Impacts of the ongoing site closure since 5 September xxxx

Our Ref: xxx

Date:

To

xxx Contracting LLC

P. O. Box xxx

Dubai, U.A.E.

Attention            : Mr. xxx, Group Procurement Manager

Project                 : xxx Phase 2

Subject :     Impacts of the ongoing site closure since 5 September xxxx

References: xxx dated 18 August xxxx

Dear Sir,

We are writing to you with regards the sudden and unexpected closure of your project site which has now been a closed site since Sunday 05 September xxxx.

Although we have been attempting for the past week to get pertinent information from M/S XXX (CLIENT NAME) as to the exact reason all work on site have now been suspended, or to receive any update on when the site will be reopened, no information is being shared with us.

This is especially concerning considering the M/S XXX (CLIENT NAME) labor strike incident which occurred on 18 August xxxx as recorded in our letter Ref: xxx dated 18 August xxxx.

This ongoing situation is preventing M/s xxx (Contractor Name) from receiving its final certifications and due payments towards work that has already been performed and we further clarify as follows:

Replacement of marble sets

M/S XXX (CLIENT NAME) has been withholding certification in excess of xxxM on the pretext that some of the marble sets in the pods are not approved and should be replaced. All such sets have been delivered to site and replaced with the exception of 50 sets which were ready for delivery on 5 September xxxx but were not received by your site due to the unexplained site closure. This has already been communicated to you through email. (Appendix 1)

Default in certification & LC expiry

With regards to your repeated acts of withholding certification, we remind you that you currently still in default and holding the certification of an amount of AED xxx which is preventing M/s xxx (Contractor Name) from submitting the respective TAX invoices and processing the LC documents for settlement of amounts.

According to the current LC terms, the last date of shipment is from 15 September xxxx, therefore you are required to issue our full certification before the expiry date to allow us to submit the relevant TAX invoices and claim the amount.

Failing to do so, you must amend the LC prior its current expiry to a new date of 15 November xxxx or later.

Default in signing LC documents

In addition to that, we have submitted to your office since 02 September xxxx the commercial invoice for the gross certified amount of AED xxx (appendix 2) as per the payment certificate no.6 but till date M/S XXX (CLIENT NAME) have not released the signed LC document for it.

You are currently in default for the certification & signing of LC document of a total amount of AED 1,553,597.89 and you have defaulted in the payment of all previously certified amounts including the advance payment.

We remind you that due to your recurring acts of illicitly post-dating LC documents, M/s xxx (Contractor Name) has still not received its due payments to this date.

Short Payments & Additional Bank Charges

Furthermore, as per our Subcontract Payment Terms, the LC opener’s bank charges are on the applicant’s account but instead M/S XXX (CLIENT NAME) have opened the LC and imposed all the charges to the beneficiary’s account which resulted till this date in a short payment and extra charges incurred by M/s xxx (Contractor Name) amounting to AED xxx from the settlement of advance payment and first progress payment.

Additional charges will be incurred upon the settlement time of balance progress payment which we have the signed LC documents for which are not yet due according to their delayed signed dates.

You are immediately requested to settle the charges currently due via a Current Dated Cheque (CDC).

In closing

While M/s xxx (Contractor Name) has completed delivery of all pods on 24 November xxxx in accordance with the contract schedule, allowing M/S XXX (CLIENT NAME) to complete all subsequent activities, M/S XXX (CLIENT NAME) has systematically and blatantly resorted to the following:

• M/S XXX (CLIENT NAME) has failed to release the advance payment in accordance with the payment terms stipulated in our contract.
• M/S XXX (CLIENT NAME) has failed to adhere to the 120 LC payment terms stipulated in our contract.
• M/S XXX (CLIENT NAME) has intentionally delayed, and withheld, certification of work done to reduce the value of invoices and due payments to M/s xxx (Contractor Name).
• M/S XXX (CLIENT NAME) arbitrarily and without justification imposed short certification and deductions on certifications to reduce value of due payments.
• M/S XXX (CLIENT NAME) has deliberately and purposefully delayed signing of L/C documents to delay release of payment.
• M/S XXX (CLIENT NAME) has deliberately and purposefully post-dated L/C document to further compound the delay in the release of our due payments.

Despite numerous notices and urges to comply with our payment terms by releasing payment and refraining from postdating LC documents, M/S XXX (CLIENT NAME) has blatantly ignored all our pleas in complete disregard to any industry standards and its obligations under the law.

M/s xxx (Contractor Name) has fully financed your project and you are consciously putting our company in a position where we are unable to meet our financial obligations to our suppliers. You are fully liable towards the impact of such actions and the resulting damage to M/s xxx (Contractor Name).

You are requested to reply within 24h of receiving this letter with your confirmation of the date when the site will reopen, and you are requested to release de certification and payments before expiry of our L/C ref. xxx on 15 September xxxx.

Should you fail to revert back to us within 24h of this letter, M/s xxx (Contractor Name) will reserve its right to take any action towards M/s M/S XXX (CLIENT NAME) and pursue any remedies available at law or in equity.

All rights are reserved

Yours faithfully,

On behalf of xxx LLC                                                                      

xxx

project Manager