Business Conditions of Ferona, a.s.

Article I

Purchase Agreements

1. The subject matter of individual purchase agreements will be metallurgical materials and other products and services sold by Ferona and specified in its current price lists and/or special offers (hereinafter only the “goods”).
2. Ferona’s principal obligation resulting from each purchase agreement is to deliver the agreed goods, whereas the buyer’s principal obligation is to accept the goods and pay the agreed purchase price.
3. When ordering the goods, the buyer shall specify his representative authorised to buy from Ferona, i.e. to accept the delivered goods and/or to conclude purchase agreements. If no such person is specified in his order or in a supplement to agreement on business cooperation, the buyer shall issue every person purchasing and/or accepting the goods on his behalf with a power of attorney. If no power of attorney is issued, it is understood that whoever presents the buyer’s order to Ferona will be regarded as authorised to buy the goods and whoever is willing to accept the goods from Ferona and to confirm such acceptance will be regarded as authorised to accept the goods.

Article II

Goods and Documents

1. 1. Unless the buyer orders the goods pursuant to CSN EN 10021:2007 (42 0905), or according to a relevant standard characterising the product(s) ordered or at least states the following details:
   • the type / kind of products (product specification, including dimensions),
   • the grade of steel / material or its code number,
   • the quantity required,
   • the type and extent of inspection document,
   • other requirements concerning surface finish, thermal treatment, special tolerances, special purpose of use (if possible, by stating the number of technical standard required or the symbol featured therein),

Ferona shall be entitled to supply the goods in the usual finish.

2. If alternative materials from which the goods are to be manufactured are permitted by the relevant CSN or CSN EN (see www.ferona.cz for a current list of alternative materials) and if the buyer does not expressively excludes such alternative materials in his order, Ferona shall be entitled to deliver such alternative materials.
3. Ferona hereby confirms that all products in its portfolio that are subject to Act No. 22/1997 Coll. on technical parameters of products, as amended, and to other relevant governmental regulations, are furnished with a Certificate of Compliance (or EC Certificate of Compliance) obtained by their manufacturer/importer and that all products and documents in harmonised spheres are marked with “CE”.
4. The quantity agreed in purchase contracts is stated approximately only. Unless specified otherwise, the acceptable tolerance shall amount to +/- 10%.
5. If the goods are to be delivered together with inspection documents (attests) and if Ferona fails to deliver such documents with the goods, it shall forward them as soon as possible in one of the following ways: to an e-mail address specified by the buyer, by mail to the buyer’s billing address, or by another method agreed upon by the contracting parties.

Article III

Packaging

1. The goods shall be packed in a way usual in this field of business and with regard to the agreed place of delivery and transportation method to guarantee their protection and preservation.
2. Ferona provides for buying back of undamaged packaging that was shown as a separate item on an invoice.
3. Ferona meets its obligations resulting from the Packaging Act, i.e. namely to collect used packaging and to utilise waste packaging materials, through the authorised packaging company EKO-KOM, a.s., registered office: Praha 4, Na Pankráci 1685/17 (www.ekokom.cz).

Article IV

Delivery Term

1. If no term of delivery of the goods is agreed upon, Ferona is entitled to deliver the goods at any time. Unless contractually agreed upon otherwise, Ferona may deliver the goods even before the date of delivery and in well-founded cases also in several parts, the buyer being obligated to accept the goods.
2. The goods shall be regarded as duly delivered once they are accepted by the buyer’s authorised representative. If the goods are to be sent to the buyer, they shall be regarded as delivered once handed over to the first forwarder.

Article V

Delivery Place

1. If agreed upon by both contracting parties, Ferona shall arrange for the goods to be dispatched to the buyer. If no delivery place is specified in purchase contract, the goods shall be sent to the buyer’s branch specified in such contract. If no branch is specified in the contract, the goods shall be sent to the buyer’s registered office. If the place of delivery is not accessible by standard trucks, the buyer shall point this fact out to Ferona in his order.
2. The buyer shall make sure that his representative authorised to accept the goods is present at the agreed place of delivery at the agreed time.
3. The buyer’s representative authorised to accept the goods must establish his/her identity to Ferona upon the delivery of the goods, state all necessary details in acceptance protocol and confirm his/her reception of the goods.
4. If any goods to be collected in one of Ferona’s branches are not collected within ten days following the agreed date of delivery, Ferona shall be entitled to withdraw from the relevant purchase contract.

Article VI

Reservation of Ownership Rights

Ferona shall remain the exclusive owner of all goods until the buyer’s settlement of their entire purchase price.

Article VII

Purchase Price

1. The purchase price negotiated in any purchase agreement is fixed and cannot be changed without a mutual consent of both contracting parties. If no agreement on the purchase price is reached, the prices featured in Ferona’s current price list shall be applied.
2. If the buyer and Ferona agree on any additional processing of the goods (for instance, splitting, burning, etc.), Ferona shall be entitled to charge the buyer for such additional processing. The exact amount of the charge shall be negotiated in the relevant purchase agreement or specified in compliance with Ferona’s current price list. Should the buyer fall behind on his collection of any goods processed in the aforementioned way and should Ferona withdraw from the agreement with the buyer as a result, Ferona shall be entitled to claim a contractual penalty totalling 40% of the agreed purchase price and also the charge(s) for additional processing. The buyer’s settlement of the contractual penalty in no way affects Ferona’s right to claim compensation for any damage exceeding the contractual penalty.
3. If the goods are to be delivered to any place outside Ferona, Ferona shall be entitled to charge the buyer for transportation. If no transportation charge is agreed upon in purchase contract, Ferona shall be entitled to charge the buyer according to its price list. If the charge cannot be calculated in the aforementioned way, Ferona shall be entitled to charge an amount customary at the moment of delivery of the goods and reflecting the method and subject of transportation.
4. Should the goods have to be redelivered as a result of any breach of the obligations defined in Article V, Section 2, Ferona shall be entitled to charge the buyer for such repeated delivery.
5. The provisions of this contract concerning the buyer’s settlement of purchase price shall be applied in a similar way to the buyer’s settlement of the transportation charges specified in Section 2, and to the buyer’s settlement of the transportation charges specified in Sections 3 and 4, and to the buyer’s payment for packaging according to Article III and the buyer’s settlement of the price of any other provided service.
6. The buyer is not entitled to retain or unilaterally offset or otherwise reduce the price invoiced by Ferona for any reason whatsoever.

Article VIII

Terms of Payment

1. Unless agreed upon otherwise, the purchase price shall be payable before Ferona’s delivery of the goods.
2. The purchase price may be settled:
1. through a bank transfer to Ferona’s account specified in the relevant purchase contract or otherwise indicated by Ferona (for instance, in its invoice),
2. by cash at Ferona’s cash desk or paid out to Ferona’s driver,
3. through post or through a forwarder.
3. If the purchase price is not settled before the delivery of the goods, it shall be payable on the date specified in Ferona’s accounting and tax document - invoice. Ferona shall specify the maturity period of its invoices in accordance with the overall volume of orders and the length of mutual business relations.
4. The purchase price shall be regarded as duly settled as soon as it is credited to Ferona’s account or paid by cash at Ferona’s cash desk or to Ferona’s driver.
5. The buyer’s failure to settle the agreed purchase price on time shall be regarded as a gross breach of contract. In such a case, Ferona shall be entitled to claim a punitive interest totalling 0.05% of the outstanding amount for each commenced day of the buyer’s delay. In addition, Ferona shall be entitled to suspend its supplies based on other contracts concluded with the buyer or withdraw from such contracts.

Article IX

Liability for Defects

1. Ferona shall be liable for any and all defects of the goods at the moment of their delivery to the buyer.
2. The buyer shall inspect the goods thoroughly immediately after accepting them. All apparent defects must be recorded by the buyer upon his acceptance of the goods pursuant to Article V, Section 3. Later claims concerning any apparent defect that could have been detected upon the buyer’s acceptance of the goods shall be disregarded. If the goods are supplied in their original packaging and no defect of the packaging is detected upon their delivery, the buyer shall check the goods immediately after unpacking them, but no later than 30 days after accepting them.
3. If the goods suffer from any defect, Ferona - at its own discretion - shall either replace such goods or repair the defect(s) free of charge. The contracting parties may also negotiate an adequate purchase price discount.
4. The buyer shall always present all his claims in writing.
5. Unless agreed upon otherwise, the buyer shall forfeit his right to be refunded the purchase price of any claimed goods if the goods are not returned to Ferona in their original condition within 30 days after Ferona’s acceptance of the buyer’s claim.

Article X

Concluding Provisions

1. All legal relations of the parties resulting from concluded purchase agreements shall be governed by the Commercial Code.
2. All disputes resulting from and/or related to any purchase contract not resolved by mutual negotiations shall be presented to the court having local jurisdiction in the place in which the branch of Ferona concluding such purchase contract has its registered address.
3. These Business Conditions shall apply to all transactions negotiated after their publication.
4. All previous delivery, payment and other conditions regulating Ferona’s sales of the goods are null and void.
5. These Business Conditions are valid from 1 January 2008.