Pokorný, Wagner & Partners, s.r.o., Attorneys-at-Law

Agrofert Successful in Law Suit against PKN Orlen

PRAGUE (30 June 2009) – The Arbitration court in Prague has decided in favour of company Agrofert Holding (“Agrofert”) in its claim against Polish company Polski Koncern Naftowy Orlen (“PKN Orlen”). The Polish company has to pay, on the basis of decision of the arbiters, a contractual penalty which exceeds EUR 77.2 million (over 2 billion CZK) with accessories.

The Court has decided, today, on the legitimacy of the claim of the company Agrofert submitted against PKN Orlen on 16 December 2005, for the reason of non-compliance with obligations arising out of concluded contracts between both companies regarding their mutual cooperation in privatisation of the company Unipetrol. The exact reason for submission of claim was a breach by PKN Orlen of its obligation to procure that the company Unipetrol would conclude an agreement with Agrofert on a future agreement on a transfer of shares.

PKN Orlen had to procure that Unipetrol would sell Agrofert selected shares in Unipetrol’s subsidiary companies according to a series of agreements concluded with Agrofert in the case that it won a bidding process in the privatisation and acquired the state’s share of company. This never happened and therefore Agrofert expected to receive payment of a contractual penalty, which PKN Orlen refused to compensate.

A further claim of Agrofert which was submitted to the Arbitration court in Prague on 20 October 2006, through which Agrofert claims a total material and immaterial loss in the amount of CZK 17.352 billion, has not been decided on yet.

The legal counsel of the claiming party is the law firm Pokorný, Wagner & Partner.