Notice to the Market Recognized the right of preference of Nova Riotel

BHG S.A. - Brazil Hospitality Group ("BHG" or "Company"), pursuant to best corporate governance practices, hereby informs its shareholders and the market in general that yesterday (May 6, 2014) the Third Panel of the Superior Court of Justice granted the Special Appeal that recognized the right of preference of Nova Riotel Empreendimentos Hoteleiros Ltda. ("Nova Riotel") in a yet unpublished decision.

The Company will await the publication of the appellate decision to evaluate and decide on its next measures and any appeals that are still possible and applicable to the lawsuit in question, always in the best interest of its investments and shareholders.

We hereby stress that the acquisition of Hotel Rio Palace ("Hotel"), located at Av. Atlântica nº 4.240, in the city and state of Rio de Janeiro, belonging to Veplan Hotéis e Turismo S.A., a company under reorganization ("Veplan"), by BHG only took place after the 4th Civil Chamber of the State Appellate Court of Rio de Janeiro unanimously approved, on July 6, 2011, the Private Instrument of Promise of Sale ("Promise of Sale"), entered into by BHG and Veplan on August 26, 2010 and amended on September 2, 2010.

In order to comply with the Promise of Sale, on August 17, 2011, Veplan and Melongena Empreendimentos 1 Ltda, a company belonging to BHG's economic group, signed the Hotel's final deed of sale, which until now has been awaiting the registration with the applicable register of deeds; this registration has been suspended due to a first instance ruling by the 6th Corporate Court of the Rio de Janeiro Judicial District that recognized the supposed right of preference of Nova Riotel Empreendimentos Hoteleiros Ltda. ("Nova Riotel"), as lessee, to acquire the Hotel.

On January 9, 2012, the Company filed an interlocutory appeal with the 4th Civil Chamber of the State Appellate Court of Rio de Janeiro to appeal said ruling, which was granted relief on May 23, 2012, reversing the first instance ruling, thereby rejecting Nova Riotel's alleged right of preference.

On May 6, 2012, Nova Riotel filed a Special Appeal no. 1374643/RJ (2013/0076548-3) against said ruling by the 4th Civil Chamber of the State Appellate Court of Rio de Janeiro, whose relief granted by the Superior Court of Justice is the subject matter of this Notice to the Market.

Rio de Janeiro, May 07, 2014

Luiz Felipe Negreiros de Sá

Chief Financial and Investor Relations Officer
BHG S.A. - BRAZIL HOSPITALITY GROUP

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