March 20, 2008. On March 18, 2008 the Federal Financial Markets Service (FSFR) of Russia registered a prospectus of securities and six additional issues of Sochinskaya TES shares to the amount of 3.06 trln shares at par value of 0.1 roubles each, worth 306 bln roubles, placed by means of conversion as part of reorganization of Sochinskaya TES in the form of a merger with JSC INTER RAO UES, Severo-Zapadnaya TETs, Ivanovskiye PGU, Kaliningradskaya TETs-2 and INTER RAO UES Holding to be spun off from RAO UES of Russia, namely:

- An issue worth 21.1 bln roubles will be placed by converting the Kaliningradskaya TETs-2 shares into additional registered ordinary uncertified shares in Sochinskaya TES upon merger;

- An issue worth 88.7 bln roubles will be placed by converting the shares in JSC INTER RAO UES into additional registered ordinary uncertified shares in Sochinskaya TES upon merger;

- An issue worth 146.2 bln roubles will be placed upon the spin-off of INTER RAO UES Holding from RAO UES of Russia coupled with simultaneous merger of INTER RAO UES Holding with and into Sochinskaya TES by converting the ordinary shares in INTER RAO UES Holding into the shares in Sochinskaya TES;

- An issue worth 6.8 bln roubles will be placed upon the spin-off of INTER RAO UES Holding from RAO UES of Russia coupled with simultaneous merger of INTER RAO UES Holding with and into Sochinskaya TES by converting the preferred shares in INTER RAO UES Holding into the shares in Sochinskaya TES;

- An issue worth 35.1 bln roubles will be placed by converting the shares in Severo-Zapadnaya TETs into additional registered ordinary uncertified  shares in Sochinskaya TES upon merger;

- An issue worth 8.1 bln roubles will be placed by converting the shares in Ivanovskiye PGU into additional registered ordinary uncertified shares in Sochinskaya TES upon merger.

In addition, on March 18, 2008 the FSFR of Russia performed state registration of, and assignment of identification numbers to, the issues of ordinary and preferred shares in INTER RAO UES Holding placed upon the spin-off of INTER RAO UES Holding from RAO UES of Russia by distributing the shares in the joint-stock company created as a result of a spin-off among the shareholders of RAO UES of Russia.

The registration of additional issues of shares in Sochinskaya TES, placed by converting into them the shares in INTER RAO UES Holding to be spun off from RAO UES of Russia, and the assignment of identification numbers to INTER RAO UES Holding shares was a pilot project within the final stage of RAO UES of Russia restructuring. 

The additional shares in Sochinskaya TES are being placed as part of reorganization of Sochinskaya TES in the form of its merger with JSC INTER RAO UES, Kaliningradskaya TETs-2, Severo-Zapadnaya TETs, Ivanovskiye PGU and INTER RAO UES Holding, the merger being an integral part of the final stage of RAO UES of Russia restructuring.

The reorganization is implemented in two stages: by May 1, 2008, Sochinskaya TES is expected to have been merged with JSC INTER RAO UES, Kaliningradskaya TETs-2, Severo-Zapadnaya TETs, Ivanovskiye PGU; the merger of INTER RAO UES Holding to be spun off from RAO UES of Russia with and into Sochinskaya TES is scheduled for June 2008. In the course of reorganization-related procedures, Sochinskaya TES will be renamed as OJSC INTER RAO UES.