EXHIBIT 1
EXECUTION COPY
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ORIENT-EXPRESS HOTELS LTD.
(a Bermuda company)
8,611,565 Class A Common Shares
UNDERWRITING AGREEMENT
Dated: November 17, 2005
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Orient-Express Hotels Ltd.
a Bermuda company
8,611,565 Class A Common Shares
(Par Value $.01 Each)
UNDERWRITING AGREEMENT
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November 17, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Orient-Express Hotels Ltd., a Bermuda company (the "Company"), and Sea
Containers Ltd., a Bermuda company (the "Selling Shareholder"), confirm their
respective agreements with Citigroup Global Markets Inc. ("Citigroup"), Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill
Lynch") and Scotia Capital (USA) Inc. ("Scotia Capital") (collectively, the
"Underwriters", which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), with respect to the sale by the
Selling Shareholder of 8,611,565 class A common shares, par value $.01 each, of
the Company ("Class A Shares"), and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of Class A Shares set forth
in Schedule A hereto, and (B) the grant by the Selling Shareholder to the
Underwriters, acting severally and not jointly, of the option described in
paragraph 2(b) hereof to purchase all or any part of 1,291,735 additional Class
A Shares to cover overallotments, if any. The aforesaid 8,611,565 Class A Shares
(the "Initial Shares") to be purchased by the Underwriters, and all or any part
of the 1,291,735 Class A Shares subject to the option described in paragraph
2(b) hereof (the "Option Shares"), are hereinafter called, collectively, the
"Shares". Each Class A Share includes a right (a "Right") to purchase, under
certain circumstances, one one-hundredth of a series A junior participating
preferred share of the Company (a "Preferred Share"), subject to adjustment. The
Rights are provided for in a Rights
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Agreement dated as of June 1, 2000, between the Company and EquiServe Trust
Company N.A. (successor to Fleet National Bank), as rights agent (the "Rights
Agreement").
The Company and the Selling Shareholder understand that the Underwriters
propose to make a public offering of the Shares as soon as the Underwriters deem
it to be advisable after this Agreement has been executed and delivered.
The Company has filed with the United States Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (Registration
No. 333-102576) and a post-effective amendment no. 1 thereto (together with the
exhibits thereto and the documents incorporated by reference therein, the
"Registration Statement"), relating to the offer and sale of the Shares from
time to time by the Selling Shareholder in accordance with Rule 415 under the
Securities Act of 1933, as amended (the "1933 Act"). The Registration Statement
includes a basic prospectus referred to below that, as supplemented from time to
time, will be used in connection with offerings of Shares. As provided in
Section 3(b), a prospectus supplement reflecting the terms of the public
offering of the Shares and the other matters set forth therein has been prepared
and will be filed together with the basic prospectus referred to below pursuant
to Rule 424(b) ("Rule 424(b)") under the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations") (such prospectus supplement, in
the form first filed on or after the date hereof pursuant to Rule 424(b), is
herein referred to as the "Prospectus Supplement"). The basic prospectus dated
October 28, 2005 relating to the offer and sale of the Shares from time to time
by the Selling Shareholder under the Registration Statement, as supplemented by
the Prospectus Supplement, is herein called the "Prospectus," except that, if
such basic prospectus is amended on or prior to the date on which the Prospectus
Supplement is first filed pursuant to Rule 424(b), the term "Prospectus" shall
refer to such basic prospectus as so amended and as supplemented by the
Prospectus Supplement, in either case including the documents filed by the
Company with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "1934 Act"), that are incorporated by reference therein on or prior
to the date on which the Prospectus Supplement is first filed pursuant to Rule
424(b). The term "Preliminary Prospectus" means the preliminary prospectus
supplement dated November 9, 2005, specifically relating to the offer and sale
of the Shares provided for in this Agreement, together with the basic prospectus
dated October 28, 2005 and including the documents filed by the Company with the
Commission pursuant to the Exchange Act that are incorporated by reference
therein. Any reference herein to the terms "amendment" or "supplement" with
respect to the Registration Statement, the Prospectus, or the Preliminary
Prospectus shall be deemed to refer to and include any documents filed with the
Commission under the Exchange Act after the date hereof, the date the Prospectus
is filed with the Commission, or the date of such Preliminary Prospectus, as the
case may be, and incorporated therein by reference pursuant to Item 12 of Form
S-3 under the Securities Act. For purposes of this Agreement, all references to
the Registration Statement, the Preliminary Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, the Preliminary Prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which are
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included in a document which is incorporated by reference in the Registration
Statement, the Preliminary Prospectus or the Prospectus, as the case may be; and
all references in this Agreement to amendments or supplements to the
Registration Statement, any preliminary prospectus or the Prospectus shall be
deemed to mean and include the filing of any document under the 1934 Act which
is incorporated by reference in the Registration Statement, the Preliminary
Prospectus or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. The Company meets the
registrant requirements for the use of Form S-3 to register under the 1933
Act the offer and sale of the Shares by the Selling Shareholder as
described in the Prospectus. The Registration Statement has become
effective under the 1933 Act, no stop order suspending the effectiveness of
the Registration Statement has been issued under the 1933 Act, and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for supplemental information has been
complied with.
At the respective times when the Registration Statement and any
post-effective amendments thereto became effective or will become effective
and as of the date of this Agreement, the Registration Statement and any
amendments and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. The Prospectus as of the date
hereof and at the Closing Time (and, if any Option Shares are purchased, at
the Date of Delivery), does not and will not include an untrue statement of
a material fact and does not and will not omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The
representations and warranties in this subsection (a)(i) shall not apply to
statements in or omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with the Furnished Information, as
provided in paragraph 6(a) of this Agreement.
The Preliminary Prospectus and the basic prospectus filed as part of
the Registration Statement as originally filed, or as part of any amendment
thereto, or filed pursuant to Rule 424(b), and, if applicable, Rule 430A
under the 1933 Act Regulations ("Rule 430A"), complied when so filed in all
material respects with the 1933 Act Regulations, and the Preliminary
Prospectus and the Prospectus delivered to the Underwriters for use in
connection with this offering was substantively identical to the
electronically transmitted copies thereof filed with the Commission by
means of EDGAR, except to the extent permitted by Regulation S-T.
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The descriptions in the Registration Statement and the Prospectus of
contracts and other legal documents, statutes, and legal and governmental
proceedings are accurate summaries in all material respects.
(ii) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectus pursuant to Item 12 of Form S-3 under the 1933 Act, at the time
they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder (the "1934 Act
Regulations"), as applicable, and, when read together with the other
information in the Prospectus, at the time the Registration Statement
became effective, as of the date of the Prospectus and at the Closing Time
(and if any Option Shares are purchased, at the Date of Delivery), does not
and will not contain an untrue statement of a material fact and did not
omit or will not omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(iii) Independent Accountants. To the knowledge of the Company,
Deloitte & Touche LLP, the accountants who certified and reported on the
financial statements and supporting schedule included in or incorporated by
reference into the Registration Statement and the Prospectus, is an
independent registered public accounting firm as required by the 1933 Act
and the rules of the Commission.
(iv) Financial Statements. The consolidated financial statements of
the Company and its consolidated subsidiaries included in or incorporated
by reference into the Registration Statement and the Prospectus, together
with the related schedule and notes, present fairly the financial position
and results of operations of the Company and its subsidiaries on a
consolidated basis at the respective dates, or for the respective periods,
to which they apply; such financial statements have been prepared in
conformity with U.S. generally accepted accounting principles applied on a
consistent basis throughout the respective periods involved, and in
compliance with the applicable accounting requirements of the 1933 Act, the
1934 Act and the rules of the Commission, and the supporting financial
statement schedule or schedules included or incorporated by reference in
the Registration Statement, when considered in relation to the basic
consolidated financial statements taken as a whole, presents or present
fairly in all material respects the information required to be stated
therein. Any summary consolidated financial data included or incorporated
by reference in the Prospectus present fairly the information shown therein
and have been compiled on a basis consistent with that of the audited
consolidated financial statements included or incorporated by reference in
the Registration Statement and the Prospectus.
(v) No Material Adverse Change in BusinessSubsequent to December 31,
2004, or except as otherwise disclosed in the Prospectus, (A) there has
been no material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business (a "Material Adverse Change"), (B) there
have been no transactions entered into by the Company or
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any of its subsidiaries, other than those in the ordinary course of
business, which are material with respect to the Company and its
subsidiaries considered as one enterprise, and (C) there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital shares, other than regular quarterly dividends
in the amount of $.025 per Class A Share and per Class B Share (as
hereinafter defined).
(vi) Good Standing of the Company and its Subsidiaries. The Company
and the subsidiaries of the Company have been duly organized and are
validly existing as companies or corporations, as the case may be, in good
standing under the laws of their respective jurisdictions of organization,
with full power and authority (corporate and other) to own, lease and
operate their respective properties and conduct the Company's business on a
consolidated basis as described in the Prospectus; and the Company has full
power and authority (corporate and other) to enter into and perform its
obligations under this Agreement; and the Company and the subsidiaries of
the Company are in compliance with all laws requiring their qualification
to do business as foreign corporations, and are in good standing, in all
jurisdictions in which they respectively own or lease properties of a
nature, or transact business of a type, that would require such
qualification, except where the failure to comply with such laws would not
have a material adverse effect on the condition, financial or otherwise, or
on the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business (a "Material Adverse Effect").
(vii) Authorization and Validity of Agreement. This Agreement has been
duly authorized, executed and delivered by the Company and is a valid and
binding agreement of the Company, except that (a) the validity of the
indemnification and contribution provisions of Sections 6 and 7 of this
Agreement may be limited by public policy considerations, and (b) the
validity of Section 16 of this Agreement may be limited by the public
policy of the State of New York, and may be subject to the discretion of
the United States federal or New York State courts with respect to venue,
as provided in 28 U.S.C. Section 1404(a) and/or New York CPLR Section 510,
respectively.
(viii) Authorization of Rights Agreement. The Rights Agreement has
been duly authorized, executed and delivered by the Company; the Rights
have been duly authorized by the Company, and the Rights attached to the
Shares were validly issued when the Shares to which they are attached were
issued; and the Preferred Shares issuable upon exercise of the Rights have
been duly authorized by the Company and validly reserved for issuance upon
the exercise of the Rights and, when issued upon such exercise in
accordance with the terms of the Rights Agreement, will be validly issued,
fully paid and non-assessable.
(ix) Authorization and Description of Shares. The Shares to be
purchased by the Underwriters from the Selling Shareholder have been duly
authorized by the Company and have been validly issued to the Selling
Shareholder and are fully paid and non-assessable; and the descriptions of
the Class A Shares and the Rights in the Prospectus are materially accurate
and complete summaries of the rights in the instruments defining the same.
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(x) Capitalization. The authorized, issued and outstanding capital
shares of the Company are as set forth in the Prospectus in the first
paragraph under the caption "Description of the Common Shares" (except for
subsequent issuances, if any, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectus).
All of the outstanding capital shares of the Company and the
subsidiaries of the Company, including the Shares to be purchased by the
Underwriters from the Selling Shareholder, have been duly authorized and
validly issued and are fully paid and non-assessable, and the Company,
directly or through subsidiaries, owns all the outstanding capital shares
of its subsidiaries, free and clear of all material security interests,
liens, encumbrances, claims and equities, except that approximately 3.0% of
the equity in Companhia Hoteis Palace, approximately 4.5% of the equity in
Societe de la Cite S.A., approximately 25% of the equity in Miraflores
Ventures Ltd. and Plan Costa Maya S.A. de C.V., and 6.5% of the equity in
Europe Hotel LLC are not owned by the Company or its subsidiaries; no
holder of the outstanding capital shares of the Company is or will be
subject to personal liability with respect to the debts or obligations of
the Company solely by reason of being such a holder; and none of the
outstanding capital shares of the Company was issued in violation of the
preemptive rights of any shareholder of the Company.
(xi) New York Stock Exchange Listing. The Class A Shares (including
the Shares) and the Rights are listed on the New York Stock Exchange.
(xii) Absence of Defaults and Conflicts. Neither the Company nor any
of its subsidiaries is in violation of its charter or bye-laws or other
constituent documents, or is in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any contract,
loan or credit agreement, note, lease, indenture, mortgage, deed of trust
or other instrument or agreement to which it is a party or by which it or
its property may be bound or subject except for such defaults, if any, that
individually or in the aggregate would not have a Material Adverse Effect;
and
(A) the execution and delivery by the Company of this Agreement;
(B) the performance by the Company of its obligations under this
Agreement and its compliance with such obligations;
(C) the sale and delivery by the Selling Shareholder of the
Shares, the Rights, and, upon exercise of the Rights, the Preferred
Shares; and
(D) the consummation of the other transactions contemplated in
this Agreement,
(I) have each been duly authorized by all necessary corporate action
on the part of the Company, (II) do not and will not, whether with or
without the giving of notice, the passage of time, or both, conflict
with or result in a breach or violation by the Company of any of the
terms or provisions of, or constitute a default under, do not and will
not result in a change of control with respect to the Company under,
or (III) will not result in the creation or imposition of any tax,
lien, charge or encumbrance upon, any property or
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assets of the Company or any subsidiary of the Company under: (x) any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any of the Company's
subsidiaries is a party or by which any of them is bound or to which
any of their properties may be subject, except for such breaches,
violations, defaults, liens and charges or encumbrances that would not
have a Material Adverse Effect; or (y) the charter or bye-laws or
other constituent documents of the Company or any of the Company's
subsidiaries; or (z) any statute, rule or regulation, or any decree,
judgment or order of any United States domestic ("domestic") or
foreign court or governmental agency or body having jurisdiction over
the Company or any of the Company's subsidiaries, or over their
respective properties, except for such breaches, violations, defaults,
liens, charges or encumbrances, if any, that would not have a Material
Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign (other than as disclosed in the
Prospectus), now pending or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries, which action,
suit or proceeding is required to be disclosed in or incorporated by
reference into the Registration Statement or might result in a Material
Adverse Change, or might materially and adversely affect the sale of the
Shares pursuant to this Agreement; and all pending or threatened legal or
governmental proceedings to which the Company or any of its subsidiaries is
a party or of which any of their property is the subject and which are not
described in or incorporated by reference into the Registration Statement
or otherwise publicly disclosed prior to the date of this Agreement,
including ordinary routine litigation incidental to their businesses, are,
considered in the aggregate, not material to the Company and its
subsidiaries considered as one enterprise.
(xiv) Documents. There are no contracts or documents which are
required to be filed or incorporated by reference as exhibits to the
Registration Statement by the 1933 Act or by the rules of the Commission,
or are required to be described in the Prospectus, which have not been so
filed or incorporated by reference or described.
(xv) Possession of Intellectual Property. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them, and neither the Company nor any of its subsidiaries
has received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its subsidiaries therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
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(xvi) Absence of Further Requirements. No consent, approval,
authorization or order of, or registration, qualification or filing of or
with, any court or governmental agency or body (domestic or foreign) is
required for the performance by the Company of its obligations under this
Agreement or the consummation of the transactions contemplated by the this
Agreement or otherwise in connection with the valid sale and delivery by
the Selling Shareholder of the Shares and the Rights except:
(a) such as shall have been obtained or made under the 1933 Act or
the 1933 Act Regulations,
(b) such as have been obtained from the Bermuda Monetary Authority
(if any), and
(c) such as may be required under state securities laws in connection
with the purchase and distribution of the Shares and the Rights
by the Underwriters.
(xvii) Possession of Licenses and Permits. Except as disclosed in the
Registration Statement or the Prospectus, or except as would not
individually or in the aggregate have a Material Adverse Effect, each of
the Company and its subsidiaries owns, possesses or has obtained all
material governmental licenses, permits, certificates, consents, orders,
approvals and other authorizations necessary to own or lease, as the case
may be, and to operate its properties and to carry on its business as
presently conducted, and neither the Company nor any of its subsidiaries
has received any notice of proceedings relating to revocation or
modification of any such licenses, permits, certificates, consents, orders,
approvals or authorizations.
(xviii) Title to Property. Each of the Company and its subsidiaries
has good and marketable title to all properties and assets owned by it,
free and clear of all liens, charges, encumbrances or restrictions, except
such as (A) are otherwise referred to in the Prospectus or (B) are neither
material in amount nor materially significant in relation to the business
of the Company and its subsidiaries considered as one enterprise. All of
the leases and subleases material to the business of the Company and its
subsidiaries, considered as one enterprise, and under which the Company or
any subsidiary holds properties, are in full force and effect, and neither
the Company nor any of its subsidiaries has any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of
the Company or any subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the Company or
such subsidiaries to the continued possession of the leased or subleased
premises under any such lease or sublease.
(xix) Investment Company Act. The Company is not an "investment
company" or an entity "controlled" by an "investment company" as such terms
are defined in the Investment Company Act of 1940, as amended.
(xx) Environmental Laws. Except as disclosed in the Prospectus or
except as would not individually or in the aggregate have a Material
Adverse Effect, (A) the
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Company and its subsidiaries are in compliance with all applicable
Environmental Laws, (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable Environmental
Laws and are in compliance with their requirements, (C) there are no
pending or threatened Environmental Claims against the Company or any of
its subsidiaries, and (D) there are no circumstances with respect to any
property or operations of the Company or its subsidiaries that could
reasonably be anticipated to form the basis of an Environmental Claim
against the Company or its subsidiaries. "Environmental Law" means any
United States (or other applicable jurisdiction's) federal, state, local or
municipal statute, law, rule, regulation, ordinance, code, policy or rule
of common law and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to the environment, health, safety or any chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
governmental authority, and "Environmental Claims" means any and all
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigations or proceedings relating in any way to any Environmental Law.
(xxi) Registration Rights. There are no contracts, agreements or
understandings between the Company and any person other than the Selling
Shareholder granting such person the right to require the Company to
include in the Registration Statement any securities (debt or equity) of
the Company owned or to be owned by such person.
(xxii) Disclosure Controls and Procedures; Internal Control over
Financial Reporting. The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e) under
the 1934 Act), and internal control over financial reporting (as such term
is defined in Rule 13a-15(f) under the 1934 Act), as described in Item 9A
of the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2004. The Company's system of internal accounting controls is
sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with U.S. generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. There have been no changes
in the Company's internal control over financial reporting since December
31, 2004, that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.
(xxiii) Compliance with Sarbanes-Oxley Act of 2002. The Company and
its officers and directors are in compliance with applicable effective
provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith (the "Sarbanes-Oxley Act"), and are
actively taking steps to ensure that they will be in compliance with other
applicable provisions of the Sarbanes-Oxley Act upon their effectiveness.
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(xxiv) Absence of Manipulation. Neither the Company nor any affiliate
of the Company has taken, nor will the Company or any affiliate take,
directly or indirectly, any action which is designed to or which has
constituted or which would be expected to cause or result in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares.
(xxv) Taxes. The Company and its subsidiaries have filed all necessary
U.S. federal, state and foreign income tax returns and have paid all taxes
shown by such returns which are due and payable, and any related or similar
assessment, fine or penalty levied against any of them, except in each case
as may be being contested in good faith and by appropriate proceedings. The
Company and its subsidiaries have made adequate charges, accruals and
reserves in the applicable financial statements described in the
Registration Statement and Prospectus in respect of all U.S. federal, state
and foreign income taxes for all periods as to which the tax liability of
the Company or any of its subsidiaries has not been finally determined.
(b) Officer's Certificate. Any certificate signed by any officer of the
Company or any of its subsidiaries and delivered pursuant to the terms of this
Agreement to the Underwriters or to counsel for the Underwriters shall be deemed
a representation and warranty by the Company to the Underwriters as to the
matters covered thereby.
(c) Representations and Warranties by the Selling Shareholder. The Selling
Shareholder represents and warrants to each Underwriter as of the date hereof
and as of the Closing Time and each Date of Delivery (if any) referred to in
Section 2(b) hereof, and agrees with each Underwriter, as follows:
(i) Good Standing of the Selling Shareholder. (A) The Selling
Shareholder has been duly organized and is validly existing as a company in
good standing under the laws of Bermuda; (B) the Selling Shareholder is in
compliance with all laws requiring its qualification to do business as a
foreign corporation, and is in good standing, in all jurisdictions in which
the Selling Shareholder owns or leases properties of a nature, or transacts
business of a type, that would require such qualification, except where the
failure to comply with such laws would not have a material adverse effect
on the condition, financial or otherwise, or on the earnings, business
affairs or business prospects of the Selling Shareholder and its
subsidiaries considered as one enterprise whether or not arising in the
ordinary course of business (a "Selling Shareholder Material Adverse
Effect"); and (C) the Selling Shareholder is not in violation of its
charter or bye-laws or other constituent documents.
(ii) Accurate Disclosure. To the best knowledge of the Selling
Shareholder, the representations and warranties of the Company contained in
Section 1(a) hereof are true and correct; and the appropriate members of
management of the Selling Shareholder have reviewed and are familiar with
the Registration Statement and the Prospectus and, to their best knowledge,
neither the Prospectus nor any amendment or supplement thereto, at the time
the Prospectus or any amendment in any such amendment or supplement will be
issued and at the Closing Time, will include any untrue statement of a
material fact or omits to state a material fact necessary in order to make
the
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statements therein, in the light of the circumstances under which they were
made, not misleading; and the Selling Shareholder is not prompted to sell
the Shares to be sold by the Selling Shareholder hereunder by any
information concerning the Company or any subsidiary of the Company which
is not set forth in the Prospectus.
(iii) Authorization of Agreements. The Selling Shareholder has the
full right, power and authority to enter into this Agreement and to sell,
transfer and deliver the Shares hereunder. Each of the following actions:
(A) the execution and delivery by the Selling Shareholder of this
Agreement;
(B) the performance by the Selling Shareholder of its obligations
under this Agreement and its compliance with such obligations;
(C) the sale and delivery by the Selling Shareholder of the
Shares and the Rights attached to the Shares; and
(D) the consummation of the other transactions contemplated in
this Agreement,
have been duly authorized by all necessary corporate action on the part of
the Selling Shareholder and do not and will not, whether with or without
the giving of notice, the passage of time, or both, conflict with or
constitute a breach of or a default under, or result in the creation or
imposition of any tax, lien, charge or encumbrance upon the Shares pursuant
to, any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, license, lease or other agreement or instrument to which
the Selling Shareholder is a party or which is specifically binding on it
or to which any of the Selling Shareholder's property or assets is subject
(except for such conflicts, breaches, or defaults or liens, charges or
encumbrances that would not result in a Selling Shareholder Material
Adverse Effect), (c) will not result in any violation of the provisions of
the charter, bye-laws or other constituent documents of the Selling
Shareholder, and (d) will not result in any violation of any applicable,
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, within or without the
United States, having jurisdiction over the Selling Shareholder or any of
its properties.
(iv) Direct Holder of Shares; Title to Shares. The Selling Shareholder
has, and at the Closing Time will have, full right, power and authority to
hold, sell, transfer and deliver the Shares pursuant to this Agreement or a
valid security entitlement in respect of such Shares, free and clear of any
lien, charge or encumbrance (including free and clear of any lien, charge
or encumbrance that Citibank International plc and/or its affiliates may
have held with respect to the Shares pursuant to the certain security
agreement dated as of December 22, 2003, as amended).
(v) Delivery of Shares. Upon payment of the purchase price for the
Shares to be sold by such Selling Shareholder pursuant to this Agreement,
delivery of such Shares, as directed by the Underwriters, to Cede & Co.
("Cede") or such other nominee as may be designated by The Depository Trust
Company ("DTC") (unless
12
delivery of such Shares is unnecessary because such Shares are already in
possession of Cede or such other nominee), registration of such Shares in
the name of Cede or such other nominee of DTC (unless registration of such
Shares is unnecessary because such Shares are already registered in the
name of Cede or such other nominee), and the crediting of such Shares on
the books of DTC to securities accounts of the Underwriters (assuming that
neither DTC nor any such Underwriter has notice of any "adverse claim",
within the meaning of Section 8-105 of the New York Uniform Commercial Code
(the "UCC"), to such Shares), (A) DTC shall be a "protected purchaser",
within the meaning of Section 8-303 of the UCC, of such Shares and will
acquire its interest in the Shares (including, without limitation, all
rights that the Selling Shareholder had or has the power to transfer in
such Shares) free and clear of any adverse claim within the meaning of
Section 8-102 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such
Shares and (C) no action (whether framed in conversion, replevin,
constructive trust, equitable lien, or other theory) based on any adverse
claim to such Shares may successfully be asserted against the Underwriters
with respect to such security entitlement; for purposes of this
representation, such Selling Shareholder may assume that when such payment,
delivery (if necessary) and crediting occur, (x) such Shares will have been
registered in the name of Cede or another nominee designated by DTC, in
each case on the Company's share registry in accordance with its memorandum
of association, bye-laws and applicable law, (y) DTC will be registered as
a "clearing corporation", within the meaning of Section 8-102 of the UCC,
and (z) appropriate entries to the accounts of the several Underwriters on
the records of DTC will have been made pursuant to the UCC.
(vi) Absence of Manipulation. The Selling Shareholder has not taken,
and will not take, directly or indirectly, any action which is designed to
result in, or which has constituted, or which might reasonably be expected
to cause or result in, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares.
(vii) Absence of Further Requirements. No consent, approval,
authorization or order of, or registration, qualification or filing of or
with, any court or governmental agency or body (domestic or foreign) is
required for the performance by the Selling Shareholder of its obligations
under this Agreement or the consummation of the transactions contemplated
by this Agreement or otherwise in connection with the valid sale and
delivery by the Selling Shareholder of the Shares except:
(a) such as have been or shall have been obtained or made under the
1933 Act or the 1933 Act Regulations,
(b) such as have been obtained from the Bermuda Monetary Authority
(if any), and
(c) such as may be required under state securities laws in connection
with the purchase and distribution of the Shares and the Rights
by the Underwriters.
13
(viii) No Association with NASD. Neither the Selling Shareholder nor
any of its affiliates directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with, or has any other association with (within the meaning of Article I,
Section 1(dd) of the By-laws of the National Association of Securities
Dealers, Inc. (the "NASD")), any member firm of the NASD.
(d) Officer's Certificates. Any certificate signed by any officer of the
Selling Shareholder and delivered to the Underwriters or to counsel for the
Underwriters pursuant to the terms of this Agreement shall be deemed a
representation and warranty by the Selling Shareholder to each Underwriter as to
the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Shares. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Selling Shareholder agrees to sell to each Underwriter, and each Underwriter,
severally and not jointly, agrees to purchase from the Selling Shareholder, at
the price per share set forth in Schedule B, the number of Initial Shares set
forth in Schedule A opposite the name of such Underwriter, plus any additional
number of Initial Shares which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof, subject, in each case, to such
adjustments among the Underwriters as Citigroup in its sole discretion shall
make to eliminate any sales or purchases of fractional securities.
(b) Option Shares. In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Selling Shareholder hereby grants an option to the Underwriters,
severally and not jointly, to purchase up to an additional 1,291,735 Option
Shares, at the price per share set forth in Schedule B, less an amount per share
equal to any dividends or distributions declared by the Company and payable on
the Initial Shares but not payable on the Option Shares. The option hereby
granted will expire 30 days after the date hereof and may be exercised in whole
or in part from time to time only for the purpose of covering overallotments
which may be made in connection with the offering and distribution of the
Initial Shares upon notice by Citigroup to the Selling Shareholder setting forth
the number of Option Shares as to which the several Underwriters are then
exercising the option and the time and date of payment and delivery for such
Option Shares. Any such time and date of delivery (a "Date of Delivery") shall
be determined by Citigroup, but shall not be later than seven full business days
after the exercise of said option, nor in any event prior to the Closing Time,
as hereinafter defined. If the option is exercised as to all or any portion of
the Option Shares, each of the Underwriters, acting severally and not jointly,
will purchase that proportion of the total number of Option Shares then being
purchased which the number of Initial Shares set forth in Schedule A opposite
the name of such Underwriter bears to the total number of Initial Shares,
subject in each case to such adjustments as Citigroup in its discretion shall
make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of the Shares
for, the Initial Shares shall be made at the offices of Shearman & Sterling LLP,
599 Lexington Avenue, New York, New York, 10022, or at such other place as shall
be agreed upon by the Underwriters and the Selling Shareholder, at 9:00 A.M.
(Eastern time) on the third (fourth, if the pricing occurs
14
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Underwriters and the Selling Shareholder (such time of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Shares are
purchased by the Underwriters, payment of the purchase price for, and delivery
of such Option Shares shall be made at the above-mentioned offices, or at such
other place as shall be agreed upon by the Underwriters and the Selling
Shareholder, on each Date of Delivery as specified in the notice from the
Underwriters to the Selling Shareholder.
Payment shall be made to the Selling Shareholder by wire transfer of
immediately available funds to bank accounts designated by the Selling
Shareholder against delivery to the Underwriters for the respective accounts of
the Underwriters of the Shares to be purchased by them. It is understood that
each Underwriter has authorized Citigroup, for its account, to accept delivery
of, receipt for, and make payment of the purchase price for, the Initial Shares
and the Option Shares, if any, which it has agreed to purchase. Citigroup,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Initial Shares or
the Option Shares, if any, to be purchased by any Underwriter whose funds have
not been received by the Closing Time or the relevant Date of Delivery, as the
case may be, but such payment shall not relieve such Underwriter from its
obligations hereunder.
(d) Denominations; Registration. The Initial Shares and the Option Shares,
if any, shall be in such denominations and registered in such names as the
Underwriters may request in writing at least one full business day before the
Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company and the Selling Shareholder. The
Company and the Selling Shareholder covenant, jointly and severally, with each
Underwriter as follows:
(a) The Company will advise you immediately and confirm such advice in
writing:
(i) of the Company's intention to amend or supplement the Registration
Statement or the Prospectus (either by filing any report pursuant to
Section 13(a) of the 1934 Act, or otherwise), and the Company will furnish
you with copies of any such amendment or supplement a reasonable time in
advance of filing, and will not file such amendment or supplement
(including any document incorporated by reference into the Registration
Statement or the Prospectus) without your consent, which consent shall not
be unreasonably withheld; provided, however, that neither your consent to,
nor the Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 5; and
before such filing the Company will make available to you for consultation
appropriate personnel of the Company so as to permit you to conduct due
diligence with respect to such filing;
(ii) of the receipt of any comments from the Commission with respect
to the Registration Statement or the Prospectus, or the request by the
Commission for any
15
amendment to the Registration Statement or any supplement to the Prospectus
or for additional information relating to the Registration Statement or the
Prospectus or any document incorporated by reference into the Prospectus;
(iii) of the filing or effectiveness of the Registration Statement,
the Prospectus or any amendment or supplement thereto; and
(iv) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement, or of the suspension of
the qualification of the Shares for offering or sale in any jurisdiction or
the institution or threat of any proceeding for any such purposes. The
Company will use its best efforts to prevent the issuance of any such order
or of any order suspending such qualification and to obtain its lifting at
the earliest possible moment, if issued.
(b) Immediately following the execution of this Agreement, the Company will
prepare a Prospectus Supplement that complies with the 1933 Act and the 1933 Act
Regulations and which sets forth the terms of the public offering of the Shares
not otherwise specified in the basic prospectus or the Registration Statement,
the name of each Underwriter participating in the offering and the amount of
Shares that each severally has agreed to purchase, the name of each Underwriter,
if any, acting as representative of the Underwriters in connection with the
offering, the price at which the Shares are to be purchased by the Underwriters
from the Company, any initial public offering price, any selling concession and
reallowance, and such other information as you and the Company deem appropriate
in connection with the offering of the Shares. The Company will promptly
transmit copies of the Prospectus Supplement and the basic prospectus to the
Commission for filing pursuant to Rule 424(b) under the Securities Act and will
furnish to the Underwriters as many copies of such prospectus supplement and the
basic prospectus as you shall reasonably request. Additionally, the Company will
furnish to the Underwriters such copies of all amendments or supplements to the
Prospectus, in each case as soon as available and in such quantities as the
Underwriters may reasonably request.
(c) If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with offers or sales of the Shares, any event shall
occur or condition exist as a result of which it is necessary, in the reasonable
opinion of counsel for the Company, to amend or supplement the Prospectus so
that it will not include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the reasonable opinion
of such counsel, at any such time to amend or supplement the Registration
Statement or the Prospectus in order to comply with the requirements of the 1933
Act or the rules of the Commission, the Company will give you immediate notice
to cease the sale of the Shares, and the Company will, subject to subsection
3(a)(i), promptly prepare and file with the Commission, at the Company's
expense, such amendment or supplement, whether by filing documents pursuant to
the 1934 Act, the 1933 Act or otherwise, as may be necessary to correct such
untrue statement or omission or to make the Registration Statement comply with
such requirements.
16
(d) The Company will make generally available to its security holders an
earnings statement that satisfies the provisions of Section 11(a) of the 1933
Act and Rule 158 under the 1933 Act.
(e) Until this Agreement is terminated, or the option granted in paragraph
2(b) of this Agreement has expired, the Company will furnish to the
Underwriters, as soon as available, (i) a copy of its annual report to
shareholders, (ii) a copy of each other document mailed by the Company to its
shareholders, (iii) each press release or announcement issued by the Company,
and (iv) from time to time, such other information concerning the Company and
its subsidiaries as the Underwriters may reasonably request.
(f) The Company and the Selling Shareholder will cooperate with the
Underwriters in qualifying the Shares, including the Rights associated
therewith, for offering and sale under the laws of such jurisdictions as the
Underwriters shall reasonably designate and will cooperate with the Underwriters
in continuing such qualifications in effect so long as required for the
distribution by the Underwriters of such Shares and Rights in such
jurisdictions; provided that in connection with such qualification, the Company
will not be required to qualify as a foreign corporation or a securities dealer
in any jurisdiction, or to consent to the service of process under the laws of
any jurisdiction (except service of process with respect to the offering and
sale of the Shares) or to take any action which would or could subject the
Company to taxation in any jurisdiction where it is not now so subject. The
Company will execute such statements and reports which the Underwriters or its
counsel prepare as may be required by the laws of each jurisdiction in which the
Shares and Rights are being qualified. The Company will also supply the
Underwriters with such information for determining the legality of the Shares
and Rights for investment under the laws of such jurisdictions as the
Underwriters may reasonably request.
(g) For a period of 90 days from the date of this Agreement, the Company
and the Selling Shareholder will not, without the prior written consent of
Citigroup, directly or indirectly offer, pledge, sell or contract to sell any
Class A Shares or any of the Company's class B common shares, par value $.01
each (the "Class B Shares"); sell any option or contract to purchase any Class A
or Class B Shares; purchase any option or contract to sell any Class A or Class
B Shares; grant any option, right or warrant for the sale of any Class A or
Class B Shares; lend or otherwise dispose of or transfer any Class A or Class B
Shares; file a registration statement or amendment thereto under the Securities
Act for the Class A or Class B Shares, except for a post-effective amendment to
the Company's registration statement on Form S-3, Registration No. 333-102576;
or enter into any swap or other agreement or any transaction that transfers, in
whole or in part, directly or indirectly, the economic consequence of ownership
of any Class A or Class B Shares, whether any such swap or transaction is to be
settled by delivery of shares or other securities, in cash or otherwise. The
foregoing sentence shall not apply to (i) Class A Shares issuable upon the
exercise of employee stock options granted in the normal course of the Company's
business, (ii) Class A Shares issuable upon conversion of the Company's
outstanding Class B Shares and preferred shares, and (iii) any sale by Citibank
International plc of the Class A and Class B Shares pledged to Citibank by the
Selling Shareholder, as described in the Prospectus under the caption
"Beneficial Ownership of Class A and Class B Common Shares." Notwithstanding the
foregoing, if: (A) during the last 17 days of the 90-day lock-up period, the
Company issues an earnings release or material news or a material event relating
to the Company occurs, or (B) prior to the expiration of the 90-day lock-up
period,
17
the Company announces that it will release earnings results or becomes aware
that material news or a material event will occur during the 16-day period
beginning on the last day of the 90-day lock-up period, then the restrictions
imposed by this paragraph 3(g) shall continue to apply until the expiration of
the 18-day period beginning on the date of issuance of the earnings release or
the occurrence of the material news or material event, as applicable, unless
Citigroup waives, in writing, such extension.
The Selling Shareholder hereby acknowledges and agrees that written notice of
any extension of the 90-day lock-up period pursuant to the previous paragraph
will be delivered by the Underwriters to the Company (in accordance with Section
12 hereof) and that any such notice properly delivered will be deemed to have
been given to, and received by, the Selling Shareholder. The Selling Shareholder
further agrees that, prior to engaging in any transaction or taking any other
action that is subject to the terms of the above paragraph during the period
from the date of this Agreement to and including the 34th day following the
expiration of the initial 90-day lock-up period, it will give notice thereof to
the Company, and will not consummate such transaction or take any such action,
unless it has received written confirmation from the Company that the 90-day
lock-up period (as may have been extended pursuant to the previous paragraph)
has expired.
(h) At any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Shares, if the Company releases to the
general public quarterly financial statement information of the Company, interim
financial statement information with respect to any unanticipated charge or gain
or, upon your request, any other interim financial statement information related
to the Company with respect to each of the first three quarters of any fiscal
year, or preliminary financial statement information with respect to any fiscal
year, the Company will promptly thereafter file with or furnish to the
Commission a Form 8-K Report under the 1934 Act, as required by Item 2.02 of the
said form, that includes (or the Company shall, subject to subsection 3(a)(i),
otherwise cause the Registration Statement to be amended and the Prospectus to
be supplemented to include or incorporate by reference) such financial statement
information and, if and to the extent the Company deems it relevant,
corresponding information for the comparable period of the preceding fiscal
year.
(i) At any time when a prospectus is required to be delivered under the
1933 Act in connection with sales of the Shares, the Company (i) will file with
or furnish to the Commission promptly and within the time periods required by
the 1934 Act and the 1934 Act Regulations all documents required to be filed or
furnished, as applicable, under the 1934 Act by it with the Commission, and (ii)
will obtain the written consent of the Company's independent registered public
accounting firm for the incorporation by reference in the Registration Statement
of their reports on the audited financial statements contained in the Company's
annual reports on Form 10-K under the 1934 Act.
SECTION 4. Payment of Expenses.
(a) Expenses of the Selling Shareholder. The Selling Shareholder will pay
all expenses incident to the performance of its and the Company's obligations
under this Agreement, and the sale of the Shares pursuant to this Agreement,
including (i) the costs of the preparation, printing
18
and filing the Registration Statement (including financial statements and
exhibits as well as any documents incorporated by reference therein) as
originally filed and of each amendment thereto, (ii) the costs of the printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale, or delivery of the Shares, (iii) any stock or other
transfer taxes and any stamp or other duties payable upon the sale, or delivery
to the Underwriters of the Shares being sold by the Selling Shareholder, (iv)
the fees and disbursements of its and the Company's counsel, accountants and
other advisors, (v) the filing fees incident to any filings under state
securities laws, and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such filings, (vi) the printing and delivery to
the Underwriters of copies of each preliminary prospectus, the Prospectus and
any amendments or supplements thereto, (vii) the costs of the preparation,
printing and delivery to the Underwriters of copies of the Blue Sky Survey and
any supplement thereto, (viii) the fees and expenses of any transfer agent or
registrar for the Class A Shares, (ix) the filing fees incident to, and the
reasonable fees and disbursements of counsel to the Underwriters in connection
with, the review by the NASD of the terms of the sale of the Shares and (x) the
fees and expenses incurred in connection with the listing of the Shares on the
New York Stock Exchange.
(b) Termination of Agreement. If this Agreement is terminated by Citigroup,
acting on behalf of the Underwriters, in accordance with the provisions of
paragraph 5(r) hereof or pursuant to Section 9 hereof, or because of any
refusal, inability or failure on the part of the Company or the Selling
Shareholder to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Underwriters, then the Company
and the Selling Shareholder shall, jointly and severally, reimburse the
Underwriters through Citigroup on demand for all of their out-of-pocket
expenses, including reasonable fees and disbursement of counsel for the
Underwriters, that shall have been incurred by them in connection with the
proposed purchase and sale of the Shares.
(c) Allocation of Expenses. The provisions of this Section shall not affect
any agreement that the Company and the Selling Shareholder may make for the
sharing of the costs and expenses of the offer and sale of the Shares.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to (1) the accuracy, as of the
Closing Time and each Date of Delivery, of the representations and warranties of
the Company and the Selling Shareholder contained in Section 1 hereof, or in
certificates of any officer of the Company or any subsidiary of the Company or
the Selling Shareholder delivered pursuant to the provisions hereof, (2) the
performance by the Company and the Selling Shareholder of their respective
covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement has become effective, and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or threatened
by the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. The Prospectus shall have been
filed with the Commission in accordance with Rule 424(b).
19
(b) Opinion of U.S. Counsel for the Company. At Closing Time, the
Underwriters shall have received the opinion, dated as of the date of
Closing Time, of Carter Ledyard & Milburn LLP, U.S. counsel for the
Company, in form and substance reasonably satisfactory to counsel for the
Underwriters to the effect set forth in Exhibit A-1 hereto.
(c) Opinion of Bermuda Counsel for the Company. At Closing Time, the
Underwriters shall have received the opinion, dated as of the date of
Closing Time, of Appleby Spurling Hunter, Bermuda counsel for the Company,
in form and substance reasonably satisfactory to counsel for the
Underwriters to the effect set forth in Exhibit A-2 hereto.
(d) Opinion of Edwin S. Hetherington. At Closing Time, the
Underwriters shall have received the opinion, dated as of the date of
Closing Time, of Edwin S. Hetherington, Secretary of the Company and Vice
President, General Counsel and Secretary of the Selling Shareholder, in
form and substance reasonably satisfactory to counsel for the Underwriters,
to the effect set forth in Exhibit A-3 hereto.
(e) Opinion of U.S. Counsel for the Selling Shareholder. At Closing
Time, the Underwriters shall have received the opinion, dated as of the
date of Closing Time, of Carter, Ledyard & Milburn LLP, U.S. counsel for
the Selling Shareholder, in form and substance reasonably satisfactory to
counsel for the Underwriters, to the effect set forth in Exhibit A-4
hereto.
(f) Opinion of Bermuda Counsel for the Selling Shareholder. At Closing
Time, the Underwriters shall have received the opinion, dated as of the
date of Closing Time, of Appleby Spurling Hunter, Bermuda counsel for the
Selling Shareholder, in form and substance reasonably satisfactory to
counsel for the Underwriters, to the effect set forth in Exhibit A-5
hereto.
(g) Opinion of Counsel for Underwriters. At Closing Time, the
Underwriters shall have received the opinion, dated as of the date of
Closing Time, of Shearman & Sterling LLP, counsel for the Underwriters. In
giving such opinion, such counsel may rely, as to all matters governed by
laws other than the laws of the State of New York, the federal law of the
United States and the General Corporation Law and Limited Liability Company
Act of the State of Delaware, upon the opinions of counsel reasonably
satisfactory to the Underwriters. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent
they deem proper, upon certificates of officers of the Company and its
subsidiaries, the Selling Shareholder and public officials.
(h) Officer's Certificate of the Company. At Closing Time, there shall
not have been, since the date hereof, any Material Adverse Change, and the
Underwriters shall have received a certificate of the Chairman, President
or any Vice President of the Company, dated as of the date of Closing Time,
to the effect that (i) there has been no such Material Adverse Change, (ii)
the representations and warranties in Section 1(a) hereof are true and
correct in all respects with the same force and effect as though expressly
made at and as of Closing Time, (iii) the Company has complied with all
20
agreements and satisfied all conditions on its part to be performed or
satisfied under the this Agreement at or prior to Closing Time, and (iv) no
stop order suspending the effectiveness of the Registration Statement or
the qualification of the Shares for offer or sale in any jurisdiction has
been issued, and no proceedings for that purpose have been initiated or are
pending or, to such person's knowledge, are threatened.
(i) Officer's Certificate of the Selling Shareholder. At Closing Time,
the Underwriters shall have received a certificate of the President or any
Vice President of the Selling Shareholder, dated as of the date of Closing
Time, to the effect that (i) the representations and warranties of the
Selling Shareholder contained in paragraph 1(b) hereof are true and correct
in all respects with the same force and effect as though expressly made at
and as of Closing Time and (ii) the Selling Shareholder has complied in all
material respects with all its covenants in this Agreement, and satisfied
all conditions hereunder on its part to be performed or satisfied under
this Agreement at or prior to Closing Time.
(j) Accountants' Comfort Letter. On the date of this Agreement, the
Underwriters shall have received from Deloitte & Touche LLP a letter dated
such date, in form and substance reasonably satisfactory to the
Underwriters, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(k) Bring-down Comfort Letter. At Closing Time, the Underwriters shall
have received from Deloitte & Touche LLP a letter, dated as of the date of
Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to paragraph (j) of this Section 5, except that
the specified date referred to shall be a date not more than three business
days prior to the date of Closing Time.
(l) Approval of Listing. At Closing Time, the Class A Shares
(including the Shares) shall be listed on the New York Stock Exchange.
(m) No Objection. If required, the NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness of the
underwriting compensation.
(n) Lock-up Agreements. At the date of this Agreement, the
Underwriters shall have received agreements substantially in the form of
Exhibit B hereto signed by the persons listed on Schedule C hereto.
(o) Release of Shares. The Selling Shareholder shall have received a
letter or certificate from Citibank International plc and/or its affiliates
evidencing the release of the Shares from any pledges, liens, encumbrances
or similar instruments that Citibank International plc and/or its
affiliates may have held with respect to the Shares pursuant to the certain
security agreement dated as of December 22, 2003, as amended.
(p) Conditions to Purchase of Option Shares. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the
21
Option Shares, the representations and warranties of the Company and the
Selling Shareholder contained in Section 1 hereof, and the statements in
any certificates furnished by the Company and the Selling Shareholder, any
subsidiary of the Company hereunder shall be true and correct as of each
Date of Delivery and, at the relevant Date of Delivery, the Underwriters
shall have received:
(i) Officer's Certificate of the Company and the Selling
Shareholder. A certificate, dated such Date of Delivery, of the
Chairman, President or any Vice President of the Company and the
President or any Vice President of the Selling Shareholder either (A)
confirming that the certificates delivered at Closing Time pursuant to
paragraphs 5(h) and 5(i) hereof by the Company and the Selling
Shareholder, respectively, remain true and correct as of such Date of
Delivery, or (B) to the same effect as the certificates required by
paragraphs 5(h) and 5(i).
(ii) Opinions of Counsel for Company and the Selling Shareholder.
The opinions of Carter Ledyard & Milburn LLP, Appleby Spurling Hunter
and Edwin S. Hetherington, each in form reasonably satisfactory to
counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Shares to be purchased on such Date of Delivery and
otherwise to the same effect as the opinions required by paragraphs
5(b), (c), (d), (e) and (f) hereof.
(iii) Opinion of Counsel for Underwriters. The opinion of
Shearman & Sterling LLP, counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Shares to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion
required by paragraph 5(g) hereof.
(iv) Bring-down Comfort Letter. A letter from Deloitte & Touche
LLP in form and substance reasonably satisfactory to the Underwriters
and dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the Underwriters pursuant to
paragraph 5(k) hereof, except that the specified date in the letter
furnished pursuant to this paragraph shall be a date not more than
five days prior to such Date of Delivery.
(q) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
other documents as they may reasonably require for the purpose of enabling
them to pass upon the sale of the Shares as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions herein contained; and all
proceedings taken by the Company and the Selling Shareholder in connection
with the sale of the Shares as herein contemplated shall be reasonably
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters.
(r) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement, or, in the case of any condition to the purchase of Option
Shares on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Shares, may be terminated by Citigroup, acting on behalf the
22
Underwriters, in its absolute discretion, by notice to the Company and the
Selling Shareholder at any time at or prior to Closing Time or such Date of
Delivery, as the case may be, and such termination shall be without
liability of any party to any other party except as provided in Section 4
and except that Sections 1, 6, 7 and 8 shall survive any such termination
and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. (1) The Company and the Selling
Shareholder, jointly and severally, agree to indemnify and hold harmless each
Underwriter, its affiliates, as such term is defined in Rule 405 under the 1933
Act (each, an "Affiliate"), its selling agents and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act to the extent and manner set forth in clauses (i),
(ii) and (iii) below as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A information, if
applicable, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading, or arising out of any untrue statement or alleged
untrue statement of a material fact included in any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto), or the omission
or alleged omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company and the Selling Shareholder; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Citigroup), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity, as to any preliminary prospectus, shall
not inure to the benefit of any person on account of any loss, liability, claim,
damage, or expense arising from the sale of the Shares to any person by the
Underwriters if the Underwriters failed to send or give a copy of any subsequent
preliminary prospectus or the Prospectus to such person within the time required
by the 1933 Act, and the untrue statement or alleged untrue statement or mission
or alleged omission of a material fact in such preliminary prospectus was
corrected in the
23
subsequent preliminary prospectus or the Prospectus, unless such failure
resulted from noncompliance by the Company with Section 3(c) hereof; and
provided further, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Underwriters expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A information, if
applicable, or any preliminary prospectus, or the Prospectus (or any amendment
or supplement thereto) (the "Furnished Information"). The Underwriters will
deliver to the Company at Closing Time a certificate identifying the location of
all Furnished Information in the Prospectus.
(b) Indemnification of Company, the Selling Shareholder and Others. Each
Underwriter severally agrees to indemnify and hold harmless the Company, the
Selling Shareholder, the Company's directors, each of its officers who signed
the Registration Statement, and each person, if any, who controls the Company or
the Selling Shareholder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, against any and all loss, liability, claim, damage
and expense described in the indemnity contained in paragraph (a) of this
Section 6, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto) or any preliminary prospectus, or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with the
Furnished Information.
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this Section 6
indemnity agreement. In the case of parties indemnified pursuant to paragraph
6(a) above, counsel to the indemnified parties shall be selected by Citigroup
and, in the case of parties indemnified pursuant to paragraph 6(b) above,
counsel to the indemnified parties shall be selected by the Company and the
Selling Shareholder. An indemnifying party may participate at its own expense in
the defense of any such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party)
also be counsel to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to
any local counsel) separate from their own counsel for all indemnified parties
in connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
24
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
subsection 6(a)(iii) effected without its written consent if (i) such settlement
is entered into more than 45 days after receipt by such indemnifying party of
the aforesaid request, (ii) such indemnifying party shall have received notice
of the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(e) Other Agreements with Respect to Indemnification. The provisions of
this Section shall not affect any agreement between the Company and the Selling
Shareholder with respect to indemnification; provided, however, that the Company
and the Selling Shareholder agree, represent and warrant that no such agreement
will conflict with the respective obligations of the Company and the Selling
Shareholder under this Agreement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Selling Shareholder
on the one hand and the Underwriters on the other hand from the offering of the
Shares pursuant to this Agreement or (ii) if the allocation provided by clause
(i) is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company and the Selling Shareholder on the one hand
and of the Underwriters on the other hand in connection with the statements or
omissions, which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Selling Shareholder on the one hand
and the Underwriters on the other hand in connection with the offering of the
Shares pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Shares pursuant
to this Agreement (before deducting expenses) received by the Selling
Shareholder and the total underwriting discount received by the Underwriters, in
each case as set forth on the cover of the Prospectus bear to the aggregate
initial public offering price of the Shares as set forth on such cover.
The relative fault of the Company and the Selling Shareholder on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Shareholder or by the
Underwriters, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company, the Selling Shareholder and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other
25
method of allocation which does not take account of the equitable considerations
referred to above in this Section 7. The aggregate amount of losses,
liabilities, claims, damages and expenses incurred by an indemnified party and
referred to above in this Section 7 shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission.
Notwithstanding the provisions of this Section, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of any such untrue or alleged
untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and each Underwriter's Affiliates and selling agents shall have the
same rights to contribution as such Underwriter, and each director of the
Company or the Selling Shareholder, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or the
Selling Shareholder within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company or
the Selling Shareholder, as the case may be. The Underwriters' respective
obligations to contribute pursuant to this Section are several in proportion to
the number of Initial Shares set forth opposite their respective names in
Schedule A hereto, and not joint.
The provisions of this Section shall not affect any agreement between the
Company and the Selling Shareholder with respect to contribution; provided,
however, that the Company and the Selling Shareholder agree, represent and
warrant that no such agreement will conflict with the respective obligations of
the Company and the Selling Shareholder under this Agreement.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries or of the
Selling Shareholder submitted pursuant hereto shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of any
Underwriter or its Affiliates or selling agents, any person controlling any
Underwriter, or by or on behalf of the Company or the Selling Shareholder, and
shall survive the delivery of the Shares to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. Citigroup may, in its absolute discretion,
terminate this Agreement, by notice to the Company and the Selling Shareholder,
at any time at or prior to Closing Time (i) if there has been, since the time of
execution of this Agreement or since the
26
respective dates as of which information is given in the Prospectus (exclusive
of any supplement thereto), any Material Adverse Change, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make it,
in the sole judgment of Citigroup, impracticable or inadvisable to market the
Shares or to enforce contracts for the sale of the Shares, or (iii) if trading
in any securities of the Company has been suspended or materially limited by the
Commission or New York Stock Exchange, or if trading generally on the American
Stock Exchange or the New York Stock Exchange or in the Nasdaq National Market
has been suspended or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by any
of said exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, or (v) if a banking
moratorium has been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section
9, such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Shares which it or they are obligated to purchase under this Agreement (the
"Defaulted Shares"), the other Underwriters shall have the right, within 24
hours thereafter, to make arrangements for the non-defaulting Underwriter, or
any other underwriters, to purchase all, but not less than all, of the Defaulted
Shares in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Underwriters shall not have completed such arrangements
within such 24-hour period, then:
(a) if the aggregate number of Defaulted Shares does not exceed 10% of
the aggregate number of Shares to be purchased on such date, the
non-defaulting Underwriter shall be obligated, each severally and not
jointly, to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the aggregate number of Defaulted Shares exceeds 10% of the
aggregate number of Shares to be purchased on such date, this Agreement or,
with respect to any Date of Delivery which occurs after Closing Time, the
obligation of the Underwriters to purchase and of the Company and the
Selling Shareholder to sell the Option Shares to be purchased and sold on
such Date of Delivery, shall terminate without liability on the part of the
non-defaulting Underwriters.
No action taken pursuant to this Section 10 shall relieve any defaulting
Underwriter from liability in respect of its default.
27
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Selling Shareholder to sell the relevant Option
Shares, as the case may be, either (i) the non-defaulting Underwriters or (ii)
the Selling Shareholder shall have the right to postpone Closing Time or the
relevant Date of Delivery, as the case may be, for a period not exceeding seven
days in order to effect any required changes in the Registration Statement or
Prospectus or in any other documents or arrangements. As used herein, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section.
SECTION 11. Default by the Selling Shareholder. If the Selling Shareholder
shall fail at Closing Time to sell and deliver the number of Shares which the
Selling Shareholder is obligated to sell hereunder, then the Underwriters may,
at the option of the Underwriters, by notice from the Underwriters to the
Company, terminate this Agreement without any liability on the part of any
non-defaulting party except that the provisions of Sections 1, 4, 6, 7 and 8
shall survive such termination and remain in full force and effect. No action
taken pursuant to this Section shall relieve the Selling Shareholder so
defaulting from liability in respect of such default.
In the event of a default by the Selling Shareholder as referred to in this
Section, the Underwriters and the Company shall have the right to postpone
Closing Time for a period not exceeding seven days in order to effect any
required change in the Registration Statement or Prospectus or in any other
documents or arrangements.
SECTION 12. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by fax or any other standard form of telecommunication. Notices to
the Underwriters shall be directed to c/o Citigroup Global Markets Inc., 388
Greenwich Street, New York, New York 10013 Attention: General Counsel (fax:
212-816-7912). Notices to the Company and the Selling Shareholder shall be
directed to Orient- Express Hotels Ltd. at 22 Victoria Street, Hamilton HM 12,
Bermuda, attention of the Secretary (fax: (809) 292-8666), with copies to
Orient-Express Hotels Inc., 1114 Avenue of the Americas, New York, New York
10036, attention of John T. Landry, Jr., Esq. (fax (212) 302-5199); to
Orient-Express Services Ltd., Sea Containers House, 20 Upper Ground, London SE1
9PF, England, attention of Edwin S. Hetherington, Esq. (fax
011-44-207-805-5916); and to Vincent Monte-Sano, Esq., Carter Ledyard & Milburn
LLP, 2 Wall Street, New York, New York 10005 (fax: (212) 732-3232).
SECTION 13. Parties. This Agreement shall inure to the benefit of and be
binding upon the Underwriters, the Company, the Selling Shareholder and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company, the Selling Shareholder and their respective
successors, and the controlling persons and officers and directors referred to
in Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company, the Selling Shareholder and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of
28
Shares from any Underwriter shall be deemed to be a successor by reason merely
of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings herein and
the Table of Contents are for convenience only and shall not affect the
construction hereof.
SECTION 16. Submission to Jurisdiction. Any legal action or proceeding with
respect to this Agreement, the Shares or any document related thereto may be
brought in the courts of the State of New York in the County of New York or the
United States District Court for the Southern District of New York and, by
execution and delivery of this Agreement, the Company and the Selling
Shareholder each hereby accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid courts in any
such legal action or proceeding. The parties hereto hereby irrevocably waive
trial by jury, and the Company and the Selling Shareholder each hereby
irrevocably waives any objection, including, without limitation, any objection
to the laying of venue or based on the grounds of forum non conveniens, which it
may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions. The Company and the Selling Shareholder each
hereby irrevocably designates Orient-Express Hotels Inc. and Corporation Service
Company as the designee, appointee and agent of the Company and the Selling
Shareholder to receive, for and on behalf of the Company, and the Selling
Shareholder service of process in such respective jurisdictions in any legal
action or proceeding with respect to this Agreement, the Shares or any document
related thereto. It is understood that a copy of such process served on either
such agent will be promptly forwarded to the Company and the Selling Shareholder
at their respective addresses set forth in Section 12, but the failure of the
Company or the Selling Shareholder to receive such copy will not affect in any
way the service of such process. In addition to service on the Company's and the
Selling Shareholder's process agent, the Company and the Selling Shareholder
each further irrevocably consents to the service of process of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to the Company and the
Selling Shareholder at their respective said address, such service to become
effective 10 days after such mailing. Nothing herein will affect your right or
the right of any holder of Shares to serve process in any other manner permitted
by law or to commence legal proceedings or otherwise proceed against the Company
and the Selling Shareholder in any other jurisdiction.
SECTION 17. No Fiduciary Duty. The Company and the Selling Shareholder
hereby acknowledge that (a) Citigroup and the other Underwriters are acting as
principal and not as an agent or fiduciary of the Company and the Selling
Shareholder and (b) their engagement of Citigroup and the other Underwriters in
connection with the offering of the Shares is as independent contractors and not
in any other capacity. Furthermore, each of the Company and the Selling
Shareholder agrees that it is solely responsible for making its own judgments in
connection with the offering of the Shares (irrespective of whether Citigroup or
any other
29
Underwriter has advised or is currently advising the Company or the Selling
Shareholder on related or other matters).
[SIGNATURE PAGE FOLLOWS]
30
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Selling Shareholder a
counterpart hereof, whereupon this instrument, along with all counterparts, will
become a binding agreement among the Underwriters, the Company and the Selling
Shareholder in accordance with its terms.
Very truly yours,
ORIENT-EXPRESS HOTELS LTD.
By:/s/Simon M.C. Sherwood
----------------------
Name: Simon M.C. Sherwood
Title: President
SEA CONTAINERS LTD.
By:/s/Ian Durant
-------------
Name: Ian Durant
Title: Senior Vice President
and Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
CITIGROUP GLOBAL MARKETS INC.
By:/s/Scott Eisen
--------------
Name:Scott Eisen
Title:Director
On behalf of itself and the other Underwriters
SCHEDULE A
Number of
Initial
Name of Underwriter Shares
- ------------------- ------
Citigroup Global Markets Inc....................................... 6,028,096
Merrill Lynch, Pierce, Fenner & Smith
Incorporated ................................. 2,152,891
Scotia Capital (USA) Inc........................................... 430,578
---------
Total.............................................................. 8,611,565
Sch A-1
SCHEDULE B
Orient-Express Hotels Ltd.
8,611,565 Class A Common Shares
(Par Value $.01 Each)
1. The public offering price per share, for the Shares, determined as
provided in Section 2, shall be $32.00.
2. The purchase price per share for the Shares to be paid by the several
Underwriters shall be $30.48, being an amount equal to the initial public
offering price set forth above less $1.52 per share; provided that the purchase
price per share for any Option Shares purchased upon the exercise of the
overallotment option described in Section 2(b) shall be reduced by an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial Shares but not payable on the Option Shares.
Sch B-1
SCHEDULE C
List of persons subject to lock-up under paragraph 5(n) in the form of
Exhibit B
1. Simon M. C. Sherwood
2. James B. Sherwood
Sch C-1
Exhibit A-1
FORM OF OPINION OF CARTER LEDYARD & MILBURN LLP
TO BE DELIVERED PURSUANT TO PARAGRAPH 5(b)
November 23, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Re: Orient-Express Hotels Ltd.
Public Offering of Class A Common Shares
----------------------------------------
Ladies and Gentlemen:
We have acted as counsel to Orient-Express Hotels Ltd., a Bermuda company
("OEH"), in connection with the execution and delivery of the Underwriting
Agreement dated November [ ], 2005 (the "Underwriting Agreement"), among OEH,
Sea Containers Ltd., a Bermuda company ("Sea Containers"), and the several
underwriters addressed above (the "Underwriters"). The Underwriting Agreement
relates to the sale by Sea Containers of up to 9,903,300 shares (the "Shares")
of the class A common shares, par value $.01 each, of OEH (the "Class A
Shares"). The Shares include up to 1,291,735 Class A Shares to cover
overallotments. Unless otherwise defined herein, all capitalized terms herein
are as defined in the Underwriting Agreement.
This opinion is being delivered to you pursuant to paragraph 5(b) of the
Underwriting Agreement in connection with the purchase by the Underwriters of
8,611,565 of the Shares pursuant to paragraph 2(a) of the Underwriting Agreement
(the "Initial Shares"). As a basis for the opinions expressed herein, we have
examined copies of the Registration Statement and the Prospectus, and originals,
or copies certified or otherwise identified to our satisfaction, of such
A-1-1
other agreements and certificates and statements of governmental officials, as
we have deemed necessary. In such examination, we have assumed the genuineness
of all signatures, the authenticity of all documents submitted to us as
originals, and the conformity with the originals (and the authenticity of such
originals) of all documents submitted to us as copies. We have, when relevant
facts material to our opinion were not independently established by us, relied
to the extent we deemed such reliance proper, upon written or oral statements of
officers and other representatives of OEH.
Based on the foregoing and subject to the qualifications set forth below,
it is our opinion that:
1. Orient-Express Hotels Inc. has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, and each of Charleston Center LLC and Windsor Court Hotel LLC has been
duly formed and is validly existing as a limited liability company in good
standing under the laws of the State of Delaware.
2. To the best of our knowledge, except as may be described in the
Prospectus, there are no legal or governmental proceedings pending or threatened
in the United States to which OEH or any of its subsidiaries is a party or to
which any of its or their properties is subject and which are required to be
described in the Registration Statement or the Prospectus pursuant to Item 103
("Legal Proceedings") of Regulation S-K.
3. (a) The execution and delivery by OEH of the Underwriting Agreement, (b)
the performance by OEH of its obligations under the Underwriting Agreement, and
its compliance with its obligations thereunder, (c) the consummation of the
offering, sale and delivery by Sea Containers of the Shares and the Rights
associated therewith, and (d) the consummation of the other transactions
contemplated by the Underwriting Agreement specifically referring to OEH,
including the issuance and delivery by OEH of the Preferred Shares issuable upon
the exercise of the Rights (assuming that the Preferred Shares were issued on
the date of this opinion), each do not and will not, whether with or without the
giving of notice, the passage of time, or both, conflict with or constitute a
breach of or default under, result in a breach or violation by OEH of any of the
terms or provisions of, or result in a change of control with respect to OEH or
a default by OEH under, or result in the creation or imposition of any tax,
lien, charge or encumbrance upon any property or assets of OEH or any of its
subsidiaries under, (A) any indenture, mortgage, deed of trust, loan agreement
or any other agreement or instrument listed in Annex A hereto, or (B) any United
States federal or New York statute, rule or regulation, or any decree, judgment
or order, known to us, of any United States federal or New York court or
governmental agency or body specifically applicable to OEH or to any of its
properties, except for such breaches, violations, defaults, liens, charges or
encumbrances that would not have a Material Adverse Effect.
4. No consent, approval, authorization or order of, or registration or
qualification or filing of or with, any United States federal or New York
governmental agency or body or, to the best of our knowledge, any United States
federal or New York court is required for the performance by OEH of its
obligations under the Underwriting Agreement or the consummation of the
transactions contemplated by the Underwriting Agreement, except, in the case of
the Initial Shares and the Rights associated therewith, (a) such as have been
obtained or made under
A-1-2
the Securities Act of 1933, as amended (the "1933 Act"), and (b) such as may be
required under state securities laws in connection with the purchase and
distribution of the Initial Shares by the Underwriters, and except in the case
of the Preferred Shares issuable upon the exercise of the Rights associated with
the Shares, (a) such as may be required under the 1933 Act or the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and (b) such as may be
required under state securities laws in connection with the issuance of the
Preferred Shares upon the exercise of such Rights.
5. The Registration Statement is effective under the 1933 Act and, to the
best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for that purpose have
been initiated or are pending or threatened.
6. Each document incorporated by reference in the Registration Statement
and Prospectus, at the time such document was initially filed with the
Commission, complied as to form in all material respects with the requirements
of the 1934 Act and the rules of the Commission thereunder.
7. The descriptions in the Registration Statement and the Prospectus of
those contracts and other legal documents, United States federal and New York
statutes, and legal and governmental proceedings in the United States that are
listed in Annex B hereto, are accurate summaries in all material respects.
8. The information included in the Prospectus under "Material Tax
Considerations--Material United States Federal Income Tax Considerations"
accurately describes in all material respects the United States federal income
tax consequences that generally will apply to purchasers of Shares under
currently applicable law.
9. To the best of our knowledge, there are no contracts or documents
required to be described in the Registration Statement or Prospectus, or
required to be filed as exhibits to the Registration Statement, or incorporated
by reference in the Registration Statement or the Prospectus, which are not
described or filed or incorporated by reference as required, it being understood
that we express no opinion as to the financial statements and related notes and
schedule or schedules or other financial information and statistical data in the
Registration Statement or the Prospectus.
10. The Class A Shares and the Rights are listed on the New York Stock
Exchange.
11. OEH is eligible to use Form S-3 for the registration under the 1933 Act
of the offer and sale of the Shares as described in the Prospectus. The
Registration Statement, the Prospectus and each amendment or supplement thereto
comply as to form in all material respects with the requirements of the 1933 Act
and the rules of the Commission thereunder.
12. OEH's submission (pursuant to Section 16 of the Underwriting Agreement)
to the personal jurisdiction of the courts of the State of New York in the
County of New York or the United States District Court for the Southern District
of New York with respect to any action or proceeding arising out of, or based
on, the Underwriting Agreement is valid and enforceable against OEH, and OEH's
appointment of Orient-Express Hotels Inc. and Corporation Service Company as its
designee, appointee and agent upon whom process may be served in any such
A-1-3
action or proceeding is also valid and enforceable against OEH. However, the
enforceability of such submission and appointment is subject to, and may be
limited by, (i) bankruptcy, insolvency, liquidation, receivership, moratorium,
reorganization, fraudulent conveyance or other similar laws relating to or
affecting the enforcement of the rights of creditors, (ii) general principles of
equity, and (iii) the discretion of United States federal or New York State
courts with respect to venue, as provided in 28 U.S.C. ss. 1404(a) and New York
CPLR ss. 510, respectively.
13. OEH is not an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company Act of
1940, as amended.
While we have not made any independent investigation of, are not passing
upon and do not assume responsibility for, the accuracy or completeness of the
statements contained in the Registration Statement or the Prospectus (other than
as indicated in paragraphs 7 and 8 above), on the basis of discussions regarding
the business and affairs of OEH and our familiarity with certain matters
relating to such business and affairs as a result of having served as United
States counsel for OEH in connection with previous transactions, nothing has
come to our attention that would lead us to believe that the Registration
Statement (other than the financial statements and notes and other financial and
statistical data included in the Registration Statement, as to which we express
no view), as of the date it was declared effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus (other than the financial statements and notes and other
financial and statistical data included in the Prospectus, as to which we
express no view), at the date of the Prospectus and at all times up to and
including the date of this opinion, contained or contains an untrue statement of
a material fact or omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
No opinion is expressed herein as to any laws other than the laws of the
United States of America and the State of New York, and the General Corporation
Law and Limited Liability Company Act of the State of Delaware. This opinion is
limited to the matters expressly stated herein, and no opinion is implied or may
be inferred beyond the matters expressly stated herein. This opinion may not be
used or relied upon by or published or communicated to any person or entity
other than the Underwriters and their counsel for any purpose whatsoever without
our prior written consent in each instance.
Very truly yours,
VMS/SVB:lrh
A-1-4
ANNEX A
Indentures, Mortgages, Loan Agreements, Etc.
1. Credit Agreement, dated as of September 18, 2002, by and among
Orient-Express Hotels Ltd., Companhia Hoteis Palace, WestLB AG, New York
Branch, and the lenders party thereto from time to time.
2. Loan Agreement, dated as of May 22, 2002, by and among Charleston Center
LLC, as Borrower, Credit Lyonnais New York Branch and Aareal Bank AG, as
Lenders, Credit Lyonnais New York Branch, as Co-Agent and Administrative
Agent for Lenders, and Aareal Bank AG, as Co-Agent for Lenders.
3. Credit Agreement, dated as of August 20, 2003, by and among `21' Club,
Inc., Mountbay Holdings Inc., Keswick Club L.P. as Borrowers, `21' Club
Properties Inc., Inn at Perry Cabin Corporation, Keswick Corporation,
Keswick Hall Inc., Keswick Utilities, Inc., Orient-Express Hotels Inc.,
Orient-Express Hotels Ltd., as Borrower's Parties and Oversea-Chinese
Banking Corporation Limited, New York Agency, as Lender.
4. Loan Agreement, dated as of July 27, 2001, by and among Island Hotel
(Madeira) Limited, Orient-Express Hotels Ltd., the Banks and Financial
Institutions set forth in Schedule 1, and Oversea-Chinese Banking
Corporation Limited, as Agent and Security Trustee.
5. Loan Agreement, dated as of May 1, 2003, by and between Windsor Court Hotel
LLC and Oversea-Chinese Banking Corporation Limited, New York Agency.
6. Cash Advance Project Finance Facility Agreement, dated March 22, 2000, by
and among Clyfire Pty Limited and Merjade Pty Ltd., as Borrowers, each
Company specified as a Guarantor in Schedule 1, Westdeutsche Landesbank
Girozentrale, ARBN, as Initial Bank, each Financial Institution specified
as a Bank in Schedule 2, each Financial Institution specified as a Hedge
Counterparty in Schedule 3, Westdeutschebank Landesbank Girozentrale, ARBN,
as Facility Agent, and Westdeutsche Landesbank Girozentrale, ARBN, as
Security Trustee.
7. Loan Agreement, dated April 9, 2003, by and among Commerzbank
Aktiengesellschaft, Sucursal en Madrid, Orient-Express Madrid S.L. and
Orient-Express Spanish Holdings.
8. Agreement for Euro 135 Million Term and Multi-Currency Revolving Credit
Facility, dated July 1, 2003, by and between Orient-Express Hotels Ltd. and
Barclays Bank PLC.
9. Services Agreement, dated as of August 1, 2000, by and among Sea Containers
Ltd., Sea Containers Services Ltd. and Orient-Express Hotels Ltd., as
amended by an Amendment of Services Agreement, dated as of January 1, 2001,
by and among Sea Containers Ltd., Sea Containers Services Ltd. and
Orient-Express Hotels Ltd.
10. Noncompete Agreement, dated August 1, 2000, by and between Sea Containers
Ltd. and Orient-Express Hotels Ltd.
A-1-5
11. Restructuring Agreement, dated as of July 21, 2000, by and among Sea
Containers Ltd., Orient-Express Hotels Ltd., Orient-Express Hotels Inc.,
Orient-Express Properties Inc., Sea Containers UK Ltd., Sea Containers
British Isles Ltd. and Orient-Express Hotels UK Ltd.
12. Orient-Express Hotels Ltd. 2000 Stock Option Plan, dated June 5, 2000.
13. Orient-Express Hotels Ltd. 2004 Stock Option Plan.
14. Contract, dated February 18, 1982, by and between James Blair Sherwood and
Hotel Cipriani S.p.A.
15. Rights Agreement, dated as of June 1, 2000, by and between Orient-Express
Hotels Ltd. and Fleet National Bank, as Rights Agent.
16. Tax Sharing Agreement, dated as of August 1, 2000, by and between Sea
Containers Ltd. and Orient-Express Hotels Ltd.
17. Share Owning Subsidiaries Restructuring Agreement, dated as of July 21,
2000, by and among Sea Containers Ltd., Sea Containers Holdings Ltd., Sea
Containers House Ltd., The Marine Containers Insurance Co. Ltd., Sea
Containers Asia Ltd. and Orient-Express Hotels Ltd., as amended by an
Amended and Restated Share Owning Subsidiaries Restructuring Agreement,
dated as of June 6, 2001, by and among Sea Containers Ltd., Orient-Express
Hotels Ltd., Orient-Express Holdings 1 Ltd., Orient-Express Holdings 2
Ltd., Orient-Express Holdings 3 Ltd., Orient-Express Holdings 4 Ltd., and
Contender 2 Ltd.
18. Indemnity Agreement dated August 1, 2000, by and between Orient-Express
Hotels Ltd. and Sea Containers Ltd.
19. Amended and Restated Right of First Refusal and Option Agreement Regarding
Indirectly Held Hotel Cipriani Interests, dated February 8, 2005, by and
among James B. Sherwood, Orient-Express Hotels Inc. and Sea Containers
America Inc.
20. Amended and Restated Agreement Regarding Hotel Cipriani Interests, dated
February 8, 2005, by and among James B. Sherwood, Orient-Express Hotels
Inc., and Hotel Cipriani S.p.A.
21. Amendment Agreement dated March 11, 2005, relating to a Multicurrency Term
Facility Agreement dated February 19, 2002 between Barclays Bank plc and
Orient-Express Hotels Ltd. for the financing of Le Manior and La Residencia
hotels.
22. Bank of Scotland Term Loan Agreement with Venice Simplon-Orient-Express
Limited, dated September 21, 2005.
23. Standard Bank of South Africa Limited Loan Facility with Mount Nelson Hotel
Limited, dated April 15, 2005, related to the refinancing of Mount Nelson
and Westcliff hotels.
A-1-6
24. Loan Facility Agreement between WestLB AG, Sydney Branch and Orient-Express
Hotels Ltd. and certain of its affiliates, dated April, 2005, related to
the refinancing of the Observatory and Lilianfels hotels in Australia.
A-1-7
ANNEX B
Descriptions of Contracts, Other Legal Documents,
Statutes and Legal Proceedings
A. Contracts and Other Legal Documents
Item Location of description
---- -----------------------
1. Orient-Express Hotels 2000 Stock Annual Report on Form 10-K of
Option Plan the Company for the fiscal year ended
December 31, 2004 (the "Form 10-K"),
at Item 11, page 71,
under the caption "2000 and 2004 Stock
Option Plans."
2. Orient-Express Hotels 2004 Stock Form 10-K at Item 11, page 71, under
Option Plan the caption "2000 and 2004 Stock Option Plans."
3. Schedule 13D and Schedule 13G reports with A. Footnotes (2), (5) and (6) to the "Five Percent
respect to the beneficial ownership of the Shareholders" table, Form 10-K at Item 12,
Company's common shares pages 72-73, and
B. Footnotes (4) and (5) to the table on page S-16
of the Prospectus under the caption "Beneficial
Ownership of Class A and Class B Common Shares."
4. Amended and Restated Agreement Regarding Form 10-K at Item 13, page 75.
Hotel Cipriani Interests dated February 8,
2005, between James B. Sherwood,
Hotel Cipriani S.r.l. and the Company.
5. Amended and Restated Right of First Form 10-K at Item 13, page 75.
Refusal and Option Agreement Regarding
Indirectly Held Hotel Cipriani
Interests dated February 8, 2005, between
James B. Sherwood and the Company.
6. Services Agreement dated August 1, 2000 Form 10-K at Item 13, pages 75-76 under the
among Sea Containers Ltd., Sea Containers caption "Agreements with Sea Containers Ltd.
Services Ltd. and the Company, and - Services Agreement."
Amendment thereto dated January 1, 2001.
7. Tax Sharing Agreement dated August 1, 2000, Form 10-K at Item 13, page 76 under
between Sea Containers Ltd, and the the caption "Agreements with
Company. Sea Containers Ltd. - Tax Sharing Agreement."
8. Non-Compete Agreement dated August 1, 2000, Form 10-K at Item 13, page 76 under
between Sea Containers Ltd. and the the caption "Agreements with
Company. Sea Containers Ltd. - Non-Compete Agreement."
A-1-8
B. United States Federal and New York Statutes (not including the Internal
Revenue Code).
None
C. Legal and Governmental Proceedings in the United States.
None
A-1-9
Exhibit A-2
FORM OF OPINION OF APPLEBY SPURLING HUNTER
TO BE DELIVERED PURSUANT TO PARAGRAPH 5(c)
November 23, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Dear Sirs
Orient Express Hotels Ltd. ("OEHL")
and Orient-Express Holdings I Ltd. (the "Subsidiary")
We have acted as legal counsel in Bermuda to OEHL and this opinion as to Bermuda
law is addressed to you with respect to the sale by Sea Containers Ltd ("Sea
Containers"), of class A common shares, par value $0.01 each (the "Common
Shares") of OEHL to the Underwriters pursuant to the terms of the underwriting
agreement among OEHL and Citigroup Global Markets Inc. as representative of the
several underwriters identified therein (collectively, the "Underwriters") (the
"Underwriting Agreement"). Each Common Share includes a right (a "Right") to
purchase, under certain circumstances, one one-hundredth of a series A junior
participating preferred share of OEHL (a "Preferred Share"), subject to
adjustment. The Rights are being issued pursuant to the terms of the Rights
Agreement. This opinion is delivered pursuant to section 5(c) of the
Underwriting Agreement, in connection with the following documents:
(i) Registration Statement;
(ii) Prospectus;
(iii) Rights Agreement; and
(iv) Underwriting Agreement.
A-2-1
The documents referred to in paragraphs (iii) and (iv) above are collectively
referred to as the "Subject Agreements". All Common Shares sold by Sea
Containers to the Underwriters pursuant to the terms of the Underwriting
Agreement are collectively referred to herein as the "Securities").
For the purposes of this opinion we have examined and relied upon the documents
listed (which in some cases, are also defined in the First Schedule to this
opinion) (the "Documents"). Unless otherwise defined herein, capitalised terms
have the meanings assigned to them in the Underwriting Agreement.
Assumptions
- -----------
In stating our opinion we have assumed:
(a) the authenticity, accuracy and completeness of all Documents and other
documentation examined by us submitted to us as originals and the
conformity to authentic original documents of all Documents and other such
documentation submitted to us as certified, conformed, notarised, faxed or
photostatic copies;
(b) that each of the Documents and other such documentation which was received
by electronic means is complete, intact and in conformity with the
transmission as sent;
(c) the genuineness of all signatures on the Documents;
(d) the authority, capacity and power of each of the persons signing the
Documents (other than those persons signing on behalf of OEHL in respect of
the Subject Agreements);
(e) that any representation, warranty or statement of fact or law, other than
as to the laws of Bermuda, made in any of the Documents is true, accurate
and complete;
(f) that the Subject Agreements constitute the legal, valid and binding
obligations of each of the parties thereto, other than OEHL, under the laws
of its jurisdiction of incorporation or its jurisdiction of formation;
(g) that the Subject Agreements have been validly authorised, executed and
delivered by each of the parties thereto, other than OEHL, and the
performance thereof is within the capacity and powers of each such party
thereto, and that each such party to which OEHL purportedly delivered the
Subject Agreements has actually accepted delivery of such Subject
Agreements;
A-2-2
(h) that the Subject Agreements will effect, and will constitute legal, valid
and binding obligations of each of the parties thereto, enforceable in
accordance with their terms, under the laws by which they are expressed to
be governed;
(i) that the Subject Agreements are in the proper legal form to be admissible
in evidence and enforced in the courts, and in accordance with the laws, of
the jurisdiction by which they are expressed to be governed;
(j) that there are no provisions of the laws or regulations of any jurisdiction
other than Bermuda which would be contravened by the execution or delivery
of the Subject Agreements or which would have any implication in relation
to the opinion expressed herein and that, in so far as any obligation
under, or action to be taken under, the Subject Agreements is required to
be performed or taken in any jurisdiction outside Bermuda, the performance
of such obligation or the taking of such action will constitute a valid and
binding obligation of each of the parties thereto under the laws of that
jurisdiction and will not be illegal by virtue of the laws of that
jurisdiction;
(k) that the records which were the subject of the Company Searches were
complete and accurate at the time of such search and disclosed all
information which is material for the purposes of this opinion and such
information has not since the date of the Company Searches been materially
altered;
(l) that the records which were the subject of the Litigation Searches were
complete and accurate at the time of such search and disclosed all
information which is material for the purposes of this opinion and such
information has not since the date of the Litigation Searches been
materially altered;
(m) that the Resolutions are in full force and effect and have not been
rescinded, either in whole or in part, and accurately record the
resolutions either adopted as unanimous written resolutions of the Board of
Directors of OEHL or passed by, the Board of Directors of OEHL or Special
Committees thereof at meetings which were duly convened and at which a duly
constituted quorum was present and voting throughout and that there is no
matter affecting the authority of such Directors or Special Committee
members to effect entry by OEHL into the Subject Agreements, not disclosed
by the Constitutional Documents or the Resolutions, which would have any
adverse implication in relation to the opinions expressed herein;
A-2-3
(n) that each of the parties to the Subject Agreements other than OEHL have no
express or constructive knowledge of any circumstance whereby any Director
of OEHL, when the Board of Directors of OEHL passed or adopted the
Resolutions, failed to discharge his fiduciary duty owed to OEHL and to act
honestly and in good faith with a view to the best interests of OEHL;
(o) that OEHL has entered into its obligations under the Subject Agreements in
good faith for the purpose of carrying on its business and that, at the
time it did so, there were reasonable grounds for believing that the
transactions contemplated by the Subject Agreements would benefit OEHL;
(p) that each transaction to be entered into pursuant to the Subject Agreements
is entered into in good faith and for full value and will not have the
effect of illegally preferring one creditor over another;
(q) the Underwriters are not carrying on investment business in or from within
Bermuda under the provisions of the Investment Business Act 2003 (the
"IBA") as amended from time to time, or if conducting such investment
business, is exempted, excluded or has otherwise complied with the
licensing requirements of the IBA.
Opinion
- -------
Based upon and subject to the foregoing and subject to the reservations set out
below and to any matters not disclosed to us, we are of the opinion that:
(1) Each of OEHL and the Subsidiary is an exempted company duly incorporated
with limited liability, validly existing and in good standing under the
laws of Bermuda.
(2) OEHL has all requisite corporate power and authority under its
Constitutional Documents to own, lease, manage and operate its properties
and to conduct its business as described in the Registration Statement and
the Prospectus and OEHL has all requisite power and authority to enter into
and perform its obligations under the Underwriting Agreement.
(3) The Underwriting Agreement has been duly authorised, executed and delivered
by OEHL and constitutes valid and binding obligations of OEHL enforceable
against it in accordance with its terms.
(4) The authorized and issued share capital of OEHL is as set forth in the
Prospectus under the caption "Description of the Common Shares ". All of
the issued and outstanding
A-2-4
common shares of OEHL have been duly authorized and validly issued and are
fully paid and non-assessable; and none of the outstanding Common Shares of
OEHL were issued in violation of any pre-emptive or other similar rights of
any security holder of OEHL pursuant to the Constitutional Documents.
(5) The Securities to be purchased by the Underwriters from Sea Containers have
been duly authorised for issuance by OEHL and have been validly issued,
fully paid and non-assessable and no holder of the Securities is or will be
subject to personal liability with respect to the debts or obligations of
OEHL solely by reason of being such a holder.
(6) The Rights Agreement has been duly authorized, executed and delivered by
OEHL, the Rights have been duly authorized by OEHL, the Rights attached to
the Securities are validly issued, and the Preferred Shares issuable upon
the exercise of the Rights have been duly authorized by OEHL for issuance
upon the exercise of the Rights and, when issued upon such exercise in
accordance with the terms of the Rights Agreement, will be validly issued,
fully paid and non-assessable.
(7) Based solely on the results of the Litigation Search there is not pending
or threatened any action, suit, proceeding, inquiry or investigation in
Bermuda, to which OEHL or the Subsidiary is a party, or to which the
property of OEHL or the Subsidiary is subject, before or brought by any
court or governmental agency or body, in Bermuda, which could reasonably be
expected to result in a Material Adverse Effect, or which could reasonably
be expected to materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in the
Purchase Agreement or the performance by OEHL of its obligations
thereunder.
(8) The information in the Registration Statement and the Prospectus under
"Description of the Common Shares", "Material Tax Considerations - Material
Bermuda Tax Considerations", Risk Factors - Risks of Owning and Selling
Class A Common Shares and in the Registration Statement under Items 14 and
15 to the extent that it constitutes matters of Bermuda law, or legal
conclusions with respect thereto, are accurate in all material respects.
(9) Neither the execution and delivery by OEHL of the Underwriting Agreement,
the performance by OEHL of, or its compliance with, its obligations under
the Underwriting Agreement and the consummation of the transactions
contemplated in the Underwriting Agreement or in the Registration Statement
and Prospectus, including the sale and delivery by Sea Containers of the
Securities, the Rights and the Preferred Shares issuable
A-2-5
upon the exercise of such Rights (assuming such Preferred Shares were
issued on the date of this opinion), do not and will not result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any tax, lien, charge or
encumbrance upon any property or assets of OEHL under, (i) any indenture,
mortgage, deed of trust, loan agreement or any other agreement or
instrument which is described or referred to in the Prospectus, or is filed
or incorporated by reference as an exhibit to the Registration Statement,
and to which OEHL or the Subsidiary is a party or by which they are bound
or to which any of their property or assets are subject (except for such
breaches, violations, defaults, liens, charges or encumbrances that would
not have a Material Adverse Effect), or (ii) any requirement of any law or
any regulation of Bermuda or (iii) the Constitutional Documents.
(10) No consent, approval, authorisation or order of, or registration or
qualification or filing of or with, any Bermuda governmental agency or
Bermuda governmental body or, to the best of our knowledge, any Bermuda
court is required for the performance by OEHL of its obligations under the
Underwriting Agreement, except the consent of the Bermuda Monetary
Authority to the issue by OEHL of the Securities (which consent has been
obtained).
(11) The choice of the laws of the state of New York as the proper law to govern
the Underwriting Agreement is a valid and binding choice of law under
Bermuda law and such choice of law would be recognised, upheld and applied
by the courts of Bermuda as the proper law of the Underwriting Agreement in
proceedings brought before them in relation to the Underwriting Agreement,
provided that (i) the point is specifically pleaded; (ii) such choice of
law is valid and binding under the laws of the state of New York; and (iii)
recognition would not be contrary to public policy as that term is
understood under Bermuda law. Although ultimate determination of the public
policy issues would depend upon the circumstances prevailing at the time of
the court application, we are not aware of any current public policy
constraints to the recognition of New York law as the governing law of the
Underwriting Agreement.
(12) The irrevocable and unconditional submission by the Company to the
jurisdiction of any state or federal court in New York under the
Underwriting Agreement is not contrary to Bermuda law and would be
recognised by the courts of Bermuda as a legal, valid and binding
submission, provided that such submission is accepted by such courts and is
legal, valid and binding under the laws of the State of New York.
A-2-6
(13) A final and conclusive judgment of a competent foreign court against OEHL
based on the Underwriting Agreement, and the transactions contemplated
thereby (other than a court of jurisdiction to which the Judgment
(Reciprocal Enforcement) Act 1958 applies, and it does not apply to the
courts of New York) under which a sum of money is payable (not being a sum
payable in respect of taxes or other charges of a like nature, in respect
of a fine or other penalty, or in respect of multiple damages as defined in
The Protection of Trading Interests Act 1981) may be the subject of
enforcement proceedings in the Supreme Court of Bermuda under the common
law doctrine of obligation by action on the debt evidenced by the judgment
of such competent foreign court. A final opinion as to the availability of
this remedy should be sought when the facts surrounding the foreign court's
judgment are known, but, on general principles, one would expect such
proceedings to be successful provided that:
(a) the court which gave the judgment was competent to hear the action in
accordance with private international law principles as applied in
Bermuda; and
(b) the judgment is not contrary to public policy in Bermuda, has not been
obtained by fraud or in proceedings contrary to natural justice and is
not based on an error in Bermuda law.
Enforcement of such a judgment against the assets in Bermuda may involve the
conversion of the judgment debt into Bermuda dollars, but the Bermuda Monetary
Authority's policy is to give the consents necessary to enable recovery in the
currency of the obligation.
We have no reason to believe that as of the date of this opinion the enforcement
of a foreign judgment relating to the indemnification and contribution
provisions set forth in Sections 6 and 7 of the Underwriting Agreement would
contravene Bermuda public policy or laws.
(14) There are no Bermuda capital, stamp or other issuance taxes or duties
payable in Bermuda in connection with the issuance, sale and delivery of
the Securities to the Underwriters, or the consummation of any of the other
transactions contemplated in the Underwriting Agreement.
Reservations
- ------------
We have the following reservations:
(a) The term "enforceable" as used in this opinion means that there is a way of
ensuring that each party performs an agreement or that there are remedies
available for breach.
(b) We express no opinion as to the availability of equitable remedies such as
specific performance or injunctive relief, or as to any matters that are
within the discretion of the courts of Bermuda in respect of any
obligations of OEHL as set out in the Subject
A-2-7
Agreements. Further, we express no opinion as to the validity or binding
effect of any waiver of or obligation to waive either any provision of law
(whether substantive or procedural) or any right or remedy.
(c) Enforcement of the obligations of OEHL under the Subject Agreements may be
limited or affected by applicable laws from time to time in effect relating
to bankruptcy, insolvency or liquidation or any other laws or other legal
procedures affecting generally the enforcement of creditors' rights.
(d) Enforcement of the obligations of OEHL may be the subject of a statutory
limitation of the time within which such proceedings may be brought.
(e) We express no opinion as to any law other than Bermuda law and none of the
opinions expressed herein relates to compliance with or matters governed by
the laws of any jurisdiction except Bermuda. This opinion is limited to
Bermuda law as applied by the Courts of Bermuda at the date hereof.
(f) Where an obligation is to be performed in a jurisdiction other than
Bermuda, the courts of Bermuda may refuse to enforce it to the extent that
such performance would be illegal under the laws of, or contrary to public
policy of, such other jurisdiction.
(g) We express no opinion as to the validity, binding effect or enforceability
of any provision incorporated into the Subject Agreements by reference to a
law other than that of Bermuda, or as to the availability in Bermuda of
remedies that are available in other jurisdictions.
(h) Where a person is vested with discretion or may determine a matter in his
or its opinion, such discretion may have to be exercised reasonably or such
an opinion may have to be based on reasonable grounds.
(i) Any provision in the Subject Agreements that certain calculations or
certificates will be conclusive and binding will not be effective if such
calculations or certificates are fraudulent or erroneous on their face and
will not necessarily prevent juridical enquiries into the merits of any
claim by an aggrieved party.
(j) We express no opinion as to the validity or binding effect of any provision
of the Subject Agreements that provides for the severance of illegal,
invalid or unenforceable provisions.
A-2-8
(k) A Bermuda court may refuse to give effect to any provisions of the Subject
Agreements in respect of costs of unsuccessful litigation brought before
the Bermuda court or where that court has itself made an order for costs.
(l) Searches of the Register of Companies at the office of the Registrar of
Companies and of the Supreme Court Causes Book at the Registry of the
Supreme Court are not conclusive and it should be noted that the Register
of Companies and the Supreme Court Causes Book do not reveal:
i) whether an application to the Supreme Court for a winding up petition
or for the appointment of a receiver or manager has been prepared but
not yet been presented or has been presented but does not appear in
the Causes Book at the date and time the Search is concluded;
ii) whether any arbitration or administrative proceedings are pending or
whether any proceedings are threatened, or whether any arbitrator has
been appointed;
iii) details of matters which have been lodged for filing or registration
which as a matter of general practice of the Registrar of Companies
would have or should have been disclosed on the public file but have
not actually been registered or to the extent that they have been
registered have not been disclosed or appear in the public records at
the date and time the search is concluded;
iv) details of matters which should have been lodged for registration but
have not been lodged for registration at the date the search is
concluded; or
v) whether a receiver or manager has been appointed privately pursuant to
the provisions of a debenture or other security, unless notice of the
fact has been entered in the register of charges in accordance with
the provisions of the Companies Act 1981 (Bermuda).
(m) In order to issue this opinion we have carried out the Company Search as
referred to in the Schedule to this opinion and have not enquired as to
whether there has been any change since the date of such search.
(n) In order to issue this opinion we have carried out the Litigation Search as
referred to in the Schedule to this opinion and have not enquired as to
whether there has been any change since the date of such search.
A-2-9
(o) In opinion paragraph (1) above, the term "good standing" means that each of
OEHL and the Subsidiary has received a Certificate of Compliance from the
Registrar of Companies.
(p) Any reference in this opinion to shares being "non-assessable" shall mean,
in relation to fully-paid shares of OEHL and subject to any contrary
provision in any agreement in writing between OEHL and the holder of
shares, that: no shareholder shall be obliged to contribute further amounts
to the capital of OEHL, either in order to complete payment for their
shares, to satisfy claims of creditors of OEHL, or otherwise; and no
shareholder shall be bound by an alteration of the Memorandum of
Association or Bye-Laws of OEHL after the date on which he became a
shareholder, if and so far as the alteration requires him to take, or
subscribe for additional shares, or in any way increases his liability to
contribute to the share capital of, or otherwise to pay money to, OEHL.
(q) In giving Opinions (4) and 9(1) we rely exclusively on statements and
representations made in the Officer's Certificate. We have made no
independent verification of the matters referred to in the Officer's
Certificate.
Disclosure
- ----------
This opinion is addressed to you in connection with the issue and sale of the
Securities to the Underwriters pursuant to the terms of the Subject Agreements
and is not to be made available to, or relied on by any other person or entity,
or for any other purpose, without our prior written consent.
This opinion is addressed to you solely for the benefit of the Underwriters and
is neither to be transmitted to any other person, nor relied upon by any other
person or for any other purpose nor quoted or referred to in any public document
nor filed with any governmental agency or person, without our prior written
consent, except as may be required by law or regulatory authority (except that
EquiServe Trust Company, N.A, as the transfer agent for OEHL, may rely upon the
opinion set forth in paragraph 5 above, subject to the assumptions and
reservations set forth herein relating to such opinion. Further, this opinion
speaks as of its date and is strictly limited to the matters stated herein and
we assume no obligation to review or update this opinion if applicable laws or
the existing facts or circumstances should change.
This opinion is governed by and is to be construed in accordance with Bermuda
law. It is given on the basis that it will not give rise to any legal
proceedings with respect thereto in any jurisdiction other than Bermuda.
Yours faithfully
Appleby Spurling Hunter
A-2-10
SCHEDULE
--------
1. Copy of a Registration Statement on Form S-3, Registration No. 102576 filed
with the Securities and Exchange Commission on 17 January 2003 and
post-effective amendment No.1 thereto filed with the Securities and
Exchange Commission on 11 October 2005 (the "Registration Statement").
2. Copy of the prospectus, issued by OEHL dated [ ]2005 (the "Prospectus") as
amended and supplemented from time to time, issued in connection with the
offering of the Securities by Sea Containers.
3. Copy of executed Underwriting Agreement dated [ ] November 2005 between
OEHL and the Underwriters (the "Underwriting Agreement").
4. Copy of the executed Rights Agreement dated as of 1 June 2000 between OEHL
and Fleet National Bank, as rights agent (the "Rights Agreement").
5. Copy of the permission dated 29 November 2002 given by the Bermuda Monetary
Authority under the Exchange Control Act (1972) and related regulations for
the proposed offer and sale of the Securities and subsequent free
transferability of such shares.
6. Copy of the resolutions passed by the Board of Directors of OEHL at a
meeting held on [ ] 2005, unanimous written resolutions of the Board of
Directors of the Company adopted on [ ] 2005, and resolutions passed by the
Special Committee of the Board of Directors of OEHL at a meeting held on [
] (collectively, the "Resolutions").
7. The entries and filings shown in respect of OEHL and the Subsidiary on the
file of OEHL and the Subsidiary maintained in the Register of Companies at
office of the Registrar of Companies in Hamilton, Bermuda, as revealed by a
search on [ ] November 2005 (the "Company Searches").
8. The entries and filings shown in the Supreme Court Causes Book maintained
at the Registry of the Supreme Court in Hamilton, Bermuda, as revealed by a
search on [ ] November 2005 in respect of OEHL and the Subsidiary
respectively (the "Litigation Searches").
A-2-11
9. Certified copies of the Certificate of Incorporation, Memorandum of
Association and Bye-Laws of each of OEHL and the Subsidiary as at the date
hereof.
10. A Certificate of Compliance, dated [ ] Novemberr 2005 issued by the
Ministry of Finance in respect of each OEHL and the Subsidiary.
11. A certified copy of' the "Foreign Exchange Letter", dated 16 October 1987
in relation to OEHL, issued by the Bermuda Monetary Authority, Hamilton
Bermuda.
12. A Certificate of Incumbency in respect of OEHL dated [ ] November 2005.
13. A certified copy of the "Tax Assurance", dated 8 December 1987 in relation
to OEHL, issued by the Registrar of Companies for the Minister of Finance.
14. A certified copy of the Register of Directors and Officers in respect of
OEHL.
15. The Officer's Certificate (the "Certificate") dated [ ] November 2005 in
relation to OEHL and the Subsidiary signed by Edwin S. Hetherington,
Secretary of OEHL and Assistant Secretary of the Subsidiary.
A-2-12
Exhibit A-3
FORM OF OPINION OF EDWIN S. HETHERINGTON
TO BE DELIVERED PURSUANT TO PARAGRAPH 5(d)
November 23, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Re: Orient-Express Hotels Ltd.
Public Offering of Class A Common Shares
----------------------------------------
Ladies and Gentlemen:
I am the Secretary of Orient-Express Hotels Ltd., a Bermuda company ("OEH"). I
am delivering this opinion in connection with the execution and delivery of the
Underwriting Agreement dated November [ ], 2005 (the "Underwriting Agreement"),
among OEH, Sea Containers Ltd., a Bermuda company ("Sea Containers"), and the
several underwriters addressed above (the "Underwriters"). The Underwriting
Agreement relates to the sale by Sea Containers of up to 9,903,300 shares (the
"Shares") of the class A common shares, par value $.01 each, of OEH (the "Class
A Shares"). The Shares include 1,291,735 Class A Shares to cover
over-allotments. Unless otherwise defined herein, all capitalized terms herein
are as defined in the Underwriting Agreement.
This opinion is being delivered to you pursuant to paragraph 5(d) of the
Underwriting Agreement in connection with the purchase by the Underwriters of
8,611,565 of the Shares pursuant to paragraph 2(a) of the Underwriting Agreement
(the "Initial Shares"). As a basis for the opinions expressed herein, I have
examined copies of the Registration Statement and the Prospectus, and originals,
or copies certified or otherwise identified to my satisfaction, of such other
agreements, and certificates and statements of governmental officials, and of
officers and other representatives of OEH, as I have deemed necessary. In such
examination, I have assumed the genuineness of all signatures, the authenticity
of all documents submitted to me as originals, and
A-3-1
the conformity with the originals (and the authenticity of such originals) of
all documents submitted to me as copies.
Based upon the foregoing and subject to the qualifications expressed below,
I am of the opinion that:
1. The execution and delivery by OEH of the Underwriting Agreement, (b)
the performance by OEH of its obligations under the Underwriting
Agreement, and its compliance with its obligations thereunder, (c) the
consummation of the offering, sale and delivery by Sea Containers of
the Shares and the Rights associated therewith, and (d) the
consummation of the transactions contemplated by the Underwriting
Agreement specifically referring to OEH, including the issuance and
delivery by OEH of the Preferred Shares issuable upon the exercise of
the Rights (assuming that the Preferred Shares were issued on the date
of this opinion), each do not and will not, whether with or without
the giving of notice, the passage of time, or both, conflict with or
constitute a breach of or default under, result in a breach or
violation by OEH of any of the terms or provisions of, or result in a
change of control with respect to OEH or a default by OEH under, or
result in the creation or imposition of any tax, lien, charge or
encumbrance upon any property or assets of OEH or any of its
subsidiaries under, (A) any indenture, mortgage, deed of trust, loan
agreement or any other agreement or instrument listed in Annex A
hereto, or (B) any applicable law, statute, rule, regulation,
judgment, order, writ or decree, known to me, of any government,
government instrumentality or court in the United Kingdom having
jurisdiction over OEH or any of its subsidiaries or any of their
assets, properties or operations.
2. To the best of my knowledge, there are no legal or governmental
proceedings pending or threatened in England to which OEH or any of
its subsidiaries is a party or to which any of its or their property
is subject, except as may otherwise be disclosed in the Prospectus and
except for such proceedings that, individually or in the aggregate,
would not have a Material Adverse Effect.
In my capacity as the Secretary of OEH, I have participated in the preparation
of the Registration Statement and the Prospectus. In the course of those
preparations, I have participated in conferences with other officers and other
representatives of OEH, representatives of the independent public accountants
for OEH, counsel to OEH and representatives of the Underwriters, and I am
familiar with the statistical data contained in the Registration Statement and
the Prospectus. Although I have not independently verified the accuracy,
completeness or fairness of that statistical data, I advise you that no facts
have come to my attention that cause me to believe (i) that the Registration
Statement, at the time it became effective, included any statistical data which
constituted or contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements in the Registration Statement not misleading, or (ii) that the
Prospectus, at the time it was issued and on the date hereof, included or
includes any statistical data which constituted or contained, or constitutes or
contains, an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements in the Prospectus, in
the light of the circumstances under which they were made, not misleading.
Nothing set forth in this paragraph
A-3-2
is intended to express any view with respect to the financial statements of OEH,
or any related notes or schedules.
This opinion is limited to the matters expressly stated herein, and no opinion
is implied or may be inferred beyond the matters expressly stated herein. This
opinion may not be used or relied upon by or published or communicated to any
person or entity, other than you and your counsel, for any purpose whatsoever
without my prior written consent in each instance; except, however, that this
opinion may be shown to those persons entitled to examine your books and records
by laws applicable to you.
Very truly yours,
A-3-3
ANNEX A
Indentures, Mortgages, Loan Agreements, Etc.
1. Credit Agreement, dated as of September 18, 2002, by and among
Orient-Express Hotels Ltd., Companhia Hoteis Palace, WestLB AG, New York
Branch, and the lenders party thereto from time to time.
2. Loan Agreement, dated as of May 22, 2002, by and among Charleston Center
LLC, as Borrower, Credit Lyonnais New York Branch and Aareal Bank AG, as
Lenders, Credit Lyonnais New York Branch, as Co-Agent and Administrative
Agent for Lenders, and Aareal Bank AG, as Co-Agent for Lenders.
3. Credit Agreement, dated as of August 20, 2003, by and among `21' Club,
Inc., Mountbay Holdings Inc., Keswick Club L.P. as Borrowers, `21' Club
Properties Inc., Inn at Perry Cabin Corporation, Keswick Corporation,
Keswick Hall Inc., Keswick Utilities, Inc., Orient-Express Hotels Inc.,
Orient-Express Hotels Ltd., as Borrower's Parties and Oversea-Chinese
Banking Corporation Limited, New York Agency, as Lender.
4. Loan Agreement, dated as of July 27, 2001, by and among Island Hotel
(Madeira) Limited, Orient-Express Hotels Ltd., the Banks and Financial
Institutions set forth in Schedule 1, and Oversea-Chinese Banking
Corporation Limited, as Agent and Security Trustee.
5. Loan Agreement, dated as of May 1, 2003, by and between Windsor Court Hotel
LLC and Oversea-Chinese Banking Corporation Limited, New York Agency.
6. Cash Advance Project Finance Facility Agreement, dated March 22, 2000, by
and among Clyfire Pty Limited and Merjade Pty Ltd., as Borrowers, each
Company specified as a Guarantor in Schedule 1, Westdeutsche Landesbank
Girozentrale, ARBN, as Initial Bank, each Financial Institution specified
as a Bank in Schedule 2, each Financial Institution specified as a Hedge
Counterparty in Schedule 3, Westdeutschebank Landesbank Girozentrale, ARBN,
as Facility Agent, and Westdeutsche Landesbank Girozentrale, ARBN, as
Security Trustee.
7. Loan Agreement, dated April 9, 2003, by and among Commerzbank
Aktiengesellschaft, Sucursal en Madrid, Orient-Express Madrid S.L. and
Orient-Express Spanish Holdings.
8. Agreement for Euro 135 Million Term and Multi-Currency Revolving Credit
Facility, dated July 1, 2003, by and between Orient-Express Hotels Ltd. and
Barclays Bank PLC.
9. Services Agreement, dated as of August 1, 2000, by and among Sea Containers
Ltd., Sea Containers Services Ltd. and Orient-Express Hotels Ltd., as
amended by an Amendment of Services Agreement, dated as of January 1, 2001,
by and among Sea Containers Ltd., Sea Containers Services Ltd. and
Orient-Express Hotels Ltd.
10. Noncompete Agreement, dated August 1, 2000, by and between Sea Containers
Ltd. and Orient-Express Hotels Ltd.
A-3-4
11. Restructuring Agreement, dated as of July 21, 2000, by and among Sea
Containers Ltd., Orient-Express Hotels Ltd., Orient-Express Hotels Inc.,
Orient-Express Properties Inc., Sea Containers UK Ltd., Sea Containers
British Isles Ltd. and Orient-Express Hotels UK Ltd.
12. Orient-Express Hotels Ltd. 2000 Stock Option Plan, dated June 5, 2000.
13. Orient-Express Hotels Ltd. 2004 Stock Option Plan.
14. Contract, dated February 18, 1982, by and between James Blair Sherwood and
Hotel Cipriani S.p.A.
15. Rights Agreement, dated as of June 1, 2000, by and between Orient-Express
Hotels Ltd. and Fleet National Bank, as Rights Agent.
16. Tax Sharing Agreement, dated as of August 1, 2000, by and between Sea
Containers Ltd. and Orient-Express Hotels Ltd.
17. Share Owning Subsidiaries Restructuring Agreement, dated as of July 21,
2000, by and among Sea Containers Ltd., Sea Containers Holdings Ltd., Sea
Containers House Ltd., The Marine Containers Insurance Co. Ltd., Sea
Containers Asia Ltd. and Orient-Express Hotels Ltd., as amended by an
Amended and Restated Share Owning Subsidiaries Restructuring Agreement,
dated as of June 6, 2001, by and among Sea Containers Ltd., Orient-Express
Hotels Ltd., Orient-Express Holdings 1 Ltd., Orient-Express Holdings 2
Ltd., Orient-Express Holdings 3 Ltd., Orient-Express Holdings 4 Ltd., and
Contender 2 Ltd.
18. Indemnity Agreement dated August 1, 2000, by and between Orient-Express
Hotels Ltd. and Sea Containers Ltd.
19. Amended and Restated Right of First Refusal and Option Agreement Regarding
Indirectly Held Hotel Cipriani Interests, dated February 8, 2005, by and
among James B. Sherwood, Orient-Express Hotels Inc. and Sea Containers
America Inc.
20. Amended and Restated Agreement Regarding Hotel Cipriani Interests, dated
February 8, 2005, by and among James B. Sherwood, Orient-Express Hotels
Inc., and Hotel Cipriani S.p.A.
21. Amendment Agreement dated March 11, 2005, relating to a Multicurrency Term
Facility Agreement dated February 19, 2002 between Barclays Bank plc and
Orient-Express Hotels Ltd. for the financing of Le Manior and La Residencia
hotels.
22. Bank of Scotland Term Loan Agreement with Venice Simplon-Orient-Express
Limited, dated September 21, 2005.
23. Standard Bank of South Africa Limited Loan Facility with Mount Nelson Hotel
Limited, dated April 15, 2005, related to the refinancing of Mount Nelson
and Westcliff hotels.
A-3-5
24. Loan Facility Agreement between WestLB AG, Sydney Branch and Orient-Express
Hotels Ltd. and certain of its affiliates, dated April, 2005, related to
the refinancing of the Observatory and Lilianfels hotels in Australia.
A-3-6
Exhibit A-4
FORM OF OPINION OF CARTER LEDYARD & MILBURN LLP
TO BE DELIVERED PURSUANT TO PARAGRAPH 5(e)
November 23, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Re: Orient-Express Hotels Ltd.
Public Offering of Class A Common Shares
----------------------------------------
Ladies and Gentlemen:
We have acted as counsel to Sea Containers Ltd., a Bermuda company ("Sea
Containers"), in connection with the execution and delivery of the Underwriting
Agreement dated November [ ], 2005 (the "Underwriting Agreement"), among Sea
Containers, Orient-Express Hotels Ltd., a Bermuda company ("OEH"), and the
several underwriters addressed above (the "Underwriters"). The Underwriting
Agreement relates to the sale by Sea Containers of up to 9,903,300 shares (the
"Shares") of the class A common shares, par value $.01 each, of OEH (the "Class
A Shares"). The Shares include up to 1,291,735 Class A Shares to cover
over-allotments. Unless otherwise defined herein, all capitalized terms herein
are as defined in the Underwriting Agreement.
This opinion is being delivered to you pursuant to paragraph 5(e) of the
Underwriting Agreement in connection with the purchase by the Underwriters of
8,611,565 of the Shares pursuant to paragraph 2(a) of the Underwriting Agreement
(the "Initial Shares"). As a basis for the opinions expressed herein, we have
examined copies of the Registration Statement and the Prospectus, and originals,
or copies certified or otherwise identified to our satisfaction, of
A-4-1
such other agreements, and such certificates and statements of governmental
officials, as we have deemed necessary. In such examination, we have assumed the
genuineness of all signatures, and the authenticity of all documents submitted
to us as originals, and the conformity with the originals (and the authenticity
of such originals) of all documents submitted to us as copies. We have, when
relevant facts material to our opinion were not independently established by us,
relied to the extent we deemed such reliance proper, upon written or oral
statements of officers and other representatives of OEH.
Based on the foregoing and subject to the qualifications set forth below,
it is our opinion that:
1. To the best of our knowledge, except as described in the Registration
Statement and the Prospectus, there are no legal or governmental proceedings
pending or threatened in the United States to which the Selling Shareholder is a
party or to which any of its properties is subject, which might reasonably be
expected to affect materially and adversely the consummation of the transactions
contemplated in the Underwriting Agreement, or the performance by the Selling
Shareholder of its obligations thereunder.
2. No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any United States federal or New York
state court or governmental authority or agency (other than those obtained under
the 1933 Act and the 1933 Act Regulations, which have been obtained, or those
which may be required under the securities or blue sky laws of New York, as to
which we express no opinion) is necessary or required in connection with the due
authorization, execution and delivery by the Selling Shareholder of the
Underwriting Agreement or for the offering, issuance, sale or delivery of the
Initial Shares being sold by the Selling Shareholder.
3. The execution and delivery by Selling Shareholder of the Underwriting
Agreement, the performance by the Selling Shareholder of, or its compliance with
its obligations under, the Underwriting Agreement, and the consummation of the
transactions contemplated by the Underwriting Agreement, including the offering,
sale and delivery by the Selling Shareholder of the Initial Shares, the Rights
and the Preferred Shares issuable upon the exercise of such Rights (assuming
such Preferred Shares were issued on the date of this opinion) do not and will
not, whether with or without the giving of notice or the passage of time or
both, conflict with or constitute a breach of or default under, result in a
breach or violation by the Selling Shareholder of any of the terms or provisions
of, or result in a default by the Selling Shareholder under, or result in the
creation or imposition of any tax, lien, charge or encumbrance upon the Initial
Shares to be sold by the Selling Shareholder under, (A) any indenture, mortgage,
deed of trust, loan agreement or any other agreement or instrument listed in
Annex A hereto, or (B) any United States federal or New York statute, rule or
regulation, or any decree, judgment or order, known to us, of any United States
federal or New York court or governmental agency or body specifically applicable
to the Selling Shareholder or to any of its properties, except for such
breaches, violations, defaults, liens, charges or encumbrances which might
reasonably be expected not to affect materially and adversely the consummation
of the transactions contemplated in the Underwriting Agreement, or the
performance by the Selling Shareholder of its obligations thereunder.
A-4-2
4. Upon payment of the purchase price for the Shares to be sold by such
Selling Shareholder pursuant to the Underwriting Agreement, delivery of such
Shares, as directed by the Underwriters, to Cede or such other nominee as may be
designated by DTC (unless delivery of such Shares is unnecessary because such
Shares are already in possession of Cede or such other nominee), registration of
such Shares in the name of Cede or such other nominee (unless registration of
such Shares is unnecessary because such Shares are already registered in the
name of Cede or such other nominee) and the crediting of such Shares on the
books of DTC to securities accounts of the Underwriters (assuming that neither
DTC nor any such Underwriter has notice of any "adverse claim", within the
meaning of Section 8-105 of the UCC, to such Shares), (A) DTC shall be a
"protected purchaser", within the meaning of Section 8-303 of the UCC, of such
Shares and will acquire its interest in the Shares (including, without
limitation, all rights that the Selling Shareholder had or has the power to
transfer in such Shares) free and clear of any adverse claim within the meaning
of Section 8-102 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such Shares
and (C) no action (whether framed in conversion, replevin, constructive trust,
equitable lien, or other theory) based on any adverse claim to such Shares may
be successfully asserted against the Underwriters with respect to such security
entitlement; for purposes of the foregoing representations, we have assumed that
when such payment, delivery (if necessary) and crediting occur, (x) such Shares
will have been registered in the name of Cede or another nominee designated by
DTC, in each case on the Company's share registry in accordance with its
certificate of incorporation, bylaws and applicable law, (y) DTC will be
registered as a "clearing corporation", within the meaning of Section 8-102 of
the UCC, and (z) appropriate entries to the accounts of the several Underwriters
on the records of DTC will have been made pursuant to the UCC.
No opinion is expressed herein as to any laws other than the laws of the
United States of America and the State of New York. This opinion is limited to
the matters expressly stated herein, and no opinion is implied or may be
inferred beyond the matters expressly stated herein. This opinion may not be
used or relied upon by or published or communicated to any person or entity
other than the Underwriters and their counsel for any purpose whatsoever without
our prior written consent in each instance.
Very truly yours,
VMS/SVB
A-4-3
Exhibit A-5
FORM OF OPINION OF THE SELLING SHAREHOLDER'S
BERMUDA COUNSEL TO BE DELIVERED PURSUANT TO SECTION 5(f)
November 23, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Dear Sirs
Sea Containers Ltd. (the "Selling Shareholder")
We have acted as legal counsel in Bermuda to the Selling Shareholder and this
opinion as to Bermuda law is addressed to you with respect to the sale by the
Selling Shareholder, of previously issued class A common shares, par value $0.01
each (the "Common Shares") of Orient-Express Hotels Ltd. (the "Company") owned
by the Selling Shareholder to the Underwriters pursuant to the terms of the
Underwriting Agreement. This opinion is delivered pursuant to section 5(f) of
the Underwriting Agreement, in connection with the following documents:
(i) the Registration Statement;
(ii) the Underwriting Agreement; and
(iii) the Prospectus.
All Common Shares sold by the Selling Shareholder to the Underwriters pursuant
to the terms of the Underwriting Agreement are collectively referred to herein
as (the "Shares").
For the purposes of this opinion we have examined and relied upon the documents
listed (which in some cases, are also defined in the Schedule to this opinion)
(the "Documents"). Unless otherwise defined herein, capitalised terms have the
meanings assigned to them in the Underwriting Agreement.
A-5-1
Assumptions
- -----------
In stating our opinion we have assumed:
(a) the authenticity, accuracy and completeness of all Documents and other
documentation examined by us submitted to us as originals and the
conformity to authentic original documents of all Documents and other such
documentation submitted to us as certified, conformed, notarised, faxed or
photostatic copies;
(b) that each of the Documents and other such documentation which was received
by electronic means is complete, intact and in conformity with the
transmission as sent;
(c) the genuineness of all signatures on the Documents;
(d) the authority, capacity and power of each of the persons signing the
Documents (other than the Selling Shareholder in respect of the
Underwriting Agreement);
(e) that any representation, warranty or statement of fact or law, other than
as to the laws of Bermuda, made in any of the Documents is true, accurate
and complete;
(f) that the Underwriting Agreement constitutes the legal, valid and binding
obligations of each of the parties thereto, other than the Selling
Shareholder, under the laws of its jurisdiction of incorporation or its
jurisdiction of formation;
(g) that the Underwriting Agreement has been validly authorised, executed and
delivered by each of the parties thereto, other than the Selling
Shareholder, and the performance thereof is within the capacity and powers
of each such party thereto, and that each such party to which the Selling
Shareholder purportedly delivered the Underwriting Agreement has actually
accepted delivery of such Underwriting Agreement;
(h) that the Underwriting Agreement will effect, and will constitute legal,
valid and binding obligations of each of the parties thereto, enforceable
in accordance with its terms, under the laws by which it is are expressed
to be governed;
(i) that the Underwriting Agreement is in the proper legal form to be
admissible in evidence and enforced in the courts, and in accordance with
the laws, of the jurisdiction by which it is expressed to be governed;
A-5-2
(j) that there are no provisions of the laws or regulations of any jurisdiction
other than Bermuda which would be contravened by the execution or delivery
of the Underwriting Agreement or which would have any implication in
relation to the opinion expressed herein and that, in so far as any
obligation under, or action to be taken under, the Underwriting Agreement
is required to be performed or taken in any jurisdiction outside Bermuda,
the performance of such obligation or the taking of such action will
constitute a valid and binding obligation of each of the parties thereto
under the laws of that jurisdiction and will not be illegal by virtue of
the laws of that jurisdiction;
(k) that the records which were the subject of the Company Search were complete
and accurate at the time of such search and disclosed all information which
is material for the purposes of this opinion and such information has not
since the date of the Company Search been materially altered;
(l) that the records which were the subject of the Litigation Search were
complete and accurate at the time of such search and disclosed all
information which is material for the purposes of this opinion and such
information has not since the date of the Litigation Search been materially
altered;
(m) that the Resolutions are in full force and effect and have not been
rescinded, either in whole or in part, and accurately record the
resolutions passed by, the Board of Directors of the Selling Shareholder at
a meeting which was duly convened and at which a duly constituted quorum
was present and voting throughout and resolutions passed by the members of
the Special Committee of the Board of Directors of the Selling Shareholder
and that there is no matter affecting the authority of such Directors or
Special Committee members to effect entry by the Selling Shareholder into
the Underwriting Agreement, not disclosed by the Constitutional Documents
or the Resolutions, which would have any adverse implication in relation to
the opinions expressed herein;
(n) that the Underwriters have no express or constructive knowledge of any
circumstance whereby any Director of the Selling Shareholder, when the
Board of Directors and the members of the Special Committee of the Selling
Shareholder passed the Resolutions, failed to discharge his fiduciary duty
owed to Selling Shareholder and to act honestly and in good faith with a
view to the best interests of Selling Shareholder;
(o) that the Selling Shareholder has entered into its obligations under the
Underwriting Agreement in good faith for the purpose of carrying on its
business and that, at the time it
A-5-3
did so, there were reasonable grounds for believing that the transactions
contemplated by the Underwriting Agreement would benefit the Selling
Shareholder;
(p) that each transaction to be entered into pursuant to the Underwriting
Agreement is entered into in good faith and for full value and will not
have the effect of illegally preferring one creditor over another; and
(q) the Underwriters are not carrying on investment business in or from within
Bermuda under the provisions of the Investment Business Act 2003(the "IBA")
as amended from time to time, or if conducting such investment business, is
exempted, excluded or has otherwise complied with the licensing
requirements of the IBA.
Opinion
- -------
Based upon and subject to the foregoing and subject to the reservations set out
below and to any matters not disclosed to us, we are of the opinion that:
(1) The Selling Shareholder is an exempted company duly incorporated with
limited liability, validly existing and in good standing under the laws of
Bermuda.
(2) The Underwriting Agreement has been duly authorised, executed and delivered
by the Selling Shareholder and constitutes valid and binding obligations of
the Selling Shareholder enforceable against it in accordance with its
terms.
(3) The Shares to be purchased by the Underwriters from the Selling Shareholder
have been duly authorised by the Company validly issued to the Selling
Shareholder and are fully paid and non-assessable and the Selling
Shareholder has duly authorised the sale of the Shares to the Underwriters
and no holder of the Securities is or will be subject to personal liability
with respect to the debts or obligations of the Selling Shareholder solely
by reason of being such a holder.
(4) Based solely on the results of the Litigation Search there is not pending
or threatened any action, suit, proceeding, inquiry or investigation in
Bermuda, to which the Selling Shareholder is a party, or to which the
property of Selling Shareholder is subject, before or brought by any court
or governmental agency or body, in Bermuda, which could reasonably be
expected to result in a Material Adverse Effect, or which could reasonably
be expected to materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in the
Underwriting Agreement or the performance by Selling Shareholder of its
obligations thereunder.
A-5-4
(5) Neither the execution and delivery by the Selling Shareholder of the
Underwriting Agreement, the performance by the Selling Shareholder of, or
its compliance with, its obligations under the Underwriting Agreement and
the consummation of the transactions contemplated in the Underwriting
Agreement or in the Registration Statement (including the sale and delivery
by the Selling Shareholder of the Shares, the Rights and the Preferred
Shares issuable upon the exercise of such Right (assuming such Preferred
Shares were issued on the date of this opinion) or compliance by the
Selling Shareholder with its obligations under the Underwriting Agreement
will, (i) conflict with or result in a breach or a default under any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to us which the Selling Shareholder is a party or by which
it is bound or to which any of the property or assets of the Selling
Shareholder is subject (except for such conflicts, breaches or defaults
that would not result in a Selling Shareholder Material Adverse Effect)
(ii) result in the violation of the Selling Shareholder's Constitutional
Documents or (iii) result in the violation of any law or regulation of
Bermuda.
(6) No consent, approval, authorisation or order of, or registration or
qualification or filing of or with, any Bermuda governmental agency or
Bermuda governmental body or, to the best of our knowledge, any Bermuda
court is required for the performance by the Selling Shareholder of its
obligations under the Underwriting Agreement, except the consent of the
Bermuda Monetary Authority to the transfer by the Selling Shareholder of
the Securities (which consent has been obtained).
(7) The choice of the laws of the state of New York as the proper law to govern
the Underwriting Agreement is a valid and binding choice of law under
Bermuda law and such choice of law would be recognised, upheld and applied
by the courts of Bermuda as the proper law of the Underwriting Agreement in
proceedings brought before them in relation to the Underwriting Agreement,
provided that (i) the point is specifically pleaded; (ii) such choice of
law is valid and binding under the laws of the state of New York; and (iii)
recognition would not be contrary to public policy as that term is
understood under Bermuda law. Although ultimate determination of the public
policy issues would depend upon the circumstances prevailing at the time of
the court application, we are not aware of any current public policy
constraints to the recognition of New York law as the governing law of the
Underwriting Agreement.
(8) The irrevocable and unconditional submission by the Selling Shareholder to
the jurisdiction of any state or federal court in New York under the
Underwriting Agreement is not contrary to Bermuda law and would be
recognized by the courts of Bermuda as a
A-5-5
legal, valid and binding submission, provided that such submission is
accepted by such courts and is legal, valid and binding under the laws of
the Sate of New York.
(9) A final and conclusive judgment of a competent foreign court against the
Selling Shareholder based on the Underwriting Agreement, and the
transactions contemplated thereby (other than a court of jurisdiction to
which the Judgment (Reciprocal Enforcement) Act 1958 applies, and it does
not apply to the courts of New York) under which a sum of money is payable
(not being a sum payable in respect of taxes or other charges of a like
nature, in respect of a fine or other penalty, or in respect of multiple
damages as defined in The Protection of Trading Interests Act 1981) may be
the subject of enforcement proceedings in the Supreme Court of Bermuda
under the common law doctrine of obligation by action on the debt evidenced
by the judgment of such competent foreign court. A final opinion as to the
availability of this remedy should be sought when the facts surrounding the
foreign court's judgment are known, but, on general principles, one would
expect such proceedings to be successful provided that:
(a) the court which gave the judgment was competent to hear the action in
accordance with private international law principles as applied in
Bermuda; and
(b) the judgment is not contrary to public policy in Bermuda, has not been
obtained by fraud or in proceedings contrary to natural justice and is
not based on an error in Bermuda law.
Enforcement of such a judgment against the assets in Bermuda may involve the
conversion of the judgment debt into Bermuda dollars, but the Bermuda Monetary
Authority's policy is to give the consents necessary to enable recovery in the
currency of the obligation.
(10) We have no reason to believe that as of the date of this opinion the
enforcement of a foreign judgement relating to the indemnification and
contribution provisions set forth in Sections 6 and 7 of the Underwriting
Agreement would contravene Bermuda public policy or laws.
(11) There are no Bermuda capital, stamp or other issuance taxes or duties
payable in Bermuda in connection with the transfer, sale and delivery of
the Securities to the Underwriters, or the consummation of any of the other
transactions contemplated in the Underwriting Agreement.
A-5-6
Reservations
- ------------
We have the following reservations:
(a) The term "enforceable" as used in this opinion means that there is a way of
ensuring that each party performs an agreement or that there are remedies
available for breach.
(b) We express no opinion as to the availability of equitable remedies such as
specific performance or injunctive relief, or as to any matters that are
within the discretion of the courts of Bermuda in respect of any
obligations of the Selling Shareholder as set out in the Underwriting
Agreement. Further, we express no opinion as to the validity or binding
effect of any waiver of or obligation to waive either any provision of law
(whether substantive or procedural) or any right or remedy.
(c) Enforcement of the obligations of the Selling Shareholder under the
Underwriting Agreement may be limited or affected by applicable laws from
time to time in effect relating to bankruptcy, insolvency or liquidation or
any other laws or other legal procedures affecting generally the
enforcement of creditors' rights.
(d) Enforcement of the obligations of Selling Shareholder may be the subject of
a statutory limitation of the time within which such proceedings may be
brought.
(e) We express no opinion as to any law other than Bermuda law and none of the
opinions expressed herein relates to compliance with or matters governed by
the laws of any jurisdiction except Bermuda. This opinion is limited to
Bermuda law as applied by the Courts of Bermuda at the date hereof.
(f) Where an obligation is to be performed in a jurisdiction other than
Bermuda, the courts of Bermuda may refuse to enforce it to the extent that
such performance would be illegal under the laws of, or contrary to public
policy of, such other jurisdiction.
(g) We express no opinion as to the validity, binding effect or enforceability
of any provision incorporated into the Underwriting Agreement by reference
to a law other than that of Bermuda, or as to the availability in Bermuda
of remedies that are available in other jurisdictions.
A-5-7
(h) Where a person is vested with discretion or may determine a matter in his
or its opinion, such discretion may have to be exercised reasonably or such
an opinion may have to be based on reasonable grounds.
(i) Any provision in the Underwriting Agreement that certain calculations or
certificates will be conclusive and binding will not be effective if such
calculations or certificates are fraudulent or erroneous on their face and
will not necessarily prevent juridical enquiries into the merits of any
claim by an aggrieved party.
(j) We express no opinion as to the validity or binding effect of any provision
of the Underwriting Agreement that provides for the severance of illegal,
invalid or unenforceable provisions.
(k) A Bermuda court may refuse to give effect to any provisions of the
Underwriting Agreement in respect of costs of unsuccessful litigation
brought before the Bermuda court or where that court has itself made an
order for costs.
(l) Searches of the Register of Companies at the office of the Registrar of
Companies and of the Supreme Court Causes Book at the Registry of the
Supreme Court are not conclusive and it should be noted that the Register
of Companies and the Supreme Court Causes Book do not reveal:
i) whether an application to the Supreme Court for a winding up petition
or for the appointment of a receiver or manager has been prepared but
not yet been presented or has been presented but does not appear in
the Causes Book at the date and time the Search is concluded;
ii) whether any arbitration or administrative proceedings are pending or
whether any proceedings are threatened, or whether any arbitrator has
been appointed;
iii) details of matters which have been lodged for filing or registration
which as a matter of general practice of the Registrar of Companies
would have or should have been disclosed on the public file but have
not actually been registered or to the extent that they have been
registered have not been disclosed or appear in the public records at
the date and time the search is concluded;
iv) details of matters which should have been lodged for registration but
have not been lodged for registration at the date the search is
concluded; or
v) whether a receiver or manager has been appointed privately pursuant to
the provisions of a debenture or other security, unless notice of the
fact has been
A-5-8
entered in the register of charges in accordance with the provisions
of the Companies Act 1981 (Bermuda)..
(m) In order to issue this opinion we have carried out the Company Search as
referred to in the Schedule to this opinion and have not enquired as to
whether there has been any change since the date of such search.
(n) In order to issue this opinion we have carried out the Litigation
Search as referred to in the Schedule to this opinion and have not
enquired as to whether there has been any change since the date of such
search.
(o) In opinion paragraph (1) above, the term "good standing" means that the
Selling Shareholder has received a Certificate of Compliance from the
Registrar of Companies.
(p) Any reference in this opinion to shares being "non-assessable" shall
mean, in relation to fully-paid shares of the Company and subject to
any contrary provision in any agreement in writing between the Company
and the holder of shares, that: no shareholder shall be obliged to
contribute further amounts to the capital of the Company, either in
order to complete payment for their shares, to satisfy claims of
creditors of the Company, or otherwise; and no shareholder shall be
bound by an alteration of the Memorandum of Association or Bye-Laws of
the Company after the date on which he became a shareholder, if and so
far as the alteration requires him to take, or subscribe for additional
shares, or in any way increases his liability to contribute to the
share capital of, or otherwise to pay money to, the Company.
(q) In giving Opinion (5)(i) we rely exclusively on statements and
representations made in the Officer's Certificate. We have made no
independent verification of the matters referred to in the Officer's
Certificate.
Disclosure
- ----------
This opinion is addressed to you in connection with the issue and sale of the
Securities to the Underwriters pursuant to the terms of the Underwriting
Agreement and is not to be made available to, or relied on by any other person
or entity, or for any other purpose, without our prior written consent.
This opinion is addressed to you solely for the benefit of the Underwriters and
is neither to be transmitted to any other person, nor relied upon by any other
person or for any other purpose nor quoted or referred to in any public document
nor filed with any governmental agency or person, without our prior written
consent, except as may be required by law or regulatory authority. Further, this
opinion speaks as of its date and is strictly limited to the matters stated
herein and
A-5-9
we assume no obligation to review or update this opinion if applicable laws or
the existing facts or circumstances should change.
This opinion is governed by and is to be construed in accordance with Bermuda
law. It is given on the basis that it will not give rise to any legal
proceedings with respect thereto in any jurisdiction other than Bermuda.
Yours faithfully
Appleby Spurling Hunter
A-5-10
SCHEDULE
--------
1. Copy of a Registration Statement on Form S-3, Registration No. 333- 102576
filed with the Commission on 17 January 2003 and post-effective amendment
no. 7 thereto, filed with the Commission on 11 October 2005 (the
"Registration Statement").
2. Copy of the prospectus, issued by the Company [ ] 2005 (the "Prospectus")
as amended and supplemented from time to time, issued in connection with
the sale of the Securities by the Selling Shareholder.
3. Copy of executed Underwriting Agreement dated [ ]2005 between the Selling
Shareholder, the Company and the Underwriters (the "Underwriting
Agreement").
4. Copy of the permission dated 29 November 2002 given by the Bermuda Monetary
Authority under the Exchange Control Act (1972) and related regulations for
the proposed offer and sale of the Securities and subsequent free
transferability of such shares.
5. Copies of the resolutions passed at a meeting of the Board of Directors of
the Selling Shareholder held on [ ]2005 and resolutions passed by the
Special Committee of the Board of Directors of the Selling Shareholder at a
meeting held on [ ] 2005 (the "Resolutions").
6. The entries and filings shown in respect of the Selling Shareholder on the
file of the Selling Shareholder maintained in the Register of Companies at
office of the Registrar of Companies in Hamilton, Bermuda, as revealed by a
search on [ ] November 2005 (the "Company Search").
7. The entries and filings shown in the Supreme Court Causes Book maintained
at the Registry of the Supreme Court in Hamilton, Bermuda, as revealed by a
search on [ ] November 2005 in respect of the Selling Shareholder (the
"Litigation Search").
8. Certified copies of the Memorandum of Association and Bye-Laws of the
Selling Shareholder as at the date hereof.
9. A Certificate of Compliance dated [ ] November 2005 issued by the Ministry
of Finance in respect of each the Selling Shareholder.
A-5-11
10. A Certificate of Incumbency in respect of the Selling Shareholder dated [ ]
November 2005.
11. The Officer's Certificate (the "Certificate") dated [ ] November 2005 in
relation to the Selling Shareholder signed by Edwin S. Hetherington,
Secretary of the Selling Shareholder.
A-5-12
Exhibit B
FORM OF LOCK-UP AGREEMENT PURSUANT TO PARAGRAPH 5(n)
November 17, 2005
Citigroup Global Markets Inc.
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Scotia Capital (USA) Inc.
as the several Underwriters
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Public Offering of Class A
Common Shares of Orient-Express Hotels Ltd.
-------------------------------------------
Ladies and Gentlemen:
The undersigned, a stockholder and an officer and director of
Orient-Express Hotels Ltd., a Bermuda company (the "Company"), understands that
Citigroup Global Markets Inc. ("Citigroup") and Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated propose to enter into an Underwriting
Agreement (the "Underwriting Agreement") with the Company and Sea Containers
Ltd. providing for the public offering of the Company's class A common shares,
par value $.01 each (the "Class A Shares"). In recognition of the benefit that
such an offering will confer upon the undersigned as a shareholder and an
officer and director of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the Underwriting
Agreement that, during a period of 60 days from the date of the Underwriting
Agreement, the undersigned will not, without the prior written consent of
Citigroup, directly or indirectly, (i) offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant for the sale of, or otherwise dispose
of or transfer any shares of the Company's Class A Shares or any of its class B
common shares, par value $.01 each (the "Class B Shares"), or any securities
convertible into or exchangeable or exercisable for shares of Class A or B
Shares, whether now owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires the power of
disposition; or file, or cause to be filed, any registration statement under the
Securities Act of 1933, as amended, for the Class A or Class B Shares
(collectively, the "Lock-Up Shares") or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Lock-Up Shares, whether
any such swap or transaction is to be settled by delivery of shares of Class A
Shares or B Shares or other securities, in cash or otherwise.
Notwithstanding the foregoing, if:
B-1
(1) during the last 17 days of the 60-day lock-up period, the Company
issues an earnings release or material news or a material event relating to the
Company occurs; or
(2) prior to the expiration of the 60-day lock-up period, the Company
announces that it will release earnings results or becomes aware that material
news or a material event will occur during the 16-day period beginning on the
last day of the 60-day lock-up period,
the restrictions imposed by this letter shall continue to apply until the
expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event, as applicable,
unless Citigroup waives, in writing, such extension.
The undersigned hereby acknowledges and agrees that written notice of any
extension of the 60-day lock-up period pursuant to the previous paragraph will
be delivered by Citigroup to the Company (in accordance with Section 12 of the
Underwriting Agreement) and that any such notice properly delivered will be
deemed to have been given to, and received by, the undersigned. The undersigned
further agrees that, prior to engaging in any transaction or taking any other
action that is subject to the terms of this lock-up agreement during the period
from the date of this lock-up agreement to and including the 34th day following
the expiration of the initial 60-day lock-up period, it will give notice thereof
to the Company and will not consummate such transaction or take any such action
unless it has received written confirmation from the Company that the 60-day
lock-up period (as may have been extended pursuant to the previous paragraph)
has expired.
[SIGNATURE PAGE FOLLOWS]
B-2
Very truly yours,
Signature:
---------------------------
Print Name:
--------------------------
B-3
Table of Contents
UNDERWRITING AGREEMENT
SECTION 1. Representations and Warranties......................................4
(a) Representations and Warranties by the Company..................4
(i) Compliance with Registration Requirements.............4
(ii) Incorporated Documents................................5
(iii) Independent Accountants...............................5
(iv) Financial Statements..................................5
(v) No Material Adverse Change in Business................6
(vi) Good Standing of the Company and its Subsidiaries.....6
(vii) Authorization and Validity of Agreement...............6
(viii) Authorization of Rights Agreement.....................7
(ix) Authorization and Description of Shares...............7
(x) Capitalization........................................7
(xi) New York Stock Exchange Listing.......................7
(xii) Absence of Defaults and Conflicts.....................7
(xiii) Absence of Proceedings................................8
(xiv) Documents.............................................9
(xv) Possession of Intellectual Property...................9
(xvi) Absence of Further Requirements.......................9
(xvii) Possession of Licenses and Permits...................10
(xviii)Title to Property....................................10
(xix) Investment Company Act...............................10
(xx) Environmental Laws...................................10
(xxi) Registration Rights..................................11
(xxii) Disclosure Controls and Procedures; Internal Control
over Financial Reporting.............................11
(xxiii)Compliance with Sarbanes-Oxley Act of 2002...........11
(xxiv) Absence of Manipulation. ............................11
(xxv) Taxes. ..............................................11
(b) Officer's Certificate.........................................12
(c) Representations and Warranties by the Selling Shareholder.....12
(i) Good Standing of the Selling Shareholder.............12
(ii) Accurate Disclosure..................................12
(iii) Authorization of Agreements..........................13
(iv) Direct Holder of Shares; Title to Shares.............13
(v) Delivery of Shares...................................13
(vi) Absence of Manipulation..............................14
(vii) Absence of Further Requirements......................14
(viii) No Association with NASD.............................15
(d) Officer's Certificates........................................15
SECTION 2. Sale and Delivery to Underwriters; Closing.........................15
(a) Initial Shares................................................15
(b) Option Shares.................................................15
i
(c) Payment 16
(d) Denominations; Registration...................................16
SECTION 3. Covenants of the Company and the Selling Shareholder...............17
SECTION 4. Payment of Expenses................................................20
(a) Expenses of the Selling Shareholder...........................20
(b) Termination of Agreement......................................20
(c) Allocation of Expenses........................................21
SECTION 5. Conditions of Underwriters' Obligations............................21
(a) Effectiveness of Registration Statement.....................21
(b) Opinion of U.S. Counsel for the Company.....................21
(c) Opinion of Bermuda Counsel for the Company..................21
(d) Opinion of Edwin S. Hetherington............................21
(e) Opinion of U.S. Counsel for the Selling Shareholder.........22
(f) Opinion of Bermuda Counsel for the Selling Shareholder......22
(g) Opinion of Counsel for Underwriters.........................22
(h) Officer's Certificate of the Company........................22
(i) Officer's Certificate of the Selling Shareholder............22
(j) Accountants' Comfort Letter.................................23
(k) Bring-down Comfort Letter...................................23
(l) Approval of Listing.........................................23
(m) No Objection................................................23
(n) Lock-up Agreements..........................................23
(o) Release of Shares...........................................23
(p) Conditions to Purchase of Option Shares.....................24
(q) Additional Documents........................................24
(r) Termination of Agreement....................................25
SECTION 6. Indemnification....................................................25
(a) Indemnification of Underwriters...............................25
(b) Indemnification of Company, the Selling Shareholder and
Others........................................................26
(c) Actions Against Parties; Notification.........................26
(d) Settlement without Consent if Failure to Reimburse............27
(e) Other Agreements with Respect to Indemnification..............27
SECTION 7. Contribution.......................................................27
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.....29
SECTION 9. Termination of Agreement...........................................29
(a) Termination; General..........................................29
(b) Liabilities 29
SECTION 10. Default by One or More of the Underwriters........................30
SECTION 11. Default by the Selling Shareholder................................30
ii
SECTION 12. Notices...........................................................31
SECTION 13. Parties...........................................................31
SECTION 14. GOVERNING LAW AND TIME............................................31
SECTION 15. Effect of Headings................................................31
SECTION 16. Submission to Jurisdiction........................................31
SECTION 17. No Fiduciary Duty.................................................32
iii
SCHEDULES
Schedule A - List of Underwriters....................................Sch A-1
Schedule B - Selling Shareholder and Company Shares..................Sch B-1
Schedule C - Pricing Information.....................................Sch C-1
Schedule D - List of Persons and Entities Subject to Lock-up.........Sch D-1
EXHIBITS
Exhibit A-1 - Form of Opinion of Carter Ledyard & Milburn LLP..........A-1-1
Exhibit A-2 - Form of Opinion of Appleby Spurling Hunter...............A-2-1
Exhibit A-3 - Form of Opinion of Edwin S. Hetherington.................A-3-1
Exhibit A-1 - Form of Opinion of Carter Ledyard & Milburn LLP..........A-4-1
Exhibit A-2 - Form of Opinion of Appleby Spurling Hunter...............A-5-1
Exhibit B - Form of Lock-up Agreement....................................B-1
iv