Ulica Marijana Čavića 4, Zagreb

Zagreb, 2 Feb 2010.

ZAGREBAČKA BURZA

Ivana Lučića 2a

10000 Zagreb

Subject:Notification, market of the Kingdom of Sweden

Dear Sirs,

With regard to the above, I take the liberty to inform you of the following:

Please, note that Dalekovod d.d. has been present on the Swedish market for a long time already; however only with one part of the production range of Dalekovod, i.e. sale of suspension and jointing equipment for transmission lines, mainly through the agency network, without any direct contacts with the Employers (Transmission System Operators and Distribution System Operators).

Parallel with the pre-qualification procedure for construction of power transmission and distribution projects in Norway (2004), we also started the pre-qualification procedure for construction of power transmission and distribution projects in Sweden.

A significant positive incentive to that project was given by the announcement of the Government of the Republic of Croatia for publication of an Invitation to Bid for purchase of military aircrafts under offset program conditions.

The Swedish company SAAB included Dalekovod in its draft program and in this way provided opportunity to us for making significant contacts in the Swedish National Transmission System Operator (Svenska Kraftnat) who significantly speeded up the qualification procedure and enabled us soon to participate in public Invitations to Bid for Svenksa Kraftnat. It should be noted that very successful results of Dalekovod in construction of 420 kV transmission lines in Norway also contributed significantly to the above.

Further, in 2007 Dalekovod participated in the Invitation to Bid for construction of 420 kV transmission lines (Interconnection between Norway and Sweden) but unfortunately with no success.

In the meantime, it is through the colleagues from SAAB, that have managed to make contacts with the Vattenfall Services Nordic company and on 30 June 2009 to conclude a Contract on performance of electrical installationworks (installation of conductors and OPGW cables) on one part of the section (47.5 km) of the 500 kV Dannebo-Finnböle Transmission Line.

Performance of the above works, along with the preparations that have been conducted during the winter, shall commence in the summer of 2010. This is a relatively small contract (ca SEK 18.000.000,00); however, it presents a significant breakthrough for Dalekovod.

During December last year, again with the help of SAAB, we managed to visit and talk with the representatives of the ABB and AREVA companies and also to agree on participation of Dalekovod, as a partner or subcontractor, in construction of 400 kV substations in Sweden.

The pre-qualification procedure for the contractors in Sweden is somewhat different from the same procedure in Norway and requires a more frequent renewal of processes.

As very big investment projects related to construction of power transmission and distribution projects are to be announced soon as e.g.:

-South Western Link 400 kV (total investment of ca € 600m)

-Stockholm Sröm 400 kV

-Hammarfarsen-Sigsän 220 kV

-Erikslund 130 kV;

and as a part of the qualification procedure, a delegation of the Swedish Transmission System Operator (Svenska Kraftnat) headed by Mr. Hans Lundin, Purchasing Manager, shall perform auditing in the company Dalekovod d.d. Zagreb.during February, i.e. from 3 Feb until 5 Feb 2010.

The program shall include, besides inspection of the production and technological documentation, a tour and inspection of the production capacities of Dalekovod d.d. (works at Velika Gorica and galvanizing Plant at Dugo Selo) and a tour and inspection of the field construction works on the project TL 2x400 kV Ernestinovo-Pečuh.

We hope that the positive auditing results shall provide opportunity to Dalekovod for making an even more important breakthrough on the Swedish market.

Bests regards,

Miroslav Nikolić, LL.B.

stranica 1/2