Payment Terms for Legal Services

1. Introduction

These Payment Terms for Legal Services (hereinafter: the “Payment Terms”) form part of and supplement the Company’s Terms of Cooperation. They set out the fee structures applicable to the legal services provided by Company in Lithuania UAB (hereinafter: the “Company”), the deposit system applicable to legal engagements, invoicing procedures, and payment obligations. In the event of any inconsistency between these Payment Terms and the relevant Engagement Letter, the Engagement Letter prevails.

The Company applies three fee structures for its legal services: fixed fees, hourly fees, and combination arrangements. The applicable fee structure for any given engagement is agreed in the Engagement Letter before services commence. No legal service is commenced without a written fee agreement.

2. Fixed Legal Fees

Fixed fees apply where the scope of the legal service is sufficiently defined to allow the Company to quote a single, all-inclusive fee for the complete engagement. Fixed fees provide the Client with cost certainty — the agreed fee is payable regardless of the actual time the Company spends on the engagement, provided the scope does not change.

2.1 When Fixed Fees Apply

Fixed fees are the Company’s preferred fee structure for services with a well-defined scope and a predictable deliverable. The following legal services are typically offered on a fixed-fee basis:

2.2 Scope Change Procedure

Where the Client requests services that fall outside the scope agreed in the Engagement Letter, or where unforeseen circumstances materially expand the work required to complete the engagement, the Company will notify the Client in writing before undertaking any out-of-scope work. Additional fees for out-of-scope work are agreed in writing before the additional work commences. The Client’s written approval — by email or signed amendment — is required before the Company proceeds.

2.3 Fixed Fee Payment Terms

Unless the Engagement Letter specifies otherwise, fixed fees are payable as follows:

• For engagements with a fixed fee up to €500: 100% payable in advance before services commence.
• For engagements with a fixed fee between €500 and €2,000: a deposit of 50% is payable before services commence; the remaining 50% is payable on delivery of the final deliverable.
• For engagements with a fixed fee exceeding €2,000: a deposit of 40% is payable before services commence; further milestone payments and the final balance are as specified in the Engagement Letter.

Where the engagement is completed before the full fee is paid, the outstanding balance is due within fourteen (14) calendar days of the invoice date.

3. Hourly Legal Fees

Hourly fees apply where the scope of the legal work cannot be determined with sufficient certainty at the outset — typically for litigation support, complex negotiations, ongoing advisory retainers, and matters where the volume of work depends on third-party actions or proceedings.

3.1 Standard Hourly Rate

150 EUR/hour.

3.2 Time Recording

Time is recorded in minimum units of sixty (60) minutes (1 hour). Time is recorded for all legal work performed — including drafting, reviewing, researching, attending meetings and calls, corresponding with counterparties and authorities, and preparing and submitting filings. Time is not recorded for internal administrative tasks unrelated to the Client’s matter. Detailed time records are maintained for all hourly engagements and are available to the Client on request.

3.3 Activities Charged at the Hourly Rate

The following activities are chargeable at the standard hourly rate:

• Legal drafting — contracts, legal opinions, memoranda, filings, correspondence with authorities;
• Legal research — researching Lithuanian law, regulatory requirements, and relevant court practice;
• Document review and due diligence — reviewing contracts, corporate documents, regulatory submissions, and court materials;
• Negotiation — attending or participating in negotiations with counterparties, their advisers, or authorities;
• Meetings and calls — client consultations, meetings with third parties, and calls on legal matters, whether in person or remote;
• Regulatory and court proceedings — attending hearings, filing submissions, corresponding with the court, and managing litigation strategy;
• Authority liaison — communicating with VMI, JAR, FNTT, the Bank of Lithuania, Migration Department, Labour Exchange, and other Lithuanian authorities;
• Project management — coordinating multi-party transactions, managing document flows, and supervising third-party advisers.

3.4 Hourly Fee Estimates

Where an engagement is to be conducted on an hourly basis, the Company will provide the Client with a written estimate of the expected total hours and total cost at the outset. The estimate is not a binding cap unless expressly stated as such in the Engagement Letter — it is a good-faith projection based on the information available at the time. The Company will notify the Client in writing when the actual time expended is likely to exceed the estimate by more than 20%, and will seek the Client’s instruction before proceeding beyond the notified threshold.

3.5 Hourly Fee Invoicing

For ongoing hourly engagements, time is invoiced monthly in arrears by the last business day of the month. Each invoice includes a time summary listing the activities performed, the date, the time recorded for each activity, and the fee calculated at the applicable rate. The Client may request a more detailed time record at any time. Invoices are payable within fourteen (14) calendar days of the invoice date.

3.6 Reduced and Enhanced Rates

The standard hourly rate is €150 per hour for all legal services. The following rate variations may apply where agreed in the Engagement Letter.

4. Deposit System for Legal Services

The Company applies a deposit system to all legal service engagements. The deposit is required before services commence and serves three purposes: it confirms the Client’s commitment to the engagement; it provides the Company with working capital security for the time and resources it will deploy on the Client’s matter; and it establishes the framework for the management of the Client’s legal funds on account.

4.1 Deposit Requirement

A deposit is required for all legal engagements before services commence. The deposit amount is specified in the Engagement Letter. Where no specific deposit amount is stated, the following default scale applies.

4.2 Deposit Account — Funds on Account

Deposits paid by the Client are held by the Company as funds on account — meaning they are held specifically for application against the Client’s legal fees as they fall due. The deposit is not a prepayment of the entire engagement cost; it is a security balance against which fees are drawn down as the work progresses and is invoiced.

The deposit does not accrue interest. The Client acknowledges that the Company does not operate a client money account of the type maintained by regulated law firms — the deposit is held in the Company’s general business account and is applied against invoiced fees.

4.3 Application of the Deposit

Deposits are applied to fees in the following order and manner:

• The Company issues invoices as work progresses in accordance with Section 3.5 (for hourly engagements) or at the milestones specified in the Engagement Letter (for fixed-fee engagements).
• Each invoice specifies: the amount due; the current deposit balance; the amount to be applied from the deposit against the invoice; and the net amount payable by the Client (if any) where the invoice exceeds the deposit balance.
• Where the invoice amount is less than or equal to the current deposit balance, the invoice is applied against the deposit and no payment is required from the Client for that invoice.
• Where the invoice amount exceeds the current deposit balance, the Client pays the difference between the invoice amount and the remaining deposit balance within fourteen (14) calendar days of the invoice date.

4.4 Deposit Top-Up

When the deposit balance falls below the minimum threshold specified in the Engagement Letter — or, in the absence of a specified threshold, below the equivalent of two (2) further hours of expected legal work — the Company will notify the Client in writing and request a top-up payment. The top-up amount is specified in the top-up notice and is typically calculated to restore the deposit to its initial level or to provide security for the next phase of the engagement. The Company reserves the right to pause work on the engagement until the top-up payment is received.

4.5 Refund of Unused Deposit

Where the engagement is completed and the total fees invoiced are less than the deposit paid, the unused portion of the deposit is refunded to the Client within fourteen (14) calendar days of the final invoice. Where the engagement is terminated by either party before completion, the deposit balance after application of all fees earned and disbursements incurred up to the termination date is refunded to the Client within fourteen (14) calendar days of the termination date. Disbursements that have been committed but not yet paid at the termination date are deducted from the deposit balance before the refund is calculated.

4.6 Deposit for Multiple Concurrent Matters

Where the Client instructs the Company on multiple concurrent legal matters, a separate deposit may be required for each matter, or the parties may agree a single pooled deposit to cover all concurrent matters. The allocation of a pooled deposit across matters is managed by the Company and confirmed to the Client in the monthly fee statement.

5. Disbursements and Third-Party Costs

Disbursements are out-of-pocket expenses incurred by the Company on the Client’s behalf in the course of providing legal services. They are charged at cost, without mark-up, and are invoiced separately from or alongside legal fees. The following are treated as disbursements:

• Government fees — JAR, VMI, Migration Department, and other authority filing fees;
• Notarial fees — for documents requiring notarisation, legalisation, or apostille;
• Court fees — filing fees, court expert costs, and enforcement fees in litigation matters;
• Translation costs — certified translations by sworn translators;
• Courier and delivery costs — for the physical delivery of original documents;
• Register search fees — Registrų centras, JADIS, and other register extracts;
• Travel expenses — where travel is required for a client matter and agreed in advance.

6. Invoicing Procedure

6.1 Invoice Content

All invoices issued by the Company for legal services include:

• The Company’s full name, registration number, registered address, and VAT number;
• The Client’s name and billing address;
• A unique invoice number and the invoice date;
• The engagement reference and a description of the services invoiced;
• For hourly fee invoices: a summary of time recorded by activity, date, and duration;
• The fee amount, any applicable VAT, and the total amount payable;
• The current deposit balance and the amount applied from the deposit;
• The net amount payable by the Client (if any);
• The due date for payment;
• The Company’s bank account details for payment.

6.2 Invoice Delivery

Invoices are delivered by email to the billing contact specified in the Engagement Letter. The Client is responsible for ensuring that the billing contact details are current. Invoices are deemed received on the business day following despatch by email.

6.3 Payment Methods

Payment is accepted by the following methods:

• Bank transfer (SEPA and international wire) — to the Company’s designated bank account as shown on the invoice;
• Card payment — where the Company’s payment platform is available;
• Other methods — as agreed in the Engagement Letter.

Payment in cash is not accepted. All payments must be made in euros (EUR) unless the Engagement Letter specifies a different currency.

6.4 Payment Allocation

Where the Client has outstanding invoices from multiple engagements, payments received are allocated to the oldest outstanding invoice first, unless the Client specifies otherwise at the time of payment.

7. Late Payment and Consequences

Timely payment is essential to maintaining the continuity of legal services. The following consequences apply where invoices are not paid by the due date:

7.1 Late Payment Interest

Late payment interest accrues at the rate of 0.05% per day on the outstanding amount from the due date until the date of actual payment. This interest rate is consistent with the rate provided in the Company’s Terms of Cooperation and is applied without the need for a separate notice. The Client acknowledges that this rate is reasonable and proportionate given the nature of professional services engagements.

7.2 Suspension of Services

Where an invoice remains unpaid for more than fourteen (14) calendar days after the due date, the Company may — after written notice to the Client — suspend all work on the Client’s legal matters until the outstanding amount is paid in full. The Company will give at least three (3) business days’ advance written notice before suspending services. The Company is not liable for any prejudice to the Client’s legal position resulting from a service suspension caused by late payment.

7.3 Termination for Non-Payment

Where an invoice remains unpaid for more than thirty (30) calendar days after the due date, the Company may terminate the engagement in accordance with Section 11 of the Terms of Cooperation. Termination for non-payment does not release the Client from liability for all fees accrued up to the termination date.

7.4 Recovery of Collection Costs

Where the Company engages a debt collection agency or legal counsel to recover an outstanding invoice, the Client is liable for the reasonable costs of collection, including debt collection agency fees, court fees, and legal costs, to the extent permitted by Lithuanian law.

8. Value Added Tax (VAT / PVM)

The Company’s fees for legal services are quoted exclusive of Lithuanian VAT (PVM). Where the supply of services is subject to Lithuanian VAT, VAT is added to the invoice at the applicable rate (currently 21% under Article 19(2) of the Law on VAT — PVMĮ).

8.1 B2B Services to EU Clients

For legal services provided to clients established in other EU member states for the purposes of their business activities, the place of supply under Article 13 of the PVMĮ is the Client’s country of establishment. The reverse charge mechanism applies — the Client accounts for VAT in its own jurisdiction and no Lithuanian VAT is charged on the invoice. The invoice will reference the reverse charge and the Client’s VAT number.

8.2 Services to Non-EU Clients

For legal services provided to clients established outside the EU, Lithuanian VAT is generally not charged where the services are used for the Client’s business purposes. The Company will confirm the applicable VAT treatment in the Engagement Letter.

8.3 Lithuanian VAT Registration Number

Where applicable, the Company’s Lithuanian VAT number will be stated on all invoices. Clients who are VAT-registered in the EU may request that the Company’s VAT registration number be included on invoices for their own input VAT recovery purposes.

9. Billing Disputes

Where the Client disagrees with any invoice issued by the Company, the following procedure applies:

• The Client must notify the Company in writing within seven (7) calendar days of the invoice date, specifying: the invoice reference; the amount in dispute; and the specific basis for the dispute.
• The undisputed portion of the invoice remains payable by the original due date. A billing dispute does not suspend the obligation to pay the undisputed amount.
• The Company will review the disputed amount and respond in writing within five (5) business days of receiving the dispute notification.
• Where the dispute is resolved in the Client’s favour — in whole or in part — the Company will issue a credit note for the relevant amount or adjust the next invoice accordingly.
• Where the dispute is not resolved within thirty (30) days of the Client’s notification, either party may refer it to the complaint handling procedure under the Company’s Complaint Handling Policy.

The Company’s detailed time records for hourly engagements are available to the Client at any time on request and constitute the primary evidence for the resolution of billing disputes on hourly matters.