Processing and Fabrication Division, Defense Production Act Branch, WL/MTPD, Wright-Patterson AFB OH 45433-7739, telephone (937) 255-9665 Ext. 225. (2) Technical: Mr. Eric Pohlenz, Wright Laboratory, Manufacturing Technology Directorate, Processing and Fabrication Division, Defense Production Act Branch, WL/MTPD, Wright-Patterson AFB OH 45433-7739, telephone (937) 255-9665, Ext. 224. The Program Sponsor is Dr. James Schwabe, Naval Surface Warfare Center -- Crane Division, Code 605, Bld. 2087, 300 Highway 361, Crane, IN 47522-5001, telephone (812) 854-2280. (3) An Ombudsman has been appointed to hear concern from offerors and potential offerors during the proposal development phase of this acquisition. The purpose of the Ombudsman is not to diminish the authority of the Contracting Officer, but to communicate contractor concerns, issues, disagreements and recommendations to the appropriate Government personnel. All potential offerors should use the established channels to voice concerns before resorting to use of the Ombudsman. When requested, the Ombudsman will maintain strict confidentiality as to the source of concern. The Ombudsman does not participate in the evaluation of proposals or in the selection decision. Interested parties should direct all routine communication concerning this acquisition to the Contracting Officer listed above. The Ombudsman should only be contacted with issues or problems that have been previously brought to the attention of the contracting officer and could not be satisfactorily resolved at that level. These serious concerns only may be directed to the Ombudsman, Mr. Michael S. Coalson, ASC/SYI, Bldg 52, 2475 K St, Suite 1, Wright-Patterson AFB, OH 45433-7642, E-mail coalsoms@sy.wpafb.af.mil, phone (937)255-9279, extension 232. (See Note 26.) (0163)

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