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KiIr m u r!^� I 1 1 ey )�� ! 101 II II Page 2 AWE that they would be responsible forthe additional engineering costs as well as liquidated damages. IRCU. is currently withholding $306,703.98 which includes Pay Application 25 for $153,897.15 and 5% retainage of $152,806.83. Although AWE has done a good job on completed work and has achieved great results with well production and quality, theycontinued to miss promised deadlines and completion dates and are nearly 2 years late on a 2 -year project duration. In their defense, they did not adjust pricing on any of the new work since the beginning of the project and were idle during the Scrub Jay delay without any additional request for time. Therefore, it is not recommended to enforce the full liquidated damage amount and that the following options be considered as a discount in liquidated damages for negotiating a settlement with AWE: Fulfill Pay Application 25 but keep retainage — Total Damages $152,806.83. The retainage amount is withheld to ensure contractual obligations are met, and in this case, would. not be returned to AWE for inability to meet schedule requirements. The retainage would cover the amount of the Kimley-Horn amendment and represents approximately 49% of the total liquidated damages, thereby offering AWE a concession on the total amount owed. Assess 50% Discount of liquidated damages —Total Damages $156,375.00. Keep half of the total liquidated damages, which amounts to $156,375. This option also covers the amount of the Kimley-Horn amendment and offers AWE a concession on the total amount owed. It is our recommendation that IRCU employ the first option. While the dollar amounts are comparable, this option to keep the retainage is slightly less, with the goal of preserving a working relationship with AWE. We hope that these options provide a solution that is amenable to both IRCU and AWE. If you have any questions, please don't hesitate to reach out at your earliest convenience. Sincerely, / Mark D. Miller, P.E. cc: Terry Southard,(IRCU) Jon Friedrichs, P.G. (JLA) Vaughn Hayduk, P.E.