OFFERING MEMORANDUM Global Offering of up to ... - Nordex
OFFERING MEMORANDUM Global Offering of up to ... - Nordex
OFFERING MEMORANDUM Global Offering of up to ... - Nordex
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10.8 million). Ekter disputes the claim with respect <strong>to</strong> its legal basis and amount. The claim is split in<strong>to</strong><br />
an amount <strong>of</strong> GRD 1,584 million, (representing approximately DM 9.1 million) for lost subsidies and<br />
GRD 299.7 million, (representing approximately DM 1.7 million) for commissions lost because <strong>of</strong> the<br />
use <strong>of</strong> <strong>Nordex</strong> wind turbines instead <strong>of</strong> the wind turbines <strong>of</strong> a certain other manufacturer as initially<br />
stipulated. Although they were obliged by the arbitral award <strong>to</strong> reassign all the rights in the wind<br />
power project, ITA asserts that both claims arose because the defendants had taken control <strong>of</strong> the wind<br />
power project fraudulently and had obtained an authorization for the wind power project by fraud. In<br />
respect <strong>of</strong> the damages claim relating <strong>to</strong> the lost subsidies, ITA alleges that it would have received these<br />
subsidies if it had developed the project. Ekter, however, is <strong>of</strong> the opinion that Greek subsidy law only<br />
provides for the granting <strong>of</strong> subsidies <strong>to</strong> inves<strong>to</strong>rs in a project and not <strong>to</strong> a project developer such as<br />
ITA. In respect <strong>of</strong> the lost commissions, ITA argues that it would have been paid by the other wind<br />
turbine manufacturer, if its wind turbines had been erected instead <strong>of</strong> <strong>Nordex</strong> wind turbines, as is now<br />
envisaged. In addition, ITA bases its claim for damages, inter alia, on alleged criminal conduct by<br />
members <strong>of</strong> the board <strong>of</strong> Ekter. However, the department <strong>of</strong> the state prosecu<strong>to</strong>r <strong>of</strong> Athens has rejected<br />
criminal proceedings initiated by ITA against these board members.<br />
In a second action, ITA claims damages in an aggregate amount <strong>of</strong> GRD 3,883.7 million (approximately<br />
DM 22.3 million) from seven defendants, including Ekter and <strong>Nordex</strong> Energy GmbH, as joint deb<strong>to</strong>rs. A<br />
proportion <strong>of</strong> the damages claimed (GRD 1,883.7 million) covers the same claims as the first action.<br />
With respect <strong>to</strong> the claim <strong>of</strong> GRD 1,883.7 million, ITA asserts that the defendants had moved ahead<br />
with the project despite the arbitral award and ITA thereby suffered a loss <strong>of</strong> commissions and pr<strong>of</strong>its<br />
that it could otherwise have expected <strong>to</strong> have received for performance <strong>of</strong> the project. The defendants<br />
are <strong>of</strong> the opinion that the arbitral award in respect <strong>of</strong> the assignment <strong>of</strong> the authorization <strong>to</strong> erect<br />
wind turbines in particular is unenforceable and Ekter may therefore continue with the project.<br />
Furthermore, ITA claims a further GRD 2 billion (approximately DM 11.5 million), asserting that the<br />
defendants had sought <strong>to</strong> obtain an advantage by way <strong>of</strong> unfair competition by erecting their wind<br />
turbines. ITA has not yet substantiated the damage with respect <strong>to</strong> the amount <strong>of</strong> GRD 2 billion.<br />
However, no <strong>Nordex</strong> wind turbines have been erected.<br />
In a provisional injunction proceeding, ITA tried <strong>to</strong> prevent Ekter as well as four other defendants from<br />
beginning construction work on the site in Tourla. However, ITA’s motion was dismissed by the district<br />
court <strong>of</strong> Chalkida, Greece, in a court order dated September 13, 2000. The court stated that Ekter had<br />
no other obligation than <strong>to</strong> pay <strong>to</strong> ITA the contractual compensation and <strong>to</strong> erect wind turbines <strong>of</strong> a<br />
certain manufacturer. Furthermore, the authorization <strong>to</strong> erect wind turbines, which was addressed <strong>to</strong><br />
Ekter, was not assignable.<br />
Meanwhile, Ekter itself has brought claims for damages <strong>of</strong> GRD 299.985 million (approximately DM 1.7<br />
million) against ITA, asserting that ITA unjustly obtained the arbitral award by deceiving the arbitra<strong>to</strong>r<br />
in Athens with misstatements and by inducing the witnesses <strong>to</strong> give misstatements. The damages<br />
claimed by Ekter relate <strong>to</strong> the damage <strong>to</strong> its reputation.<br />
In the meantime, the conflicts described above have as <strong>of</strong> March 27, 2001 been fully resolved pursuant<br />
<strong>to</strong> an out-<strong>of</strong>-court settlement between (i) <strong>Nordex</strong> Energy GmbH and Ekter and (ii) ITA and other<br />
companies contractually related <strong>to</strong> ITA <strong>to</strong> which certain claims had been transferred. The out-<strong>of</strong>-court<br />
settlement was validly entered in<strong>to</strong>, however, in order <strong>to</strong> ensure its continued effectiveness under<br />
Greek law, it needs <strong>to</strong> be registered with the Greek tax authorities. This can be effected by Ekter and will<br />
be done shortly. In this settlement, <strong>Nordex</strong> Energy GmbH has agreed <strong>to</strong> make a compensa<strong>to</strong>ry payment<br />
<strong>of</strong> a mid-seven-digit million Deutsche Mark amount <strong>to</strong> ITA and the companies that are contractually<br />
related <strong>to</strong> ITA, which has already partly been paid. This compensa<strong>to</strong>ry payment is in line with the<br />
amount which the Company calculated as representing the potential risk involved in this conflict. Ekter<br />
also agreed <strong>to</strong> withdraw it lawsuit against ITA. In return, ITA and the companies that are contractually<br />
related <strong>to</strong> it have agreed, with Ekter and <strong>Nordex</strong> Energy GmbH, <strong>to</strong> waive their rights under the arbitral<br />
award <strong>of</strong> May 31, 2000 and all claims under the contract dated Oc<strong>to</strong>ber 23, 1997 between Ekter and<br />
ITA. ITA has also agreed <strong>to</strong> withdraw the pending lawsuits, and the formal withdrawal <strong>of</strong> the lawsuits<br />
has been initiated. Finally, ITA and the companies contractually related <strong>to</strong> it have agreed <strong>to</strong> recognize<br />
Ekter as being solely entitled <strong>to</strong> the Tourla wind energy project and not <strong>to</strong> assert any claims in<br />
connection with the project in the future.<br />
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