Terms and conditions for orders made by S u b t e r r a a.s. (“Subterra a.s.”) – annex and an integral part of the order (“Terms and Conditions”):

These Terms and Conditions form an annex to an issued order and, as an integral part of it, form, together with the order, a binding instruction for a contractual partner of Subterra a.s. (“Contractual Partner”) who, by accepting an order, undertakes to comply with them.

For the purposes of these Terms and Conditions and an order, the term “Buyer/Seller” means the Contractual Partners to a purchase contract; for a contract for work with Contractual Partners, the term is “Client/Contractor”; and for service contracts with Contractual Partners, the term is “Client/Supplier”.

The ordered goods, work and services (“Subject of Performance” or “Goods/Work”) are deemed to have been delivered upon the signing of the delivery note/handover record/service record by an authorised representative of the Buyer/Client; after acceptance of the Subject of Performance, including documentation, at the place of delivery, execution of the work, or performance of the service work.

The Seller/Contractor/Supplier must deliver, together with the Goods/Work, relevant declarations under applicable European legislation proving conformity with Czech legislation and technical standards (Declaration of Performance and CE marking for construction products, declaration of conformity).

The Seller/Contractor/Supplier is responsible for the quality, functionality and completeness of the Subject of Performance (the Seller is also responsible for its proper preparation and packaging for transport) and guarantees that the Subject of Performance will be provided in full compliance with the terms of the order, with the agreed parameters and in first-class quality, in accordance with proven technologies, binding technical standards (ČSN, ČSN-EN, ČSN-ISO) and related regulations.

By guaranteeing the quality of the goods, the Seller/Contractor/Supplier assumes the obligation that the delivered Subject of Performance will be fit for use for the agreed purpose during the warranty period, respectively that it will retain the agreed properties. The Seller/Contractor/Supplier is responsible for ensuring that the delivered Goods/Work are/is free of third-party rights, in particular industrial or other intellectual property rights. Any claims arising from defects in the Goods/Work are without prejudice to the entitlement of the Buyer/Client to claim compensation for damage incurred in connection with the existence of legal or factual defects in the Goods/Work.

The Seller/Contractor/Supplier is entitled to perform before the agreed date only with the written consent of the Buyer/Client. If more goods are delivered than agreed in an order, the Buyer/Client may accept the delivery or may refuse to accept the excess goods. Upon delivery of the goods, the Buyer/Client acquires ownership of the goods.

The Seller/Contractor/Supplier must examine all the documents received from the Buyer/Client before commencing performance, and must raise written objections without delay in the event of any discrepancies found. Objections raised at a later date will be disregarded.

The annexes attached to an order are considered an integral part of such order.

All correspondence relating to an order, including its annexes, must be delivered by registered mail to the registered office of the Buyer/Client or handed over in person at the mailroom at the same address between 7:00 a.m. and 2:00 p.m.

Arrangements marked with an asterisk (*) also apply mutatis mutandis to the Contractual Partners “Seller – Buyer”.

a) Invoicing:

The Seller/Contractor/Supplier must provide a signed paper original of a tax document with annexes in addition to an electronic invoice upon request. It is forbidden to deliver invoices and other accounting documents in any other way than to the mailroom of the Buyer/Client. The parties expressly agree that the date of delivery of a sent invoice with annexes is deemed to be the date of delivery of the relevant email to the mailroom of the Buyer/Client on business days. If delivered on non-business days, the following business day. The due date for the invoice in question commences from that moment.

b) Compliance:

The Contractual Partner acknowledges that the Buyer/Client requires adherence to ethical principles and rejects any unethical, illegal or corrupt behaviour. The Contractual Partner declares and confirms, by signing the order in question, that they have read the above-mentioned compliance principles and the Subterra Code of Ethics for Contractual Partners, which is published and freely available on the website of the Buyer/Client in the Compliance section (https://www.subterra.cz/compliance), and undertakes to comply with the principles set out in the Code of Ethics for at least the duration of the business relationship established by the relevant order.

c) The employment of foreign nationals and illegal work:

If the Contractor/Supplier is not a foreign entity and performs the work through its employees who are considered foreign nationals under the Employment Act, these employees of the Contractor/Supplier must meet the conditions for employment and must be employed in accordance with Section 89 of Act No 435/2004, on employment, as amended, and the Contractor/Supplier is responsible for ensuring that such employees of the Contractor/Supplier carry out their activities exclusively in accordance with the issued permits at all times during the performance of the Subject of Performance.

The Contractor/Supplier must demonstrate to the Client, upon request, that the obligations under the previous paragraph have been fulfilled, by submitting copies of the relevant documents. At the Client’s request, the Contractor/Supplier must demonstrate compliance with the above obligations also in respect of the employees of its subcontractor/sub-supplier if they are considered foreign nationals under the Employment Act.

The Contractor/Supplier undertakes not to allow or entrust the performance of work to a subcontractor/sub-supplier that allows illegal work within the meaning of Section 5(e) of Act No 435/2004, on employment, as amended. *

d) Other conditions of performance:

The Seller/Contractor/Supplier must proceed in accordance with the relevant generally binding legislation of the Czech Republic, relevant technical standards, the order, these Terms and Conditions, conditions stipulated by public permits, and statements of the relevant public authorities and other entities.

The Seller/Contractor/Supplier, by confirming an order, including its annexes, or by commencing the Subject of Performance, or by taking over the construction site/service site, acknowledges and undertakes to perform the Subject of Performance in accordance with the above conditions of performance. The Seller/Contractor/Supplier further acknowledges that they are bound, during performance, by the conditions set out in the investor’s contract concluded between the investor and the Client/Buyer. By accepting an order and these Terms and Conditions, the Seller/Contractor/Supplier declares that they have read the relevant provisions of the investor’s contract concerning the scope of their performance according to the relevant order.

The Client/Buyer is entitled to unilaterally extend or restrict the scope of the Subject of Performance and to request a change to it. If a change affects the Subject of Performance, the Contractual Partner must notify the Client/Buyer of this fact within three days of receipt of notification of the change, e.g. by means of an entry in the construction or assembly diary, and the Client/Buyer must decide on further action without undue delay.

Prior to commencing the Subject of Performance, the Contractor/Supplier must check and test all the submitted documents and the situation at the construction site/service site and in its vicinity, and must notify the Client in writing of any discovered defects, omissions, discrepancies, incomplete descriptions and comments relating to the expected method of performing the work, including in connection with other works, deliveries, equipment and performances, and in accordance with the purpose for which the work is intended, together with written proposals for the removal of such discovered defects.

When carrying out the work (directly or through potential subcontractors), the Contractor/Supplier must comply, without exception and to the full extent, with all relevant generally binding legislation and technical standards, in particular standards related to occupational health and safety (covering openings, fencing of excavations, reinforcing excavations, footbridges, etc.), fire protection and environmental protection. *

In relation to potential liability for damage incurred by another person in connection with the activity or relationship between the Contractor/Supplier and its subcontractors, the Contractor must have an insurance contract concluded with a sum insured equal to the price of the work (according to the possible risks from failure to perform). *

The Contractual Partner undertakes to cooperate to the maximum possible extent with the Buyer/Client for the removal of warranty defects in the shortest possible time. In the event of an accident or defect endangering the safety of persons or the operation of equipment, the Contractual Partner must commence the removal of the defect within 24 hours of a complaint being filed. The Contractual Partner must start the remedy even if the complaint is not accepted.

The price of the Subject of Performance represents the agreed value of all the performances and obligations of the Contractual Partner according to the order in question and its annexes, including the obligations arising for the Contractual Partner from the quality warranty provided.

The Contractual Partner expressly acknowledges and, by confirming the order in question and its annexes, or by commencing performance, or by taking over the construction site or place of service according to the order, expressly agrees that the right to payment of the price of the Subject of Performance arises if the following conditions are also met:

Invoicing (usually partial monthly payments) is based on the terms of the investor’s contract, and the due date starts to run when all the above conditions are met.

The liability of the Client/Buyer, as recipient of the taxable performance, for unpaid VAT on performance provided by the Contractual Partner is governed by Section 109 of Act No 235/2004, on value added tax (“VAT Act”). The Contractual Partner declares that at the time of acceptance of the relevant order, it is not an “unreliable payer” within the meaning of Section 106a of the VAT Act, and undertakes that if it becomes an unreliable payer during the period of performance according to an order, it will immediately notify the Client/Buyer in writing. The Contractual Partner further declares that its account specified in the header of an order is an account published by the VAT administrator in a manner allowing remote access and that it will remain such an account for the entire duration of the contract based on the order.

In the event that retainage has been agreed between the parties, the following applies:

The right to release the first half of the retainage from the total price of the work arises within 30 days of receipt of a relevant request from the Contractor. Such request must be made after the completion of the work without defects and backlogs, after the handover and acceptance of the work by the Client, and not before the Client receives the payment of such retainage from the superior client. The request must always be accompanied by a record of the handover and acceptance of the work, respectively a record of the elimination of minor defects and backlogs, if the work was accepted with them or after their elimination. *

The right to the payment of the second half of the retainage from the total price of the work only arises for the Contractor upon expiry of the longest agreed warranty period. This amount serves to ensure the liability of the Contractor for defects in the work during the warranty period. The amount will be paid by the Client within 30 days of receipt of the Contractor’s written request, which the Contractor is entitled to send 30 days after the expiry of the longest warranty period, but not before the Client receives payment of this retainage from the superior client, and at the same time under the condition that there are no defects in the work that would be covered by the quality warranty, and that legitimately claimed defects in the work have been properly removed by the Contractor. In the event the Contractor refuses to remove legitimately claimed defects or fails to remove them within the agreed period or within a reasonable period if no deadline has been agreed, the Client is entitled to use the retainage to remove such claimed defects. *

e) Affidavit and liability for a Contractual Partner in the position of Contractor:

By accepting an order, the Contractor, within the meaning of Section 324a(8) of Act No 262/2006, the Labour Code, as amended, solemnly declares and expressly confirms that:

The Contractor must submit the following documents to the Client at the Client’s request within 14 days of acceptance of an order:

The aforementioned documents will be considered as an annex and an integral part of the order after they are handed over to the Client. A breach of this obligation, as well as falsity of confirmed and declared facts, is considered a serious breach of the contractual relationship established by the order, and will give the Client the right to withdraw from the order or the contract based on the order.

f) Arrangements for the Contractor’s bankruptcy:

In the event of a bankruptcy order being issued against the Contractor, the parties expressly value the Contractor’s obligations to properly complete and deliver the work and the warranty provided by the Contractor at an amount equivalent to 10% of the agreed price of the work, excluding VAT, as a lump sum value for the proper completion and delivery of the work, and an amount equivalent to 10% of the agreed price of the work, excluding VAT, as a lump sum value for the fulfilment of the obligations under the agreed warranty. The parties agree that in the event that either or both of the above-mentioned obligations are not fulfilled, the price of the work will be automatically reduced by the value of the unfulfilled obligation as calculated above.