CORPORATE
GOVERNANCE

TECHNICAL COMMITTEE

Victor Zorrilla Vargas
Chairman

indepeNDENT MEMBERS

  • Alberto Rafael Gómez Eng
  • Héctor Medina Aguiar
  • Marcelo Zambrano Lozano
  • Everardo Elizondo Almaguer
  • Adrián Garza de la Garza

PROPIETARY MEMBERS

  • Joel Zorrilla Vargas
  • Oscar Eduardo Calvillo Amaya
  • José Gerardo Clariond Reyes-Retana
  • Santiago Pinson Correa
  • Adrián Jasso
  • Robert Jaime Dotson Castrejón
  • Juan Carlos Hernáiz Vigil

Laura Nelly Lozano Romero
Secretary

DIRECTORS

Oscar Eduardo Calvillo Amaya
Chief Executive Officer

Joel Zorrilla Vargas
Vice President of Corporate Strategy

Fernando Rocha Huerta
Chief of Acquisitions and Development Officer

Diego Zorrilla Vargas
Vice President of Acquisitions and New Projects

Laura Mayela Gracia Treviño
Project Director

Miguel Aliaga Gargollo
Chief Financial Officer

Lizette Chang y García
Investor Relations Officer

Alejandro Leal-Isla Garza
Director of Financial Planning and Analysis

Laura Nelly Lozano Romero
Legal Director

Daniel Arán Cárdenas
Director of Administration

Emilio Antonio Peña Barrera
Information Technology Director

Guillermo Espinoza Garza
Invesment Evaluation Manager

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
TECHNICAL COMMITTEE

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
AUDIT COMMITTEE

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
PRACTICES COMMITTEE

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
NOMINATIONS COMMITTEE

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
CREDIT SURVEILLANCE COMMITTEE

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616
FINANCIAL COMMITTEE

ANNUAL REPORT FROM THE ADMINISTRATOR OF THE IRREVOCABLE TRUST IDENTIFIED UNDER THE NUMBER F/1616 (THE “TRUST”), SUBSCRIBED BY ASESOR DE ACTIVOS PRISMA, S.A.P.I. DE C.V., AS THE TRUSTOR; AND DEUTSCHE BANK MÉXICO, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, FIDUCIARY DIVISION AS THE FIDUCIARY, AND CI BANCO, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, AS THE AGENT ON THE COMPLIANCE WITH FISCAL OBLIGATIONS, IN TERMS OF ARTICLE 76 FRACTION XIX, OF THE INCOME.

ENTITIES AND MAIN FUNCTIONS
OF CORPORATE GOVERNANCE

ADVISOR

  • Assist in the formulation and implementation of investment and financial strategies
  • Protect the assets of the Trust

HOTEL OPERATOR (RELATED PARTY)

  • Perform hotel management services

Control Trust

  • Appoint chairman of technical committee
  • Elect majority of members of technical committee, as long as it holds 11% or more of outstanding CBFIs

Trustee

  • Acquire, maintain and dispose of the rights that constitute the trust
  • Make, administer and maintain eligible investments
  • Carry on liquidation process upon termination of the trust

Management Subsidiary

  • Manage day-to-day operations and provide management, maintenance and support functions needed to conduct business

CBFI Holders’ Assembly

  • Elect members of the Technical Committee, for each 10% of outstanding CBFIs held
  • Remove and appoint Common Representative (6)
  • Approve transactions that represent 20% or more of assets
  • Convey or grant an extension to the Trustee to propose an amendment to the Mexican Issuance Deed (6)
  • Remove Advisor, Management Subsidiary and Hotel Operator without “cause” (7)
  • Amend certain provisions of trust agreement (7)
  • Terminate trust agreement (7)
  • Liquidate the assets (7)
  • De-list the CBFIs from the National Securities Registry of the Mexican Stock Exchange (7)
  • Approve transactions in real estate that represent 20% or more of assets (6)(9)

Technical Committee (1)

  • Management of the business
  • Approve the emissions of CBFIs
  • Approve transactions in real estate representing between 5% and 19.99% of assets
  • As necessary, the appointment of the Administrator (with the opinion of the Corporate Governance Committee)
  • Designate fiscal and accounting advisor (8)
  • Approve amendments to Eligibility Criteria (8)
  • Approve policies and transactions between related parties (4)
  • Approve leverage policies (after first fiscal year) proposed by Advisor (8)
  • Analyze and approve transactions outside Eligibility Criteria
  • Appoint legal, tax and accounting advisors, and instruct Trustee to hire such advisors
  • Appoint and remove independent auditor, with audit committee recommendation
  • Approve internal controls and internal audit rules, with prior opinion of the audit committee
  • Establish accounting policies, with prior opinion of audit committee
  • Approve financial statements, with prior opinion of audit committee, for consideration at CBFI Holders’ Assembly
  • Establish distribution policies and approve distributions above 95% of taxable income
  • Appoint members of the audit committee and practices committee (other than chairman)
  • Appoint the secretary of technical committee
  • Appoint members of the nominations committee
  • Review compliance by Management Subsidiary with property management agreement, and by the Advisor with advisory agreement
  • Approve acquisitions of 10% or more of outstanding CBFIs (or similar transactions)
  • Approve sale of properties in connection with the exercise of rights of first refusal and reversion right
  • Approve voting agreements
  • Designate a seller in the event that it was necessary to terminate the Trust
  • Instruct Trustee to disclose certain statutory events

AUDIT COMMITTEE (2)

  • Evaluate independent auditors and analyze their reports
  • Solicit the Advisor’s opinion and/or independent experts
  • Inform the Technical Committee of important detected irregularities
  • Verify the implementation of internal control mechanisms and their compliance with applicable law
  • Investigate possible non-compliance of operating and accounting policies
  • Oversee that the Advisor complies with the agreements of the Shareholders Meeting and of the Technical Committee
  • Recommend the appointment or removal of an independent auditor
  • Inform the Technical Committee regarding the status of internal control systems and internal auditing
  • Opine regarding the company’s accounting policies, prior to the approval of the Technical Committee
  • Analyze and discuss financial, and recommend their approval to technical committee

Practices committee(1)

  • Provide opinions regarding to the value of the transactions
  • Opine regarding the designation of the Advisor when nominated by the Technical Committee.
  • Request and obtain independent expert opinions
  • Evaluate the performance of senior executives
  • Provide recommendations to the technical committee as to what reports it should request from the Advisor and the Trustee
  • Provide recommendations to the Technical Committee on the removal of the Independent Auditor
  • Present market studies and recommendations related to sectors in which our properties and assets belong
  • Opine regarding distributions that exceed 95% of the company’s Taxable Income

nominations committee (10)

  • Search, analyze, evaluate and propose candidates for election as independent members of the Technical Committee.
  • Monitor and review all matters related to the independence.
  • Certify the Independence, experience and professional prestige of candidates
  • Propose the salaries that should be paid to the members of the Technical Committee

Credit Surveillance Committee (11)

  • Over see the guide lines of the mechanisms and controls applied to credit lines, loans or financings assumed against the Trust’s Equity

Financial Committee

  • Analyze and when necessary, decide upon all matters related to bank loans, financial debt or any of the Trust’s financial matters
(1)The Technical Committee is comprised of 13 proprietary members (five of which are independent) as well as their respective alternates. An alternate member may act as any of the elected board members in the case that any board member is unable to attend a Technical Committee meeting. At least 25% of the proprietary members and their respective alternate members must be independent, as established in the written requirements; over 25% of the Technical Committee’s proprietary members must be independent members.
(2)The Auditing Committee is comprised of three members. Each member of the Auditing Committee must be an independent member as established by the Trust.
(3)The Practices and Investments Committee is comprised of three members. In accordance with the requirements of the Trust, each of the three Practices and Investments Committee members should be independent.
(4)Also requires a majority approval vote by its independent members related to the political reforms pertaining to debt leverage levels.
(5)Any Holder or group of Holders that represent 10% or more of the CBFIs outstanding will have the right to nominate a proprietary member of the Technical Committee and their respective alternate.
(6)Requires the approval vote by the Holders of the majority of the CBFIs outstanding. In the respective Shareholder Meeting, a minimum of 89% of the CBFI’s outstanding must be represented in order for the decision to be valid.
(7)Requires the approval vote of over 89% of the Holders of the CBFI’s outstanding.
(8)Also requires the majority vote in favor of the independent members.
(9)In one transaction, or in a series of related transactions that are considered as one, based on the most recent Audited Financial Results for the previous quarter.
(10)The Nominations Committee is comprised of ve members of whom most must be independent.
(11)The Credit Oversight Committee is comprised of five members, of which three are independent.

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 TECHNICAL COMMITTEE

The undersigned, Victor Zorrilla, Chairman of the Technical Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), hereby reports to the Shareholders’ Meeting on the completion of the following activities during the scal year 2014:

  • Eight meetings were held, during the months of April, July, August, October, November and December 2015 as well as in February and April 2016.
  • The Consolidated Financial Statements were approved for March, June, September and December 2015, upon recommendation from the Audit Committee.
  • The March, June, September and December 2015 Holder Distributions were approved for a total of Ps. 338.1 million upon recommendation from the Audit Committee.
  • The 2015 budget for the Trust and its Subsidiary was approved.
  • The contract terms of KPMG as the Independent Auditor of the Trust for the year 2015 were approved, upon the recommendations by the Audit Committee.
  • The Audited Financial Statements for the year 2015 with the corresponding Opinion Report without exception by the Independent Auditor were approved, after hearing the opinion of the Auditing Committee.
  • Approval was given -after hearing the opinion of the Practices Committee- The acquisitions of the Hampton Inn & Suites by Hilton Chihuahua, City Express Chihuahua, City Express Junior Chihuahua and Courtyard by Marriott Chihuahua hotels, with a total investment value of Ps. 713.9 million, as well as the development of the JW Marriott Monterrey hotel with a total investment value of up to Ps. 343.4 million.
  • Approval was given –after hearing the opinion of the Practices Committee- to the contracting terms with Operadora México –a Related Party- of the hotels Holiday Inn Reynosa Industrial Poniente, Hampton Inn by Hilton Hermosillo, Arriva Express Guadalajara, Staybridge Suites Guadalajara Expo, Hampton Inn by Hilton Chihuahua, City Express Chihuahua, City Express Junior Chihuahua, Courtyard by Marriott Chihuahua, Courtyard by Marriott Saltillo, and Fairfield Inn & Suites by Marriott Coatzacoalcos.
  • Approval was given, following the opinion of the Practices and Investments Committee, for the annual and semi-annual review of the rental for the spaces utilized by Operadora México Servicios y Restaurantes S.A.P.I. de C.V. in the hotels where it was determined that an updating was required.
  • The integration and faculties of a Financial Committee were approved.
  • Approval was given –after hearing the opinion of the Practices Committee– the creation of Internal Unit for Market Studies.
  • Determined –prior authorization by the Practices Committee– the procedure for the replacement of real estate assets in the Trust’s hotels.
  • Approval –prior opinion of the Practices Committee– the nomination of Laura Nelly Lozano Romero and Lizeth Mariel Pedraza Nava as Secretary and Alternate, respectively, of the Technical Committee.
  • Approval of the hiring of advisors for the process prior to the Debt Issuance, and proposal at the Shareholders’ Meeting to the approval of said Debt Issuance for up to Ps. 2 billion, with a total 5-year program of up to Ps. 5 billion.
  • The designation of an Evaluation Committee was approved, which analyzed and authorized the contracting of Santander as a market maker for 2015.
  • Presented all of the real estate assets that comprise Equity and rati ed all of the processes necessary for their acquisition, prior to presenting these at the Shareholders’ Meeting.
  • Approval for the sale of a portion of the 286.7 m2 located in the front portion of the Hotel Holiday Inn Puebla La Noria lot to the government of Puebla, for the construction of the Nodo Alitxcáyotl.
  • Approval of a Level 1 American Depositary Receipt Program.
  • Ratification of Fibra Inn’s participation in the Mexican Association of Real Estate Fibras (Asociación Mexicana de Fibras Inmobiliarias).

San Pedro Garza García, April 29 2016.

Mr. Victor Zorrilla Vargas
Chairman of the Technical Committee
Trust F/1616

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 AUDIT COMMITTEE

The undersigned, Mr. Rafael Gomez Eng, President of the Audit Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), hereby reports to the Shareholders’ Meeting that during fiscal year 2015 the following activities were completed carried:

  • Four meetings were held, taking place in the months of April, July, and October, as well as in February 2016.
  • The Consolidated Financial Statements corresponding to March, June, September and December of 2015 were analyzed and recommended to the Technical Committee.
  • The March, June, September and December 2015 Holder Distributions were evaluated and recommended to the Technical Committee for a total of Ps. 338.1 million.
  • Established the criteria for the accounting format for the repositioning of the real estate and equipment for the Hotels that comprise the Trust
  • The Trust for the year 2015 were defined and were recommended to the Technical Committee.
  • The work carried out by the Auditing firm was duly supervised.
  • The Certified Financial Statements for the year 2013, with the corresponding Opinion Report were analyzed and recommended to the Technical Committee, with no exception from the Independent Auditor.

San Pedro Garza García, April 29 2016.

Mr. Rafael Gómez Eng
PRESIDENT OF THE AUDIT COMMITTEE
Trust F/1616

AUDIT COMMITTEE

Rafael Gómez Eng President
Héctor Medina Aguiar
Everardo Elizondo Almaguer

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 PRACTICES COMMITTEE

The undersigned, Mr. Adrián Garza de la Garza, President of the Practices Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), hereby reports to the Shareholders’ Meeting at the completion of the fiscal year 2015:

  • Six meetings were held during the months of February, May, July (2 sessions), October and November of 2015.
  • Evaluation and recommendation to the Technical Committee for the acquisition of the hotels: Hampton Inn by Hilton Chihuahua, City Express Chihuahua, City Express Junior Chihuahua, Courtyard by Marriott Chihuahua, with a total investment of Ps. 713.9 million, as well as the development of the JW Marriott Monterrey hotel, with a total investment of up to Ps. 343.4 million was evaluated and recommended to the Technical Committee.
  • Recommendation of the contractual terms set forth with Operadora México Servicios y Restaurantes S.A.P.I de C.V. –a Related Party- to the Technical Committee regarding the Holiday Inn Reynosa Industrial Poniente, Hampton Inn by Hilton Hermosillo, Arriva Express Guadalajara, Staybridge Suites Guadalajara Expo, Hampton Inn by Hilton Chihuahua, City Express Chihuahua, City Express Junior Chihuahua, Courtyard by Marriott Chihuahua, Courtyard by Marriott Saltillo, and Fairfield Inn & Suites by Marriott Coatzacoalcos hotels. In addition, analysis and recommendation to the Technical Committee for the semi-annual and annual review of the space rentals used by Operadora México Servicios y Restaurantes S.A.P.I de C.V., where an update was determined to be necessary.
  • Confirmation of meeting the Eligibility Criteria required to invest in the following hotels:
    Holiday Inn Reynosa Industrial Poniente, Hampton Inn by Hilton Hermosillo, Arriva Express Guadalajara, Staybridge Suites Guadalajara Expo, with a total investment of Ps. 775.0 million.
  • Study and approval of the proposal for the change in electric energy provider for the Trust’s Hotels.
  • Evaluation and proposal to the Technical Committee to substitute the Secretary of this Committee.
  • Analysis and approval to establish an Internal Work Management division.
  • Analysis and recommendation to the Technical Committee to create an Internal Work Management division.
  • Evaluation and recommendation to the Technical Committee regarding the furniture replacement procedure of the Trust’s Hotels.

San Pedro Garza García, April 29 2016.

Mr. Adrián Garza de la Garza
President of the PRACTICES Committee
Trust F/1616

PRACTICES COMMITTEE

Adrián Garza de la Garza President
Héctor Medina Aguiar
Rafael Gómez Eng

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 NOMINATIONS COMMITTEE

The undersigned, Mr. Marcelo Zambrano Lozano, President of the Nominations Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), reports to the Shareholders’ Meeting that during the fiscal year 2015:

  • One meeting was held in the month of April 2015.
  • Approval of the change in the compensation amount for the Independent Board Members.
  • Designation of special delegates to implement the agreements.

San Pedro Garza García, April 29 2016.

Mr. Marcelo Zambrano Lozano
President of the Nominations CommitteE
Trust F/1616

NOMINATIONS COMMITTEE

Marcelo Zambrano Lozano President
Adrián Garza de la Garza
Héctor Medina Aguiar
Joel Zorrilla Vargas
Victor Zorrilla Vargas

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 CREDIT SURVEILLANCE COMMITTEE

The undersigned, Mr. Rafael Gómez Eng, President of the Credit Surveillance Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), reports to the Shareholders’ Meeting that the following activities were carried out during the fiscal year 2015:

  • Four meetings were held during the months of April, July, and October, as well as in February 2016.
  • Analyze and approve the reports in accordance with the Requirements for Compliance with the Financial Guidelines of the Mexican Securities and Exchange Commission (CNBV) for Bank Loans and the Debt Issuance of FINN15, corresponding to March, June, September and December 2015.

San Pedro Garza García, April 29 2016.

Mr. Rafael Gómez Eng
President of the Credit Surveillance Committee
Trust F/1616

CREDIT SURVEILLANCE COMMITTEE

Rafael Gómez Eng President
Héctor Medina Aguiar
Everardo Elizondo Almaguer
Alejandro Javier Leal-Isla Garza
Oscar Eduardo Calvillo Amaya

ANNUAL REPORT ON ACTIVITIES
TRUST F/1616 FINANCIAL COMMITTEE

The undersigned, Mr. Héctor Medina Aguiar, President of the Financial Committee of the Irrevocable Trust identified under the number F/1616 (the “Trust”), reports to the Shareholders’ Meeting that the following activities were carried out during the fiscal year 2015:

  • Three meetings were held during the months of July, September and October 2015.
  • Analyze and approve the Terms and Conditions for the First Public Debt Issuance of the Trust (FINN 15), for Ps. 1,875.35 million.
  • Analyze and determine the strategy for the partial coverage of the Swaps for a total value of Ps. 625 million.
  • Approval to undergo negotiations with the Banks in order to improve the conditions of the Credit with Banorte, Actinver, Banamex, Scotiabank and Banregio.

San Pedro Garza García, April 29 2016.

Mr. Héctor Medina Aguiar
President of the Financial Committee
Trust F/1616

FINANCIAL COMMITTEE

Héctor Medina Aguiar President
Adrián Garza de la Garza
Everardo Elizondo
José Antonio Gómez Aguado de Alba
Oscar Eduardo Calvillo Amaya
Santiago Pinson Correa

ANNUAL REPORT FROM THE ADMINISTRATOR OF THE IRREVOCABLE TRUST IDENTIFIED UNDER THE NUMBER F/1616 (THE “TRUST”), SUBSCRIBED BY ASESOR DE ACTIVOS PRISMA, S.A.P.I. DE C.V., AS THE TRUSTOR; AND DEUTSCHE BANK MÉXICO, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, FIDUCIARY DIVISION AS THE FIDUCIARY, AND CI BANCO, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE, AS THE AGENT ON THE COMPLIANCE WITH FISCAL OBLIGATIONS, IN TERMS OF ARTICLE 76 FRACTION XIX, OF THE INCOME.

San Pedro Garza García, Nuevo León, April 29, 2016.

Pursuant to the provisions established in Article 76, Fraction XIX, of the Income Tax Law, Administradora de Activos Fibra Inn, S.C., in its capacity as Administrator of the Trust, hereby presents the report that reflects the compliance with the fiscal obligations of the Trust for the period encompassed between January 1 and December 31, 2014 (the “Period of Review”), so that in due course the said report can be submitted to the consideration of the Annual General Shareholders’ Meeting of the of Real Estate Trust Certificates with the ticker symbol “FINN13” (“CBFIs”), which will be held on 29 of April 2016.

It is hereby represented that the fiscal status of the Fiduciary of the Trust was examined for the Period Review that covers the certified financial statements, and, regarding meeting its fiscal obligations as a direct tax payer, withholder and/or collector, whereby it is represented that none of the fiscal obligations of the Trust is outstanding or in default. It is hereby reported that the calculations were verified and found that the federal taxes accrued during the Period Reviewed as reported show that there are no rulings on outstanding balances or any payment that has been omitted.

Regarding the amount and payment of the Workers Profit Share, it is hereby reported that the Trust has no employees, and therefore, it was not subject to any labor related obligations during the Period Reviewed.

This report is issued solely and exclusively for the information for the CBFI Holders of the trust, and to be subjected for approval before the Anual General Shareholders’ meeting of the Trust, pursuant to the provisions established by the applicable laws, and shall not be used for any other purpose.


Administradora de Activos Fibra Inn, S.C.,
in its capacity as Administrator of the
Trust through its legal representative
Mr. Oscar Eduardo Calvillo Amaya