Elektrim reduces board costs through insurance

Elektrim is renegotiating its contracts with legal advisors and plans to annul the one signed with Weil Gotshal&Manges (WG&M), according to which the company transferred $1 million to the law firm as a form of standby protection for the members of its management and supervisory boards. "Instead of spending $1 million, the company could insure its boards members and this would be cheaper," said Mateusz Rodzynkiewicz, partner in law firm Oleś&Rodzynkiewicz. As a result of this restructuring, the general costs of the management amounted to zł. 11.3 million in Q1 2003, as opposed to zł. 21.9 million a year earlier. However, Lech Gilciński, partner in WG&M, said, "Annulling the contract does not necessary mean the end of our cooperation." In related news, Elektrim's bondholders claim that it broke the terms of settlement proceedings by suspending its representative on the company's management board, and allowing its power plant ZE PAK to repay a loan of EUR 32 million after the deadline. Due to this, they demand faster than anticipated repurchasing of bonds and will aim at taking over 50.5% of shares in ZE Pątnów II. (Parkiet, June 20, pp. 1, 3) M.M.