SPA-RECREATIONAL CENTER “Lješljani” Novi Grad, 23 February 2015.

LOCATION: Bosnia and Herzegovina, Republic of Srpska Novi Grad municipality, Local community Devetaci

Basic location information: Thermo-mineral water characterisitcs: Altitude 211 – 461 m BRC zone surface ha Adopted regulatory plan for special area,,Spa Lješljani” Preserved nature 2 natural wells of thermo-mineral water Power supply network, 20/0.4 kV 50 kA Temperature 31°- 33° Methan sodium - chloride hydroxide hypothermal hyperaalkaline mineral water Wide range of use for various conditions and injuries Physical-chemical analyses of water carried in several scientific-research institutes High alkalinity and mineralization of water Ideal in use for metabolism and digestive system diseases and conditions, urinal and gynecological system, rheumatic and neural conditions, postoperational and posttraumatic conditions Best results are in use for dermal diseases and conditions

Construction of SRC,,Lješljani” is defined as one of the most important municipal development projects There is no current developed and organized offer Concept is based on year-round offer: health-recreational services, business/congress tourism, sport-recreational contents, accommodation and gastronomy, eco-ethno tourism, special interests (rafting, hunting, fishing), accompanying contents (shops, souvenirs, boutiques, craft shops). Feasibility study defines construction of acommofation units (363 beds), health, welness and spa contents, sport infrastructure and catering infrastructure. Feasibility study for construction of Spa-recreational center..Lješljani“ Regulatory plan of special area,,Spa Lješljani” The Spatial plan of Republic of Srpska has defined area of Spa Lješljani as area of a special purpose Regulated area has surface of 31 ha Regulatory plan is valid for period 2009 – 2019 Construction zone defined by Plan has surface of m2 Approximate costs of arrengement of building land are EUR

CostsProfitability Preoperational phase (non material investments, property-legal relations, buying of land): € I construction phase (construction and equipping of central building and indoor swimming pool, providing and preparation of labor force, SRC marketing plan implementation): € II construction phase (construction and equipping of Wellness hotel, providing and preparation of labor force, SRC marketing plan implementation): € III construction phase (construction and equipping of bungalows, providing and preparation of labor force, SRC marketing plan implementation): € TOTAL INVESTMENTS: € in the first ten years total revenues would have amounted 47,5 million € in the following ten years destination would generate additional 58,8 million € the largest revenue in the projected period destination would realize from Wellness hotel, around 56%, the Central building would take share of around 37% in the total revenues. Bungalows would bring an additional 6% of revenue the share of swimming pool is estimated at less than 1% the Project is solvent at all stages of its operations Static indicators of financial analysis are satisfactory in the Project's sixth year the net present value is positive for each discount rate that is <9.5% for the selected discount rate of 9% it amounts 1,07 million KM the simple payback period is 11 years, and the internal rate of return is 9.5%.

Owner/Developer: Novi Grad Municipality Novi Grad, Bosnia and Herzegovina tel: Contacts: Developer’s costs and fee: Preparatory phase (non material investments, property-legal relations, land purchasing) - 4,6% of overal investment costs Investor: Construction phases (I, II and III) – 95,4 % of overal investment costs Financing