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Table of Contents Park & Resort News 1 Marketing 4 Letters from Mallorca 8

Team News 10 Making a Difference 11

S E C O N D Q U A R T E R 2 0 1 5

A Family Resort Vision Realized...

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PARK & RESORT NEWS

A Family Resort Vision Realized Sol Katmandu Park & Resort hotel opened May 1 to the scurry of lots of tiny feet—we are most definitely a family hotel and Mallorca’s most successful family hotel this season. And, when we say family hotel, we aren’t kidding. Family business is up significantly, with children making up 30% of guests. Since the booking season opened, Sol Katmandu has remained one of the top booked Meliá properties. It leads the Sol chain in bookings and is the #1 hotel in sales in the UK. To date, hotel occupancy is almost double that of same time last year, average daily rate (ADR) is up 20% and is projected to achieve plan. In keeping with strategy, key segments driving success are also the most profitable areas with e-commerce up more than four times (429%) versus last year and direct bookings almost double last year at 180%. These results are driven by Team Katmandu passion and hard work. From the heavy lifting of all of the hotel resort upgrades…to our 4-star operations team…to an integrated sales and marketing effort to presell “a fun-inclusive resort like no other” — the bookings tell the story. Some of the key hotel improvements that allowed this success story to unfold include:

• Signaling the start of a mythical stay, guests are drawn in by Desirata, the glowing red jewel in the temple entrance.

• The lobby has been completely opened up with glass doors on all sides, providing a welcoming feel.

• Reception includes a spot for tots to color and play during the check-in process and a steampunk magician suspends disbelief as he engages guests.

• All rooms have been fully upgraded including the creation of additional room types for families.

• New outdoor dining has been added providing a beautiful garden setting. • Pool area has two new bars, an outdoor dining/

seating area and all new upper deck. • A new open-air stage in the plaza between the park

and hotel offers nightly entertainment. • Steampunk Sweets has been fully outfitted with lots of

treats and is home to the all-new Maiya’s Breakfast. • Kamp Katakidu has been fully revamped with a full

array of entertainment options to give everyone in the family “freedom to play.”

• And, Katmandu Park is included with stay as the key booking differentiator, with Katlantis Splash for the little ones and all the other park attractions that offer fun and thrills to all ages.

The hotel delivers a “fun-inclusive” holiday for our guests and is positioned well to achieve its 2015 business goals and creating mythical memories for all who experience a Sol Katmandu Adventure.

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PARK & RESORT NEWS

Katmandu Shampoo is Highlight of Resort Training Adventure A landmark milestone was achieved for the Sol Katmandu Park & Resort brand when the first joint employee training took place uniting staff from all areas of the resort. With this training, the official identity of the resort as a united property and single brand was reinforced with the Mallorca team. The training experience was developed by a committee comprising members from Katmandu Group, Meliá and an outside training consulting firm who delivered the sessions to employee groups of approximately 20 each over a five-day period. Employee groups composed of hotel and park staff met each day to find out more about the Sol brand, the Sol Katmandu brand specifically and all the characteristics and values that make us “Katmandu”.

Activities included lively discussions, costumed role playing, customer service brain storming, brand identity exercises and a “Katmandu Shampoo” representing what each team member brings to the guest experience. Team members had a chance to join in activities with others they might never meet and hear their experiences and thoughts regarding delivering the Katmandu difference when serving our guests. They also had a chance to learn about the other Sol brand properties and compare the similarities along with what makes us stand out from the rest.

In true Katmandu tradition, it was a day of adventure, stories and imagination with friends old and new. Even Boro joined in the fun and all agreed it was a valuable opportunity to celebrate our Katmandu brand!

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Timbuktu® Smokehouse Tavern opens in May

Kategorically delicious! Timbuktu Smokehouse Tavern opened May 1 thanks to “Teambuktu” led by Sinto Llobera. The restaurant offers authentic smokehouse meats, ides and a colossal signature dessert that lives up to its name, Boro’s Brownie.

PARK & RESORT NEWS

Katmandu Trivia!

What does POOOOOOK mean in Kat

Lingo?

Answer on page 11.

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MARKETING

Katmandu Park and Jet 2 Partner in Leeds Rhino Rugby Promotion The Katmandu marketing team has also been collaborating with international and local partners. The largest promotion this quarter was with Jet 2 and the Leeds Rhino Rugby team in the UK. The grand prize of this promotion was a weekend stay in our resort. Simon personally promoted Sol Katmandu Park & Resort in front of 18,000 spectators at the rugby match, where the raffle winner was selected. This campaign featured Boro and Zombie masks, with a vanity url http://www.jet2holidays.com/katmandu, and a special brochure with raffle ticket included.

TUI Open Day at Sol Katmandu Park & Resort The season opened with TUI hosting its annual TUI Open Day at Sol Katmandu Park & Resort. Booths were set up inside the hotel lounge areas so that all the TUI agents could learn about Mallorca attractions and were able to experience Katmandu first hand.

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MARKETING

Katmandu Hosts 25th Anniversary Special Event Sol Katmandu Park & Resort was host to the 25th anniversary special event in June for Cadena Dial—the largest Spanish Radio Group with multiple stations across Spain. The event featured entertainment on the main stage throughout the day from Zumba in the morning to Maria Bimbolles, a breakout children’s entertainment brand to musical productions. Katmandu Park was promoted in advance of the event as the venue with a special ticket offer that drove incremental resident attendance. And, Timbuktu catered and hosted the Cadena Dial VIPs.

Here Comes the Adventure The Sol rebranding campaign “Here Comes the Adventure” at Sol Katmandu Park Resort continues throughout Europe. In a repeat performance in London, a fleet of “Here comes the Sol” wrapped taxis are on the move for a 60-day showing. The Sol Katmandu Park & Resort taxi wrap features the

popular young yeti character, Maiya. The interior of the taxis includes seat back graphics and themed receipts that showcase a promotion to win a trip. In Bilbao, Spain, Sol Katmandu Park & Resort graphics wrap the entire people mover train in the city center creating a spectacular presence.

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MARKETING

Digital Update: Katmandu is a Big “Hit” Online Since relaunching www.KatmanduPark.com last year, Katmandu is growing in web traffic and online tickets sold. In addition, Katmandu social media accounts hold future growth opportunities with our in-house social media team and newcomers Daniel Alonso (Community Manager) and Amanda DeMarcus (Marketing Manager).

• Katmandu Park website traffic is up 50% in visitors, up 80% in pages visited, and up 55% in time visitors spend on the website year over year.

• Tickets purchased online have increased dramatically roughly 2.5 times that of same period last year. We broke our previous record of online sales in June, and we expect the trend to continue throughout the season.

• Both Sol Katmandu Park & Resort’s and Katmandu Park’s social media accounts are up roughly 30% each month-over-month in impressions generated by statuses/posts—an increase that is considerably higher than the national average.

• Katmandu Park has seen steady growth from 2013 to YTD 2015 in number of fans for its Facebook page, growing at a rate of approximately 23% per year, or approximately 1,200 new fans each year.

Please ‘like’ us on Facebook and ‘follow’ us on Twitter (click links below)!

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MARKETING

May 1 marked the opening of our re-designed Make A Mythical Shop. The new design is bright, colorful and appeals to all ages to purchase the perfect souvenir memory. We opened up the lobby wall so now guests can enter from multiple points. We re-merchandised the store, adding lights, mannequins, themed displays and new floors and ceiling. The result has been positive, with May sales up 114% over last year and June up 190% over last year.

This season we expanded our Make A Mythical program with the addition of two favorite plush characters, Maiya and Kumar. The Make A Mythical plush experience brings these characters to life and engages children. Both Maiya and Kumar have custom costumes with a matching character backpack. The Make A Mythical program continues to be our strongest selling category with 47% of total sales.

Also new this season are pens, mugs, shot glasses, water bottles and shark bottle openers. In apparel, we launched Katlantis as well as Maiya and Kumar shirts and branded polos. In accessories we have a new costume jewelry program for adult and children and a steampunk collection of hats, jewelry, sunglasses and goggles. With an increased assortment of souvenir items and the space re-design, Make A Mythical Shop is one of our proudest achievements this season.

Make A Mythical Shop Re-Design Helps Increase Retail Sales

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“Thanks to Juli, Scott, Jen, Mauricio, Patricia, Simon, Mike and Jill for showing Suzanne and me a great time at Sol Katmandu. We really enjoyed meeting all the people and getting better acquainted with the product and beautiful location. Thanks also to KG and Lise for their orientation and insights. I kept telling Scott and Juli I had to see this to believe and understand it. Well, I saw it and I believe—still working on understanding the full scope of the opportunity. We brought back some magic Mediterranean salts, great memories and enthusiasm for the future. We both look forward to another trip and a crash course on Tenerife.” ~ Dan Jensen, Partner

LETTERS FROM MALLORCA

Dan and Suzanne Jensen traveled all the way from Yosemite National Park in California to meet Boro the Great. Judging from this photo, Dan found his investment in good hands!

Mark, Giouzel, Jackie & Daniel Glodener visited Katmandu during a cruise stop on the island. It didn’t take too long for the Katmandu Shampoo to take effect as noted in the transformative photos!

“We really enjoyed our recent visit to Sol Katmandu Park & Resort! It was very busy, a lot of happy people. The park and hotel are very well maintained, clean and organized. A lot of happy customers, and that’s what we need. A real success story, which will be replicated.” ~ Mark Glodener, Partner

Partners KG and Lise Johnson, Michael Dumas and Diane Collerette, along with their families, visited Katmandu in June. From fun in the park to excursions around the island and even a family birthday dinner at the Mallorcan favorite Ca’n Pedro. Fun was had by all!

During my recent trip to Mallorca, I had the great pleasure of sharing the Katmandu Park experience with some of our partners. It was a proud moment to showcase our team’s intense work on the resort updates and inspiring for everyone to see their investment at work and reflected in the smiles of our guests! ~ Deena Redding, Financial Services/Investor Relations

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My First Visit to Katmandu I’d previously heard that Mallorca is the place to vacation, but rumors, pictures and second-hand descriptions could have never prepared me for what awaited in Spain! As our car neared the resort, my face was pressed to the glass, akin to a 5-year-old going to the fair for the first time. Fast forward three weeks and I left just the way I came - with my face pressed to the glass catching one last glimpse of the place that had become my “home away from home.” During my three-week stay at the resort, I was fortunate enough to meet so many kind and talented individuals while accomplishing the first of many projects. I was able to spend some time with Jill to receive hands-on training as well as learn from some of the greatest minds in the amusement business. In this three-week visit, I officially joined the social media team and began working on a campaign, assisted with this year’s photo and video shoot, and experienced every aspect of the resort - including talking with guests. And, oh yeah, how could I forget being recorded while on the 4D theater ride? (If there’s a video floating around, I suggest not watching it if you’re in the library, office or any other quiet place.) All in all, it was an adventurous, whirlwind trip and one that I will remember forever - I’m already counting down the days to my next visit! I’m so very honored and excited to have joined such an amazing team and I’m looking forward to helping Katmandu reach its full potential. I thank each and every one of you for this amazing opportunity and hope that you’ll reach out with any questions, comments or ideas - my door is always open! Kandu! (Thank you in Kat Lingo!) ~ Katmanda - Amanda DeMarcus

LETTERS FROM MALLORCA

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TEAM NEWS

We are very excited to welcome two key players to our Sol Katmandu Park & Resort team!

Daniel Alonso, Community Manager Daniel Alonso, a Mallorca native, is the newest addition to our Katmandu team! Joining in the role of Community Manager, Daniel will be the backbone of our social media team, assisting with strategy, campaign development and execution, as well as daily engagement with our fans. Daniel received his first degree in Tourism from the Universitat de les Illes Balears where he participated in an exchange program in Switzerland for one year and completed an internship in Playa del Carmen, Mexico. Daniel is currently studying for a Master’s in Tourism Management. Daniel’s work experience began at the Tryp Bellver in Palma de Mallorca, part of Meliá Hotels International, where he worked for more than 5 years before joining the SPK&R team after having also worked for several months in the head offices of Meliá. Please join us in welcoming Daniel to our growing team - he can be reached at dalonso@katmandupark.com.

Amanda DeMarcus - Marketing Manager Amanda “Katmanda” DeMarcus began her role as Marketing Manager in June for three weeks of on-the-job training in Mallorca. Prior to joining Katmandu, Amanda spent three years at a boutique public relations firm in Atlanta, Georgia, where she was responsible for multiple clients in the automotive, luxury lifestyle and experiential branding space. She has a strong background in public relations, marketing, web development, social media, analytics and crisis communications. Amanda hails originally from Vero Beach, Florida, and is a proud University of Florida Gator alumnus, where she earned her B.S. in Public Relations. While there, Amanda also earned accolades in Business Management, International Relations and Spanish - the latter through an international language program in Santander, Spain. Outside of work, Amanda enjoys playing golf, weightlifting, painting, reading and playing guitar. Amanda (along with her beloved dog, Ellie Mae) will relocate back to her Orlando roots in early August where she can be reached at ademarcus@katmandugroup.com.

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Wishes on the Wind There is a place that has inspired dreamers, explorers and seekers for centuries. As a matter of fact, the mystique of Kathmandu, Nepal, inspired our own “Legend of Katmandu” and many visual references throughout the resort - this includes the hotel entrance that was designed after a centuries old temple in Bhaktapur Durbar Square of Kathmandu. On April 25, 2015, that temple was reduced to rubble and now exists only in memories and photographs. Thousands of lives were lost and many more lives affected in a devastating earthquake. Shortly after the disaster, Sol Katmandu Park & Resort partnered with UNICEF in setting up a campaign to collect funds and well wishes for the relief efforts. Donation tins were set up around the resort and proceeds were forwarded directly to UNICEF. Many of our park and hotel guests generously reached into their pockets to support the “Wishes on the Wind” campaign and, in return, had the opportunity to customize flags with their wishes for the people of Nepal. Together we can make a difference!

MAKING A DIFFERENCE

Thank you, Jill Markey! The Katmandu team gathered to wish Jill well as she embarks on a new adventure as a retail buyer in Atlanta, where she will be buying branded merchandise for 14 airport stores and helping launch new retail and F&B concepts nationwide. Jill will be greatly missed but has left an indelible mark on Katmandu and in the hearts of this team...Kandu, Jilly-Kat!

HAPPY!

Trivia answer!

POOOOOOOK means…