GENERAL TERMS AND CONDITIONS OF THE AGREEMENT ON ORDER FOR BUYING / SELLING FINANCIAL INSTRUMENTS

Transcription

1 GENERAL TERMS AND CONDITIONS OF THE AGREEMENT ON ORDER FOR BUYING / SELLING FINANCIAL INSTRUMENTS

2 I. SUBJECT AND CONTENT OF THE GENERAL TERMS AND CONDITIONS Article 1 (1) The subject and content of these General Terms and Conditions is the regulation of rights and obligations between the Bank and the Client regarding the execution and implementation of the Agreement on Order for Buying/Selling Financial Instruments (hereinafter referred to as: Agreement), as well as other transactions involving the Client s Securities and monetary funds as provided by these General Terms and Conditions, and acquainting the Client with risks involved in performing transactions with Securities. (2) The General Terms and Conditions are a constituent part of the Contract, as well as other acts of the Bank where expressly indicated therein. (3) For certain categories of Clients the Special Terms and Conditions of the Financial Instruments Buying/Selling Order shall be applied (Special terms and Conditions). In case of discrepancies between Special Terms and General Terms, provisions set in Special Terms shall be considered valid. II. DEFINITIONS Article 2 Individual expressions indicated in these General Terms and Conditions shall have the following meaning: è Stock Exchange The Zagreb Stock Exchange (Zagrebačka burza d.d.) or other regulated public market in Croatia or abroad. è The Bank Company that provides financial services under consent of authorized agencies è Schedule of Charges The Schedule of Charges in Attachment 1 to the Contract defining the amount and method of calculating fees to be charged by the Bank to the Client for performing operations under these General Terms and Conditions. è Financial Instruments Transferable securities, money market instruments, fund shares, derivatives in the sense of Article 1, Paragraph 2d of the Capital Market Act. è Client or Ordering Party Resident or non-resident legal or natural person, or other organisation without legal personality, entering into a Contract with the Bank either directly or by way of an Authorized Representative pursuant to valid legislation, based on which the Bank is authorized to perform a certain operation involving Securities in its own name and for the Client s account. è Book of Orders The Bank s business book kept in electronic form as the aggregate of individual Orders, organized and kept according to the CMA and other applicable regulations. è Corporate actions Include the general assembly of stockholders of a public limited company or the general assembly of bondholders, the calculation and payment of dividend in cash, increase or decrease of the issuer s equity, splitting or merging shares, conversion of securities, new issues of debt securities, calculation and payment of interest and principal, acquisition of public limited companies, transfer of shares held by small shareholders, company mergers and integrations, company demergers, company restructuring, transfer of assets of public limited companies, issuance, registration and payment of entitlements and warrants, as well as any other activities related to exercising rights arising from securities, changes regarding securities and status changes of the issuer. è Order The Client s unilateral statement of will addressed to the Bank in the manner indicated in Art. 11, paragraph 1 hereof by which the Bank is ordered to perform a certain transaction involving Securities in the Bank s name and for the Client s account. è Authorized Representative A legal or natural person authorized pursuant to the law or a power of attorney issued by the Client to place Securities Buying/Selling Orders and perform other transactions involving Securities as provided by the Contract and General Terms and Conditions in the Client s name and for the Client s account. è Monetary Account 2

3 Monetary Account held in the Bank s books in the Client s name and used by the Bank for deposits and transfers of funds with the purpose of buying or selling Transferable Securities. è Transferable Securities Account Transferable Securities Account held in the Bank s books in the Client s name and used by the Bank to register the Client s Transferable Securities based on performed operations as provided by these General Terms and Conditions and the Contract. è Business Day Any day on which banks in the Republic of Croatia are open for transactions of the operations contained herein as well as any day on which the relevant market where a certain transaction is executed is open, except Saturdays and Sundays. The Bank s opening hours are 8 a.m. to 4 p.m. on business days. è PIN (eng. Personal Identification Number) secret six-digit number provided by the Central Depository & Clearing Company Inc. when a Transferable Securities account is opened. The Transferable Securities Account shall have only one PIN, valid for all Transferable Securities registered or to be registered in the Transferable Securities Account. è ISIN (engl. International Securities Identification Number), unique Security identification number. è Statement of Intention to Use Investment Services at Own Risk a document signed by the client who confirms that he is familiar with the risks and possible consequences of trading structured securities, after Bank s evaluation of the client s unsuitable investment profile (the statement) or after inability to evaluate the client because he does not want to give details to the Bank as an investment company as referred to in Article 69.stavka 1st ZTK, or if he has not given enough information about their knowledge and experience. (Article 69, paragraph 4. ZTK). è Default interest Interest payable by the Client in the event of default in meeting contractual obligations. Default interest shall be calculated at the statutory default interest rate. è Tied agent means a natural or legal person who, under the full and unconditional responsibility of only one investment firm on whose behalf he/she/it acts, carries on the activities laid down in this Act as the activities of tied agents. è Password An alphanumeric designation of defined size used for Client identification and protection from unauthorized action. è Broker An authorized company employee authorized to perform trading operations involving Securities. è Resident 1.Legal entities with registered seat in the Republic of Croatia, except their subsidiaries in foreign countries, 2.Subsidiaries of foreign companies and sole traders registered in the register kept with a competent body of state government or administration in the Republic of Croatia, 3.Sole traders, trade business owners and other natural persons with registered seat or residence in the Republic of Croatia, performing their registered business activity by independent work (hereinafter referred to as: individual entrepreneurs), 4.Natural persons with residence in the Republic of Croatia, 5.Natural persons residing the Republic of Croatia based on valid residence permit for a period of at least 183 days, 6.Diplomacies, consular and other representative offices of the Republic of Croatia in foreign countries, financed from the Croatian budget and citizens of Croatia employed with such representative offices and their family members. è Non-residents All other persons not indicated as Residents. è CDCC Central Depository & Clearing Company Inc. / Središnja depozitarna agencija d.d., Zagreb, Heinzlova 62a. è Adequacy questionnaire Questionnaire for evaluating client s suitability of investment services - questionnaire that Bank is using to assesses the client's level of knowledge required for trading structured securities, according Čl.68 and 69 ZTK The Bank shall use the Adequacy Questionnaire to collect the following client details considered to be relevant for the assessment of the adequacy of the service for the Client: - general client details 3

4 - data about the level and form of education - frequency of monitoring movements on financial markets - data about the period of use and types of investment services used by the client - data about the frequency of performing transactions and types of financial instruments involved in transactions - data about the client s risk horizon and risk appetite, as well as general knowledge about certain financial instruments è HANFA Croatian Financial Service Supervisory Agency / Hrvatska agencija za nadzor financijskih usluga, Zagreb, Miramarska 24b. è Investors Protection Fund Financial instruments and/or monetary funds belonging to client are safeguarded pursuant to the Capital Market Act provisions which regulate establishment of the Fund (Article 222.-Article 246.). Investors protection system, in the sense of this Act, is conducted and overseen by the Agency. Fund itself is formed and managed by the company licensed by the Agency. The fund will react if the Agency ascertains fund s member inability to meets obligations towards the client in a way that he can not fulfil cash obligation and/or give back financial instruments that he was keeping, administrating or managing for the client s account, and when it is improbable those circumstances will be changed in the foreseeable future. è Transferable Securities Shares, or other securities, bonds and other types of secured debt, including certificates on deposited securities, all other securities that grant the right to obtain or sell such transferable securities or based upon which a cash payment can be done, determined on the basis of transferable securities, currencies, interest rates or gains of commodities, indexes or other gauges, money market instruments and all other securities set by provisions of CMA (hereinafter: transferable securities or securities). è FEOA Foreign Exchange Operations Act (official gazette Narodne novine no. 96/03, 140/05, 132/06) including any subsequent amendments thereto. è CMA Capital Market Act (official gazette Narodne novine no. 88/08) including any subsequent amendments thereto. III. OPERATING LICENSE Article 3 (1) The Bank is registered with the competent court based on approval by the Securities Commission of the Republic of Croatia (now Croatian Financial Services Supervisory Agency) and the Croatian National Bank to perform operations of buying and selling Securities at the order of the Ordering Party (in its own name and for the account of the Ordering Party). (2) The Bank is also registered for performing operations involving Securities pursuant to provisions of the CMA regarding the providing of banking services and other financial services based on the license issued by competent bodies. (3) The Bank may occasionally act using services of one or more tied agents. Such tied agents should be authorized by the Agency's decision. Article 4 (1) The Bank is a member of the Zagreb Stock Exchange. (2) The Bank is a member of the Central Depository & Clearing Company. (3) The Bank is licensed to provide all agent services in operations involving Securities, as well as other services provided by institutions referred to in paragraphs 1 and 2 of this Article pursuant to regulations governing operations with Securities. (4) The Bank is also a member of other financial institutions authorized by competent bodies and uses the services of such institutions or performs operations in its own name and for the Client s account through mediation by such institutions. Article 5 (1) The Bank shall perform operations subject to these General Terms and Conditions independently, in its own name and for the Client s account. 4

5 (2) The Bank may, in its own name and for the Client s account, use services of financial institutions referred to in Article 4 hereof with the purpose of executing Orders or performing only certain operations indicated in the Order (using agent services). (3) The Bank may also, within statutory limitations, entrust the performance of all or individual operations determined by these General Terms and Conditions to third parties. Article 6 Policy on Preventing Conflict of Interest (hereinafter the Policy) regulates/prescribes the rules/principles on managing /handling and preventing the conflict of interest in operations with financial instruments of Societe Generale Splitska banka d.d. (hereinafter the Bank), as a credit institution. The provisions of this Policy are based on provisions of the Capital market Act (hereinafter the Act) and the Rule-Book on organizational requirements for providing investment services and carrying out of investment activities and auxiliary services (hereinafter the Rule-Book). The provisions of this documents are based on the provisions of other Bank s documents which regulate the operations with securities. The aim of the policy is: To identify the potential and/or existing conflicts of interest which could occur while providing investment and other auxiliary services and carrying out of investment activities, Establishing of preventive measures and actions for the purpose of preventing or removing conflict of interest, Establishing the process of sorting out the conflict of interest in situations in which the implementation of preventive measures is not possible, Establishing the high standards of business behavior and transparency of operations expected from the relevant persons, Informing all the employees of the Bank and relevant persons about the duties related to managing the conflict of interest in providing investment services and carrying out of investment activities. The conflict of interest represents every situation in which the Bank and/or a relevant person are not neutral and objective in relation to the subject of operations, i.e. by using its specific position while providing and performing investment services and activities as well as auxiliary services the Bank and/or the relevant person have professional and/or personal interest which are competitive with the interests of the clients and which could affect the impartiality in providing and performing services and activities and to impair the clients interests. The conflict of interest can arise between: The interest of the Bank and/or a relevant person, i.e. the persons directly or indirectly related to them through controls on one side and interests of the Bank s clients on the other side Interests of various clients of the Bank between each other Conflict of interest can exist in the following cases: The Bank and/or a relevant person could realize the financial profit and avoid the loss to the damage of the client, The Bank of the relevant persons who have interest or the benefit from the outcome of the operations carried out for the client or from the transaction effected for the account of the client and which differ from the interest of the client The Bank and/or relevant persons have the financial or some other motive for favoring the interest of another client or group of clients to the damage of the interest of a client, The subject of the Bank s operations and/or relevant person is the same as the subject of operations of the Client, The Bank and/or relevant persons will have received or will receive from the person that is not the client, the additional stimulation on the basis of the deal performed for the client and that is in money, goods, services etc. and which is not the usual commission, or fee for carrying out such a deal, Societe Generale Splitska banka d.d. manages the conflict of interest, both the existing ones and the potential ones, in the manner that the abuse of situation of the conflict of interest is avoided as well as violation of all liabilities towards the clients and violation of effective acts and regulations. To that aim the Bank uses the various procedures and techniques for managing the situations in which the conflict of interest might occur in order to avoid or reduce the risks and potential impact of conflict of interest on the clients. Some of the actions and measures undertaken for the purpose of preventing the conflict of interest including the following: The Bank has adopted the Codex of behavior which defines ethical principles which every employee should respect and it insures that all employees are informed with the rules of behavior and that they 5

6 apply the same in their everyday practice, particularly in the organizational parts in which there is the higher possibility for appearing of conflict of interest. The Bank owns the procedures the aim of which is the prevention and control of exchange of information between the relevant persons engaged in the activities which bear the risk of conflict of interest and in which the exchange of information might impair the interest of one or more clients, Everywhere where it is needed the Bank undertakes the activities for the purpose of separating the transactions and/or activities in the manner that the same are carried out disregarding other transactions and/or activities (within the so called Chinese walls). This procedure is supported by the organizational measures such as separated reporting lines, separated premises and restricted access to information Internal documents which regulate this area are available to all employees and internal education is regularly carried out so that every employee can have sufficient information and could proceed according to the internal documents for the purpose of preventing conflict of interest. The system of updated monitoring of relevant information in the safe environment has been implemented for the purpose of identification and managing the conflict of interest. In certain situations, and particularly in case of appearing of conflict of interest between the clients and the Bank, the Bank may decide to reject certain transactions (or to withdraw from the same ) if the key conflict of interest has been identified which can not be avoided and which can impair certain interests of the client. In certain cases it is necessary to advise the client on the permanent storage media about the potential conflict of interest, in the clear and fair way so that the client can bring the decision based on such information The Bank keeps the adequate records of services and activities of the Bank by which the conflict of interest is identified The personal trading of employees in the particularly privileged areas is the subject of special rules in the manner that the employees should report all their transactions with financial instruments. Procedures for managing the conflict of interest are the subject of the regular review by the Compliance unit so that compliance with the same can be insured. The areas of confidentiality have been set up i.e. virtual and physical barriers between the Front office and Back office have been set up, by which the participation of relevant persons in various operations with securities is prevented or supervised at the same time. The separate supervision of relevant persons whose primary function includes the business activities for a client or providing of services to clients whose interests might come into conflict or who represent the various interests which might be in conflict in another way, including the interest of the Bank itself, has been achieved through the internal audit unit and compliance unit. The incomes of the relevant persons who are mostly engaged in one business activity are not directly related to the incomes or profit of relevant persons who are mostly engaged in another business activity when the conflict might arise with respect to those activities. The areas of confidential /privileged information are the areas of responsibilities in which the more frequent confidential / privileged information are expected. In principle, the confidential/privileged information should not be leaving the areas of privileged information. In order to enable the control of the flow of confidential information and the same time to enable the transfer of information for official purposes when it is absolutely necessary, the areas of confidentiality have been divided by the so called Chinese walls. The Chinese walls insure that the relevant information remain confidential and within the confidential area in which the same appeared. Those information may be used within the confidential area provided that it is necessary for normal flow of operations. The privileged information appearing within certain confidential area should not leave that area. For the purpose of smooth flow of operations it might proven necessary that the relevant information passes across the Chinese wall. For that purpose the transfer i.e. the exchange of privileged information between the two areas of privileged information is possible exclusively against the prior approval by the head responsible for that area and the person in charge of reconciliation. The detailed information which is proceeded must be documented, together with the source from out of which it has originated and dates on which the same has been received, i.e. proceeded. The employees which move from one confidential area into another, either on temporary basis (for ex. due to participation in the project) or permanently, may use the privileged information and proceed the same only under the conditions that they have advised the person in charge for reconciliation. The aim of creating the areas protected by the Chinese wall and special manner of handling the confidential information is to prevent the conflict of interest. It also contributes to independency and 6

7 impartiality in providing services to clients and carrying out of transactions for the own account without impairing the key everyday cooperation. IV. GIVING ORDERS Providing information to the Client Article 7 (1) Before accepting the Client s order, the Bank shall acquaint the Client with all data and circumstances which are known to the Bank and which are normally considered necessary for deciding on the execution of operations under these General Terms and Conditions, including exact information on the offer, demand, transactions and developments of the prices of Securities, general overview of the characteristics and risks associated with Securities, as well as other details to enable the Client to deliver Orders to the Bank without difficulties. The Bank shall inform the Client by way of a special document/letter about the Client classification as either a Retail Client or a Professional Client or Eligible Counterparty, as well as associated protection levels. (2) Client is entitled to submit a written request on changing their own classification in another category of clients at any moment. In this case, Bank agrees to inform Client in writing about the consequences that may arise from changing the protection level requested and will respect and follow the provisions of the internal classification rules. (3) The Bank will acquaint the client with Order execution policy and Rules on actions to prevent conflict of interest. Providing Coverage advance of funds Article 8 (1) The Bank shall accept, i.e. execute the Securities Buying/Selling Order only if the Client has transferred the amount representing full coverage required for the execution of the delivered Order, increased by the amount of any associated fees and expenses payable to the Bank based on Order execution, including Stock Exchange commissions and CDCC fees (if the Securities are in the CDCC system), calculated pursuant to the provisions of the Schedule of Charges (such total amount shall be referred to hereinafter as: Coverage). (2) The Bank shall inform the Client on the manner of transferring Coverage. The Coverage shall be considered transferred by the Client when the funds are paid to the Monetary Account according to the Bank s instructions. (3) The Bank may at any time suspend the performance of operations subject to these General Terms and Conditions until receipt of the money transfer, i.e. until payment of the Client s money serving as Coverage, and shall not be liable in such event for any loss caused by non-payment of Coverage by the Client. (4) In addition, Client agrees that if executed order is not timely settled, the Bank has the right to keep financial instruments which the Client owns, also the Bank has the right to Out of Court settlement from their value, as well as the right to settle with the funds in a separate account if the Client has matured, and outstanding obligations to the Bank, arising from any contracts concluded in accordance with these General Conditions. In order to fulfill the provisions of the preceding paragraph, the Client irrevocably authorizes the Bank to charge his funds account for the above amounts or any other Client's transaction account opened at the Bank. The Bank will notify the Client of intention to exercise the right to settle from the right to keep or of intention of settlement execution. Settlement amount represents the value of the completed Order increased for amount of related fees and expenses to the Bank under execution, including commissions and fees for SKDD and Markets Providing Coverage registration of Securities Article 9 (1) The Bank shall accept, i.e. execute the Securities Buying/Selling Order only if the Client has registered the Securities required for the execution of the delivered Order. 7

8 (2) The Bank shall instruct the Client on how to register Securities depending on the form of issuance, place and method of deposit, as well as on the place and manner of registration. (3) The Securities shall be considered registered by the Client in the sense of provisions of these General Terms and Conditions when the following conditions are cumulatively met: (a) Securities have been registered with the Bank by the Client in the computer system of the CDCC or other authorized institution where Securities are kept in electronic form, and (b) Securities registered with the Bank are available in the Securities Account. (4) The Bank may at any time request additional documents and evidence regarding information about the Security, as well as additional authorizations and other documents to fulfil the obligations undertaken and can suspend the performance of operations subject to these General Terms and Conditions in the meantime. The Bank can also check with third parties the authenticity of the Security and the data associated therewith and take other actions to ensure the inalterability of such data and the Bank s authorizations as long as operations are in process. (5) If there are several authorized persons with respect to one Security, the Bank shall demand that only one person be identified as the Authorized Representative who shall present to the Bank written consent by all other authorized persons that such Authorized Representative shall act as the Ordering Party. (6) If during the registration of a Security the Client authorizes the Bank to perform individual actions usually performed by the Client (for example, the issuance of special power of attorney, disclosure of the password, PIN or other secret information), the Client shall be considered acquainted with the risks associated with issuing such authorization or disclosure of such secret information, and the Bank shall use the authorization received only in the segment necessary to perform the actions entrusted to it. Freely transferable Securities Article 10 (1) The Bank shall, unless agreed otherwise, execute Orders only in connection with freely transferable Securities on which the right of ownership is not limited, conditioned, encumbered by third-party rights or encumbrances in favour of third parties, and the Client shall register only such Securities. (2) If a limitation to the right of ownership on Securities or the right of disposal of rights arising from Securities exists or is later established, the Client shall immediately notify the Bank thereon and the Bank and the Client shall forthwith attempt to resolve the disputable situation. If the Client should fail to notify the Bank on such limitations or, as the case may be, encumbrances in favour of third parties on Securities referred to in this paragraph, the Client shall be liable to the Bank for any loss caused by such wilful misconduct of the Client. (3) Provisions of this Article shall apply neither to limitations, conditions or other encumbrances established in the Bank s favour, nor to limitations, conditions or other encumbrances based on the execution of the Client s order in court or out-of-court debt enforcement procedures. Important elements of the Order Article 11 (1) The Bank shall accept only Orders which contain information about relevant elements of the operation to be performed based on the acceptance of the Order and which have been without any doubt delivered by the Client. (2) Important elements of the Order are considered to be: (a) Personal Client identification data identical to personal data indicated in the Contract; (b) Type of Order, i.e. type of operations to be performed by the Bank (buying/selling); (c) Information about the Security unambiguously defining the subject of the Order (official designation of the Security); (d) Information about the quantity of Securities which are subject to the Order; (e) The price of the Security subject to the Order, expressed as a unit price for shares in kunas and lipas, and for debt Securities in the percentage of their fair value (the price in the Buying Order shall be computed as the maximum price the Client is ready to pay or, as the case may be, the price on the Selling Order shall be expressed as the minimum price the Client is ready to accept for the sale of Securities); 8

9 (f) The Stock Exchange where the Order will be executed or, as the case may be, the ISIN number for a security listed on a foreign stock exchange; (g) The term of validity of the Order; and (h) The Client s signature (for Orders delivered in written form) or password (for Orders delivered verbally or in electronic form) or alternative method of Client identification. (3) If the Bank receives contradictory, vague, unclear or incomplete Orders, the Bank shall be entitled to request completion of the Order, reject the Order, take action at its own discretion or postpone acting based on the delivered Order until the Bank clarifies any issues with the Client, all without any obligations for the Bank. (4) Regarding any information not provided in the Order, which is not stipulated by regulations as obligatory element of an order or any information determined to be information prevailing on the market, the Bank shall act with due care of a prudent businessman and shall act in the Client s best interest; however, the Bank shall not guarantee that the best possible protection of interests of or benefit for the Client will be achieved by execution of such Order. Giving orders Article 12 (1) Orders can be delivered to the Bank verbally (via telephone), in written form by fax (with obligatory use of the password or via alternative method of Client identification), or personally by a Client visiting the Bank (Brokerage Department address indicated in Article 23) or by (the Order may be sent from the address indicated by the Client in the header of the Contract, with obligatory use of the password or alternative method of Client identification) or by internet based platform for trading with financial instruments SB e-tr@der as follows: (a) A written Order can be delivered by the Client to the Bank personally at the Bank s business premises or by fax at the address of the Brokerage Department address indicated in Art. 23.), by completing the Securities Buying Order or Securities Selling Order. The Bank shall accept written Order only if personal data indicated therein are identical to the Client s personal data indicated in the Contract. The Bank shall not accept Orders where personal data indicated by the Client differ from data indicated in the Contract or from data communicated by the Client to the Bank prior to delivering the written Order. (b) A verbal order can be given by the Client only via telephone and only at telephone numbers indicated in Article 23, i.e. telephone numbers communicated by the Bank to the Client with obligatory use of the password to be selected by the Client when executing the Contract and indicated in the header of the Contract. The above password shall consist of at least 5 (five) and up to 10 (ten) letters and/or digits. The Client agrees that the Bank, as a result of the development of its organization and IT support, may assign a new password to be used by the Client as unambiguous identification when giving Orders by telephone and/or another form of communication. The Bank shall notify the Client on the assignment of a new password by registered mail with receipt confirmation to the contact address indicated in the Contract header or another address communicated by the Client to the Bank in the way provided for by General Terms and Conditions and the Contract. The Client shall keep the received password secret. The Bank shall not be liable for any misuse of password by third parties. Bank can identify the Client through alternative way, or may request certain information from the client based on which can undoubtedly determine the identity of the client. These are the following personal information s: personal identification number (JMBG), Social Security number (OIB), home address as indicated at Hyperion, SKDD number of investors, telephone number and user data from the SB e- trader application (if they use the same). Upon broker s request during the process of alternative identification Client should specify at least two (2) pieces of the above information for the identification process to complete. (c) Orders in electronic form can be given only by sending an from the address indicated in the Contract header, with obligatory use of the password or via alternative method of Client identification (detailed description in the previous paragraph of this Article). 9

10 (d) Regardless of aforementioned in these General Terms, for giving order procedure whenever buying/selling via internet platform SB a special Rules on using SB shall be valid and applied. Those rules constitute an integral part of these General Rules. (e) Client Orders can be given to the Bank in the Croatian and/or English language. (2) Any person giving an Order in the name and for the account of another person (representation) must be able to provide evidence of the power of attorney granted for giving such an Order. Accepting Orders Article 13 (1) Acceptance of the Order by the Bank shall be considered exclusively the entry of the Order into the Book of Orders. (2) The mere receipt of the Order by the Bank does not represent acceptance of the Order. The Bank shall inform the Client that the Order has been accepted and registered in the Book of Orders. (3) By accepting the Order, the Bank undertakes to perform, in its own name and for the Client s account, the operation involving Securities according to data indicated in the Order and any further instructions pursuant to paragraph 7 hereof. (4) The Bank may, without indicating reasons or additional explanations reject to accept any Order delivered to it, and shall provide reasons for such action only if such obligation has been agreed in advance. The Bank shall forthwith inform the Client on the rejection of the Order. (5) The Bank shall not accept Orders where it is found or evaluated by the Bank that: (a) the Order does not contain elements important to perform the operation; (b) the Bank could not perform the Order due to significant deviations from market conditions or other reasons; (c) the Order could be given with the intention of unlawful manipulation of the Security price or with the purpose to commit other unlawful actions; (d) the Bank could incur loss or commit a misdemeanour or criminal offence by executing such Orders. (6) The Bank shall not accept the Order if it is considered by the Bank that the execution of the Order, according to the information and attributes thereof, would cause loss to the Ordering Party or that additional instructions are required. The Bank shall bring this to the Client s attention and request further instruction from the Client. Additional instructions thus received shall become an integral part of the Order which shall be considered accepted if conditions referred to in paragraph 1 of this Article have been met. (7) At the Client s request, the Bank shall forthwith deliver the extract from the Book of Order to the Client. Amendments to the Order Article 14 (1) The Bank shall accept amendments to the Order or other instructions if the Order has not been executed at the time any amendments are received or if such amendments do not affect the operations executed so far. (2) The Bank shall forthwith inform the Client on the non-acceptance of amendments to the Order or any other instructions. (3) Amendments to the Order shall be considered binding upon the Bank only if they have been entered into the Book of Orders, except for exceptional situations described in paragraph 3, Article 21 of these General Terms and Conditions. (4) In the event of amendments of data determined by valid regulations to represent relevant alterations of the Order and affect its execution and thus represent a new Order, the data in the previous Order shall be, together with accepted amendments, regarded as a new Order of the Client. (5) For any modification or amendment of the order, Bank (broker) is obligated to perform the identification of a client as prescribed in Article 12 of this General terms. 10

11 Expiry of the Order Article 15 (1) If the term of validity has been determined by the Order, the Bank s obligation regarding the nonexecuted segment of the Order shall cease to exist with the expiry of such term of validity. If the expiry of the term of validity does not affect the operations executed so far, in view of the completion status of the Order, the Bank shall complete the operations commenced. Maximum order validity is one year. (2) Unless agreed otherwise, the Order shall be valid one year. The Bank shall not be obligated to inform the Client on the expiry of the contracted term of validity of the Order. Recall of the order by the Client Article 16 (1) The Bank shall accept the recall of the Order by the Client in the manner and under the conditions applicable to the amendments to the Order referred to in Article 13 of these General Terms and Conditions. (2) The Bank may prescribe special form and procedure for the delivery of Order recalls. Termination (recall) of the Order by the Bank Article 17 (1) The Bank may at any time, unless agreed otherwise, terminate even a partially executed Order, without the obligation to state reasons or provide special explanation. The Bank shall not be liable to the Client for any loss caused by unilateral Order termination. (2) The Bank may terminate a non-executed Order also for the following reasons: (a) announced or commenced Corporate Actions due to which the conditions of the Order significantly deviate or would significantly deviate from market conditions which will prevail after the execution of such Corporate Action; (b) suspension of trading in certain Securities on the market; (c) decision of the competent regulatory body; (d) outstanding receivables of the Bank from the Client, etc. (3) Besides reasons indicated in the paragraph above, the Bank may terminate the Order at any time for the same reasons for which it can reject the Order, especially if the Client cannot be contacted. (4) The Bank shall forthwith inform the Client on the termination of the Order, primarily by telephone, and exceptionally (if the Client is not reachable) in writing. (5) The Order shall be valid from the time it is entered into the Book of Orders. Execution of the Order Article 18 (1) The Bank shall execute the Order in accordance with received instructions, with due care of a prudent businessman, within applicable limits, and take all actions with due care of the Client s interests. (2) When executing Orders, the Bank shall also observe special regulations governing the operations involving Securities, rules of institutions providing services to the Bank, as well as general rules and business customs valid in the market and among its participants. (3) If Orders can be executed in different stock exchanges, the Bank shall unless it has received instruction for the Client to the contrary select the place of Order execution. (4) The Bank can withdraw from an accepted Order and instructions only with the Client s consent; when no instruction can be obtained due to time restrictions or any other reason, the Bank can withdraw only if it is justified to assume, based on all circumstances, that this would be in the Client s best interest. (5) After Order execution, the Bank shall forthwith deliver written notification (by mail or ) on a performed transaction to the Client. Any complaints the Client may have to the above notification must be delivered in writing, no later than one Business Day following the receipt of the notification. The conditions of the above notification shall be otherwise considered accepted by the Client. 11

12 (6) If the Bank deems during the execution of the Order that there are facts and circumstances which would, if they had been known earlier, represent reasons for the non-acceptance of the Order by the Bank, the Bank may suspend the execution of the operation and request new instructions or, as the case may be, cancel the Order. Depositing the Client s assets Article 19 (1) The Bank shall receive and deposit the Securities and/or funds resulting from the execution of the Order according to valid regulations, rules of financial institutions providing services to the Bank, and in any other way agreed between the Bank and the Client. The Bank shall register the received Securities in the Securities Account and the funds in the Monetary Account. (2) The Bank shall, unless agreed otherwise (e.g. if it is agreed that all transactions from the Monetary Account and/or the Securities Account shall be settled in the Client s special custody account), use the funds in the Monetary Account to settle all monetary receivables from the Client and use Securities registered in the Securities Account to settle all receivables in Securities from the Client, according to applicable regulations. (3) The Bank shall transfer monetary funds of the Client to the Client s Monetary Account according to the instruction contained in the Order or otherwise as agreed. The Bank shall, unless agreed otherwise, transfer monetary funds within 3 (in words: three) Business Days following the performed transaction. (4) The Bank shall also transfer to the Client any other claims and receivables against third parties in the Client s favour resulting from operations performed by the Bank with such third parties in its own name and for the Client s account. (5) The Bank shall not be obligated to transfer monetary funds or deliver Securities registered in the Monetary Account or, respectively, the Securities Account, until completion of all operations commenced or, as the case may be, until settlement of all of the Bank s receivables based on operations subject to these General Terms and Conditions. (6) If the Client fails to settle the liabilities to the Bank referred to in the above paragraph, the Bank shall be in no way liable for the loss caused by non-delivery of Securities or non-payment of funds. (7) No deposit interest shall accrue on funds in the Monetary Account Banka since such funds are not included in the Bank s assets. V. FEES AND COMMISSIONS Article 20 (1) The Bank shall, based on performing operations which are subject to these General Terms and Conditions, charge fees and commissions according to the defined Schedule of Charges, as well as any default interest, to the Client. (2) The signing of the Contract by the Client shall be considered express statement of the Client s knowledge and acceptance of the provisions of the Schedule of Charges, which is acknowledged by the Client to be a constituent part of the Contract, and of the Client s acceptance of any later amendments to the Schedule of Charges. (3) The Client shall also pay to the Bank any costs, fees, penalties and other expenses charged by the market where the trading is performed or otherwise arising for the bank, including reasonable legal expenses and all tax liabilities, unless they were incurred as a consequence of the Bank s intention or gross negligence. The Bank s receivables from the Client shall always include: (a) all liabilities assumed by the Bank based on the execution of the Order and its obligations under the Contract, (b) all fees, expenses, interest and default interest incurred in connection with the execution of the Order and obligations under the Contract resulting from actions for which neither the Bank nor the Client are responsible, (c) all other receivables in connection with the fulfilment of obligations under the Order and the Contract, and (d) all taxes the Bank would be obligated to settle according to applicable regulations. (4) In order to fulfill the provisions of the preceding paragraphs the Bank pursuant to the Law on Obligatory Relations and other legal regulations is entitled to keep the financial instruments which the client owns and also has the right to Out of Court settlement from their value, as well as clearing right 12

13 with funds in a separate account if the client has matured, and outstanding obligations to the Bank, arising from any contracts concluded in accordance with these General Conditions. The Bank will notify the Client of intention to exercise the right to settle from the right to keep or of intention of settlement execution. To meet the provision of the paragraph above, the Client shall irrevocably authorize the Bank to debit such amounts against the Client s Monetary Account or any other transaction account of the Client held with the Bank. VI. RISKS AND RESTRICTION OF LIABILITY Risks of investing into Securities Article 21 Operations with financial instruments, including the buying and selling of financial instruments and management of the financial instruments portfolio bear certain risks. The risks, which cannot be completely listed, include primarily the unexpected variations in prices of securities, the impossibility of the issuer of securities to perform obligations undertaken based on such securities, additional obligations and restrictions imposed upon the holders of securities by financial or fiscal regulations in the country and abroad, changes in the market liquidity of individual securities, etc. The price of financial instruments changes according to market conditions that may be subject to a whole range of factors, of which some are completely unforeseeable. The performance of obligations arising from financial instruments for their issuers can be also threatened and even obstructed by disturbances of the issuer s business operations or the economic situation. The quality and value of individual investments can be affected by changes of the fiscal policy, introduction of restrictions on disposal of securities and other measures imposed by the executive power in the country and abroad. Investors are advised to take care of the leverage effect, i.e. the amount of debt used in the capital structure, which affects the profit after interest and taxes. Using third-party sources of funding pays out as long as business operations generate profit at a rate higher than the weighted interest rate payable for use of third-party capital. Investors are advised, when selecting securities to invest into, to try to match the size, structure, maturity and other relevant elements of the investment decision(s), the liquidity and the risk of the investment with their present and projected asset situation, taking also into account their investing experience in the same or a similar domain, and to seek professional advice as necessary. By execution of the Order and/or the Contract on the Order for the Purchase/Sale of Financial Instruments, the Instructing Party confirms to be aware of the risks inherent in the financial instrument market and the Authorised Company having provided data and information requested and satisfactory answers to all questions made by the Instructing Party concerning market circumstances and financial instruments to which the Order or the Contract on the Order for the Purchase/Sale of Financial Instruments refers. The risks of investing in financial instruments can be classified as general and specific risks relative to each individual financial instrument. Financial derivatives are used to hedge from the risk of fluctuations in prices of the underlying instrument, for speculation purposes and various types of arbitration. It is important to note that derivatives offer the possibility of high profit as well as high losses. Because it is mainly not necessary to pay the full value of the underlying instrument subject to the transaction, and the exchange of cash flows occurs in the future based on a predefined formula, derivatives enable the use of a high degree of financial leverage, which considerably increases the risk with such types of investment. Besides, the risk can in some cases exceed the risk of complete loss of funds invested, i.e. be theoretically even unlimited. General risks in operations with financial instruments are considered to be: Business Cycle Risk the risk of loss of value due to recession, i.e. the loss of value of financial instruments caused by the slowdown of economic activity from time to time, coupled with concurrent deterioration of the general economic climate (decrease of real income, growing unemployment, low level utilisation of production capacities...); Country Risk the credit risk of a certain country is called the country risk. Exposure of a country to various political, economic and other risks affects all market participants in this country. Country risk can be conditional upon the rating of the national economy in the global environment, which includes: (i) sovereign risk, i.e. risk of defaulting on the payment of the country s overdue debt 13

14 and (ii) political risk, i.e. risk of unexpected regulatory changes affecting the capital market and the investor position. Exchange rate risk (currency risk) and foreign exchange restrictions Under the influence of numerous economic and political factors and constant movements in foreign currency offer and demand, the exchange rate risk is subject to frequent fluctuations which lead to deviations of the actual value of one (contracted) currency and another currency, i.e. the currency to be used for payment. The holder of a Security denominated in foreign currency or a Security with Underlying Assets denominated in a foreign currency can be exposed to negative changes in currency exchange rates, which can affect yields on such Securities, or the risk of foreign exchange restrictions imposed. In the event of transactions involving financial instruments in a foreign currency, such measures can, for instance, prevent free convertibility of a currency to another, which can together with exchange rate fluctuations increase or decrease the value of the investment, i.e. affect the yield. Inflation risk the risk of decrease of the value of Securities and decrease of the value of the investment return rate due to an overall prices growth the growth of prices being caused by increased aggregate demand mostly financed with loans and advances, change in the structure of aggregate demand, pressures on prices caused by workers unions on the labour market, etc. Trading and liquidity risk On an illiquid market, investors may not be able to sell their Securities at fair market values due to decreased attractiveness of the instrument or market inefficiency. Holders of Securities may be exposed to market value risk whenever they sell securities prior to maturity. Liquidity (marketability) implies the possibility to sell a security or close the position in a financial instrument at market price at any time. In the event of illiquid market, making a selling order of normal volume may cause significant price fluctuations and the order may not be executable at all or may be executed only at a significantly lower price. Risk of bankruptcy of the issuer the risk of value decrease or complete loss of the Security due to the investor s bankruptcy bankruptcy being characterised by decrease of business activity which may lead to discontinuation of business operations and is caused by insolvency (the impossibility to settle due liabilities in due term) or by a situation of negative net asset values of the company (where the company s liabilities are higher that the estimated fair value of its assets); Market Psychology Risk risk of changes in the value of Securities due to speculative activities of large investors or large-size Corporate Actions on the Stock Exchange. Technology Risk Risk of failures of IT systems and/or risk of breakdown of communications between the Bank, the Central Depository and Clearing Company (SKDD) and/or the Stock Exchange and/or regulated public securities markets. Issuer risk risk of decreasing value of a Security due to bad rating of the issuer. Besides general risks in operations involving financial instruments indicated above in this text, special risks in business operations are considered to be: è A. for shares: risk of decreasing value of a share due to usual movements of prices on a market (volatility risk) and risk of non-payment of dividend; è B. for bonds: creditworthiness risk; interest rate risk and payment cancellation risk. Besides shares and bonds, trading on regulated financial markets also involves financial derivatives, which bear not only the risks above, but also some other risks to be elaborated below. Financial derivatives risk A financial derivative is an instrument with a value based on the value of another underlying instrument (including shares, ADRs/GDRs, bonds, funds, commodities, currencies, interest rates, portfolios under management or indices, future or formulas or their baskets). Instead of trading in the underlying instrument itself, the parties agree to exchange cash, the underlying instrument subject to the contract or another value, on a certain date or within a defined term, based on the value of the underlying. General risks of investing into bonds also include risks which can lead to loss of the entire or a significant part of the investment by the holder. Investors 14

15 should bear in mind that the market value of such Securities can be quite variable (depending on the volatility of the relevant Underlying Asset, and can in some cases exceed them). Risks related to the underlying asset The underlying asset can have quite variable results and bear higher credit risk than the Issuer. For this reason, the purchase price and/or settlement price can under certain circumstances be significantly below the issue price. Loss of the entire capital invested is possible in the worst case. Risks related to setting the purchase cap The purchase price of Securities can be capped by the Issuer pursuant to Final Conditions of the issuance of a security so that the yield can be significantly lower than the yield on similar structure Securities without such cap. Risk of conflict of interest (hedging transactions) The possibility of Issuer decisions having a positive or negative effect on the value of underlying assets, which can adversely affect the value of Securities related to it, cannot be excluded. The issuer can buy or sell Securities on the market of using any other public or non-public means of trading at any time during the validity of Securities. Hedging activities taken by the Issuer can affect the market price of Underlying Assets as well as the value of Securities and/or the redemption price payable to the holder of Securities. Risk of preterm redemption In the event of redemption of any Security prior to its maturity according to Conditions and applicable provisions, the holder of such Securities can be exposed to risks, including the risk of earning yields lower than expected. Effect of additional expenses Commissions and other transaction costs which may arise in connection with the purchase and/or sale of Securities may lead to increased expenses, especially in combination with low investment amounts, which can significantly decrease the profit related to such Securities. Risk of suspension, discontinuation or termination of trading/quotation There is risk of suspension, discontinuation or permanent termination of trading in Securities or Underlying Assets. Settlement System Risk Since Structured Securities may represent Securities held on behalf of various settlement systems, the investors may have to rely on procedures of such systems for transfers, payments or communication with the Issuer. Transactions in financial instruments involving parties from various countries also bear the additional risk of realisation or settlement being complicated or completely disabled due to the implementation of restrictive political or economic measures. Market risk Market risk represents the possibility of growing/falling prices of individual financial instruments, which may lead to decreased yields of loss of value of the investment portfolio. Investors may face certain risks typical for a certain market, including the risk of not being able to sell their Securities at prices that would produce yields similar to those from investments on developed markets. Risk of the issuer s credit rating One or several independent credit rating agencies may give credit ratings on issues of Securities, but these ratings do not necessarily reflect potential risks related to the Security and the Issuer. Credit risk Credit risk represents the probability of a party involved in a transaction (e.g. the issuer of a security or a person with whom deals on financial markets are closed) not being able to perform its obligations partly or completely. Risk of changes in fiscal or other regulations The risk of changes in regulations represents the probability of fiscal or other regulations in the investor s country and/or countries where the investor s assets are invested changing in a way that would adversely affect the yield. Prior to making an investment decision, every investor should consult his or her tax advisor. The risk of regulatory changes is beyond the Bank s scope of influence. Financial leverage risk An investment where the source of funds for investment is borrowing bears increased risk of loss. The profitability of the investment itself has no effect on the debt servicing 15

16 obligation and the expenses of such funding affect the investment by decreasing the yield earned. This is why funding investments through a form of borrowing should be approached with increased caution. Interest rate risk The risk of variations in interest rates represents the possibility of loss if interest rate levels on financial market should change (e.g. growth of interest rates demanded on the market may cause the prices of debt securities to drop). Risks of investing in financial instruments may be classified as general and specific risks relative to each individual financial instrument. Restriction of liability Article 22 (1) The Bank s liabilities shall be limited to actual monetary loss resulting from intentional action or gross negligence of the Bank. The Bank shall not be liable for any loss incurred by the Client due to force majeure, any kind of war (declared or not), riots, natural disasters, government restrictions, market rules, trading cancellations, strikes, communication system breakdowns, in particular the breakdown of the Stock Exchange systems or any other circumstance beyond the Bank s control. (2) The Bank shall not be obligated to provide any legal services in the Client s name and shall not bear any obligation or liability on account of any advice or any other statement given to the Client. (3) The Bank shall not guarantee, unless expressly undertaken, to execute the Order in accordance with its content or to fulfil all or any individual obligations under the Order if: (a) the counterparty with which the Bank has contracted the operation (necessary to meet the Bank s obligations to the Client) fails to meet its obligation to the Bank, or (b) the obligations were not fulfilled due to causes within the scope of liability of the counterparty, the issuer or the institution providing services to the Bank, where the Bank is obligated to use such services according to applicable regulations or such services are customarily used according to general rules and business customs prevailing in the market and between its participants, or (c) any of the following situations occurs: (a) alteration of the initial Order which has been partially or fully executed, and the Broker could not foresee, due to the existing statutory and technical framework, that the initial Order will by executed at the time or immediately after the time when the change of Order or change of conditions of the initial Order is received, or, as the case may be, that the Order has been already fully or partially executed according to conditions of the initial Order, in which case it shall be considered that the modification of the Order (in the part where the initial Order is modified): - is implemented with the execution of the initial Order if the modification refers to decrease of the quantity of Securities, or - represents a new Order if the modification refers to any other component of the Order; (b) termination of an initial Order which has been fully executed, and the Broker could not foresee, due to the existing statutory and technical framework, that the terminated Order will by executed or has already been executed according to conditions of the initial Order at the time or immediately after the time when the Order termination is received, in which case the terminated initial Order shall be considered executed; or (c) another situation similar to the situations described in the above two items of this paragraph. (4) The Bank shall also not guarantee the fulfilment of the obligation of another counterparty in any Securities Buying/Selling operation executed according to the Order. (5) The Bank shall not be responsible for cases when the Client has failed to inform the Bank in due time and without undue delay about the change of name, address, telephone numbers, addresses of authorized representatives and any other changes of data which could have a material effect on the execution of operations defined by these General Terms and Conditions. (6) The Bank shall also not be responsible for any loss incurred if the Client enables a third party to use its Password referred to in Article 11, item b. of these General Terms and Conditions or makes such Password otherwise available to a third party or in any other case of misuse by a third party in possession of the above Password. 16

17 (7) If the Bank decides based on the completed Adequacy Questionnaire that the service of trading in securities is not adequate for the Client, the Client shall be entitled to request and sign the Statement of Intention to Use Investment Services at Own Risk. By his/her signature on the Statement of Intention to Use Investment Services at Own Risk, the Client releases the bank of the responsibility for not having advised him/her about risks and any consequences in connection with trading in structured securities, after having evaluated the client s investment profile as inadequate. VII. OBLIGATION TO SECRECY AND DATA PROCESSING Article 23 The Bank shall keep data about the Client, the status and changes in the Securities Account and the Monetary Account, Orders and operations performed by the Bank for the Client s account, as well as other data and facts known to the Bank in connection with the performance of the Order, and the Bank shall be authorized to disclose such data only to persons and only in cases when such disclosure is required by law. VIII. REPORTING AND COMMUNICATION Article 24 (1) The Bank shall, unless specifically agreed otherwise, deliver and provide to the Client all confirmations, notifications, reports, initiation and any other forms of communication regarding the execution of operations under the Order and the Contract to addresses, telephone numbers and fax numbers as indicated in the header of the Contract. (2) The Client shall, unless specifically agreed otherwise, deliver and provide all instructions, notifications and any other forms of communication with the Bank regarding the execution of operations under the Order and the Contract only to the following addresses and/or telephone and fax numbers: SOCIETE GENERALE - SPLITSKA BANKA d.d. Brokerage Department R. Boškovića Split Tel.: ; 622; 654; 655 Fax: brokeri@splitskabanka.hr or personally to the address indicated above. (3) For the purpose of all operations provided for by these General Terms and Conditions, notifications and other forms of communication shall be considered delivered on the same day if they have been dispatched on business days during the working hours (8 a.m. 4 p.m.), except in the event of sending registered mail, which shall be considered received on the date of receipt or, if delivery by courier to the recipient should not be possible for any reason, on the date when the recipient receives notification about the receipt of delivery by the legal subject authorized for mail delivery. (4) The Bank and the Client undertake to forthwith inform the counterparty about any change of address and other data relevant for notification and any mail shall be considered duly delivered to the recipient party if dispatched to the addresses/telephone and fax numbers indicated in paragraph 2 of this Article until the party receives notification on the change of such data. (5) Pursuant to provisions of the Money Laundering and Terrorism Financing Prevention Act (official gazette Narodne novine, no. 87/2008), the Bank shall establish the Client s identity when opening any kind of bank accounts or other forms of establishing permanent business cooperation with the Client. To this end, the Client shall present the following documents to the Bank: (a) if the Client is a resident natural person (in the sense of provisions of the Foreign Exchange Operations Act), copy of personal identification document (personal ID card or passport) together with the original document for inspection, as well as a copy of the kuna account card opened in the Client s name. If the Client s personal identification document does not contain the civil registration number, the Client shall 17

18 be obligated to present a document with indicated civil registration number of the Client to the Bank for inspection as well as Personal identification number (OIB). (b) If the Client is a non-resident natural person (in the sense of provisions of the Foreign Exchange Operations Act), the Client shall present to the Bank the passport and a copy thereof, as well as a copy of the contract on the non-resident kuna account opened in the Client s name. (c) If the Client is a legal person, the natural person opening the account in the Client s name shall present his/her personal identification document (personal ID card or passport) and a copy thereof. If the Client is a resident legal person (in the sense of provisions of the Foreign Exchange Operations Act), the Client shall provide the Bank with the following documents: 1) original or certified copy of the Client s extract from the company register, not older than 3 months; 2) copy of the notification on the classification of the business entity according to the National Classification of Business Activities (NKD); 3) copy of the authorized signatures list based on which the regular business account was opened; 4) statement containing information about the genuine owner of the legal entity and signatures of managing board members pursuant to provisions of the Money Laundering Prevention Act and regulations based thereon. (d) If the Client is a non-resident legal person (in the sense of provisions of the Foreign Exchange Operations Act), the Client shall provide the Bank with the following documents: 1) copy of a notarized incorporation resolution, translated by a certified court interpreter; 2) copy of the contract on the non-resident kuna account opened in the Client s name; 3) statement containing information about the owner of the legal entity and list of managing board members pursuant to provisions of the Money Laundering Prevention Act and regulations based thereon. (6) For the purpose of opening the account referred to in the Contract and the General Terms and Conditions and establishing the Client s identity, the Client shall also furnish the Bank with other necessary documents as provided for by special regulations. (7) Any complaints regarding the Bank s work in executing operations under these General Terms and Conditions and the Contract shall be delivered by the Client to the Bank at the following address: SOCIETE GENERALE - SPLITSKA BANKA d.d. Brokerage Department Attn. of Head of Brokerage R. Boškovića Split Tel.: Fax: brokeri@splitskabanka.hr (8) The Bank shall make a written statement regarding the complaint within fifteen days following the day the complaint was received. Article 25 By signing the Contract, the Client expressly consents that during any kind of communication with the Client the Bank may tape or otherwise record the whole communication or any part thereof. The Bank shall not be obligated to specifically advise the Client on the fact that communications are taped or otherwise recorded before the beginning of every individual recording and the recorded conversations and transcripts thereof made by the Bank may be used by the Bank as evidence in the process of checking data and the Order and instructions given by the Client to the Bank, before a court of law or any other competent body or for any other purpose in connection with exercising the rights and obligations under these General Terms and Conditions, the Contract or any other contract. 18

19 IX. RESOLVING DISPUTES Article 26 (1) These General Terms and Conditions and the Contract shall be subject to Croatian law. (2) The Client and the Bank shall attempt to amicably resolve any disputes arising in connection with the implementation of the Contract and these General Terms and Conditions. If no agreement can be reached, the materially competent court in Split shall have jurisdiction. X. OTHER PROVISIONS Article 27 Of any of the provisions of these General Terms and Conditions and/or the Contract should be subsequently found to be null and void, this shall have no effect on other provisions and the Contract and these General Terms and Conditions shall remain valid as a whole. The contracting parties shall replace the invalid provision by a valid one enabling to the greatest possible extent the achievement of the objective contemplated by the provision found to be null and void. Article 28 (1) The Client agrees that the Book of Orders or, as the case may be, other business records of the Bank and means of evidence available to the Bank shall serve as evidence on the amount and maturity of any receivable under the Contract and any individual Order. (2) Anything not regulated by the Contract and these General Terms and Conditions shall be subject to valid legislation and secondary legislation as well as acts regarding the Bank s operations, including any amendments thereto adopted during the lifetime of the Contract. (3) If any issue regulated by these General Terms and Conditions should be regulated otherwise by legislation or secondary legislation adopted after the implementation of these General Terms and Conditions, the provisions of the relevant regulation shall apply until corresponding Amendments to these General Terms and Conditions are adopted. (4) The Client agrees that these General Terms and Conditions may be altered by the Bank at any time in accordance with statutory regulations and the Bank s business policy and that any modification, supplement or addition to these General Terms and Conditions shall be binding since their adoption and effective date, to which the Client agrees by delivering the first Order thereafter. Any modification, supplement or addition to these General Terms and Conditions shall be made in written form, presented on a place visible and available to the Client at the Bank s premises, unless stipulated otherwise by law. Except placing modifications on a visible and available place Bank is not obligated to further communicate it to Client. (5) The General Terms of September 2012., shall cease to be valid with the coming into force of these General Terms and Conditions. These General Terms and Conditions shall come into force and application on the date of adoption. 19