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5. Backfill Pit Walls: Task No. 6 Direct Costs be reduced from $392,399 to $176,580 <br />because 55% of the perimeter pit walls have been backfilled to the reclaimed slope <br />where mining has been completed. The perimeter of the pit is approximately 6,090 lineal <br />feet of which 3,335 lineal feet has been backfilled and reclaimed. <br />By reducing the previous items the total direct cost for the bonding is reduced from <br />$1,164,711 to $250,805. <br />The indirect costs are then reduced to the following for overhead and profit: <br />Liability Insurance = 1.55% of $250,805 = $3,888 <br />Performance Bond = 1.05% of $250,805 = $2,633 <br />Job Superintendent = 500 hrs - Reduce by 250 (because slopes are 55% complete for <br />backfill and slurry wall is installed) = 250 hrs at $33.50 per hr = $8,375 <br />Overhead and Profit = 10% of $250,805 = $25,080 <br />Total Overhead and Profit = $39,976 <br />The indirect costs are then reduced to the following for project management: <br />Engineering work and /or contract/bid preparation = 4.25% of $250,805 = $10,659 <br />Reclamation management and /or administration = 5.00% of $250,805 = $12,540 <br />Total Indirect Costs including Project Management, Overhead, and Profit = $63,175 <br />Total Bond Amount (Direct plus Indirect) _ $313,980 <br />Asphalt Paving Company appreciates your consideration of this bond reduction request and <br />looks forward to your response. <br />Please feel free to contact me with any questions or comments. <br />Sincerely, <br />