-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QGJghV3BBEYx0aXFMsj0KNTobnGHofkywOGokScyTUEa0PdjFHa6zuKYyGk1u42g AhvStEMoiGRaktMQNac9+A== 0000893750-06-000112.txt : 20060323 0000893750-06-000112.hdr.sgml : 20060323 20060323130038 ACCESSION NUMBER: 0000893750-06-000112 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20060323 DATE AS OF CHANGE: 20060323 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Kerzner Solomon CENTRAL INDEX KEY: 0001330670 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: BUSINESS PHONE: 242-363-6000 MAIL ADDRESS: STREET 1: KERZNER INTERNATIONAL LIMITED STREET 2: EXECUTIVE OFFICE, CORAL TOWERS CITY: PARADISE ISLAND STATE: C5 ZIP: 00000 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: KERZNER INTERNATIONAL LTD CENTRAL INDEX KEY: 0000914444 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 980136554 STATE OF INCORPORATION: C5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-48645 FILM NUMBER: 06705652 BUSINESS ADDRESS: STREET 1: ATLANTIS, CORAL TOWERS STREET 2: EXECUTIVE OFFICES CITY: PARADISE ISLAND, BAH STATE: C5 ZIP: NONE BUSINESS PHONE: 242-363-6000 MAIL ADDRESS: STREET 1: ATLANTIS, CORAL TOWERS STREET 2: EXECUTIVE OFFICES CITY: PARADISE ISLAND, BAH STATE: C5 ZIP: NONE FORMER COMPANY: FORMER CONFORMED NAME: SUN INTERNATIONAL HOTELS LTD DATE OF NAME CHANGE: 19931104 SC 13D/A 1 sch13da.txt SCHEDULE 13 D/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 5)* KERZNER INTERNATIONAL LIMITED - ----------------------------------------------------------------------------- (Name of Issuer) Ordinary Shares ($0.001 par value) - ----------------------------------------------------------------------------- (Title of Class of Securities) P8797T13 - ----------------------------------------------------------------------------- (CUSIP Number) Richard M. Levine, Esq. Executive Vice-President and General Counsel Kerzner International Limited Coral Towers Paradise Island, Bahamas (242) 363-6000 - ----------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) March 20, 2006 - ----------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [_] * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). -2- CUSIP No. P8797T13 - ------- ----------------------------------------------------------------------- 1 Names of Reporting Persons Solomon Kerzner I.R.S. Identification Nos. of above persons (entities only) Not applicable (natural person) - ------- ----------------------------------------------------------------------- 2 Check the Appropriate Box if a Member of a Group (See Instructions) (a) [_] (b) [X] - ------- ----------------------------------------------------------------------- 3 SEC Use Only - ------- ----------------------------------------------------------------------- 4 Source of Funds Not applicable - ------- ----------------------------------------------------------------------- 5 Check if Disclosure of Legal Proceedings Is Required pursuant to Items 2(d) or 2(e) [_] - ------- ----------------------------------------------------------------------- 6 Citizenship or Place of Organization South African - ------- ----------------------------------------------------------------------- 7 Sole Voting Power 3,912,019(1)(2) ------ --------------------------------------- Number of Shares Beneficially Owned by Each Reporting Person 8 Shared Voting Power with 0 ------ --------------------------------------- 9 Sole Dispositive Power 3,795,794(1)(2) ------ --------------------------------------- 10 Shared Dispositive Power 0 - -------------------------------- ------ --------------------------------------- 11 Aggregate Amount Beneficially Owned by Each Reporting Person 3,912,019(1)(2) - ------- ----------------------------------------------------------------------- 12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares (see Instructions) [X] - ------- ----------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11) 10.65% - ------- ----------------------------------------------------------------------- 14 Type of Reporting Person (See Instructions) IN - ------- ----------------------------------------------------------------------- (1) Total shares beneficially owned by Mr. Kerzner as of the date hereof consists of (i) 3,795,794 ordinary shares held for the account of World Leisure Group Limited, a British Virgin Islands holding company ("WLG") and (ii) 116,225 ordinary shares over which WLG has the right to vote through certain proxy arrangements with Sun International Limited, a company organized under the laws of South Africa. WLG is owned and controlled by the Kerzner Family Trust, a trust organized under the laws of the British Virgin Islands ("KFT"), and the Howard B. Kerzner Family Trust, a trust organized under the laws of the British Virgin Islands ("HBKFT"). Both KFT and HBKFT are controlled by Mr. Kerzner. (2) See Item 5. -3- Item 1. Security and Issuer This amendment to this Schedule 13D ("Statement") is related to the ordinary shares, $.001 par value per share (the "Ordinary Shares") of Kerzner International Limited, a corporation organized under the laws of the Commonwealth of The Bahamas ("Kerzner"). The address of the principal executive offices of Kerzner is Coral Towers, Paradise Island, The Bahamas. Item 2. Identity and Background Item 2 is hereby amended and restated in its entirety to read as follows: (a) - (b) This Statement is filed on behalf of Solomon Kerzner. Mr. Kerzner's business address is Kerzner International Limited, Executive Offices, Coral Towers, Paradise Island, The Bahamas. (c) Mr. Kerzner is Chairman of the Board of Directors of Kerzner, Coral Towers, Paradise Island, The Bahamas, and Chairman of the Board of Directors of WLG, Trident Trust Company Limited, P.O. Box 146, Road Town, Tortola, British Virgin Islands. Mr. Kerzner controls KFT and HBKFT. (d) - (e) Mr. Kerzner has not, during the last five years, (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a party to any civil proceeding of a judicial or administrative body of competent jurisdiction as the result of which he was or is subject to any judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Mr. Kerzner is a citizen of South Africa. Item 4. Purpose of Transaction Item 4 is hereby supplemented as follows: As previously disclosed, on March 17, 2006, K-Two Holdco Limited, a newly formed International Business Company organized under the laws of The Bahamas and controlled by Mr. Kerzner, Howard B. Kerzner, Istithmar PJSC ("Istithmar"), and investment funds affiliated with Whitehall Street Global Real Estate Limited Partnership 2005 ("Whitehall"), Colony Capital Acquisitions, LLC, Providence Equity Partners, Inc., and The Related Companies, L.P., submitted to Kerzner's board of directors, a proposal to acquire all of the outstanding Ordinary Shares (the "Proposal"). On March 20, 2006, a special committee of independent directors (the "Special Committee") consisting of Peter Buckley, Howard Marks, Eric Siegel and Heinrich von Rantzau, which was formed to, among other things, consider the terms and conditions of the Proposal, unanimously recommended that Kerzner's full board of directors approve the Agreement and Plan of Merger, dated March 20, 2006 (the "Merger Agreement"), among Kerzner, K-Two Holdco Limited ("Parent"), and K-2 Subco Limited, a newly formed International Business Company organized under the laws of The Bahamas and a wholly-owned subsidiary of Parent ("Merger Sub"), and on March 20, 2006, upon receipt of the recommendation of the Special Committee, the board of directors approved the Merger Agreement. Pursuant to the terms of the Merger Agreement, and subject to the conditions set forth therein, Merger Sub will merge with and into Kerzner (the "Merger") with Kerzner continuing as the surviving corporation. At the effective time of the Merger, each then outstanding Ordinary Share (except for any Ordinary Shares owned by Parent, Merger Sub, Kerzner or any of Kerzner's wholly-owned subsidiaries which will be cancelled at the effective time of the Merger and any Ordinary Shares held by holders who have properly exercised dissenters' rights) will be converted into the right to receive $76.00 in cash, without interest (the "Merger Consideration"). On March 20, 2006, Kerzner issued a press release (the "Press Release") announcing the execution of the Merger Agreement. In connection with the Proposal, on March 20, 2006, Kerzner, Caledonia Investments plc ("Caledonia") and Cement Merchants SA ("Cement Merchants") entered into a letter agreement (the "Waiver"). Pursuant to the Waiver, the provisions of the Registration Rights and Governance Agreement dated as of July 3, 2001 (as amended, the "Governance Agreement"), by and among Kerzner, Sun International Investments Limited, WLG, Kersaf Investments Limited, Caledonia, Mangalitsa Limited, Cement Merchants, Rosegrove Limited, Royale Resorts Holdings Limited, and Sun International Inc. which, among other things, limited the ability of WLG and its affiliates to propose or offer to purchase or acquire additional equity securities of Kerzner were -4- waived solely with respect to the Proposal in accordance with the terms of the Governance Agreement. The Waiver was also approved by a majority of the Independent Directors (as defined in the Governance Agreement) of Kerzner. Concurrently with the execution of the Merger Agreement, WLG, Mr. Kerzner and Howard B. Kerzner entered into an equity rollover commitment letter (the "Equity Rollover Commitment Letter"), pursuant to which, and subject to the conditions set forth therein, immediately prior to the effective time of the Merger, in exchange for capital stock of Parent, WLG, Mr. Kerzner and Howard B. Kerzner will transfer, contribute and deliver to Newco an aggregate of 3,289,474 Ordinary Shares (including 500,000 shares held by Howard B. Kerzner, which are further described in Item 5 and which are not reflected on rows (7) though (11) and (13) on the cover page to this Statement), which shares will be cancelled and retired in the Merger and will not be entitled to receive the Merger Consideration. In addition, concurrently with the execution of the Merger Agreement, at the specific request of Kerzner, and as an inducement to Kerzner's willingness to enter into the Merger Agreement, WLG, Mr. Kerzner and Howard B. Kerzner entered into a voting agreement with Kerzner relating to the 3,795,794 Ordinary Shares held for the account of WLG and any Ordinary Shares acquired by WLG, Mr. Kerzner and Howard B. Kerzner (the "Holders") subsequent to the date of the Voting Agreement (collectively, the "Subject Shares"). Pursuant to the Voting Agreement, each of the Holders has agreed to vote or execute consents with respect to the number of Subject Shares beneficially owned as of the applicable record date in favor of the approval of the Merger Agreement, the Merger and any other transactions contemplated by the Merger Agreement at any shareholder meeting (or any adjournment or postponement thereof) held for the purpose of obtaining approval of the Merger Agreement or in any other circumstances upon which a vote, consent or other approval (including a written consent) with respect to the Merger Agreement, the Merger or any other transaction contemplated by the Merger Agreement is sought. In addition, in the event that the Merger Agreement is terminated by Kerzner to enter into a definitive agreement with respect to a Superior Alternative Transaction (as defined below) in accordance with the terms of the Merger Agreement, each of the Holders has agreed to vote or execute consents with respect to the Subject Shares beneficially owned as of the applicable record date in favor of the approval of any proposal to approve the Superior Alternative Transaction (or any proposal to approve a definitive agreement relating thereto) (a "Superior Alternative Transaction Proposal") at any shareholder meeting (or any adjournment or postponement thereof) called to seek the approval of a Superior Alternative Transaction Proposal or in any other circumstances upon which a vote, consent or other approval (including a written consent) with respect to a Superior Alternative Transaction Proposal is sought. In the event that any Superior Alternative Transaction is structured as a tender or exchange offer, the Holders have agreed to (i) accept such offer with respect to all Subject Shares and tender or exchange, as applicable, all the Subject Shares pursuant to such offer and (ii) not withdraw any Subject Shares tendered pursuant to such offer. "Superior Alternative Transaction" means a Superior Proposal (as defined below) pursuant to which all Ordinary Shares outstanding immediately prior to the consummation of such transaction shall be purchased for or be converted into an amount in cash equal to no less than the sum of (x) the Merger Consideration and (y) $2.00. A Superior Alternative Transaction Proposal does not include a Superior Proposal effected other than in a single transaction or a series of related transactions, the consummation of each of which is expressly conditioned on the consummation of each other related transaction, and all of which are in fact consummated concurrently. "Superior Proposal" means a Company Acquisition Proposal (as defined below), which was not obtained in violation of the non-solicitation covenant contained in the Merger Agreement, and which the Board of Directors of Kerzner (acting through the Special Committee, if such committee still exists, or otherwise by resolution of a majority of its disinterested directors) in good faith determines, would, if consummated, result in a transaction that is more favorable from a financial point of view to the shareholders of Kerzner (in their capacities as shareholders) than the transactions contemplated by the Merger Agreement (x) after receiving the advice of its financial advisor (who shall be a nationally recognized investment banking firm), (y) after taking into account the likelihood of consummation of such transaction on the terms set forth therein (as compared to the terms set forth in the Merger Agreement) and (z) after taking into account all appropriate legal (with the advice of outside counsel), financial (including the financing terms of any such proposal), regulatory or other aspects of such proposal; provided that for purposes of the definition of "Superior Proposal", the references to "30% or more" in the definition of Company Acquisition Proposal are deemed to be references to "a majority" and the definition of Company Acquisition Proposal shall only refer to a transaction or series of transactions (i) directly involving Kerzner (and not exclusively its subsidiaries) or (ii) involving a sale or transfer of all or substantially all of the assets of Kerzner and its Subsidiaries, taken as a whole. "Company Acquisition Proposal" means any inquiry, proposal or offer from any person or group of persons other than Parent, Merger Sub or their respective affiliates relating to any direct or indirect acquisition or purchase (whether in a single transaction or a series of transactions) of a business or businesses that constitutes 30% or more of the net revenues, net income or assets of Kerzner and its subsidiaries, taken as a whole, or 30% or more of any class or series of equity securities of Kerzner or its subsidiaries, any tender offer or exchange offer that if consummated would result in any person or group of persons beneficially -5- owning 30% or more of any class or series of equity securities of Kerzner or its subsidiaries, or any merger, reorganization, consolidation, share exchange, business combination, recapitalization, liquidation, dissolution or similar transaction involving Kerzner (or any subsidiary or subsidiaries of Kerzner whose business or businesses constitute(s) 30% or more of the net revenues, net income or assets of Kerzner and its subsidiaries, taken as a whole). In addition, pursuant to the Voting Agreement, the Holders have agreed not to transfer, pledge, assign or otherwise dispose of (including by gift) (collectively, "Transfer"), or enter into any contract, option or other arrangement (including, without limitation, any profit sharing arrangement) with respect to the Transfer of, any Subject Shares, to any person other than pursuant to the Merger, except that (x) until the earlier of (i) the approval of the Merger by the shareholders of Kerzner and (ii) the termination of the Merger Agreement in accordance with its terms (the "Voting Period"), the Holders may Transfer any Subject Shares to any of their respective affiliates controlled by Mr. Kerzner or Howard B. Kerzner and (y) from and after the Voting Period, the Holders may Transfer any Subject Shares to any person, provided that the effectiveness of the Transfers described in clauses (x) and (y) are conditioned on the transferee agreeing to be bound by the provisions of the Voting Agreement in a form reasonably satisfactory to Kerzner. Furthermore, the Holders have agreed not to enter into any other voting arrangement, whether by proxy, voting agreement or otherwise, with respect to any Subject Shares. Upon consummation of the Merger, it is contemplated that the Ordinary Shares will be delisted from the New York Stock Exchange and will become eligible for termination of registration pursuant to Section 12(g)(4) of the Act. The memorandum of association and articles of association of Kerzner, as amended to read in their entirety as the memorandum of association and articles of association of Merger Sub as in effect immediately prior to the effective time of the Merger, will be the memorandum of association and articles of association of the surviving corporation in the Merger. Additionally, the directors of Merger Sub at the effective time of the Merger will be the directors of the surviving corporation in the Merger. The information set forth in response to this Item 4 is qualified in its entirety by reference to the Merger Agreement, the Press Release, the Equity Rollover Commitment Letter, the Voting Agreement and the Waiver, each of which is included as an exhibit hereto and is incorporated herein by reference. Other than as described above, Mr. Kerzner does not have any current plans or proposals that relate to or would result in any of the actions set forth in items (a) to (j) of Item 4 of Schedule 13D, although Mr. Kerzner reserves the right to develop such plans or proposals. Item 5. Interest in Securities of the Issuer Item 5 is hereby amended and restated in its entirety to read as follows: (a)-(b) Mr. Kerzner: Sole Voting Power: 3,912,019 Shared Voting Power: 0 Sole Dispositive Power: 3,795,794 Shared Dispositive Power: 0 Rows (7) through (11) and (13) of the cover page to this Statement are hereby incorporated by reference. Mr. Kerzner beneficially owns an aggregate of 3,912,019 Ordinary Shares, which represents 10.65% of the Ordinary Shares outstanding. For purposes of calculating the percentages set forth in this Item 5, the number of Ordinary Shares outstanding is assumed to be 36,718,698 (which is the number of Ordinary Shares which Kerzner represented in the Merger Agreement were outstanding on March 20, 2006). The 3,912,019 Ordinary Shares beneficially owned by Mr. Kerzner consist of (i) 3,795,794 Ordinary Shares held for the account of WLG and (ii) 116,225 Ordinary Shares over which WLG has the right to vote through certain proxy arrangements with Sun International Limited. In addition, as a result of the matters described in Item 4 above, Mr. Kerzner may be deemed to constitute a group within the meaning of Section 13(d)(3) of the Act with Istithmar, Whitehall and Howard B. Kerzner. As a result, Mr. Kerzner may be deemed to beneficially own the Ordinary Shares beneficially owned by Istithmar, Whitehall and Howard B. Kerzner. Based on information supplied by Istithmar, Whitehall and Howard B. Kerzner, respectively, as of March 20, 2006, Istithmar beneficially owned 4,500,000 Ordinary Shares, Whitehall may have been deemed to have beneficially owned no more than 8,371 Ordinary Shares and Howard B. Kerzner beneficially owned 500,000 Ordinary Shares (excluding any Ordinary Shares beneficially owned by Mr. Kerzner which may be deemed to be beneficially owned by Istithmar, Whitehall or Howard B. Kerzner). The Ordinary Shares -6- beneficially owned by Mr. Kerzner, Istithmar, Whitehall and Howard B. Kerzner represent approximately 24.3% of the Ordinary Shares outstanding. Mr. Kerzner disclaims beneficial ownership over all Ordinary Shares beneficially owned by Istithmar, Whitehall or Howard B. Kerzner. (c) Mr. Kerzner has not effected any transactions in the Ordinary Shares during the past 60 days. (d) No person has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Ordinary Shares owned by Mr. Kerzner other than KFT and HBKFT. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer Item 6 is hereby supplemented as follows: The information set forth or incorporated by reference in Item 4 is hereby incorporated herein by reference. Item 7. Material to Be Filed as Exhibits Item 7 is hereby supplemented by adding the following exhibits: Exhibit F Agreement and Plan of Merger, dated as of March 20, 2006, by and among Kerzner International Limited, K- Two Holdco Limited and K-Two Subco Limited (incorporated by reference to Exhibit 2.1 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit G Press release dated March 20, 2006 (incorporated by reference to Exhibit 99.1 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit H Voting Agreement, dated as of March 20, 2006, by and among Kerzner International Limited, World Leisure Group Limited, Solomon Kerzner and Howard B. Kerzner (incorporated by reference to Exhibit 10.2 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit I Equity Rollover Commitment Letter, dated as of March 20, 2006, from World Leisure Group Limited, Solomon Kerzner and Howard B. Kerzner to K-Two Holdco Limited Exhibit J Waiver letter, dated as of March 20, 2006, from Kerzner International Limited, Caledonia Investments plc and Cement Merchants SA to World Leisure Group Limited -7- SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: March 23, 2006 By: /s/ Solomon Kerzner Name: Solomon Kerzner -8- EXHIBIT INDEX Exhibit F Agreement and Plan of Merger, dated as of March 20, 2006, by and among Kerzner International Limited, K- Two Holdco Limited and K-Two Subco Limited (incorporated by reference to Exhibit 2.1 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit G Press release dated March 20, 2006 (incorporated by reference to Exhibit 99.1 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit H Voting Agreement, dated as of March 20, 2006, by and among Kerzner International Limited, World Leisure Group Limited, Solomon Kerzner and Howard B. Kerzner (incorporated by reference to Exhibit 10.2 to Kerzner International Limited's Form 6-K furnished to the SEC on March 20, 2006, File no. 001-04226) Exhibit I Equity Rollover Commitment Letter, dated as of March 20, 2006, from World Leisure Group Limited, Solomon Kerzner and Howard B. Kerzner to K-Two Holdco Limited Exhibit J Waiver letter, dated as of March 20, 2006, from Kerzner International Limited, Caledonia Investments plc and Cement Merchants SA to World Leisure Group Limited EX-99.I 2 exh1.txt EXHIBIT I Exhibit I March 20, 2006 K-Two Holdco Limited Coral Towers Paradise Island, The Bahamas Gentlemen: Reference is made to the Agreement and Plan of Merger dated as of the date hereof (the "Agreement") among Kerzner International Limited (the "Company"), an international business company incorporated under the laws of the Commonwealth of The Bahamas, K-Two Holdco Limited, an international business company incorporated under the laws of the Commonwealth of The Bahamas ("Newco"), and K-Two Subco Limited, an international business company incorporated under the laws of the Commonwealth of The Bahamas and a wholly-owned subsidiary of Newco. Capitalized terms used and not otherwise defined herein have the meanings ascribed to them in the Agreement. In the event of the satisfaction or waiver of the conditions precedent to Newco's obligation to consummate the Merger set forth in Article VIII of the Agreement (it being agreed for purposes of this letter agreement that any condition precedent the satisfaction of which is dependent upon the contribution contemplated by this paragraph and which shall become satisfied upon the making of such contribution shall be deemed to have been satisfied), we agree that at the Closing we will transfer, contribute and deliver to Newco an aggregate number of 3,289,474 Ordinary Shares (the "Rollover Contribution Shares"), which shares will be cancelled and retired in the Merger and will not be entitled to receive the Merger Consideration. We will not be under any obligation pursuant to the preceding sentence unless and until the conditions precedent to Newco's obligation to consummate the Merger set forth in Article VIII of the Agreement are satisfied or waived. We will not be under any obligation under any circumstances to contribute or cause to be contributed to Newco a number of Ordinary Shares in excess of the Rollover Contribution Shares. Notwithstanding anything that may be expressed or implied in this letter agreement, Newco, by its acceptance of the benefits hereof, covenants, agrees and acknowledges that, no person other than the undersigned shall have any obligation hereunder and that, notwithstanding that the undersigned is a partnership, no recourse hereunder or any documents or instruments delivered in connection herewith shall be had against any current or future officer, agent or employee of the undersigned, against any current or future general or limited partner of the undersigned or any current or future director, officer, employee, general or limited partner, member, Affiliate or assignee of any of the foregoing, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any current or future officer, agent or employee of the undersigned or any current or future general or limited partner of the undersigned or any current or future director, officer, employee, general or limited partner, member, Affiliate or assignee of any of the foregoing, as such, for any obligations of the undersigned under this letter agreement or any documents or instruments delivered in connection herewith or for any claim based on, in respect of or by reason of such obligations or their creation. World Leisure Group Limited hereby represents and warrants as follows: (a) The undersigned is duly organized, validly existing and in good standing (to the extent its jurisdiction of organization recognizes the concept of good standing) under the laws of its jurisdiction of organization. (b) The execution, delivery and performance of this letter agreement by the undersigned is within its powers and has been duly authorized by all necessary action, and no other proceedings or actions on the part of the undersigned are necessary to perform its obligations hereunder. This letter agreement is a valid and binding obligation of the undersigned enforceable against it in accordance with its terms, except as may be limited by any bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws affecting the enforcement of creditors' rights generally or by general principles or equity. (c) The execution, delivery and performance by the undersigned of this letter agreement do not and will not (i) violate the organizational documents of the undersigned, (ii) violate any applicable Law or court or governmental order to which the undersigned or any of its assets are subject or (iii) require any consent or other action by any Person under, constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in any breach of or give rise to any right of termination, cancellation, amendment or acceleration of, any right or obligation of the undersigned. (d) The undersigned is the record and beneficial owner of the Rollover Contribution Shares and owns such shares free and clear of any Lien. In the event that the Agreement is terminated pursuant to Article IX of the Agreement, this letter agreement shall automatically terminate and be of no further force or effect without further action by the parties hereto on the date that is 45 days subsequent to the termination of the Agreement if no claim for any liability has been made hereunder prior to such 45th day subsequent to the termination of the Agreement. If such a claim has been made prior to such date that is 45 days subsequent to the termination of the Agreement, this letter agreement shall terminate upon final resolution of such claim. We shall be entitled to assign all or a portion of our obligations hereunder to one or more Affiliates that agree to assume our obligations hereunder, provided that we shall remain obligated to perform our obligations hereunder to the extent not performed by such Affiliate(s). This letter agreement shall not be assignable by you without our prior written consent. Notwithstanding any other term or condition of this letter agreement, our liability under this letter agreement shall be limited to a willful and material breach of this letter agreement and under no circumstances shall our maximum liability for any reason, including our willful and material breach of any of our commitments set forth herein, extend beyond our 3 obligation to contribute or cause to be contributed to Newco the Rollover Contribution Shares, nor shall we be liable for any special, indirect, or consequential damages. If the express third party beneficiary hereof determines to enforce the terms of this letter agreement as a result of a willful and material breach of this letter agreement, such third party beneficiary must do so on a pro rata basis against any other party to Equity Financing Commitments and Equity Rollover Commitments that have willfully and materially breached their obligations thereunder. We acknowledge that the Company has relied on this letter agreement and is an express third party beneficiary hereof and is entitled to enforce obligations of the undersigned hereunder directly against the undersigned to the full extent thereof. This letter agreement is not intended to, and does not, confer upon any Person, other than Newco and the Company, rights or remedies hereunder or in connection herewith. This letter agreement may be executed in counterparts. This letter agreement may not be terminated (except as otherwise provided herein), amended, and no provision waived or modified, except by an instrument in writing signed by us and Newco; provided that any termination, amendment, waiver or modification that would reasonably be expected to be adverse to the Company in any material respect (after taking into account any other amendments, waivers or modifications proposed to be made to the other Financing Commitments) shall require the consent of the Company. This letter agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware. In addition, each party (i) irrevocably and unconditionally consents and submits to the personal jurisdiction of the state and federal courts of the United States of America located in the State of Delaware solely for the purposes of any suit, action or other proceeding between any of the parties hereto, or between any of the parties hereto and the express third-party beneficiary hereof, arising out of this letter agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from such court, (iii) waives any claim of improper venue or any claim that the courts of the State of Delaware are an inconvenient forum for any action, suit or proceeding between any of the parties hereto, or between any of the parties hereto and the express third-party beneficiary hereof, arising out of this letter agreement, (iv) agrees that it will not bring any action relating to this letter agreement in any court other than the courts of the State of Delaware and (v) to the fullest extent permitted by Law, consents to service being made through the notice procedures set forth in Section 10.1 of the Agreement (with the address of the undersigned being the address set forth in the first page of this letter agreement). EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS LETTER AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY. 4 The parties hereto shall keep the existence and terms of this letter agreement confidential, and no party shall, without the prior approval of the other party, make any press release or other announcement concerning the existence or the terms of this letter agreement, except (i) as and to the extent necessary to comply with applicable federal or state laws, (ii) in connection with the exercise of any remedies hereunder or in any suit, action or proceeding relating to this letter agreement or enforcement of rights hereunder, and (iii) to the Company and its directors, officers, employees and advisors. Very truly yours, WORLD LEISURE GROUP LIMITED By: /s/ Solomon Kerzner ------------------------- Name: Solomon Kerzner Title: Chairman SOLOMON KERZNER /s/ Solomon Kerzner ---------------------------- HOWARD B. KERZNER /s/ Howard B. Kerzner ---------------------------- Accepted and Agreed to as of the date written above K-TWO HOLDCO LIMITED By: /s/ Howard B. Kerzner ----------------------- Name: Howard B. Kerzner Title: President EX-99.J 3 letter.txt EXHIBIT J March 20, 2006 World Leisure Group Limited Trident Trust Company Limited PO Box 146 Road Town Tortola British Virgin Islands Gentlemen: Reference is made to the Registration Rights and Governance Agreement dated as of July 3, 2001 (as amended, the "Agreement"), by and among Sun International Hotels Limited, a company incorporated under the laws of The Bahamas (renamed "Kerzner International Limited") (the "Company"), Sun International Investments Limited, a company incorporated under the laws of the British Virgin Islands, World Leisure Group Limited, a company incorporated under the laws of the British Virgin Islands ("WLG"), Kersaf Investments Limited, a company incorporated under the laws of the Republic of South Africa, Caledonia Investments PLC, a company incorporated under the laws of England ("Caledonia"), Mangalitsa Limited, a company incorporated under the laws of The Bahamas, Cement Merchants SA, a company, incorporated under the laws of Panama, Rosegrove Limited, a company incorporated under the laws of the British Virgin Islands, Royale Resorts Holdings Limited, a company incorporated under the laws of Bermuda and Sun International Inc., a company incorporated under the laws of Panama. The undersigned are pleased to confirm that each of them are, by this letter, waiving the restrictions of Section 2.1 of the Agreement solely with respect to the WLG Proposal. For purposes of this waiver letter, the term "WLG Proposal" means the proposal by K-Two Holdco Limited (which is an affiliate of WLG) ("Buyer") to acquire all of the outstanding shares of the Company at a price of $76.00 per share in cash, pursuant to and in the manner contemplated by the Agreement and Plan of Merger by and among the Company, Buyer and K-Two Subco Limited dated as of March 20, 2006 (the "Merger Agreement"), and other related documents that are on terms acceptable to the Company. This letter constitutes a valid waiver under the terms of the Agreement and may be relied upon by WLG and Buyer for all purposes, subject to the limitations of such waiver set forth herein. The Company also confirms that this waiver has been approved by the approval of a majority of the Company's Independent Directors (as defined in the Agreement). WLG acknowledges that it continues to be bound by all existing agreements between it and the Company, including the Agreement, and that this letter agreement does not in any manner modify or limit the Company's or WLG's rights under such agreements, except as and to the extent specifically set forth herein. This letter and the waivers set forth herein will terminate and be of no further effect upon the termination of the Merger Agreement. Sincerely, KERZNER INTERNATIONAL LIMITED By: /s/ Eric Siegel ------------------------------ Name: Eric Siegel Title: Chairman of the Special Committee CALEDONIA INVESTMENTS PLC By: /s/ Graeme P. Denison ------------------------------ Name: Graeme P. Denison Title: Company Secretary CEMENT MERCHANTS SA By: /s/ Dr. Hans Eggenberger ------------------------------ Name: Dr. Hans Eggenberger Title: Director By: /s/ Gerhard Meier ------------------------------ Name: Gerhard Meier Title: Director Agreed and Acknowledged: WORLD LEISURE GROUP LIMITED By: /s/ Solomon Kerzner ----------------------- Name: Solomon Kerzner Title: Chairman -----END PRIVACY-ENHANCED MESSAGE-----