Notice of Default

Letter Ref: - KRO2-NP-JV-L-0003

Reply to: - KRO2-AF-NP-L-0002 & KRO2-AF-NP-L0007
Date: - 22-2-2022

Dear Nadeem,

Trust this Letter finds you well, please note that with regards to your letter KRO2-AF-NP-L0007 & KRO2-
AF-NP-L0002 we would like to mention that we have already finalized and handed over Lines 80 with
pump room 81, Line 70 with pump room 71 and line 40 is currently ongoing.

Line 30 is not yet handed over by the JV to Napoli to start with.

It is unfortunate and unjust to send us an NOD (Notice of Default) in accordance with clause 2.3
Contractor’s instructions, 4.2 Subcontractors representative, 7 Time of completion and its subclauses
from 7.1 to 7.5 under the subcontract agreement SA05C1-32AZ-388-00 without taking into consideration
all the delays that are due to leakage from dam boards (not in Napoli Scope) and unforeseen damages to
the pumps in other lines causing the backflow of sea water to our tanks in lines 80, 70 and 40, malfunction
of overhead crane, the interference of other subcontractors, asking for our technicians to do other works
in other areas well out of our scope due to Acciona/ RTCC Necessity, live electrical cables and water leaks,
performing works that are out of scope prior of sending any variation in order to not stop, delay or damage
RTCC Acciona JV main schedule with SWCC. (Refer to email examples dated, 11/Dec/22, 10/JAN/23,
28/Aug/22, 31/Aug/22, 24/Aug/22, 8/Jun/22, 1/Aug/22, 18/Jul/22)

Non the less Napoli has adjusted with all the site issues and done works that are well out of our scope
such as but not limited to Grouting of Suction Bell mouths, Grouting behind mechanical fixation of railings,
Grouting underneath all mechanical equipment (twice due to design changes), pouring of basis
underneath the elbow pumps, closing of gates between pump rooms, injection of water leaks outside of
the tanks, removal of parts of the old mechanical equipment, Painting and repairing of pump inlet walls,
demolition of old elbow pipe basis, Painting of all Site offices and main office building, refurbishment of
the site offices, etc.…

Not to mention the most important aspect that is payment issues and due amounts that are paid well
after the due date (if paid at all) and in portions that are inappropriate to the requirements.

We at Napoli do agree that there are “communication issues” within the past few days and we request a
Meeting that end up with defined requirements for both Parties (Acciona RTCC JV and Napoli) that
includes minutes of meeting signed by both parties, of which both parties will adhere to , moreover we at
Napoli reserve all our rights to reply, but action will be taken to remedy the supposed breach prior to the
expiry of the notice period in the contract, we will also take all the necessary steps in order to fulfil all the
requirements of the JV within the next days including a revised schedule as per clause 7. (This will require
coordination with your planner in order to know the date of release for all the tanks (Tank 30 is remaining)
and this has been asked through emails and verbally by our engineers none the less the dates given for
handing over the tanks was not respected due to issues not within your grasp)

In light of the above, it is kindly requested that you have a second thought about the Notice of default
taking into account that we at Napoli will take actions to remedy the issues after the aforementioned
meeting. We further reserve our right to issue any additional response or further amend the contents of
this response or any other subsequent notice, email, correspondence, etc. issued by us to you, at an
appropriate juncture.

Best of Regards,

Majed Al Ghamidi