Notice to the Market Signature of Memorandum of Understanding to Manage new Tulip Inn Campo Grande hotel in Campo Grande (Mato Grosso do Sul) and acquisition of 50% of Tulip Inn Sete Lagoas, located in Sete Lagoas (Minas Gerais)

In line with best corporate governance practices, BHG S.A. - Brazil Hospitality Group ("BHG" or "Company") hereby informs its shareholders and the market in general that, on June 27, 2014, it signed a Memorandum of Understanding to manage a hotel, a project to be developed in the city of Campo Grande, state of Mato Grosso do Sul, and shall be named Tulip Inn Campo Grande.

The hotel to be developed will be located in Bairro Alta Afonso Pena, at Avenida Afonso Pena, the city's main avenue, near the Downtown area and distant only 20 minutes from the airport. It will be located in front of the most modern aquarium under construction - Aquário Pantanal - and close to Parque dos Poderes, workplace of an average of 27 thousand employees of all State Departments, the State and Federal Prosecution Offices, the Federal Revenue Service, Courts, among others. Regarding its economic profile, it is a region of tourism and businesses, where large companies from different segments are located (extraction, clothing, furniture, slaughterhouses, dairy products, rubber, among others), in addition to service providers that have an important role in the municipality's economy. There are no hotels near the development.

This hotel will comprise an eight-store hotel tower with 120 rooms, and infrastructure for a restaurant, convention centers and leisure area. The project will be developed by Progemix and units will be sold by GS Negócios Imobiliários. The hotel is scheduled to begin operations in 2016.

This is the first BHG hotel in the state of Mato Grosso do Sul, in one of the main cities of Brazil's Midwestern region.

This development will replace the development previously announced on March 14, 2012, in the same city, which would have 140 hotel accommodation units, but which was not concluded.

We would also like to announce that BHG will have a 50% interest in Tulip Inn Sete Lagoas, announced on July 26, 2012, which will be inaugurated on the first quarter of 2015. This development will no longer be part of FIP's (BHG Modal Fundo de Investimento em Participações em Hotelaria) hotel portfolio.

Rio de Janeiro, June 27, 2014

Luiz Felipe Negreiros de Sá

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

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